By Nelson Cary and Cory Catignani
The Trump Administration has acted quickly to address some of the rules promulgated by the Department of Labor (“DOL”) during the Obama presidency. One such rule is the overtime regulation that would more than double the salary threshold for employees to be exempt from overtime requirements. The overtime rule was invalidated by a Texas district court and is on appeal to the Fifth Circuit Court of Appeal. The Trump Administration recently requested an extension in the case, indicating it may withdraw the government’s appeal and allow the rule to die.
The Trump Administration took similar action in a lawsuit challenging Obama’s fiduciary rule that requires financial professionals who advise retirement accounts to act in their client’s best interest when recommending investment products. The administration requested a stay of the case while it reviewed the rule. A Texas federal judge, however, denied the request and upheld the rule as lawful. We will see if the administration appeals that ruling.
In the meantime, there has been no action taken on an equally important rule. Readers may recall our previous posts on the persuader rule that, if allowed to stand, would radically alter the interpretation of the Labor-Management Reporting and Disclosure Act. A federal court permanently enjoined the rule back in November 2016, but that ruling is on appeal. The Trump Administration so far has not taken any action in that appeal, according to the court’s docket.
While it would be surprising if it chose to pursue the appeal, it is unclear why it has yet to ask for a stay like it did for the overtime and fiduciary rules so that it can consider whether to abandon the government’s appeal. Withdrawing the appeal would be a relatively simple way for the DOL to provide immediate relief from the rule.
Perhaps the answer lies in the fact that the appeal is still in its early stages. No briefs have been filed and no oral argument date is set. But for labor professionals working for employers, intervention by the Administration to withdraw the appeal can’t come soon enough. Stay tuned while we continue to monitor this case.