On November 22, 2016, a federal court in Texas issued a nationwide preliminary injunction blocking the Department of Labor (DOL) from enforcing the new federal overtime rule which was set to take effect on December 1, 2016.

The federal overtime rule was seen as controversial because it more than doubled the current federal salary level that must be met before an employee can be classified as exempt from overtime under one of the executive, administrative and/or professional exemptions.

The federal overtime rule required a minimum salary of $913 per week, which is also higher than California’s minimum salary threshold.

A group of states joined forces on a lawsuit to stop the overtime rule prior to the rule’s effective date. The lawsuit claimed that the DOL overstepped its authority in enacting the rule. Business groups also brought a lawsuit challenging the rule.

What Does This Mean for California Employers?

Because the federal overtime rule currently cannot be enforced, California employers should use the California salary test to determine whether an employee can be classified as exempt under the executive, administrative and/or professional exemptions.

The current minimum monthly salary test for most exempt executive, administrative and professional employees is no less than two times the California’s minimum wage for full-time employment — $3,466.67 per month for 2016. In addition to the salary test, California employees must meet a strict duties test to be classified as exempt.

Employers interested in having the Browning Law Group assist them with ensuring compliance with the California classification and overtime regulations can contact Browning Law Group at 949-234-6266 or [email protected]. For more information about Browning Law Group visit www.BrowningLawGroup.com.