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A federal judge's preliminary injunction Nov. 22 has stopped--at least temporarily--the Labor Department's Overtime Rule from taking effect on Dec. 1. And with courts, the current Obama administration, the incoming Trump administration, a Republican-led Congress, and a nervous business community all having roles in the rule's future, construction interests face many more months of uncertainty regarding the rule's ultimate fate.

The rule's progress was halted by U.S District Judge Amos Mazzant of the Eastern District of Texas, acting on a combined pair of lawsuits brought by state officials and business groups. "Due to the approaching effective date of the Final Rule, the Court's ability to render a meaningful decision on the merits is in jeopardy," the National Lumber and Building Material Dealers Association (NLBMDA) quoted Mazzant as saying. (Read the entire ruling.) "A preliminary injunction preserves the status quo while the Court determines the department's authority to make the Final Rule as well as the Final Rule's validity."

The National Association of Home Builders said Mazzant "sent a strong signal that he could likely side with NAHB and our business coalition."

“The State Plaintiffs have shown a likelihood of success on the merits because the Final Rule exceeds the Department’s authority,” Mazzant wrote in his opinion, according to NAHB.

The New York Times said the U.S. Chamber of Commerce appeared similarly optimistic. “We are, assuming that this preliminary injunction holds and there isn’t an appeal or some other thing that disrupts it, done with this regulation,” Marc Freedman, executive director of labor law policy at the Chamber, told the newspaper.

Reuters quoted Labor Department spokesman Jason Surbey as saying the agency strongly disagrees with the decision and remains confident that the entire rule is legal, and that the department is currently considering its options. Mazzant has yet to issue a final rule on the case, and there's no timetable on when he'll act, but if he goes against the government the ruling could be brought before a federal appeals court.

Issued May 18, the rule roughly doubles, to $47,476 a year, the annual pay a worker must receive in order to qualify as a manager and thus be exempt from time-and-a-half overtime pay after working 40 hours in a week. In addition, that new threshold would rise automatically in the future based on inflation. The Labor Department estimated 4.2 million Americans would be affected by the rule.

A Hanley Wood survey conducted late in October found no more than a third of building material dealers said they were ready for the change.

The issue's future is complicated by the change at the White House. President-elect Donald Trump has promised regulatory reform, but he hasn't talked much if at all about the Overtime Rule.

The rule's future also is sure to be debated in Congress, where several bills have been offered. One would impose a six-month delay on the rule from taking effect. Another--backed so far by NAHB--would have permitted the rule to take effect but would have phased in the rise of the threshold over several years while eliminating the automatic escalator clause.

Update: According to the Society of Human Resources, employers are instructed to leave in place any changes that were made to meet with the Dec. 1 implementation of the Overtime Rule. "Employers will likely want to leave decisions in place if they have already provided salary increases to employees in order to maintain their exempt status.” Employers are being instructed to “wait and see” as litigation continues. The SHRM warns that "Employers shouldn't assume however that the overtime rule will be permanently barred. They should still have a plan to move forward if necessary in the future."