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Update on U.S. DOL Overtime Rule Litigation

In a surprising and disappointing move, U.S. Secretary of Labor Alexander Acosta has decided to appeal U.S. District Court Judge Amos Mazzant’s decision on the merits that the U.S. Department of Labor’s Overtime Rule is unlawful. Secretary Acosta filed a notice to appeal the decision on October 30, 2017 to the U.S. Court of Appeals for the 5th Circuit.

In a public statement, the Department of Labor stated, “Once this appeal is docketed, the Department of Justice will file a motion with the 5th Circuit to hold the appeal in abeyance while the Department of Labor undertakes further rulemaking to determine what the salary level should be.”

The August 31, 2017 decision by Judge Mazzant found that the DOL focused too heavily on the amount of money exempt employees make – instead of on their job duties – for overtime eligibility.

It appears that the Secretary of Labor is filing the new appeal to preserve the ability to engage in new rulemaking to set an increased salary threshold, without violating the August 31, 2017 ruling of Judge Mazzant.

The DOL is currently reviewing more than 140,000 public comments recently submitted at the request of Secretary Acosta to advise the DOL on what a new Rule should look like, in terms of overtime eligibility. We have previously reported that Secretary Acosta believes a salary level in the range of $33,000 is more appropriate than the $47,000 figure in the enjoined Rule.

It is clear that Secretary Acosta wants to avoid a ruling on the merits by the U.S. Court of Appeals for the 5th Circuit. He is likely hoping to make moot any decision by the 5th Circuit by issuing a new Notice of Proposed Rulemaking with a different Rule that will be less vulnerable to attack.

It is also likely that, once a new Rule has been promulgated, the DOL will file another Motion, seeking to vacate the decision of Judge Mazzant, to avoid having on the books a reported case that limits the authority of the Secretary of Labor.

Editor’s Note: Let us hope that there would be vigorous opposition to a Motion to Vacate Judge Mazzant’s decision. That is important future guidance, in the event that a Secretary of Labor again seeks to overreach his or her authority under the federal wage and hour law.

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