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New overtime rule now on hold

Texas judge delays proposed Dec. 1 start for new regulations

A federal judge in Texas has put a temporary hold on changes to federal rules that would have made millions of U.S. workers eligible for overtime pay.

The rules were expected to take effect on Dec. 1.

But the U.S. District Court in the Eastern District of Texas granted a preliminary injunction, saying the U.S. Department of Labor’s rule exceeds the authority the agency was delegated by Congress.

As a result of Tuesday’s ruling, overtime changes are now unlikely to be in play before power shifts to President-elect Donald Trump’s administration, which has spoken out against Obama-backed government regulation and generally aligns with the business groups that opposed the overtime rule, the Associated Press reports.

The proposed overtime measure, announced in May, has been opposed by many small companies, nonprofits and others in the business world.

Trump has generally said he would curtail the regulations to lessen their impact on small business.

Nevada Attorney General Adam Laxalt, who led the coalition of 21 states and governors fighting the rule, and has been a frequent critic of what he characterized as Obama administration overreach, said in the wake of the Texas ruling that “businesses and state and local governments across the country can breathe a sigh of relief now that this rule has been halted.

“Today’s preliminary injunction reinforces the importance of the rule of law and constitutional government,” he told the Associated Press.

The Department of Labor could appeal the Tuesday ruling, which might end up at a Supreme Court that includes some Trump appointees.

But the injunction takes political pressure off the incoming administration at an opportune time, according to a labor law professor.

With no new overtime changes kicking in Dec. 1, Trump can accept the status quo and won’t have to risk angering workers by walking back overtime benefits shortly after employees start receiving them, said the professor, Ruben Garcia of UNLV’s Boyd School of Law. 

Trump’s administration could choose to make its own rule changes through the lengthy administrative process, or Congress could amend labor laws, the AP report said.

David O'Connor
Dave O'Connor covers York County, manufacturing, higher education, nonprofits, and workforce development. Have a tip or question for him? Email him at [email protected].