By Michele L. Jakubs*
On September 20, 2016, 21 states, including Ohio, filed a lawsuit, State of Nevada, et al. v. U.S. Dept. of Labor, et al., 1:16-cv-00407 (E.D., Texas 2016), in federal court, challenging the final rule recently implemented by the Department of Labor (DOL) increasing the minimum salary threshold required to qualify for the Fair Labor Standards Act's (“FLSA”) “white collar” overtime exemptions. The rule is set to take effect on December 1, 2016 and will increase the minimum salary threshold from $23,660 per year to $47,476 per year. Z&R previously reported on the scope of the changes.
The States seek a declaratory judgment from the Court holding that, among other things: (1) the final rule is unlawful under the Constitution; (2) the final rule’s automatic indexing of the salary-basis test every three years is without Constitutional authority and violates the Administrative Procedure Act; and, (3) the final rule is unconstitutional as applied to the States. The States also have asked the Court to issue an injunction enjoining the final rule from having any legal effect.
While employers should continue to prepare for the December 1, 2016 implementation of the final rule, it is possible that the Court may issue an order staying the effective date of the final rule pending resolution of the legal challenges advanced by the 21 states. Z&R will continue to monitor this case and will issue further client alerts as the case advances.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience defending employers in FLSA actions and is well versed in the nuances of the law. If you have questions about the DOL’s final rule or the FLSA more generally, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
