After a hearing in the Eastern District of Texas on a lawsuit by 21 states to enjoin the Department of Labor’s scheduled increase of the minimum salary level for exempt status under the Fair Labor Standards Act (FLSA), the federal judge hearing the case indicated that he will rule by Nov. 22, 2016. As you know, the rule is set to go into effect on Dec. 1, 2016. For those exempt employees with salaries below $47,476, many employers are weighing whether to implement salary increases up to the new threshold or convert the employees to non-exempt status. Non-exempt status would require hours tracking and make the employees eligible for overtime for hours worked over 40 hours per week.
Any employers who have not already implemented or communicated these changes may want to wait until after Nov. 22 when this court decision is expected. We will update you if these efforts to halt the change in the minimum salary basis are successful.