Tag Archives: FLSA

Overtime Rule Update: DOL Defends Power to Set Salary Threshold

The U.S. Department of Labor continues to work towards dismantling the Obama administration’s overtime rule, saying that it intends to revise the controversial rule to lower the salary threshold under the Fair Labor Standards Act’s white-collar exemptions. The Obama administration’s rule sought to more than double the current salary requirement of $23,660 a year for white-collar exemptions. Though the rule was estimated to make 4 million additional workers eligible for overtime pay, it was also expected to cause employers significant financial and regulatory burdens.… Continue Reading

Overtime Rule Update: DOL To File Request for Information In Two to Three Weeks

One of the most controversial regulatory actions from the US Department of Labor during the Obama administration was the DOL’s regulation significantly increasing the salary level under the Fair Labor Standards Act’s white-collar exemptions. The regulation sought to more than double the current salary requirement of $23,660 per year, and it included an automatic updating requirement that would have accelerated future salary level increases at a rate well above the rate of inflation. … Continue Reading

Plaintiff Lacks Standing to Pursue Claim that Was Discovered After Bankruptcy Filing

Recently, we discussed a decision that considered whether a former employee’s failure to initially list an employment discrimination claim on her bankruptcy schedules barred her from pursuing the claim against her former employer under the doctrine of judicial estoppel. The U.S. District Court for the Southern District of Texas considered the related question of whether a former employee plaintiff must reopen her bankruptcy case to list a Fair Labor Standards Act claim for failure to pay overtime wages and other claims discovered after the employee filed bankruptcy. … Continue Reading

Supreme Court Will Rule On Legality of Class Action Waivers in Employer Arbitration Agreements

The United States Supreme Court has granted consolidated review of three cases to determine whether arbitration agreements that waive employees’ rights to participate in a class action lawsuit against their employer are unlawful. The Court’s decision to address the uncertainty surrounding class action waivers of employment claims follows a circuit split last year in which the Fifth and Eighth circuits upheld such waivers and the Seventh and Ninth circuits found that such waivers violate the National Labor Relations Act. Given the increasingly widespread use of class action waivers by employers to stem costly class and collective actions, the high court’s ruling is likely to have a significant nationwide impact.… Continue Reading

4th Circuit Significantly Expands Joint Employer Liability Under FLSA With Incredibly Broad New Test

Much has been written about the National Labor Relations Board’s controversial Browning-Ferris decision that significantly expanded the scope of joint employer liability under the National Labor Relations Act. But virtually no attention has been given to the Fourth Circuit Court of Appeals’ recent panel decision in Salinas v. Commercial Interiors, Inc., No. 15-1915 (4th Cir. … Continue Reading

DOL Overtime Rule Preliminarily Enjoined; No Employer Action Required By December 1st

On November 22, a federal judge in the Eastern District of Texas preliminarily enjoined the Department of Labor’s final overtime rule, which would have expanded overtime eligibility to executive, administrative, and professional employees making less than $47,476 per year, who were previously exempt from the Fair Labor Standards Act’s requirements under its white collar exemption. The final rule was scheduled to go into effect on December 1, 2016.… Continue Reading

Federal Judge in Texas Appears Poised to Grant Injunction Putting Labor Department’s Overtime Rule On Hold

On November 16, 2016, Judge Amos L. Mazzant, heard more than three hours of oral argument from a group of 21 States (“State Plaintiffs”) challenging the Department of Labor’s new overtime rule. Following the hearing, the motion for a preliminary injunction of the rule was taken under advisement and a ruling is forthcoming on Tuesday, November 22,2016. Judge Mazzant’s pointed criticism of the rule during argument suggests employers may have reason to be optimistic.… Continue Reading

Seventh Circuit Bucks the Trend and Creates a Circuit Split Regarding Enforceability of Employment Class Action Waivers

With its May 26 Lewis v. Epic-Systems Corp. decision, the Seventh Circuit became the first circuit to back the reasoning in D.R. Horton, Inc., 357 NLRB No. 184 (2012), and held that a mandatory arbitration agreement prohibiting employees from bringing class or collective actions against their employer violates the National Labor Relations Act (NLRA). This decision creates a circuit split regarding the enforceability of arbitration agreements with class action waivers in the employment context, and the issue is now ripe for potential Supreme Court review.… Continue Reading

DOL Issues Much-Anticipated Overtime Rule – More Than Doubles Salary Requirement for FLSA Exemptions

Today, the U.S. Department of Labor published its final rule increasing the salary requirement for the Fair Labor Standards Act’s white-collar exemptions to $47,476 per year ($913 per week). Though the new salary level is not as high as the $50,440 per year level predicted by the DOL in its July 2015 proposed rule, the final rule nonetheless more than doubles the current salary requirement of $23,660 per year ($455 per week). … Continue Reading

