While the injunction that was handed down (blocking the implementation of the controversial overtime changes to the Fair Labor Standards Act) was welcomed by many employers, it is not a surprise that there remain several questions to be addressed.  Some specific answers, others do not.

In light of some of the calls we have received, and to try to provide some clarity, below are some questions and points to consider as you decide how to best proceed at your organization:

1.  Question:  Is the injunction permanent?

      Answer:  At this stage - no.  It is a temporary injunction.  The United States Department of

      Labor (DOL) can pursue different options to get the ruling re-examined at the District Court

      level or even appealed at the United States Court of Appeals.  Or, the DOL could drop the

      appeal in the future (should the DOL leadership change with the new Presidential

      administration).

2.  Question:  How quickly might a re-examination or an appeal take?

      Answer:  This can vary depending upon the path (or paths) taken and is unknown.  What is

      simply known at this point is that the rule will not be effective December 1st.

3.  Question:  If the injunction were to be reversed in the future, could such a court try to reinstate

      the rule retroactive to December 1st?

      Answer:  While it might make sense to think that a reversal would only have repercussions

      moving forward and apply prospectively, it is possible that it could be applied retroactively

      (should a court decide to reverse the initial decision and lift the injunction).

4.  Question:  Given the uncertainty of what might happen with an appeal and the outcome,

      should I just implement the changes?

      Answer:  There is no definitive answer to this.  There is no guarantee that an appeal will be

      successful.  If you do not implement the changes, it might be worthwhile to track the time

      worked for employees moving forward in the event of a retroactive application in order to

      identify, and be able to calculate, potential overtime that could be potentially owed.

5.  Question:  I have already made adjustments to how I pay people in anticipation of the changes

      taking effect.  Can I reverse those changes?

      Answer:  Technically, you could reverse those adjustments moving forward for future work

      performed (though if the effect of reversing those changes is to reduce pay levels for future

      work, such changes may be met with some backlash from your employees).  However, if

      employees have already worked under those adjustments with an expectation of receiving a

      certain level compensation, then you would still need to pay them for the days worked in

      accordance with those adjustments or expectations that you have set.

6.  Question:  In examining my positions, I discovered that some positions should have been

      treated as "non-exempt" in the first place due to the duties associated with that position.  Does

      the injunction relieve me of having to do anything with those misclassified jobs?

      Answer:  The overtime rule changes that were slated to take effect on December 1st centered

      upon changes made to the salary thresholds under the Fair Labor Standards and did not change

      the duties tests whatsoever.  Therefore, if a position was misclassified, it is probably

      worthwhile to address those misclassified positions now to become compliant moving forward,

      and examine how to best manage or reduce your exposure for past misclassifications.

If you have specific questions that pertain to your business, EANE's hotline is always available to you.  Give us a call toll-free (877) 662-6444.