NFIB Applauds Federal Court’s Decision Striking Down Unfair Overtime Rule

Date: August 31, 2017

The National Federation of Independent Business (NFIB) today applauded a decision by a federal judge in Texas to issue an expedited summary judgment against the Department of Labor’s controversial overtime rule.

The rule, which was to have taken effect last Dec. 1, would have disrupted many small employers who could not be ready by the deadline. The case was brought by NFIB and more than 55 other business groups in the U.S. District Court for the Eastern District of Texas.

“This is a victory for small businesses,” said Karen Harned, executive director of the NFIB Small Business Legal Center.

“We’re pleased the court made permanent the temporary injunction it imposed against the rule in November,” Harned said. “If the overtime rule had been allowed to stand, it would have driven up the cost of doing business for employers across the country.”

The regulation would have doubled the salary threshold below which employees are eligible for mandatory overtime. According to NFIB research, 44 percent of small businesses employ at least one person who would be eligible under the rule.

NFIB and the other groups filed suit in the U.S. District Court for the Eastern District of Texas last September to block implementation of the rule. A coalition of 21 state attorneys general filed a separate action in the same jurisdiction. The court combined the cases.

NFIB opposed the rule when it was announced by the Department of Labor in early 2016. According to Harned, it would increase labor costs for small businesses by forcing them to pay overtime to millions of additional workers. 

NFIB is the nation’s leading small-business association. For more information about the overtime rule, visit NFIB.com/overtimerule. To learn more about NFIB, visit www.NFIB.com and follow @NFIB on Twitter.

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