The Department of Labor’s attempt to extend overtime eligibility to millions of new workers has been struck down in court.
The United States District Court in the Eastern District of Texas found the Department of Labor overstepped its authority under the Fair Labor Standards Act to raise minimum salary levels high enough that it “essentially made an employees duties, functions or tasks” irrelevant to whether their duties qualified them for overtime.
The rule at hand, which was finalized by the Department of Labor in April, increased the annual salary threshold under which non-exempt workers are eligible for overtime pay from $35,568 to $43,888. That change took effect July 1.
On Jan. 1, the threshold would have increased further, to $58,656. The salary threshold then would have updated every three years based on wage data. Over the first two updates, more than 3 million workers are expected to become newly eligible for overtime pay, the agency said.
