In a case that captured the close attention of corporate legal teams and HR departments across the country, a federal district court in Texas upheld the U.S. Department of Labor (DOL)’s authority to impose a mandatory minimum salary requirement for the “white-collar” exemption from overtime pay. Under the rules of the Fair Labor Standards Act (FLSA), the DOL can outline regulations for the executive, administrative, and professional exemptions.
This decision was handed down in the lawsuit Mayfield v. U.S. Department of Labor, No. 1:22-cv-792 (W.D. Tex. Sept. 20, 2023). As a result, the judge sided in favor of the DOL in granting summary judgment. The case centered on the legal question of whether the DOL had statutory authority to enforce a salary requirement to qualify for these exemptions. The court ultimately concluded that the DOL does indeed have this power.
The decision reaffirms the DOL’s power to regulate minimum wages and overtime, a matter of considerable significance for many businesses operating in the US. Employers seeking to use the FLSA white-collar exemptions must now ensure their salaried employees meet the new salary requirement set out by the DOL.
While this ruling directly relates to employers in Texas, it also sends a crucial message to firms operating across all states. Given the vital nature of this ruling, tracking subsequent related legal developments will be paramount for all businesses employing salaried workers under these exemptions.
For a look at the full legal proceedings, click here.