Just a few weeks ago, we posted our latest update  on the Department of Labor’s proposed new overtime rule, which calls for a more than doubling of the salary level threshold for white collar exempt positions. At that time, we reported on the House Education and Workforce Committee’s renewed inquiry into the DOL’s outreach efforts, which some saw as an attempt by Congress to somehow delay or affect the issuance and implementation of the final rule.

Perhaps in an effort to avoid further delay, the DOL recently sent its proposed rule to the White House Office of Management and Budget for review, ahead of the expected schedule. So now, instead of an anticipated final rule date of July, it is possible that we could see a final rule in April or May.  Like much of what happens in Washington these days, it is likely that the timing of the rule is politically motivated and connected to the Presidential election.  Given the timing of the Congressional legislative review process, it is possible that if the regulation is issued after mid-May, there is risk of reversal, particularly if a Republican candidate is elected President.

As always, we will continue to provide updates on this important legislative initiative as we get closer to the issuance of a final rule.

lunch9568375.jpgBack in December, we wrote about a case involving the Chicago Police Department, in which officers alleged that they were owed additional overtime for time spent responding to calls and messages on their Blackberry devices, but which they failed to report in accordance with Police Department procedures. The court ruled for the City, holding that while the officers may have worked hours for which they weren’t paid, the City was not liable because it did not have actual or constructive knowledge of the uncompensated work. It was a clear win for the City and for employers in general. But before anyone gets carried away, they should read a subsequent decision from another judge in the Northern District of Illinois that illustrates the limits of the idea that employers are not on the hook for work they don’t know about.

In Caggiano v. Illinois Department of Corrections (.pdf), Michael Caggiano, a former DOC employee, sued the Department alleging that the DOC violated the FMLA by firing him due to absences that he claimed should have been protected FMLA leave. The DOC asked the court to dismiss the case on summary judgment without a trial, but the court rejected that motion, holding that Caggiano presented enough evidence to take his claims to a jury. Our colleague Jeff Nowak previously wrote about Caggiano in our sister blog, FMLA Insights, where he focused on one aspect of the court’s ruling – specifically, the DOC’s failure to designate a “rolling” 12-month period as the basis for calculating FMLA leave. Here, we’ll focus on another argument advanced by the DOC: that Caggiano wasn’t eligible for FMLA leave for at least part of the period in dispute because he had not worked enough hours.

Why are we writing about an FMLA case in our wage & hour blog? 

Employees are eligible for FMLA leave only if they have worked at least 1250 hours during the 12 months preceding the start of an FMLA leave. In support of its motion for summary judgment, the DOC argued that Caggiano worked seven and a half hour shifts, and that according to his time records he had not worked enough hours to qualify for FMLA leave during at least part of the period in dispute in the case. Caggiano argued that in fact he had worked enough hours to be eligible for FMLA leave, because he never took the 1/2 hour lunch break that was provided for in his schedule. To the contrary, he claimed that because his shift was understaffed, he was not able to be relieved at lunch, and instead ate on duty in the dayroom with inmates.

This difference is where the FLSA comes into play. According to the regulations governing the FMLA, the 1250 hour requirement is measured in the same way as “hours worked” for purposes of the FLSA. Consequently, an employee can be entitled to FMLA leave based not just on hours recorded or paid, but also on any additional “off the clock” work that the employee might perform during the 12-month measuring period.

Ignorance is not bliss for employers.

For its part, the DOC argued that even if Caggiano did work through his lunch, DOC management was never aware of it, and that the time therefore should not count as “hours worked” for purposes of either the FLSA or FMLA. The DOC presented evidence including an affidavit from Caggiano’s supervisor asserting that he never observed, ordered or required Caggiano to work through his lunch break, and another affidavit from the facility’s Superintendent asserting that he would have approved an overtime request if Caggiano reported that he had worked thorugh his lunch. Indeed, Caggiano’s time sheets showed that Caggiano never claimed overtime for working through lunch.

