United States: United States District Judge Issues Nationwide Injunction Forbidding The Implementation And Enforcement Of The DOL's Rule Increasing The Minimum Salary Level For Exempt Employees

In May 2016, a new rule published by the U.S. Department of Labor raised the salary level required for executive, administrative, and professional employees to be exempt from the FLSA's overtime requirements. The increase was substantial, from $455 to $913 per week (or from $23,660 per year to $47,476 per year). The rule was scheduled to take effect December 1, 2016. Employers scrambled to come into compliance, generally balancing whether, as a matter of math, it made more economic sense to reclassify previously exempt employees as hourly and absorb the administrative burdens of doing so (such as tracking previously untracked hours and trimming certain non-critical job duties) or to give these exempt employees a raise in pay. Yesterday, after all that effort and deliberation, employers were granted at least a temporary – perhaps a final – reprieve in the form of a preliminary injunction prohibiting enforcement of the DOL's new rule. While the injunction does mean that the rule will not go into effect on December 1, it is only preliminary and does not yet represent the final word on the matter. Employers should not yet discard or wholly abandon any planned changes. However, employers may delay their implementation of those changes and need not move forward with any salary increases or reclassifications on December 1, 2016. 

On November 22, 2016, United States District Judge Amos L. Mazzant, of the United States District Court for the Eastern District of Texas, issued a Memorandum Opinion and Order enjoining, nationwide, the implementation and enforcement of the Department of Labor's final rule published on May 23, 2016. That rule would have increased the minimum salary level for exempt employees from $455 per week ($23,660 annually) to $921 per week ($47,892 annually) effective December 1, 2016. Below we provide information about this preliminary injunction and guidance for dealing with its ramifications.

Summary of the Preliminary Injunction Order

On May 23, 2016, the Department of Labor published the final version of its new rule, which increased the minimum salary level for employees exempt from the FLSA's minimum wage and overtime requirements under the exemption for employees in an executive, administrative, or professional capacity. In relevant part, the rule states "[w]hite collar employees subject to the salary level test earning less than $913 per week will not qualify for the EAP exemption, and therefore will be eligible for overtime, irrespective of their job duties and responsibilities." Under this final rule, effective December 1, 2016, the minimum salary level increased from $455 per week ($23,660 annually) to $921 per week ($47,892 annually). 

On October 12, 2016, twenty-one states filed a motion for an emergency preliminary injunction to stay implementation and enforcement of the DOL's "new overtime rule." The state plaintiffs argued the DOL's rule is unlawful and the DOL did not have authority to promulgate the rule. Following extensive briefing by the state plaintiffs and the DOL, the district court held a preliminary injunction hearing on November 16, 2016, and issued its Memorandum Opinion and Order granting the preliminary injunction on November 22, 2016.

In rejecting the DOL's defense of the rule's increased salary requirement, the district court determined "it is clear Congress intended the EAP exemption to apply to employees doing actual executive, administrative, and professional duties. In other words, Congress defined the EAP exemption with regard to duties, which does not include a minimum salary level." (Nov. 22, 2016 Order, page 11) The court further concluded "Congress intended the EAP exemption to depend on an employee's duties rather than an employee's salary," but also specifically noted it was "evaluating only the salary-level test as amended under the Department's Final Rule" and "not making a general statement on the lawfulness of the salary-level test for the EAP exemption." (Id. at page 12)

The court determined the rule to be unlawful because, in promulgating the rule, the DOL "exceed[ed] its delegated authority and ignore[d] Congress's intent by raising the minimum salary level such that it supplants the duties test." (Id. at page 13). 

The court found the public interest would be best served by the entry of a preliminary injunction to "preserve[] the status quo while the Court determines the Department's authority to make the Final Rule as well as the Final Rule's validity." (Id. at pages 17-18) The court also agreed with the state plaintiffs that a nationwide injunction should be entered to "protect[] both employees and employers from being subject to different EAP exemptions based on location." (Id. at page 18)    

What Happens Now?

Following the court's granting of the preliminary injunction, the DOL issued this statement:

"We strongly disagree with the decision by the court, which has the effect of delaying a fair day's pay for a long day's work for millions of hardworking Americans. The department's overtime rule is the result of a comprehensive, inclusive rulemaking process, and we remain confident in the legality of all aspects of the rule. We are currently considering all of our legal options."

One legal option available to the DOL is to appeal the decision, and move to stay the injunction pending resolution of the appeal. A motion to stay would only be granted if the DOL can prove the appeal is likely to succeed on the merits. Another option would be to proceed with litigation in the district court to a final decision on the merits. 

Regardless of what the DOL ultimately chooses, the preliminary injunction means the DOL's new overtime rule will not be going into effect on December 1, 2016. We provide the following guidance to employers:

  • Continue to comply with the current DOL rules regarding the EAP exemption and minimum salary level requirement. Ensure that all employees that are classified as exempt meet the current salary basis requirements ($455 per week or $23,660 annually).
  • Delay (but do not entirely abandon) the implementation of any changes to the classification of employees or to the salary of employees that were motivated solely by the DOL's new overtime rule. However, be prepared that the rule could ultimately take effect and that those changes may need to be implemented at a later date.
  • Carefully evaluate the potential consequences of "taking back" or "undoing" any salary increases or other decisions that have already been made or communicated in anticipation of the DOL's rule going into effect on December 1, 2016.

As always, your Lewis Brisbois attorneys are available to assist you with any questions regarding the November 22, 2016 Memorandum Opinion and Order enjoining nationwide the implementation and enforcement of the DOL's new overtime rule.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions