Federal judge invalidates overtime rule that threatened millions of workers, employers

Employers and workers may not realize it, but they just dodged a bullet.

They can thank a federal judge in Texas who just tossed out a Biden administration rule that tried to raise the salary threshold for overtime pay by 65%, from $35,568 to $58,656 per year (a range that includes about 12 million workers). That new threshold would have exceeded the earnings of more than 70% of workers in lower-cost states such as Arkansas, Mississippi, South Dakota and West Virginia.

The same thing happened in 2017, when a federal judge in Texas tossed out a virtually identical overtime rule from the Obama administration. In each case, the court ruled that the Department of Labor overstepped its authority by violating Congress’ intent for overtime exemptions to be based on workers’ duties — not just their salaries.