While the court acknowledged that Caggiano’s testimony that he worked through lunch was “self-serving” and was contradicted by the DOC’s evidence, it nevertheless held that the testimony was enough to create a factual issue that had to be decided by a jury at trial instead of by the court on the DOC’s motion for summary judgment. Further, the court rejected the DOC’s argument that the Caggiano’s claim should be rejected due to a lack of evidence that the DOC actually knew Caggiano was working through his lunch, holding that the DOC bore the burden of establishing that it took adequate steps to prevent any unauthorized work:

Defendant also argues that it should prevail because Plaintiff did not “present[] evidence that he had personal knowledge that any of his IDOC supervisors or other personnel knew tht he worked through his 30-minute lunch break.” Defendant does not cite any support for this requirement, and the FLSA regulations impose a duty on management only. 29 C.F.R. § 785.13 (placing an affirmative duty on employers to oversee employees, and not rely on promulgated rule only). At this time, it is not clear whether plaintiff worked through his lunch breaks, but it is clear that defendant had a duty to ensure that plaintiff was not working through his breaks if it did not want him to. Whether defendant met this duty remains a genuine issue of material fact.

What should employers do?

This case doesn’t break any particularly new ground, but it does illustrate a long-running theme for employers dealing with “off the clock” claims. When employees claim that they are working off the clock, the burden of proof is effectively on the employer to show that this is not the case. Caggiano was decided on summary judgment, so it remains to be decided whether Caggiano did or did not work the extra hours that he claimed. But the Court’s ruling makes it clear that employers face a steep uphill battle in these cases, particularly at the summary judgment stage.

So what can employers do to minimize their risk?

  • Clear policies and sound time recording procedures are a must. Clearly instruct employees not to work through lunch and to record all of their work hours. Conduct periodic reviews to ensure that they actually follow instructions.
  • Minimize opportunities for off the clock work whenever possible. If you don’t want employees answering e-mail after hours, don’t give them remote access to their work email. If you don’t want them working through lunch, don’t allow them to eat lunch in working areas where they are likely to be interrupted.
  • Avoid automatically deducting time from an employee’s workday for unpaid lunches or other breaks. Instead, make employees affirmatively record their breaks by punching out when they go on break, and back in before resuming any work. Or, if that is not feasible, at least make sure that employees are given clear instruction on how to report any extra time in the event that their lunch period is interrupted, and again make sure that employees actually report their time when interruptions do occur.

Measures like these may not have been enough to swing the pendulum on summary judgment for the DOC, but they would certainly strengthen an employer’s case at trial.

Since June, we have written a number of posts covering the Department of Labor’s proposed new overtime rule (see our posts here), and the more than doubling of the salary level threshold for white collar exempt positions. The proposed increase in the salary threshold was quite polarizing and resulted in nearly 300,000 comments. Despite the number of comments, in September, the DOL reported to the House and Senate that it would not extend the 60-day public comment period. At that time, the DOL expressed the belief that it “produced a quality regulation” resulting from the public outreach the Department conducted between March 13, 2014, when President Obama directed the agency to update its regulations, and September 4, 2015, when the public comment period ended. Apparently, not satisfied with this response, on February 12th, the House Education and Workforce Committee renewed its inquiry into the DOL’s outreach efforts, requesting that the DOL provide evidence of meetings, telephone calls, and other communications demonstrating the DOL’s outreach activities. This request signals an attempt by some members of Congress to somehow delay or affect the issuance and implementation of the final rule. We will continue to provide updates on the proposed new rule as the anticipated date of issuance approaches. 

Miniature U.S. flagOver the last few months we’ve been asked on an almost daily basis when the DOL will be publishing its hotly anticipated white collar exemption rules. The short answer is still, we don’t know. A few months ago, the word was “late 2016,” which made some sense due to the extremely high volume of comments the DOL received during the 60-day public comment period.* Now, signs point to an earlier release.

