ROCHESTER, NY--(Marketwired - November 23, 2016) - With news late yesterday that a federal court judge in Texas issued a preliminary injunction temporarily blocking the U.S. Department of Labor (DOL) Final Overtime Rule, Paychex, Inc., a leading provider of integrated human capital management solutions for payroll, HR, retirement, and insurance services, is encouraging employers to closely monitor the latest developments.
The rule, which would have extended overtime pay to an estimated 4.2 million American workers, was scheduled to take effect on December 1, 2016. While the December 1 effective date is currently no longer mandated for employers because the injunction temporarily blocks the regulation, the future of the Final Rule remains uncertain.
"This injunction means that the December 1 deadline for compliance with the new rules cannot currently be implemented or enforced by the Department of Labor," said Paychex president and CEO Martin Mucci. "While it's anticipated that there will be further judicial review of the injunction, this development creates substantial uncertainty for businesses."
In September, two separate lawsuits had been filed against the U.S. Department of Labor challenging the agency's updated Overtime Rule. The lawsuits argued, in part, that the DOL overstepped its authority and disregarded original Congressional intent when releasing a Final Rule to increase salary thresholds for the executive, administrative, and professional white-collar exemptions from overtime and increasing the annual salary for the Highly Compensated Employee exemption, as well as including an automatic increase to those levels every three years. The two lawsuits were combined last month, and a Federal Court Judge heard the plaintiffs' motion for a preliminary injunction enjoining the implementation of the new regulations on November 16 before issuing the injunction.
Paychex will continue to closely monitor developments in this situation and will issue updates as necessary. For the latest information and further analysis, visit www.paychex.com/worx.
Paychex, Inc. (NASDAQ: PAYX) is a leading provider of integrated human capital management solutions for payroll, HR, retirement, and insurance services. By combining its innovative software-as-a-service technology and mobility platform with dedicated, personal service, Paychex empowers small- and medium-sized business owners to focus on the growth and management of their business. Backed by 45 years of industry expertise, Paychex serves approximately 605,000 payroll clients across more than 100 locations and pays one out of every 12 American private sector employees. Learn more about Paychex by visiting www.paychex.com, and stay connected on Twitter and LinkedIn.