A federal court in Texas today held a hearing to consider requests by business groups and Texas Attorney General Ken Paxton for a temporary restraining order to stop the Department of Labor’s overtime final rule from taking effect on July 1.
The rule increases the salary level below which an employee is automatically subject to the Fair Labor Standards Act’s overtime and minimum wage requirements. If the U.S. District Court for the Eastern District of Texas does not rule before July 1, the existing $35,568 salary level will increase to $43,888 on that date. If a bank has exempt employees who make between $35,568 and $43,888, the bank will need to reclassify the employee as nonexempt—and therefore subject to federal overtime and minimum wage requirements—or increase the employee’s salary to $43,888. Banks that have exempt employees whose salary falls within this salary range should plan for how the bank will respond if the rule takes effect on July 1.
Previously, the American Bankers Association joined with other trade associations in urging DOL to extend the July 1 implementation date to at least September 1. They also urged the DOL to stay implementation of the rule to allow for judicial review. DOL has not responded to the requests.
