As some readers of this Newsletter know, the federal Fair Labor Standards Act (“FLSA”) “exempts” from its overtime-pay mandate salaried employees who qualify as “executive,” “administrative,” or “professional” employees. Under existing regulations, a purportedly exempt employee must, among other things, earn a salary of at least $684 per week.
When Joe Biden took office in January 2021, many worker’s rights advocates agreed that raising the $684/week threshold was the highest priority. Also, many of these same advocates urged the U.S. Department of Labor to move quickly so that any legal challenges could be finally resolved before the end of the Biden Administration.
Unfortunately, it took the Biden DOL’s Wage and Hour Division over three years to issue its Final Rule increasing the minimum weekly salary threshold from $684 to $1,128. See generally 89 FR 32824-32973 (Apr. 26, 2024).
The regulation’s legality was challenged in the U.S. District Court for the Eastern District of Texas (one of Corporate America’s favorite venues for challenging laws that benefit workers and consumers). Not surprisingly, in November 2024, the district court judge entered an order vacating the Final Rule. See State of Texas v. U.S. Dept. of Labor, __ F. Supp. 3d __, 2024 U.S. Dist. LEXIS 207864 (E.D. Tx. Nov. 15, 2024). The Biden DOL has appealed the district court’s order. But that’s a futile gesture. The Trump DOL will certainly withdraw the appeal. This will leave the district court’s order in place. The Final Rule will remain vacated. – PW