Second Circuit Outlines Test for Individual Liability of Human Resources Directors under the FMLA

On March 17, 2016, the U.S. Court of Appeals for the Second Circuit decided Graziadio v. Culinary Institute of America, holding that sufficient evidence existed to find that the Culinary Institute of America’s (“CIA”) human resources director was an “employer” under the Family and Medical Leave Act (“FMLA”) and could therefore be held individually liable for violations of the FMLA.… Continue Reading

DOL Proposed Rulemaking – Paid Leave for Employees of Federal Contractors

The United States Department of Labor has announced a Notice of Proposed Rulemaking to implement Executive Order 13706, which requires federal government contractors to provide employees with up to 7 days of paid sick leave annually. As a result, the DOL estimates that employers will be compelled to provide additional paid leave to 828,000 employees, including 437,000 employees who do not currently receive any paid sick leave.… Continue Reading

Ninth Circuit Approves DOL Regulation Expanding Tip-Pooling Rules To All Employers

Under the Fair Labor Standards Act (FLSA), employers who use a tip credit to satisfy their minimum wage obligations for tipped employees must follow certain rules related to those tips. One of those rules relates to the use of tip pools – i.e., pooling of tips received by multiple tipped employees and then dividing the total among the pool participants based on a specified formula. … Continue Reading

Supreme Court Denies Review of Second Circuit Decision Compelling Court or DOL Approval of FLSA Settlements

The United States Supreme Court has denied a restaurant manager’s petition seeking review of whether parties may stipulate to the dismissal with prejudice of a lawsuit alleging violations of the Fair Labor Standards Act (“FLSA”), or whether judicial or Department of Labor (“DOL”) approval is a prerequisite to such a dismissal, as the Second Circuit held in his case, Cheeks v. Freeport Pancake House, Inc. Having declined the petition for writ of certiorari, FLSA lawsuits will remain more difficult to resolve for employers in New York, Connecticut, and Vermont. … Continue Reading

DOL Says Joint Employment Under FLSA and MSPA Should Be “As Broad As Possible”

On January 20, 2016, the administrator of the Department of Labor’s Wage and Hour Division (WHD), David Weil, issued an “Administrator’s Interpretation” (AI) regarding the agency’s interpretation of joint employment under the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (MSPA). … Continue Reading

9th Circuit Tosses Aside “Manager Rule” for FLSA Retaliation Cases; Holds HR Director May Pursue Claim

For years, there has been nearly universal agreement among the courts that managers do not engage in “protected activity” for retaliation claim purposes under most employment laws when they raise concerns about compliance issues in the regular course of performing their job duties. The traditional reasoning held that a manager whose job includes evaluating and/or reporting compliance issues, and who does so in furtherance of his or her job duties, should not become cloaked in anti-retaliation protection for merely doing the job he or she is employed to do. Instead, to engage in protected activity, the manager must step outside his or her role as a manager and become adversarial to the employer. … Continue Reading

Fourth Circuit Invalidates Employee Handbook Arbitration Clause

On November 24, 2015, the U.S. Court of Appeals for the Fourth Circuit refused to enforce an arbitration clause in an employee handbook on the grounds that the employee never agreed to be contractually bound by the handbook, and that a court can only compel arbitration where it is satisfied that the parties have agreed to arbitrate. This case, Lorenzo v. Prime Communications, L.P., should serve as a warning to employers to review their employee handbooks to be sure that provisions, like an arbitration clause, will be enforceable.… Continue Reading

D.C. Circuit Upholds DOL Rule Barring Third-Party Employers From Overtime, Minimum Wage Exemptions for Home Care Workers

On Friday, August 21, 2015, the U.S. Court of Appeals for the District of Columbia Circuit upheld the U.S. Department of Labor’s (“DOL”) 2013 rule extending FLSA overtime and minimum wage protections to employees of home health care agencies who provide “companionship services” or live-in domestic care.… Continue Reading

Second Circuit Rejects the DOL’s Rigid Intern Test and Adopts a Balancing Test

In a closely watched case, Glatt v. Fox Searchlight Pictures, Inc. (decided July 2, 2015), the Second Circuit rejected the Department of Labor's ("DOL") intern test under the Fair Labor Standards Act ("FLSA"), and adopted a balancing test that focuses on whether the employee or the employer is the primary beneficiary of the relationship ("primary beneficiary test").… Continue Reading

The United States Supreme Court’s Decision in Perez v. Mortgage Bankers Association and its Potential Impacts on Federal Agencies’ Rulemaking Authority

Federal agencies need not go through the formal and drawn-out "notice-and-comment" process when altering an interpretation of a regulation. In a unanimous decision, the Supreme Court in Perez v. Mortgage Bankers Association stated that the Administrative Procedure Act (the "APA") does not mandate notice-and-comment rulemaking for interpretive rules.… Continue Reading
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