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US Chamber to File Lawsuit Challenging New FLSA Rules

Word on the street is that the U.S. Chamber of Commerce is getting ready to file a lawsuit challenging the Department of Labor’s (“DOL”) new rules under the Fair Labor Standards Act.  The new rules, which will increase the salary threshold requirement for exempt employees from $23,660 to $47,476 per year, are set to take effect on December 1, 2016.  That, my friends, is now less than three months away.

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The Chamber’s lawsuit will seek a restraining order prohibiting the new rules from being enforced.  However…and this is a BIG HOWEVER, the Chamber’s lawsuit will not challenge the new salary threshold.  Rather, it will seek to invalidate portions of the new rule that create automatic updates to the salary threshold every three years.  Specifically, the lawsuit will argue that although the DOL has been given authority to set the salary threshold “from time to time,” such authority did not empower the DOL to make those adjustments via automatic updates.

Therefore, even assuming the Chamber’s lawsuit is successful, it is likely that that the portions of the rule that implement an increase to the salary threshold on December 1 will still take effect.  Accordingly, employers are advised to continue preparing for the new rules, evaluate their exempt employees, determine whether pay increases are prudent, consider adjustments to staffing and job responsibilities, and start communicating with your employees about any upcoming changes.  In addition, as always, don’t forget to work with competent employment counsel or experienced and knowledgable HR consultants when figuring out how to prepare for the new FLSA rules.

To read more about the new FLSA rules, you can read a prior post here:  The New FLSA Rules.