By: Scott A. Hagen
On November 15, 2024, Judge Sean Jordan, a U.S. District Judge in Plano, Texas, issued a detailed opinion and order in which he declared invalid a rule promulgated by the U.S. Department of Labor in April 2024 (“DOL Rule”). The DOL Rule had raised the minimum salary that exempt employees must be paid in order to meet the “salary basis” requirement of the Fair Labor Standards Act.
The DOL Rule raised the minimum salary from $684 per week to $844 per week starting on July 1, 2024, and then from $844 per week to $1,128 per week starting on January 1, 2025. The DOL Rule then established a mechanism to automatically raise the minimum every three years thereafter based on contemporary earnings data.
Judge Jordan declared the DOL Rule invalid as beyond the power of the Department of Labor. His order is effective throughout the country.
The takeaway from this court order is that the prior minimum salary of $684 per week is once again the federal rule. Employees who are classified as exempt pursuant to the executive, administrative, or professional exemption must, in addition to meeting the “primary duty” test, be paid at least $684 per week in order to qualify for this exemption.
Please feel to reach out to attorneys in Ray Quinney & Nebeker’s labor and employment section for detailed information about this case and how it impacts your business.
Scott A. Hagen
moc.nqr@negahs
801-323-3328
Scott A. Hagen is the Chair of the Firm’s Healthcare Law Section and former Chair of the Employment and Labor Section. His practice includes labor relations, employment litigation, employee benefits (ERISA) litigation, and representation of clients before administrative agencies. Mr. Hagen has represented management in collective bargaining, labor arbitrations, unfair labor practice charges, representation elections, collective bargaining, state court injunctions regarding improper picketing, and hybrid lawsuits alleging breach of a collective bargaining agreement and breach of the fair duty of representation.