According to Law360, DOL Solicitor M. Patricia Smith told attorneys at a New York State Bar Association meeting that the final rules would likely be published in July 2016. Assuming an effective date 60 days after release of the final rules, a July release would mean that employers have to comply with the new rules by September 2016. The DOL’s current regulatory agenda for the new rules also lists an anticipated final rule date of “7/00/2016.”

So what does this mean for employers?

First, if you haven’t already figured out how to address the immediate increase in the minimum salary for most exempt positions from $455 per week to an expected $970 per week, you had best get to work. Start looking now at exempt jobs with salaries below about $51,000 per year. Figure out how many hours those employees work and whether it would be better to re-classify them as non-exempt (meaning you need to track hours and pay overtime) or bump up their salaries to meet the new threshold.  Also figure out how those changes affect the rest of your compensation schedule. If salary compression at the low end of your scale is already an issue, this is only going to make things worse.

Second, remember that this is not a one-time problem. The new rules provide that the minimum salary level will be adjusted annually based on the 40th percentile of non-hourly paid employees. While this seems innocuous enough, a small wrinkle that may not be immediately apparent is that the 40th percentile will adjust from year to year. Once the new rules take effect, this means that the bottom of the sample will effectively drop away, making the 40th percentile in the following years correspondingly higher. According to at least one analysis, the proposed formula could lead to a minimum salary level of $1,393 per week ($72,436 per year) after just five years. Even if that estimate is high, you should assume that the minimum salary will continue to rise, perhaps significantly, and plan accordingly.

Third, salary levels should not be your only concern. While the DOL did not propose any changes to the current duties tests, the Department did ask for public feedback on some possible changes. In particular, the Department inquired about changes to the way that “primary duties” are measured. Currently, the regulations define “primary duties” qualitatively. An employee’s primary duties are the most important parts of the job. They are not necessarily the duties that the employee spends the majority of their work time performing, and there is no fixed limit on the amount of time an exempt employee can spend on non-exempt work. The DOL specifically requested comments on whether to change that approach, and may be considering a shift to a test more like California’s, which puts the burden on employers to show that exempt employees spend at least 50% of their working time performing exempt work.

Any changes to the duties tests in the new final rules are likely to face some serious court challenges. However, employers shouldn’t pin their hopes on litigation alone. Start looking at your exempt positions and analyzing which ones may be at risk if the duties tests do change. If you need to re-classify any employees, the period between issuance of the final rules and their effective date is your window to make the change. It’s going to be a narrow one, so don’t miss the opportunity.

*For those of you keeping track, the number is 293,371. You can read them all here. If you spend an averge of three minutes on each comment and read nonstop, it should only take you about 68 days to get through them all.

Joint Employment.pngIn our previous post about the DOL’s new Administrator’s Interpretation (“AI”) on joint employment under the FLSA, we focused on “vertical” joint employment. That’s the variety of joint employment that exists when there is some sort of intermediary, like a staffing firm, PLA, or temp agency between the employee and the employer that is ultimately benefitting from the employee’s work. In this post, we will focus on the other flavor of joint employment discussed in the new AI: horizontal joint employment.

What is Horizontal Joint Employment and Why Does It Matter?

To understand horizontal joint employment, consider an employee – let’s call her Betty – who works two jobs at two different restaurants. In the mornings, she works at Eggceptional Cafe, a breakfast and lunch place. Then in the evening, she works at Le Bistro Employeur Commune, an upscale French eatery. Suppose Betty puts in 25 hours per week at each restaurant.

If the Cafe and the Bistro are separate employers, Betty doesn’t earn any overtime even though she is working a total of 50 hours per week between her two jobs. But what if both the Bistro and the Cafe are owned by the same guy, Tom? Suppose that Tom is a hands-on sort of owner who gets directly involved in the management of both restaurants. And suppose that employees of one operation, like Betty, frequently work at the other. In fact, Tom encourages it because it allows him to offer full-time employment to good employees and avoids scheduling conflicts with other jobs.

