Court Will Consider States' Request to Pause FLSA Overtime Rule

Author: Michael Cardman, XpertHR Legal Editor

October 18, 2016

A federal court on October 17 agreed to hear a motion filed by 21 states asking the court to temporarily suspend upcoming overtime rules from the US Department of Labor (DOL).

The US District Court for the Eastern District of Texas scheduled a hearing on the motion for November 16, roughly two weeks before the DOL's new Fair Labor Standards Act (FLSA) overtime regulations are scheduled to take effect.

The states had said the court should temporarily suspend the regulations pending the outcome of a lawsuit they had filed back in September on the grounds that they are likely to win the lawsuit and that they would be irreparably harmed because the regulations will impose significant costs on them and violate the US Constitution by "trampling upon principles of federalism, tearing down the separation of powers, and infringing upon [their] sovereign rights."

Although the Eastern District of Texas is considered a friendly venue for plaintiffs seeking to overturn regulations from the Obama administration, one observer said the "the general consensus is ... that the arguments that the DOL exceeded its authority by increasing the minimum salary threshold are going to be very difficult to win."

"I'm telling all my clients that you really shouldn't bank on this lawsuit changing anything, and just keep preparing for the regulations to take effect," said William R. Pokorny, a partner in the Chicago office of Franczek Radelet.

The 21 states behind the lawsuit are Alabama, Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Mississippi, Nebraska, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Utah and Wisconsin. In related news, a coalition of 50 business groups headed by the US Chamber of Commerce on October 17 filed a motion to consolidate their similar case with the 21 states' case.