Texas judge blocks overtime rule challenged by Paxton, others

A federal judge on Tuesday blocked a new rule making millions more Americans eligible for overtime pay, indefinitely pushing back the December 1 effective date while he weighs a challenge to the requirement.

The rule raises the salary threshold below which overtime pay is mandatory from $455 to $913 a week ($23,660 to $47,476 per year). The rules were expected to affect nearly every area of business in the country.

The directive, which was issued by the U.S. Department of Labor and would allow millions of Americans to qualify for overtime pay, was ruled unconstitutional.

Critics say it’s wrong that some retail and restaurant chains pay low-level managers as little as $25,000 a year and no overtime – even if they work 60 hours a week.

According to Mazzant, the new rule’s “significant increase to the salary level creates essentially a de facto salary-only test”, making about 4.2 million workers who now fall below the threshold automatically eligible for overtime without a change to their duties.

In recent months, thousands of restaurants, retailers and other businesses have reshuffled their staffs to accommodate the regulation.

That salary threshold is about twice the amount that now allows workers to be exempted from overtime. “At the same time, it would have forced the carriers they work for to begin micromanaging their time”.

The Valley Industry and Commerce Association, or VICA, praised the decision, saying the new law would have placed yet another burden on businesses already struggling to comply with state and regional minimum wage and sick leave requirements. The states assert that those workers should be defined by job role only and not subject to overtime rules.

A lawsuit challenging the rule was filed by 21 states and a variety of employer groups. We are now considering all of our legal options. Now it is unlikely the rule will take effect before President-elect Donald Trump takes office.

In September, LABI sent a letter to U.S. Labor Department Secretary Thomas Perez, asking the federal agency to delay implementation of the rule in Louisiana parishes declared disaster areas as a result of the August flood.