Texas Judge Consolidates Challenges to Overtime Rule

Lawsuits filed by states and business groups will proceed together before the court

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A federal judge in Texas has agreed to consolidate two lawsuits aimed at stopping the overtime rule from taking effect on Dec. 1.

On Oct. 19, Judge Amos Mazzant of the U.S. District Court for the Eastern District of Texas granted a request filed by the U.S. Chamber of Commerce and over 50 other business groups to have their case combined with a similar lawsuit filed by 21 states. The states' lawsuit is led by Nevada and Texas.


FLSA Overtime Rule Compliance

For more overtime compliance news, tips and tools, check out the SHRM resources provided below:

· FLSA Overtime Rule Resources Guide
· Compliance Checklist· Infographic

The two actions present somewhat different legal arguments, but they essentially ask for the same thing, said Michael Abcarian, an attorney with Fisher Phillips in Dallas.

They want to bar the Department of Labor's (DOL's) rule that will more than double the salary threshold for overtime exemption under the Fair Labor Standards Act.

The overtime rule will raise the exempt salary threshold from $23,660 to $47,476. It also provides for automatic increases every three years based on the 40th percentile of weekly earnings of full-time salaried workers in the lowest-wage Census region.

On Oct. 12, the states filed an emergency motion to temporarily prevent the rule from taking effect while their court challenge proceeds. Two days later, the business groups asked the court for an expedited ruling on their claims that the DOL exceeded its authority by raising the salary threshold too high and by providing for automatic increases.

"Both cases involve a common question of law and fact involving the legality of the new overtime rule," according to the business groups' unopposed motion to consolidate the two cases. "Consolidation will aid in efficiency and avoid duplicative efforts on the part of all parties and the court, since the same rule is before the court in both cases."

The state case will be the "lead" case, but this is just because it was filed first and therefore has the lower court docket number, explained John Doran, an attorney with Sherman & Howard in Phoenix. 

"Consolidation could help expedite the expedited relief the various parties seek," Doran noted. "The trial court will be able to better streamline the process, avoid duplication of effort and essentially address everything at once."

Although it's possible, he said, employers shouldn't expect a miracle before the Dec. 1 implementation deadline. Businesses still need to prepare for the rule to take effect as planned. 

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