IMPORTANT INFORMATION REGARDING THE

NEW FEDERAL MINIMUM SALARY FOR

EXEMPT EMPLOYEES
Be Sure To Read This: The increased Federal
minimum salary to maintain the exempt status
of employees is scheduled to go into effect
December 1. However, yesterday a federal
district court judge said that on November 22,
next Tuesday, he will issue his decision on
whether to issue a preliminary injunction to
stop this new salary requirement from going
into effect. Consequently, employers may want
to defer any further action on implementing the
new minimum salary requirement for exempt
employees until this ruling is issued.
The Background:
Earlier this year, the
Department of Labor revised the Fair Labor
Standards Acts minimum salary requirement
for exempt employees from $23,660 to
$47,476. This new salary level was set at the
40th percentile of earnings of full-time salaried
workers in the lowest-wage Census Region,
which is the South. Exempt employees making
less than $47,476 would either need to be
brought up to the new salary minimum by
December 1, or they would be covered by
applicable state and federal minimum wage and
overtime requirements. It is estimated that
approximately 4.2 million workers who are
classified as exempt from overtime make less
than the new salary threshold that goes into
effect on December 1.
In September, a lawsuit was filed in the federal
District Court for the Eastern District of Texas by
twenty-one states and numerous business
groups to halt implementation of this new

salary requirement. The case is entitled State of

Nevada, et al. v. U.S. Department of Labor. At
a hearing on November 16, U.S. District Judge
Amos Mazzant said that he was mindful of the
December 1 deadline. He also stated that it is
not his role to get into policy decisions or base
his decision on the Trump administrations
possible treatment of this new rule. Judge
Mazzant also noted that President-elect Trump
cannot just eliminate this new rule, but instead
would have to go through a rulemaking process
to change the rule, which would take some
time.
Stradling will be closely monitoring all
developments and will issue another update
after the Judges ruling. In the meantime, you
may contact us for compliance assistance at:

Jeff Dinkin
(805) 730-6820
(949) 725-4098
jdinkin@sycr.com

Nicole Zajack
(424) 214-7017
nzajack@sycr.com