On August 16, 2013, the U.S. Court of Appeals for the Fifth Circuit reaffirmed the use of the โfluctuating workweekโ method for calculating damages of workers owed overtime pay as a result of misclassification as โexemptโ under the FLSA. In Ransom v. M. Patel Enterprises, Inc., the trial court found executive managers of Party City retail stores were misclassified as exempt from the overtime provisions of the Fair Labor Standards Act (FLSA) when the company paid them flat weekly salaries regardless of the hours they worked. On appeal to the Fifth Circuit, the company did not contest the workersโ status under the FLSA, but argued the lower court improperly calculated overtime damages.
Articles about the federal Fair Labor Standards Act (FLSA) an other topics related to wage and hours issues.
First Circuit Clarifies When High-Level Executive May Be Subject to FLSA Liability
In Manning v. Boston Medical Center Corp., a case that creates concern for high-level executives but provides a measure of relief for senior human resources employees, the U.S. Court of Appeals for the First Circuit vacated a district courtโs dismissal of claims against the defendantโs former president and CEO and held that Fair Labor Standards Act overtime claims were sufficiently pled against her. However, the First Circuit affirmed the district courtโs dismissal of FLSA claims against the defendantโs former senior human resources director (HRD). Manning comes shortly after the Second Circuit Court of Appealsโ decision in Irizarry v. Catsimatidis, where the court also held that a CEO could be personally liable for the companyโs alleged FLSA violations.
Healthcare News: Former Nurse Asks U.S. Supreme Court to Settle Circuit Split on Meal Break and Timekeeping Issue
Executive Summary: On July 22, 2013 a former nurse asked the U.S. Supreme Court to resolve a circuit split, which she claims the Sixth Circuit created when it found that the nurse’s admitted failure to follow the hospital’s procedures for logging interrupted meal breaks and correcting payroll errors precluded her from seeking damages under the Fair Labor Standards Act (FLSA).
Healthcare Industry Legal Alert: The Companionship Exemption for Agency Employed Home Care Workers May End As Early As This Month. Are You Prepared to Defend Your Agency Against the Lawsuits That Will Follow?
Executive Summary: It has been reported that the Department of Labor (DOL) will issue a rule this month revising its regulations to eliminate the Fair Labor Standards Act’s (FLSA) companionship exemption for agency-employed home care workers. This rule will expose home care agencies to significant wage and hour liability they never had before. Yet, agencies can take steps to limit their exposure to individual and class action lawsuits for overtime, other violations of the FLSA, and accompanying state law claims.
Eighth Circuit Requires Arbitration of FLSA Claim and Rejects Board Decision in D.R. Horton
Executive Summary: The Eighth Circuit recently upheld the validity of a mandatory arbitration agreement containing a class action waiver and ordered the arbitration of an employee’s collective action under the Fair Labor Standards Act. See Owen v. Bristol Care, Inc. (Jan. 7, 2013). In reaching this decision, the Court rejected the analysis of the National Labor Relations Board (NLRB) in D.R. Horton, Inc., which held that class action waivers violate employees’ rights under the National Labor Relations Act (NLRA).
Untangling Healthcare Reform Form W-2 Reporting Requirements for PEOs
Executive Summary: With the re-election of President Obama and the Supreme Court’s recent decision upholding portions of the Affordable Care Act (the “ACA”), health care reform is here to stay for the foreseeable future. Though limited challenges to the law are still pending, employers must prepare to comply with the many ACA requirements of 2013 and beyond.
Legal Alert: Eleventh Circuit Finds DHL Express Not a Joint Employer under FLSA
Executive Summary: On July 9, 2012, a federal appeals court in Georgia affirmed the dismissal of DHL Express, Inc., from a lawsuit brought by a class of current and former delivery drivers alleging overtime violations under the Fair Labor Standards Act (“FLSA”). According to the court, an assessment of the economic realities of the case did not reveal an employment relationship between DHL and the drivers.
Legal Alert: New Authority Concerning Tax Treatment of Tips
The Revenue Ruling discusses the assessment of employer FICA taxes on tips, including the application of section 3121(q) of the Internal Revenue Code (the “Code”) and the application of the credit allowed under section 45B of the Code, but warns that it is first necessary to determine whether a payment is actually a “tip” for these purposes, noting that it makes no difference what the payment might be called. Even though described as a “tip,” a payment that constitutes a “service charge” is wages, and is subject to withholding and reporting as such.
Legal Alert: Supreme Court Finds Pharmaceutical Sales Reps Exempt
The U.S. Supreme Court held today that pharmaceutical sales representatives qualify as “outside salesmen” and, accordingly, are exempt from the overtime requirements of the federal Fair Labor Standards Act (FLSA). See Christopher v. SmithKline Beecham Corp. (No. 11-204, U.S. June 18, 2012). Importantly, the Court also refused to give controlling deference to the Department of Labor’s (DOL) change of position in interpreting the regulation to exclude these employees, which was first announced in amicus briefs filed in court litigation. The Court noted that where, as here, an agency’s announcement of its interpretation is preceded by a lengthy period of conspicuous inaction, “the potential for unfair surprise is acute.”