Judge Strikes Down Overtime Rule Nationwide; Salary Threshold for Exempt Employees Now $684/week

Today a federal court struck down the Biden administration’s overtime rule, which means the minimum salary threshold for the “white-collar” exemptions to federal overtime requirements reverts to only $684 per week ($35,568 per year) nationwide.   Significantly, the decision revokes the scheduled increase to $1,128 that was planned for January 1.

In his decision, the judge held that the U.S. Department of Labor’s rule exceeds its statutory authority under the Fair Labor Standards Act.  The Court held that the Department may only use a minimum salary level if that salary serves as a reasonable proxy for an employee’s exemption status, and found that the sharp increases in the rule’s salary thresholds were not such a reasonable proxy.  The Court found that the salary thresholds instead served to displace the statutory duties test for the white-collar exemptions with a non-statutory salary-level test.

We will watch closely to see if the government appeals the decision, and keep you apprised of any developments.  Please contact your favorite Miller Johnson employment attorney if you have any questions.