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Court blocks new federal rule expanding overtime pay

Updated: Jun 29, 2022

Earlier this year, the US Department of Labor passed a Final Rule increasing the scope of employees who must be paid overtime – from those paid $455 a week ($23,660 annually for a full-year worker) to $913 a week ($47,476 annually for a full-year worker). The Rule was set to become effective on December 1, 2016. However, on November 22, 2016 a federal court in Texas issued a “nationwide injunction” prohibiting the Rule from going into effect. An appeal of the injunction has already been filed and fast tracked. The injunction leaves municipal employers in an uncertain position, as it is unclear whether the federal appeals court will uphold the injunction and whether the Department of Labor under the new administration will continue to fight the injunction. It is recommended that municipalities work closely with an attorney in navigating this issue until the courts provide more guidance.

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