Exempt Salary Rule Invalidated

August 31, 2017

By Joseph F. Saeli, Jr.

Today a Federal Court Judge in Texas struck down the Obama administration’s rule which would have increased the salary minimums for exempt employees, greatly expanding the number of employees entitled to receive overtime pay.

The Judge ruled that the Department of Labor exceeded its statutory authority in adopting the rule.  The Judge explained his analysis as follows:

“The department has exceeded its authority and gone too far with the final rule.  The department creates a final rule that makes overtime status depend predominately on a minimum salary level, thereby supplanting an analysis of an employee’s job duties. Because the final rule would exclude so many employees who perform exempt duties, the department fails to carry out Congress’s unambiguous intent.”

Be aware that this ruling will have no effect on the New York State rules for exempt employees.  Effective 12/31/17 the minimum salary for exempt employees in upstate New York increases to $780.00 per week.