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Judge Blocks Overtime Increases with Preliminary Injunction

Hil Anderson
, Senior Editor
November 23, 2016
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Washington, DC – A federal judge in Texas blocked a controversial presidential order raising the salary threshold for overtime pay on November 22.

The Obama administration’s decree would have taken effect December 1 and would have required companies to pay overtime to white collar employees who earn a maximum of $47,476 annually. Current law requires overtime only for employees making less than $23,500 a year.

U.S. District Judge Amos Mazzant granted a preliminary injunction at the request of a coalition of business associations and Republican state governors. Mazzant ruled in Sherman, TX that the U.S. Department of Labor stepped outside its bounds by arbitrarily setting the $47,476 limit based solely on salary rather than job description. The judge wrote in his opinion that the Fair Labor Standards Act included an exemption from overtime rules for “any employee employed in a bona fide executive, administrative, or professional capacity.” The full text of Mazzant’s opinion can be found on the Eastern District of Texas web site: http://www.txed.uscourts.gov/page1.shtml?location=notable.

The Department of Labor issued a statement to media outlets after the ruling saying it disagreed with the ruling and vowed to consider legal options. “The department’s overtime rule is the result of a comprehensive, inclusive rule-making process, and we remain confident in the legality of all aspects of the rule,” the statement said.

Industry groups fought the overtime order, first issued in 2014, because it would reduce their flexibility and increase costs, possibly to the point that staff reductions would be needed.

The trade show industry also opposed the new rules based on the dynamic nature of producing exhibitions, which often involve extensive travel and long days during the show. But overall, the industry was not as strident in its opposition as other industries, such as retail. Various show organizers told Trade Show Executive last Summer that they already had overtime policies and employee exemptions in place that largely complied with the new rule.

The International Association of Exhibitions and Events (IAEE) and the American Society of Association Executives earlier this year called for passage of a compromise bill that would phase in the new overtime threshold over three years. “This was one of the issues that we advocated for during Exhibitions Day this past June,” said IAEE President & CEO David DuBois.

Reach David DuBois at (972) 687-9204 or ddubois@iaee.com; John Graham, ASAE President and CEO, at (202) 626-2741 or jgraham@asaecenter.org

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