Plan to Increase Overtime Wages Blocked by Federal Court

A federal judge has blocked a Department of Labor rule on overtime pay set to take effect on December 1 that would have required employers to pay time-and-a-half to their employees who worked more than 40 hours in a given week and earned less than $47,476 a year.  Under the overtime rule currently in place, employees who earn a salary of at least $23,660 are exempt from overtime pay if they perform duties that satisfy the requirements established by the Department of Labor for executive, administrative, or professional positions.  On November 22, the U.S. District Court in the Eastern District of Texas granted a nationwide preliminary injunction halting implementation of the new rule adopted by the Department of Labor, based on the Court’s conclusion that the new rule exceeds the authority the agency was delegated by Congress.

“As a result of yesterday’s ruling, employers will not be required to comply with the new rule on December 1.  Until there is additional court action, the current standards for overtime eligibility will remain in place.  Yesterday’s ruling was preliminary in nature, so it is possible that the new regulations might be revived either as a result of further proceedings in the trial court or as a result of an appeal,” said David M. Stevens, Esq., of Whiteford, Taylor & Preston.

PKS & Company, P.A. will continue to provide any additional updates regarding overtime pay should the Department of Labor appeal to the New Orleans, Louisiana-based 5^th U.S. Circuit Court of Appeals.

PKS & Company, P. A. is a full service accounting firm with offices in Salisbury, Ocean City and Lewes that provides traditional accounting services as well as specialized services in the areas of retirement plan audits and administration, medical practice consulting, estate and trust services, fraud and forensic services and payroll services and offers financial planning and investments through PKS Investment Advisors, LLC.