On November 22, just days away from a December 1, 2016 effective date for new overtime regulations, a federal judge issued a nationwide injunction, bringing the process to a halt.
A federal judge in Texas on Tuesday blocked new Department of Labor rules that would have expanded the number of workers eligible for overtime pay.
U.S. District Judge Amos Mazzant of the Eastern District of Texas granted a preliminary injunction in combined lawsuits filed by 21 states and business groups. The rule would have allowed workers earning up to $47,476 a year to be eligible for time-and-a-half overtime pay after working 40 hours a week.
Currently, nonexempt employees making less than $23,660 are eligible for overtime pay. The salary threshold was last updated in 2004.
Mazzant said the U.S. Department of Labor didn’t have statutory authority to set a salary threshold or to automatically update the amount.
Liberal groups were swift to denounce Mazzant’s decision. “This is an extreme and unsupportable decision and is a clear overreach by the court,” said Ross Eisenbrey, vice president of the left-leaning Economic Policy Institute, who helped the Labor Department develop the regulation. Eisenbrey called it “a disappointment to millions of workers who are forced to work long hours with no extra compensation” and “a blow to those Americans who care deeply about raising wages and lessening inequality.”
But the U.S. Chamber of Commerce was jubilant. “We are very pleased that the court agreed with our arguments,” said Randy Johnson, the Chamber’s senior vice president of labor, immigration and employee benefits. The rule, he said, “would have caused many disruptions in how work gets done” and “reduced workplace flexibility, remote electronic access to work, and opportunities for career advancement.”