Federal Court Stops New Overtime Regulations from Going into Effect

Sara Geenen

A few months ago we wrote about new overtime regulations intended to update the Fair Labor Standards Act. Currently, employers are only required to pay overtime (that is, one and a half times the federal minimum wage) to employees who earn less than $23,660 per year. The new regulations would have offered overtime protections to millions of additional workers – those who earn more than $23,660 but less than $47,500 per year, and were supposed to go into effect on December 1, 2016. Several business groups brought legal challenges.

Last week, a federal court in Texas temporarily enjoined the implementation of those regulations pending the resolution of the legal challenges to the regulations. As a result of the late-issued injunction, many employers and employees find themselves in limbo. Some employees have already had their job descriptions, hours, or wages adjusted. Employers will not be required to pay overtime compensation to those workers the regulations were designed to protect, however, so employees may face additional changes.