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Federal District Court Rejects Obama Overtime Rule

Posted in Case Notes Commentary Monday Morning Review on By Lann McIntyre

A federal district judge in Texas has invalidated Obama overtime regulations which would have made it more likely states and local governments would have had to pay more employees overtime.

Per the Fair Labor Standards Act (FLSA), executive, administrative, and professional “white collar” employees do not have to be paid overtime if they work more than 40 hours a week. Per Department of Labor (DOL) regulations, adopted shortly after the FLSA was adopted in 1938, employees must perform specific duties and earn a certain salary to be exempt from overtime as white collar employees.

On May 23, 2016, DOL issued final rules nearly doubling the previous salary level test for white collar employees from $455 per week, or $23,660 per year, to $913 per week, or $47,476 per year. The rules also automatically updates the salary level every three years for white collar employees.

According to the Judge Mazzant, DOL does not have the authority to adopt a salary test that effectively eliminates the duties test, which is what the final rule does. The text of the final rule explicitly says that those earning less than $913 will be eligible for overtime “irrespective of their job duties and responsibilities.” The court likewise concluded that the automatic updating mechanism is unlawful.　 Continue reading →

 

Supreme Court Will Be “Doing the Math” in an FLSA Class Action Case

Posted in Case Notes Commentary on By Lisa Soronen, Executive Director, SLLC

Tyson Foods v. Bouaphakeo presents a classic legal dilemma:  two lines of cases, one older and one newer, neither exactly on point.  Which will the Court pick or will it craft a new test?

More pragmatically, local governments will be interested in this case because it involves the Fair Labor Standards Act (FLSA). Given the difficulties of complying with this complex law, no employer is immune from the possibility of FLSA litigation.

One of two questions the Supreme Court will decide in Tyson Foods v. Bouaphakeo is whether a representative sample may be used calculate liability and damages for an entire class of workers. The other question is whether a class may include hundreds of members who weren’t affected. Continue reading →

 

Supreme Court Rules No Pay for Passing through Security Screenings

Posted in Case Notes Commentary IMLA Briefs on By Lisa Soronen, Executive Director, SLLC

In a unanimous opinion in Integrity Staffing Solutions v. Busk, the Supreme Court held that the Fair Labor Standards Act (FLSA) does not require hourly employees to be paid for the time they spend waiting to undergo and undergoing security screenings.  Government employees who work in courthouses, correctional institutions, and warehouses routinely go through security screening at the beginning and/or end of the workday.   SCT stairs

Jesse Busk and Laurie Castro worked at warehouses filling Amazon.com orders.  They claimed that they should have been paid for the time they spent waiting and going through security screenings to prevent theft at the end of each shift.

Under the FLSA employers only have to pay “non-exempt” employees for preliminary and postliminary activities that are “integral and indispensable” to a principal activity.  According to the Court, an activity is “integral and indispensable” to a principal activity “if it is an intrinsic element of those activities and one with which the employee cannot dispense if he is to perform his principal activities.”  The Court concluded that security screenings were not intrinsic to retrieving and packing products and that Integrity Staffing Solutions could have eliminated the screenings altogether without impairing employees’ ability to complete their work. Continue reading →