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FLSA Changes on Hold

Last week a federal court in Texas granted a temporary injunction to the December 1st compliance deadline for the new FLSA salary threshold, which would have made many salaried employees eligible for overtime wages.

Although this is a preliminary injunction, it does allow employers to keep their compensation practices ‘status quo’ until a final resolution is reached.  However, we do know that many organizations have already made adjustments to employee status and/or increased annual compensation to meet the 12/1 deadline – which would be difficult to reverse.  For those businesses who have not already implemented the required changes, this decision will give them additional time to review their options during what may be a lengthy litigation process.

While the timing of the announcement came as a surprise for some HR professionals, it was met with relief for many employers.  It has been reported that 21 states filed an emergency motion for a preliminary injunction in October, and the case was consolidated with another lawsuit filed by the US Chamber of Commerce and other business groups, which according to SHRM, “raised similar objections to the rule”.  We will continue to keep you up to date on further announcements as they unfold, and are always available to discuss and strategize on compliance issues that impact your business.

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