While we might want to know a few more facts about the interaction between the two businesses, it seems likely that the Bistro and the Cafe would be considered joint employers in this scenario. That’s potentially significant for both Betty and Tom. It means that instead of two separate 25-hour per week jobs, Betty has, at least for this purpose under the FLSA, one 50-hour job, for which she is entitled to 10 hours of overtime pay.

As with vertical joint employment, there is no single test or factor that will exclusively determine whether two employers will be regarded as joint employers under the FLSA. Different courts have applied different tests and, not to be outdone, the DOL endorses its own non-exclusive list of nine questions that are relevant to the analysis. These include:

  1. Who owns the potential joint employers (i.e., does one employer own part or all of the other or do they have any common owners)?
  2. Do the potential joint employers have any overlapping officers, directors, executives, or managers?
  3. Do the potential joint employers share control over operations (e.g., hiring, firing, payroll, advertising, overhead costs)?
  4. Are the potential joint employers’ operations inter-mingled (for example, is there one administrative operation for both employers, or does the same person schedule and pay the employees regardless of which employer they work for)?
  5. Does one potential joint employer supervise the work of the other?
  6. Do the potential joint employers share supervisory authority for the employee?
  7. Do the potential joint employers treat the employees as a pool of employees available to both of them?
  8. Do the potential joint employers share clients or customers? and
  9. Are there any agreements between the potential joint employers?

What Does This Mean For Employers?

While the new AI does not break any particularly new ground regarding horizontal joint employment, it does signal that the DOL intends to push the boundaries of the joint employer doctrine under the FLSA to make it “as broad as possible.” That means that businesses owned or controlled by the same parent corporations or groups of individuals need to consider the impact of possible joint employment, even if their various operations are separated into distinct legal entities. The issue isn’t limited to the for-profit sector. For example, a medical center or foundation affiliated with a university could share staff and resources with the unviersity in ways that might raise questions of whether they are joint employers.

So what can employers do about this? In our example above, if Tom wanted to ensure that his restaurants are not joint employers for any purpose, he would need to take steps to ensure that they are each separately managed, with their own payroll, separate schedules, etc. If that isn’t feasible for Tom, there are also some relatively simple steps that Tom could take to address any overtime issues under the FLSA. For example, he could adopt a policy of not employing the same individuals at more than one restaurant in any given workweek. Alternatively, Tom could manage schedules to ensure that no employee works more than 40 hours total between the two restaurants. Or he could simply track and pay overtime as needed. The key, as with many wage and hour issues, is spotting the potential problem, and then doing something about it before you are audited by the DOL or served with a class action lawsuit.

By Guest Author: Michael A. Warner, Jr.

In recent years, one tactic for attempting to defeat wage and hour class and collective action lawsuits class action lawsuits has been to offer the named plaintiffs full relief for their individual claims in the case. Even if the offer is declined, the theory goes, the offer renders those plaintiffs’ claims moot. And under the Supreme Court’s 2013 ruling in Genesis Healthcare v. Symczyck (.pdf), if the named plaintiff’s claims become moot before a class is certified, the case goes away. No class representatives, no class, case dismissed.

However, the key premise underlying this strategy – that merely offering a plaintiff full relief renders their claim moot, even if the offer is not accepted – was never actually endorsed by the Supreme Court. In Genesis, the Court simply assumed that the named plaintiff’s claim was moot because the plaintiff didn’t argue that issue on appeal. In her dissenting opinion, Justice Kagan questioned that assumption, suggesting that the Court should have taken up the question of whether an unaccepted settlement offer can actually moot a named plaintiff’s claim and defeat a class or collective action.

Last week, the Supreme Court finally answered that question with its decision in Campbell-Ewald Co. v. Gomez (.pdf). The answer: No.

