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Texas Federal Judge Puts Halt on Obama Administration’s Overtime Rule

Nov 29 | 2016  by

By Beth Florkowski of Fausone Bohn, LLP on Tuesday, November 29, 2016.

Jim Fausone, Esq.

As discussed in last week’s blog, The New Overtime Regulation May make You Eligible for Overtime Pay, a new rule requiring employers to extend overtime protections was set to take force on December 1st.

However, on Tuesday, November 22nd, a federal judge in Texas ruled in favor of the nearly two dozen states and a coalition of business groups who filed a lawsuit challenging the new rule, alleging that the government overstepped its authority in raising the salary threshold. In his Order, the judge ruled that in setting the automatic salary increases, “the department exceeds its delegated authority and ignores Congress’s intent.”

Just about a week before it was set to take place, this ruling puts a halt on President Obama’s plan to guarantee overtime pay for millions of Americans who were not receiving overtime pay before. The rule was already said to have been in danger with President-elect Donald Trump taking office after the rule was implemented. However, with the rule now delayed, the Obama administration no longer has time on its side.

While President-elect Donald Trump has not explicitly commented on the overtime standards, he was expected to make major changes to employment regulations that the Obama administration had put in place. Republicans on Capitol Hill have been actively trying to stop the rule from being enacted. This certainly suggests that a republican-majority Congress would repeal the law if it is enacted some time before the Inauguration of President-elect Trump.