12/08/2016

Appeals Court Grants DOL Expedited Appeal on Overtime Rule Case

Earlier today, the U.S. Court of Appeals for the Fifth Circuit granted the request

Earlier today, the U.S. Court of Appeals for the Fifth Circuit granted the U.S. Department of Labor’s (DOL) request for an expedited hearing of its overtime rule appeal.

The DOL is seeking to fast-track its appeal of a preliminary injunction that blocked the agency’s new overtime rule from taking effect as scheduled on Dec. 1. The injunction was granted by a federal judge in Texas at the request of 21 states, the American Society of Association Executives (ASAE), the U.S. Chamber of Commerce and other like-minded organizations. The request challenged the DOL’s authority to double the salary limit that determines which workers should be eligible for overtime pay.

At this point, it remains unclear what impact an expedited appeal would have on the rule’s prospects. Even with the expedited hearing, oral arguments in the appellate court will not take place until February or even March, long after a new administration is in office.

During the campaign, President-Elect Donald Trump said he favored an exemption from the overtime rule for small businesses. It remains to be seen whether he and his new labor secretary will simply drop the appeal after he takes office on Jan. 20 or pursue some other litigation strategy.

Even if the Trump administration follows through with the appeal, there is a strong chance the rule will be overturned. Judge Amos Mazzant of the U.S. District Court for the Eastern District of Texas, who issued the injunction, signaled he is inclined to side with the states and business groups that challenged the new overtime rule.

“The state plaintiffs have shown a likelihood of success on the merits because the final rule exceeds the department’s authority,” Mazzant said.

Following the issuance of the injunction, ASAE President and CEO John Graham, FASAE, CAE, said that ASAE has never been against an adjustment in the salary threshold for overtime eligibility, but that “creating a one-size-fits-all measuring stick for overtime eligibility across the country was simply not workable for many employers and, in fact, would have done more harm than good for many affected employees, as well.”