• A federal court in Texas has invalidated the Department of Labor’s (DOL) 2024 overtime rule, which had aimed to increase the salary thresholds for employees to qualify for exemptions under the Fair Labor Standards Act (FLSA). This ruling effectively nullifies the increases that had already taken effect on July 1, 2024, and prevents the further increase planned for January 1, 2025.
• The court found that the DOL exceeded its authority by setting salary thresholds so high that they overshadowed the job duties test required under the FLSA. The court also struck down the provision for automatic future adjustments to the salary threshold, emphasizing that such significant changes require adherence to the Administrative Procedure Act.
• This means the current salary threshold of $684 per week ($35,568 annually), established in 2019, remains in effect for determining overtime exemptions. Employers who had adjusted employee salaries based on the now-invalidated rule are advised to consult legal counsel before making changes.
