The December 1st deadline has come and gone, and yet, the new FLSA overtime rule remains in limbo.
The new regulations, which were set to increase the exempt salary threshold to $47,467, were temporarily suspended on November 22nd — just days before the scheduled implementation.
In the weeks following, business owners everywhere have been wondering…
Just how long is this temporary suspension supposed to last?
Well, on December 1st, the Department of Labor launched an appeal to the Fifth Circuit Court of Appeals. On December 8th, the Fifth Circuit granted the DOL’s motion to expedite the appeal — fast tracking the first appeal hearing to late January or early February. More information will surface at that time.
In the meantime, President Trump has selected Andrew F. Puzder as his new Labor Secretary — and Puzder has since voiced his opposition to both the new overtime rule and the proposed minimum wage increases.
With this in mind, we can assume that if the appeal is not resolved prior to the Trump administration, it’s likely the appeal will be withdrawn or nullified.
What does this mean for you and your employees?
Some employment attorneys argue that the new rule still has a fighting chance — and failing to comply with the new rule between now and the new effective date could be a serious gamble.
“Violations could be backdated to December 1st if the new rules are eventually enforced,” says attorney Maria O. Hart.
Others aren’t quite so sure.
“I think it’s extremely unlikely,” says employment law attorney Ivo Becica. “If the injunction was reversed and the rule was put back, we don’t know what that would look like … and I find it hard to believe that a fairly business-friendly federal circuit would do that without any warning.”
(Want to hear more from Becica? Watch the webinar below.)
So, what should you do in the meantime?
First and foremost, keep a close eye on FLSA developments (we’ll be posting updates as we hear them — subscribe to our blog to get the latest news straight to your inbox!).
But remember that while all of this is going on, the FLSA still applies exactly as it did before. Lawsuits were up 456% even before the new rule was announced. So, no matter what the salary threshold, and no matter what the final ruling, FLSA violations like employee misclassification and mishandling overtime shouldn’t be taken lightly.
As always, check with your employment counsel if you have any questions or concerns about employee classification. If the new rule ends up on the cutting room floor, the “duties test” will be more important than ever when it comes to correctly classifying your employees. Whether it be $23,660 or $47,467, employee classification isn’t (and has never been) dependent on the salary threshold alone.
Protect yourself and your business in 2017, learn more at www.tsheets.com/flsa.
Psst! Check out the webinar below to learn more about the new overtime regulations and what employment attorney Maria O. Hart recommends you do now.