Gomez centered around a plaintiff who claimed to have received unsolicited advertising text messages in violation of the Telephone Consumer Protection Act (TCPA). The plaintiff’s lawyer filed the case as a class action. Before the deadline for class certification, the defendant made a settlement offer that would have provided the individual plaintiff with full relief if the plaintiff had accepted it. The plaintiff, however, didn’t take the bait. The defendant argued that even though the plaintiff rejected the settlement offer, the offer rendered the plaintiff’s claim moot and required dismissal of the lawsuit. The district court didn’t buy that argument, but nevertheless dismissed the case on other grounds. The plaintiff appealed to the Ninth Circuit Court of Appeals, which reversed the dismissal but agreed with the district court that the unaccepted settlement offer did not moot the class action.

The Supreme Court affirmed the Ninth Circuit’s ruling. By a 6-3 vote, the Court expressly adopted the reasoning of Justice Kagan’s prior dissent in Genesis, holding that the unaccepted offer did not moot the individual named plaintiff’s claim and, therefore, did not defeat the class action.

What This Means For Employers

The ruling in Gomez takes away one potentially useful strategic option for class action defendants, including employers defending wage and hour cases. That being said, the strategy was never widely used because of several drawbacks. First, it worked only if the defendant was willing to offer full relief to all of the named plaintiffs, and only if the plaintiff’s lawyer couldn’t find anyone else willing to step up and put their name on the case. Unless the amounts owed to each plaintiff are very small indeed, that can start to get expensive. Second, many courts were skeptical of this approach even before Gomez, making it far from a sure thing that a settlement offer would result in dismissal of the class claims.

If employers take any lesson from the case, it’s that it’s much better to deal with wage and hour issues up front by remaining in compliance than after the fact in litigation.

Vertical joint employmentOn January 20, 2016, the Wage and Hour Division of the U.S. Department of Labor issued a new Administrator’s Interpretation (“AI”) on the issue of joint employment under the FLSA. What is joint employment? The FLSA generally applies only to “employers.” If a company or organization is an “employer” of a given employee, it’s responsible for ensuring that the employee is paid in compliance with the FLSA. In many cases, it’s easy to identify the employer of a given employee – its name appears on the employee’s paycheck. But sometimes, the situation is more complicated.

In the new AI, the DOL states that the definition of “employ” under the FLSA is “expansive,” and should be construed to be “as broad as possible.” One consequence of this is that at any given time and for any given employee, there may be multiple entities that qualify as “employers” of that employee. When this occurs, the two entities are “joint employers.” In the new AI, the DOL discusses two forms of joint employment: vertical and horizontal. We’ll talk about horizontal joint employment in a separate post. Here, we will focus on the vertical variety.

What is vertical joint employment and why does it matter?

To understand this concept, consider the typical temporary employment scenario. Your company (we’ll call it Acme) needs some temps to help out in the warehouse during the holiday season. So you go to a temp firm, Temps R Us, and ask them to send over five people. For the time period during which those temps are working at Acme, the DOL would probably take the position that Acme and Temps R Us are joint employers of the five.

Why does that matter to Acme? Suppose that Temps R Us fails to pay the temps the minimum wage for all of their work hours, or that it fails to pay them overtime at the correct rate when they work more than 40 hours in one week. The employees certainly can sue Temps R Us if they like. But because Acme is a joint employer, they can also sue Acme to recover their unpaid wages.

Wait just a minute, you might be saying to yourself. How can they sue Acme? Didn’t Acme contract out responsibility for dealing with payroll and overtime to Temps R Us? It wasn’t Acme’s fault if Temps R Us dropped the ball. While that might be true, the point of the joint employment doctrine is that there are some responsibilities, including compliance with the FLSA, that an employer cannot contract out to a third party. Or, more precisely, you can contract out the work, but you’re still on the hook for the results.

