Articles Posted in FLSA

On Sept. 25, Warner Bros. Pictures released “The Intern,” a film starring Robert DeNiro as an intern at an e-commerce fashion company. Two weeks earlier, in an event of potentially much greater significance to interns in Georgia and the employers who use them, the 11th Circuit Court of Appeals handed down a decision that revived the Fair Labor Standards Act case brought by a group of interns. It included a new, seven-part test for determining whether a worker is an intern or an employee for purposes of the statute.

The case involved a group of students pursuing masters’ degrees as registered nurse anesthetists. As a mandatory part of their educational program, students were required to complete a clinical curriculum. For Billy Schumann and 24 other Wolford College students, this consisted of spending 16 months as interns at Collier Anesthesia, a service provider in Naples, Fla. The interns were not paid for the services they provided at Collier.

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Security guards required by their employer to monitor the radio during their meal breaks were not entitled to pay for those breaks, as monitoring the radio and responding to possible emergencies did not transform the break into compensable time.

The case was decided by the U.S. Court of Appeals for the Sixth Circuit, which has jurisdiction for cases in states from Michigan to Tennessee. The plaintiffs were security guards at a casino in Detroit. Their employer granted them meal breaks in accordance with the Fair Labor Standards Act (FLSA) but with some restrictions. Namely, they were required to monitor the radio, and in case of an emergency, they would have had to respond. They were also required to stay on the premises during these breaks, but they were allowed to sit down, watch television, use the internet, and engage in generally any task they wished.

Under the FLSA, employers are required to pay nonexempt employees an overtime wage of 1.5 times their normal wage for every hour in excess of 40 the employee works in a seven-day work week. The question before the Sixth Circuit in this case was whether the duty to monitor the radio, although labeled as a meal break, constituted work. If the time was counted as work, the plaintiffs would have worked about 41.25 hours per week and would have been owed overtime.

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The Department of Labor is considering raising the minimum wage an employee must earn to be considered an overtime exempt employee. If the proposed rules raise the wage threshold as expected, millions of workers who thus far have been exempt from overtime pay could be eligible.

The federal law that controls overtime rules in Georgia and the rest of the United States is called the Fair Labor Standards Act (FLSA). The FLSA requires employers to pay employees an overtime wage of 1.5 times the employee’s normal salary for each hour in excess of 40 the employee works in a seven-day workweek.

However, the FLSA exempts many types of employees from the overtime mandate. This means that employers are not legally required to pay these overtime-exempt employees the time-and-a-half overtime wage. Whether an employee is exempt or nonexempt is determined by the primary duties of her job. The employer does not determine whether the employee is exempt or nonexempt.

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The Eleventh Circuit last month affirmed the basic principles of the Fair Labor Standards Act (FLSA) by denying an employer’s attempt to blame its employee’s conduct for the employer’s violation of overtime wage laws.

The case, Bailey v. TitleMax of Georgia, involved an FLSA overtime claim brought by an employee of the defendant. The plaintiff worked at TitleMax for approximately one year. During this time, the employee routinely worked off the clock at the direction of his supervisor, who erroneously asserted that the company did not pay overtime. Additionally, the supervisor also edited time records to underreport the hours the plaintiff worked. These practices resulted in overtime hours the employee worked but was not paid for.

The plaintiff brought a claim under the FLSA in federal court for unpaid overtime wages. In response to the lawsuit, the defendant contended that the employee’s violations of company policy absolved it from liability. The company adopted internal policies that required employees to accurately report their hours, regularly verify their hours, and report any problems at work to their supervisors or higher-level managers. Since the employee violated these policies, the defendant argued that it should be absolved from liability pursuant to a legal theory that prevents plaintiffs from recovering if they bear responsibility for their own injuries. The district court granted summary judgment for the defendant under this theory.

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Generally, an employer must pay employees overtime wages unless the employee is exempt under federal or state law. Determining whether an employee is overtime exempt can be difficult, especially if the employee’s duties are of a mixed nature. In a recent case, the Court of Appeals of Georgia noted that it often takes a fact-intensive inquiry into the specific duties of the employee.

The case, DeKalb County v. Kirkland, involved a claim by fire captains involving accrued compensatory time. The captains contended that the county should have allowed them to use their compensatory time or paid them for it. Part of the captains’ argument relied on a provision of the county code that prohibited cash payment for compensatory time for exempt employees. They argued that they were not, in fact, overtime exempt employees, and thus the county code did not forbid payment for their accrued compensatory time.

The Court of Appeals ultimately granted summary judgment for the county. The Court noted that the determination of whether an employee is overtime exempt or nonexempt relies on his or her actual job duties. Since the captains provided no evidence to prove that they were misclassified by the county, the court could not accept their argument. Had the captains provided some evidence of their specific job duties, the Court of Appeals may have had a much harder time making a determination.

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Perhaps drawing inspiration from the college bowl games and NFL playoffs, the world of employment law lately seems fixated on the intrigue of overtime, although more in the context of bonus pay than bonus play. While it may not be as thrilling as a Hail Mary pass or as heartbreaking as a missed kick (sorry, Auburn fans) to end the game, overtime as it relates to the Fair Labor Standards Act (FLSA) can have a major impact on both employers and employees, so it’s worth taking some time out from being an armchair quarterback to look at some of the latest developments.

Two big court decisions in December went against employees looking for overtime. The first came from the US Supreme Court in Integrity Staffing Solutions v. Busk. As covered previously on this blog, the case asked whether time—up to 25 extra minutes—spent in an internal security screening line at the end of one’s shift should be compensable. In a rare move for such divergent ideologies, the justices were unanimous in rejecting the notion that time spent in the line deserves to be time on the clock. Continue reading ›

The economic downturn that began in 2008 changed a lot of things about the job market. Apart from the jump in unemployment rates, may of the jobs that were available were no longer the full-time positions that traditionally served as the norm for the workforce. More roles were converted to part-time or temporary jobs that didn’t include the benefits of full-time positions. Many of these positions also came with a certain degree of instability and no guarantee of hours, while many of the temporary workers being staffed by employment agencies were ceding a significant chunk of their potential earnings to the agencies.

Emerging from this came a rise in independent contractors (“1099 workers” to the IRS), who were often completely competent employees forced out during tough times who remained un- or under-employed for long periods and decided to cut out any middleman as they did piecemeal work where they could. The system worked out well for businesses using the independent contractors, since they were not obligated to offer benefits or even pay employment taxes on the 1099 pool of labor. As long as the workers could exercise a great deal of autonomy as to how they accomplished the assigned tasks and there was some level of impermanence, everyone–including the IRS–was happy.

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