Reacting to the injunction on the U.S. Department of Labor's overtime rule
Question: Though our company learned of the U.S. District Court of Texas' emergency injunction on Nov. 22, we had already announced to the employees the changes that would be made in anticipation of the U.S. Department of Labor overtime rule's Dec. 1 implementation. What are our options now that the rule is enjoined nationwide?
Answer: Many of my clients had fully prepared for the Dec. 1 implementation of the U.S. Department of Labor's new overtime rule, though fortunately the overwhelming majority had not yet announced any changes. If your company has announced its plans to comply with the rule, you now have the following options:
- You can do nothing and leave the changes in place.
- You can undo the changes you have made, since the rule is in all probability dead, and you will be under no legal obligation to follow it.
If you decide to undo the changes, consider how your employees will feel or react. This writer believes their reactions will depend on how they felt about the impending changes after they were first announced. If your employees felt demoted and demeaned by the changes, you may want to take advantage of the injunction and keep these employees overtime-exempt.
If you have already granted pay raises to certain employees to maintain their overtime-exempt status under the terms of the final rule, you have no obligation to keep them in place. However, you may face an employee relations nightmare if you roll them back.
The responsibility for this mess lies squarely with the U.S. Department of Labor for creating an overtime rule that more than doubled the salary threshold. This was administrative overreach at its worst. That is why the court granted the injunction. The sad part is that employers are now stuck figuring out how to undo the mess created by the secretary of labor.
Note: Nothing in this SNPA Legal Hotline Q&A should be relied upon as legal advice in any particular matter.
L. Michael Zinser is the founding partner of The Zinser Law Firm in Nashville, Tenn. The firm, which has a heavy concentration of clients in communications media, represents management in the area of labor and employment. Zinser can be reached at (615) 244-9700 or email@example.com.
SNPA's free Legal Hotline for members – (844) 804-2016 – is designed to assist newspapers with a broad range of legal issues. Hotline attorneys and CPAs will tackle questions about circulation, independent contractors, labor and employment law, taxes, finances and accounting, employment benefits, open records, libel and privacy, and other issues newspapers encounter.
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