A federal judge in Texas on Friday permanently blocked a Biden administration rule that would have made about 4 million more salaried American workers eligible for overtime pay.
U.S. District Judge Sean Jordan in Sherman, Texas, said a Department of Labor rule that went into effect in July unfairly bases eligibility for overtime pay on a worker's wages rather than their job duties.
The state of Texas and business groups representing various industries had filed suit challenging the consolidated rules.
Jordan, who was appointed during Republican President-elect Donald Trump's first term, said in June that the rule was likely invalid and called for repealing the rule and temporarily making it applicable to Texas employees. was prevented.
Starting January 1, 2025, the rule will require employers to pay overtime premiums to salaried employees making less than $1,128 a week, or about $58,600 a year, if they work more than 40 hours a week. , the price had been temporarily increased. The July 1 basis will be approximately $44,000 per year.
The previous threshold of approximately $35,500, set in 2019, will again apply.
The Department of Labor and Republican Texas Attorney General Ken Paxton's office did not respond to requests for comment.
David French, executive vice president of the National Retail Federation, one of the groups that filed the lawsuit, said the rule would limit retailers' ability to offer greater benefits to lower-ranking employees. He said he was deaf.
The Labor Department could ask the New Orleans-based 5th Circuit Court of Appeals, considered the most conservative federal appellate court, to review the ruling. However, the incoming Trump administration may abandon any attempt to reinstate the rule.
Federal law exempts workers in “executive, administrative, and professional” (EAP) positions from receiving overtime pay, and the Department of Labor has for decades considered the factors in determining when pay applies. It has been used as one of the
In introducing the rule, the Department of Labor said low-wage salaried workers often do the same work as hourly workers, but work long hours without additional pay. The regulations also provide for automatic salary threshold increases every three years to reflect wage growth.
Jordan agreed Friday with the state of Texas and business groups that the rule unfairly waives job requirements set forth in federal law by significantly increasing pay levels.
“Although the Department may impose some limitations on the scope of the operating conditions of the EAP exemption, it cannot enact regulations that displace or swallow the meaning of those conditions,” Jordan wrote.