So does this mean that you risk liability for wage and hour violations every time you have an outside vendor sending people into your facility? Fortunately, no. Consider for example what happens when Acme has a leaky toilet. Acme doesn’t employ its own plumbers – it calls a local plumbing contractor to come over and fix the leak. If the contractor is an individual, that person would likely be considered an independent contractor, not an employee, for purposes of the FLSA, because they are not “economically dependent” on Acme for their work according to the DOL’s test. They’re in business for themselves. (See our post on the DOL’s recent Administrator Interpretation on independent contractors for a discussion.) The same is true if the plumber sends over one of her employees to fix Acme’s leak: the worker is legally regarded as an employee of a separate business, because that separate business is not economically dependent upon Acme.

Of course, just like the line between independent contractor and employee, the line between mere customer and joint employer is not always so easy to discern. As explained in the new AI, there are many different factors that may be relevant to this analysis, and different courts considering the issue have formulated the inquiry in different ways. However, the DOL focuses particular attention on a seven-factor test drawn from the regulations governing the Migrant and Seasonal Acricultural Worker Protection Act (“MSPA”). The factors used there are:

  1. The extent to which the work performed by the employee is controlled or supervised by the potential joint employer “beyond a reasonable degree of contract performance oversight.”
  2. The extent that the potential joint employer has the power to hire or fire the employee, modify employment conditions, or determine the rate of pay.
  3. The degree of permanency of the relationship between the employee and potential joint employer.
  4. The extent to which the employee’s work for the potential joint employer is repetitive, rote, unskilled, and/or requires little or no training.
  5. The extent to which the employee’s work is integral to the potential joint employer’s business.
  6. Whether the employee performs work on premises owned or controlled by the potential joint employer.
  7. Whether the joint employer performs administrative functions in relation to the worker, such as handling payroll, providing workers’ compensation insurance, furnishing facilities and safety equipment, providing housing or transportation, or furnishing tools and material required for the work.

If this list seems similar to the list of factors for determining whether a worker is an employee versus an independent contractor, that is no coincidence. The DOL maintains that the ultimate question in both cases is the same: is the worker economically dependent on the potential employer/joint employer?

What Should Employers Take Away From The New AI?

The DOL’s latest AI doesn’t necessarily break any unprecedented legal ground in its analysis, particularly when viewed in light of the AI on independent contractors issued last summer. However, it does shine a spotlight on an areas that many employers simply don’t consider when they think about wage and hour compliance.

If your organization uses temps, contract workers, leased workers, or similar personnel, here are some of the issues you should be considering:

  1. Employers are responsible for ensuring that all of their employees are properly paid. In many cases this includes workers who are employed indirectly or by a third party, such as temps or workers employed by a contractor or PLA.
  2. This means that employers can be liable for a vendor’s screw-up. If your temporary staffing agency isn’t paying minimum wage, or isn’t paying people overtime at the proper overtime rate for all hours worked over 40 in a single workweek, that’s your problem as well as theirs. This means that you need to pay attention to your business partners. Choose reputable, well-established firms, even if it means paying a little bit extra. And ask about legal compliance including wage and hour compliance before you contract with anyone to provide labor for your organization. Don’t use staffing firms that have a history of wage and hour violations or that have a casual attitude toward recordkeeping and payroll.
  3. If you get wind that anyone working for your organization via a vendor is not being properly paid, don’t just dismiss it as “not my problem.” Look into it immediately, and insist that the vendor correct any issues that may arise. If they don’t, find a new vendor.
  4. Employers who use staffing firms, temp agencies, employee leasing arrangements, etc., need to carefully look at the legal documents establishing these relationships. Most staffing agency agreements are bare-bones and deal mostly with the fees due to the staffing agency. They are not designed to protect the client’s interests. Before any workers set foot on your worksite, insist on language in your agreement expressly delegating responsibility for wage and hour compliance to the vendor and obligating vendor to indemnify and defend your company if they fail to pay people as legally required. You might still be sued, but at least an indemnity clause gives you a better chance of recovering any resulting expenses.

