By Ronnie Miles, NGCOA, Senior Director of Advocacy
In June 2024, the U.S. District Court for the Eastern District of Texas considered a motion from Texas to block the Department of Labor's (DOL) new overtime rule, which was scheduled to take effect on July 1, 2024. Texas claimed the rule, which increases the minimum salary threshold for overtime exemption, exceeds the DOL's authority under the Administrative Procedure Act and the U.S. Constitution.
Texas argued that the statute does not allow the DOL to restrict executive, administrative, and professional (EAP) exemptions based solely on salary levels. The state highlighted the financial strain the rule would place on state agencies’ budgets and staffing decisions. The court acknowledged this potential burden.
The court indicated that Texas might prevail in its challenge and suggested that a temporary injunction would delay the rule’s July 1, 2024 implementation until the case is resolved. The court felt that the case would be decided before the next phase of the rule’s implementation, scheduled for January 1, 2025.
The two other lawsuits challenging the 2024 regulations are also filed in Texas. In Plano Chamber of Commerce v. U.S. Department of Labor, which was also filed in the U.S. District Court in Eastern Texas, the plaintiffs argued that because the Eastern District entered a permanent injunction against the 2016 regs, it still had enforcement jurisdiction in such matters and could use it to block the new regs.
The other case, Flint Avenue LLC v. U.S. Department of Labor, was filed in the U.S. District Court in Northern Texas. That lawsuit alleges the FLSA doesn’t allow the DOL to consider a salary-level test when drafting regulations to determine whether an employee is exempt from OT.
All these cases are expected to be impacted by the latest Supreme Court decision overturning the long-standing Chevron deference. In a 6-3 ruling, the majority held that the high court's test established in the 1984 Chevron v. Natural Resources Defense Council improperly prioritized the executive branch's legal interpretations over the judicial branch's.
For golf course owners and operators outside of Texas, you should continue planning to comply with the new rule. NGCOA will continue to monitor this very important issue and provide updates as they become available.
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