Employers will be happy to know that (at least for now!) a federal judge in Texas has blocked the overtime rule passed by President Obama that would have required employers to raise salaries or convert many exempt employees to non-exempt status. The Texas judge has issued a nationwide preliminary injunction, essentially halting the rule until a decision is made.

As a refresher, this is the overtime rule that raises the salary test for Administrative, Executive, and Professional employees to qualify for exemption from overtime pay under federal law to $913.00 per week or $47,476.00 per year. The preliminary injunction means that the rule that was set to go into effect on December 1, 2016 is temporarily stopped.  Which means employers get a free pass for now!

The preliminary injunction means that the Texas judge found the plaintiffs, a group of states and businesses that sued to stop the rule, are likely to succeed in their lawsuit.  It is not a final judgment against the rule, and it could eventually still go into effect, changing up the landscape of exempt vs. non-exempt employees across the country and hitting millions of employers pretty hard. However, this does not change the new regulations in California for salary requirements for exempt status going from $23,660 annually to $43,680 annually as of January 1, 2017. That regulation is unaffected by the currently paused overtime rule.

Of course, with the current political landscape a bit unknown as to what changes the incoming President Elect will make to some of the Obama Administration’s legislation, there could be many more changes coming up that we have yet to learn about. The entire overtime rule could potentially be overturned by the new Presidential Administration. Only time will tell. For now, we can watch this space to see how things progress regarding the preliminary injunction.