A federal judge in Texas expressed skepticism about the U.S. Department of Labor’s (DOL) analysis used to justify its expansion of overtime pay protections. This remark came during a hearing on Friday regarding a lawsuit filed by the state of Texas and various business groups challenging a Biden administration rule that would expand overtime eligibility to 4 million workers.
District Judge Sean D. Jordan questioned the DOL’s rationale for the rule, particularly its reliance on data from a Census Bureau survey. He noted that the survey is based on self-reported information, which creates uncertainty about how the agency estimated the rule’s impact. “We’re talking about when salary crosses the line and becomes predominant, and what metrics the department is using?” Jordan asked.
Texas and the business coalition argue that the new rule, which will allow salaried workers earning less than $58,656 annually to qualify for overtime pay starting January 1, exceeds the DOL’s authority and violates the Administrative Procedure Act. They point to previous court rulings stating that if the salary threshold is set too high, it can overshadow other factors, such as a worker’s job duties, in determining overtime eligibility.
Part of the rule had already taken effect in July, increasing the salary threshold from $35,568 to $43,888. The next increase is scheduled for the new year. Regardless of Judge Jordan’s ruling, the incoming administration of President Donald Trump is expected to cancel the rule.
Judge Jordan also questioned the necessity of the salary increase, noting that the DOL had updated the rule in 2019. He expressed concern that the projected number of affected workers under the 2024 rule seemed inconsistent with historical data.
During the hearing, both the state of Texas and the business coalition urged the court to vacate the entire policy. Christine L. Coogle, the Department of Justice attorney representing the DOL, argued that the two parts of the rule—the July increase and the January increase—could function independently. She suggested that any ruling should focus only on the specific areas found to be illegal, rather than invalidating the entire rule. Coogle also mentioned that there are two other legal challenges pending against the rule, and that a nationwide injunction could interfere with other courts’ jurisdictions.
Judge Jordan indicated he was unlikely to allow further briefing on the case, suggesting he had already formed an opinion.
The state of Texas was represented by Garrett Mitchell Greene, Kathleen T. Hunker, and Susanna Dokupil from the Texas Attorney General’s office, along with Munera Al-Fuhaid from the Texas Public Policy Foundation. The coalition of business organizations was represented by James Paretti Jr., Maurice Baskin, and Robert Francois Friedman of Littler Mendelson. The DOL was represented by Coogle and Brian C. Rosen-Shaud.
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