No matter if you are new to the wage and hour world and this blog, you still probably know that employers need to pay their non-exempt employees an overtime premium for all hours worked in a workweek beyond 40, pursuant to the Fair Labor Standards Act (FLSA) and applicable state law. Whatever overtime rate you implement—whether time-and-a-half or a half-time premium—the overtime rate is always based on the employee’s “regular rate.” In past posts, we have looked at special problems that calculating the regular rate raises for employers who pay non-exempt workers a salary, particularly if the employees also earn commissions or bonuses. Even if compensation paid does not fall into one of these “special” problem buckets, the regular rate calculations for non-exempt employees can prove tricky at times.
Articles about the federal Fair Labor Standards Act (FLSA) an other topics related to wage and hours issues.
Fifth Circuit Reaffirms that Private Settlements of FLSA Claims May Be Enforceable When There is a Bona Fide Liability Dispute
On June 1, 2015, in Bodle v. TXL Mortgage Corporation, the U.S. Court of Appeals for the Fifth Circuit recognized established precedent1 that parties may privately settle and release wage claims that include a bona fide dispute as to liability (e.g., hours worked or compensation owed). But, the court also refused to find a prior state court settlement agreement enforceable as to overtime claims brought under the Fair Labor Standards Act (FLSA) because there was no mention or factual development of any claim of unpaid overtime or a bona fide dispute as to hours worked or compensation owed under the FLSA in the prior state court case and its settlement negotiations.
Moving Exempt Employees to Non-Exempt Status [Wage & Hour FAQs]
We discuss the misclassification of non-exempt employees regularly here on the blog and in our presentations at conferences and webinars, but a reader of the blog wrote me before the holiday weekend to ask about the reverse situation.
Is a Threat to Reduce Pay Enough to Establish Actionable Employment Retaliation?
The question of whether a threat to reduce pay constitutes an adverse employment action is before the Fifth Circuit. Last week, a trucking school asked the Fifth Circuit to uphold a trial court decision dismissing the case on summary judgment, in part due to the fact that while the plaintiff alleged that she was threatened with a pay cut, she quit prior to receiving a cut in pay. A reversal of the trial court decision would lead to a significant expansion of the scope of actionable retaliation in the Fifth Circuit and likely beyond.
Third Circuit Upholds the Motor Carrier Exemption for Drivers Who Did Not, But Reasonably Could Have Been Expected to, Cross State Lines
Are drivers of a motor carrier who rarely or never drive the carrier’s interstate routes covered by the motor carrier exemption of the Fair Labor Standards Act? Yes, according to the U.S. Court of Appeals for the Third Circuit in Resch v. Krapf’s Coaches, Inc., Case No. 14-3679 (3d Cir. May 12, 2015).
Second Circuit Extends FLSA Anti-Retaliation Provision to More Oral Complaints
On April 20, the Second Circuit filled a gap left open by the Supreme Court by extending the Fair Labor Standards Act’s (FLSA) anti-retaliation provisions to oral complaints made to an employer (rather than just complaints made to a government agency). In Greathouse v. JHS Security, Inc., the appeals court cited both Supreme Court precedent and EEOC and DOL statutory interpretations to support this broader reading of the FLSA.
DOL Sends Proposal to Narrow Overtime Exemptions to the White House
In March 2014, President Obama ordered the U.S. Department of Labor to revise the “white collar” overtime exemption regulations. Declaring “Americans have spent too long working more and getting less in return,” the President ordered the revision of the overtime exemption regulations with a goal of making millions more workers eligible for overtime pay. On May 5, 2015, Secretary of Labor Perez announced that the DOL has submitted the proposed changes to the overtime regulations to the White House’s Office of Management and Budget (OMB) for approval.
