A federal judge has blocked the recently revised Department of Labor (DOL) overtime and salary rules from taking effect. The rules were originally intended to take effect on December 1, 2016. However, a coalition of states and business groups filed for an injunction to prevent the changes from being enacted, arguing that when the DOL establishes a new minimum salary test, it overstepped its authority. The coalition argues that that the new minimum salary test of $47,476 and the indexing mechanism — the portion of the law that automatically raises the minimum salary threshold over time, should not be enforced. A federal judge heard arguments from attorneys representing the states in State of Nevada, et al. v. United States Department of Labor, et al. on November 16th. Six days later, the judge issued a ruling on November 22nd, 2016.
There is now a nationwide injunction preventing the DOL rules from taking effect until further notice by the court. The injunction blocks the new salary test as well as the indexing component of the rule changes that purports to increase the salary threshold over time. Keep in mind that despite this injunction, employers must continue to abide by the prior rules still in force, including those requiring a salary test of $455 per week.