Last month the U.S. Circuit Court of Appeals for the Fifth Circuit upheld the Department of Labor’s (DOL’s) new overtime (OT) regulation. The court ruled that the regulation does not violate the Fair Labor Standards Act (FLSA).

The new DOL overtime rule took effect on July 1, 2024. It requires overtime pay for salaried employees who earn less than $43,888/year ($844/week). That is an increase over the old threshold, which was $35,568/year ($684/week).

Prospects: The courts, and especially the Fifth Circuit, have been skeptical of the Biden Administration’s regulatory authority on a range of issues, but on this one, the court took the Administration’s (DOL’s) side and upheld the agency’s authority to regulate in the overtime pay space. Of course, there could be an appeal, but experts believe, given the Fifth Circuit’s conservative bent/reputation, that the OT regulation will stand as written, effective as of this past July 1.

NAIFA Staff Contact: NAIFA Staff Contact: Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.