DOL Sends New FLSA Regulations to OIRA for Final Review Before Draft Publication
Since last spring, we have been following developments in the oft-delayed Fair Labor Standards Act (FLSA) regulations rewrite by the Department of Labor (DOL). Yesterday, we received word that the DOL has completed a draft of the new regulations and sent them to the Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA) for review. On Tuesday, Perez wrote in a DOL blog post, “We’ve worked diligently over the last year to develop a proposed rule that answers the President’s directive and captures input from a diverse range of stakeholders. After extensive research, study and careful analysis, we have submitted the proposed rule to the Office of Management and Budget for review. In the near future, the public will have an opportunity to weigh in and help us craft a final rule.” The submission of the new draft regulations to OIRA is the final step before the DOL officially releases the new regulations as a Notice of Proposed Rule Making for public comment.
Wage and Hour Basics Series: Penalties for FLSA Non-Compliance
Periodically this year, we have discussed some of the fundamentals of wage and hour law, starting with a general review of the white collar exemptions. We will continue to periodically review some of the more fundamental concepts of the FLSA, including a comprehensive review of the new FLSA exemption rules that we expect the DOL to issue at some point this year. As always, remember that these are just the basics: the application of these rules to specific facts is where the rubber really meets the road for employers.
Second Circuit Expands Prior Interpretation of FLSA’s Anti-Retaliation Provision to Include Internal Complaints to Employer
On April 20, 2015, the U.S. Court of Appeals for the Second Circuit ruled in Greathouse v. JHS Security Inc. that internal complaints to an employer are now protected from retaliation under the Fair Labor Standards Act (“FLSA”). This decision overrules the court’s long-standing precedent that an employee’s complaint must be made to a governmental agency in order to qualify for protection under the FLSA’s anti-retaliation provision. In doing so, the Second Circuit joined the weight of authority from its sister circuits that have already adopted similar broad interpretations of the scope of the FLSA’s anti-retaliation provision.
Reimbursing Employees for Business Expenses: The FLSA Kickback Rule [Wage & Hour FAQs]
Over the last month, Domino’s has been in the news for some of the wrong reasons, with not one but two Fair Labor Standards Act (FLSA) class action lawsuits alleging that two large Domino’s franchisees paid delivery drivers less than minimum wage.
Some Additional Thoughts on “Half-Time” Overtime: The Fluctuating Workweek Method
Last week, we discussed the fluctuating workweek method and its possible benefits. Remember that the fluctuating workweek method is not a “save lots of overtime expenses method.” Employers who use the fluctuating workweek to clamp down on overtime expenses often end up shifting those expenses from the payroll budget to the litigation budget.
9th Circuit Splits with 4th, 5th Circuits, Finds Auto Dealer Service Advisors Not Exempt Under FLSA
Reversing a district court decision, and declining to follow decisions from a number of other courts, including the Fourth and Fifth Circuits, the Ninth Circuit has deferred to the Department of Labor’s (DOL) “flip-flopped” view of whether the FLSA’s exemption for “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles,” applies to auto dealer service advisors/service writers.
Restaurant Industry Alert: “Fight for $15” Planned for Tax Day
Executive Summary: In the latest move in their two-year campaign to raise the minimum wage to $15 per hour, fast-food workers have announced plans for a major one-day walkout on April 15, 2015 – Tax Day for U.S. employers. Events are planned in approximately 200 U.S. cities as well as at least 40 other countries. In addition to fast-food workers, organizers claim the April 15 Fight for $15 will include workers from other industries including retail, child care, and airport workers as well as adjunct college professors. The movement has been spearheaded by the Service Employees International Union and is supported by several community action groups. With thousands of fast-food workers in the U.S. expected to take part in the one-day strike, employers in the fast food industry would be wise to make sure they are prepared to respond appropriately to these efforts.
Lesser Known Exemptions: The “Ministerial” Exception to the FLSA
Last week, in my post about the impact of the various iterations of the Religious Freedom Restoration Act (RFRA) on wage and hour law, we discussed the general rule that the FLSA does not contain blanket exceptions or exceptions for religious entities or individuals, with only a few exceptions. One potential caveat to this rule is an FLSA exception for ministers and clergy, the so-called “ministerial” exception.