NCLA Asks Court to End DOL's Illegal Undermining of Long-Standing Wage and Overtime Exemption

Flint Avenue, LLC v. US Department of Labor; Julie Su and Jessica Looman, in their official capacities

Washington, DC, June 12, 2024 (GLOBE NEWSWIRE) — Today, the New Civil Liberties Alliance filed a brief in Flint Avenue v. Ministry of Labour urging the U.S. District Court for the Northern District of Texas to grant a stay or preliminary injunction stopping an unconstitutional new DOL rule. The rule establishes a salary-based standard for determining whether “white-collar” employees are exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA). In doing so, the DOL rule would illegally prevent employers, including countless small businesses, from claiming the exemption for 7.7 million employees nationwide.

Reducing this exemption would require employers to reclassify these employees as hourly employees, thereby preventing them from benefiting from flexible work arrangements. NCLA’s client, Flint Avenue, LLC, is a small software company that competes with larger companies by offering its seven employees flexible packages, including unlimited vacation time. The new rule would require it to reclassify five of those employees as hourly employees, making such mutually beneficial arrangements impossible.

The FLSA statutorily exempts any person “employed in a (white collar) ability» of its minimum wage and overtime requirements, a definition based on the characteristics of a job. functionnot his salary level. Flint Avenue is likely to prevail on the merits against the DOL’s new rule, which effectively erases this standard by prohibiting employees from being eligible for the exemption unless they receive a fixed weekly salary of at least $1,128 (the equivalent of more than $58,000 per year), regardless of their role in the company. The FLSA does not authorize the DOL to impose a minimum weekly wage on all white-collar workers under the guise of an exemption. Indeed, Congress could not delegate its legislative power to the DOL without violating the vesting clause of Article I, § 1 of the Constitution.

The DOL’s new rule would take effect July 1, 2024 for the first group of employees, including one employed by Flint Avenue. This in turn increases the number of affected employees both nationally and for NCLA’s customer on January 1, 2025. NCLA is asking the Court to prevent the rule from taking effect before this unlawful regulation can irreparably harm Flint Avenue and other small businesses.

NCLA released the following statements:

“Nothing in the Fair Labor Standards Act gives the department the authority to set the minimum wage for the nation’s 45 million white-collar workers. Only Congress can exercise this power.

— Sheng Li, litigation attorney, NCLA

“The Administrative Procedure Act empowers federal district courts to stop regulatory actions that have no basis in law. One such rule is the DOL’s rule, which is a radical departure from the text of the FLSA and prior precedent.
— Mark Chenoweth, President, NCLA

For more information, visit the case page here.

ABOUT NCLA

NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional liberties against violations by the administrative state. NCLA’s public interest litigation and other pro bono advocacy work to tame the illegal power of state and federal agencies and foster a new civil liberties movement that will help restore the fundamental rights of Americans.
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CONTACT: Ruslan Moldovanov New Civil Liberties Alliance 202-869-5237 [email protected]