As we reported back in October 2015 a car dealership, Encino Motorcars, petitioned the Supreme Court to “restore uniformity” to the enforcement of legal precedent and hold that service advisors are exempt from the FLSA’s overtime requirements.  On Friday, the Supreme Court agreed to hear the case and hopefully resolve the issue once and for all as to whether service advisors are entitled to overtime pay.

The Salesman Exemption

To recap, the Fair Labor Standards Act (FLSA) explicitly exempts “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles” from the Act’s overtime pay requirement.  Service Advisors primarily sell vehicle servicing work to customers, and often times they are paid on commission.  This has led many dealerships to treat these employees as exempt “salesman.”  The Department of Labor (DOL) and the courts are in conflict on this issue.   Legal precedent supports the dealers, with the Fourth and Fifth Circuits previously holding that service advisors are salespeople, and thus exempt from the overtime provisions of the FLSA.  However, in 2011, the DOL changed its (previously) long-standing enforcement position and stated that it would no longer consider service advisors exempt from overtime under the “salesman” exemption, concluding that the exemption was limited “to salesmen who sell vehicles and partsmen and mechanics who service vehicles.”

The Ninth Circuit Rules Service Advisors Are Non-Exempt

In September 2012, service advisors sued the dealership for unpaid overtime, claiming that they were not exempt because they did not sell cars or perform repairs. The lawsuit was initially dismissed by the District Court but was given new life by the Ninth Circuit on appeal.  In March 2015, in Navarro et al. v. Encino Motorcars, LLC, the Ninth Circuit held that the dealership’s service advisors were non-exempt employees under the FLSA.  The Court, relying on the DOL’s guidance, held that because the service advisors neither sold nor personally serviced vehicles, they were not exempt from the overtime provisions of the FLSA.  This decision was in direct conflict with the prior decisions out of the Fourth and Fifth Circuits, which declined to adopt the DOL’s position. Encino Motorcars then appealed the case to the Supreme Court to address this split and make a final determination as to whether service advisors are exempt from the FLSA overtime requirements.

The Dealership Petitions the Supreme Court

In its petition to the Supreme Court, the dealership argued that the service advisors are “salesmen primarily engaged in servicing automobiles.” Additionally, the dealership argued, among other things, that the DOL’s interpretation is unreasonable, and undeserving of deference, because it “injects a glaring textual anomaly over the status of ‘partsmen,’ who the statute treats as exempt even though they are not personally involved in either selling or servicing automobiles.”  The dealership cautioned that the Ninth Circuit’s erroneous decision has far-reaching implications and further injects uncertainty over prior legal precedent.

The service advisors countered, urging the Supreme Court to pass on the case. The service advisors claimed that this was not an issue of national concern and any ruling would be limited, citing to what they characterized as a “skeletal record” on appeal that would not adequately address the exemption of service advisors generally.

Although the Supreme Court agreed to hear the case, it gave no insight or explanation as to its reasons for doing so.  While we are hopeful that the Court will finally address this issue for dealers stuck in limbo, we will have to wait and see the ruling. 

We will continue to follow this case and keep you up-to-date on the Supreme Court’s decision.  In the meantime, please contact us if you have any questions about how to classify your service advisors pending the Court’s decision.

Close up of lights on police carIf a tree falls in the forest but there is no one around to hear, does it make a sound? If a non-exempt worker answers an e-mail message after hours on her Blackberry but fails to put in for overtime, has she performed compensable work? While I’m not aware of any firm legal authority on the first question, a recent ruling by the U.S. District Court for the Northern District of Illinois offers a detailed and instructive analysis of the second. 

In Allen v. City of Chicago, a group of 51 of current and former officers in the Chicago Police Department’s Bureau of Organized Crime (“BOC”)  alleged that the City willfully violated the FLSA by requiring them to use their Blackberry devices for work-related communications while they were off duty without compensation. 

Continue Reading City Not Liable For Chicago Police Officers’ Blackberry Work Time