USDOL considers legal options after federal judge blocks pay raise for salaried workers
The US Department of Labor is “considering all of our legal options” after a federal judge blocked a USDOJ final rule set into effect Dec. 1 that raises the exemption for salaried workers throughout the United States and American Samoa.
Last week Tuesday, U.S. District Court Judge Amos Mazzant granted an Emergency Motion for Preliminary Injunction and thereby enjoined the USDOL from implementing and enforcing the Overtime Final Rule on Dec. 1.
The Federal Labor Standards Act (FLSA) exempts from both minimum wage and overtime requirements “any employee employed in a bona fide executive, administrative, or professional capacity.” This exemption is commonly referred to as the “white collar” or “EAP” exemption.
The “special salary level” for salaried workers — who are considered exempt ‘white collar’ employees in American Samoa was to increase from $380 per week — the current standard — to $767 per week on Dec. 1, 2016.
For the US, the salary exemption hikes from the current $455 per week ($23,660 annually) to $921 per week (or $47,892 annually).
Responding to Samoa News questions from last week, USDOL press office in San Francisco confirmed that the federal judge’s decision includes American Samoa.
It also provided a national press statement, which says that the department, “strongly disagrees with the decision by the court, which has the effect of delaying a fair day’s pay for a long day’s work for millions of hardworking Americans.
According to the department, its final rule is the result of a comprehensive, inclusive rule-making process, “and we remain confident in the legality of all aspects of the rule. We are currently considering all of our legal options.”
Additionally, the rule updated the standard salary level and provided a method to keep the salary level current to better effectuate Congress’s intent to exempt bona fide white-collar workers from overtime protections.
Since 1940, USDOL says its regulations have generally required each of three tests to be met for the FLSA’s executive, administrative, and professional (EAP) exemption to apply:
• the employee must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed (“salary basis test”);
• the amount of salary paid must meet a minimum specified amount (“salary level test”); and
• the employee’s job duties must primarily involve executive, administrative, or professional duties as defined by the regulations (“duties test”).
USDOL says it has always been recognized that the salary level test works in tandem with the duties tests to identify bona fide EAP employees. Additionally, it has updated the salary level requirements seven times since 1938.
Samoa News notes that the salary exception for American Samoa is lower than the US because the territory’s minimum is much lower then the national level of $7.25 per hour.
American Samoa has 17 different minimum wages, depending on the industry — with the lowest at $4.68 for garment manufacturing and the highest at $6.09 for stevedoring, and maritime shipping agency activities.