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News | Jan 01, 2011

FLSA “White Collar” Misclassification Lawsuits Continue to be Fertile Ground for Litigation

Effective August 2004, the Department of Labor (“DOL”) implemented new regulations defining the FLSA’s executive, administrative, and professional exemptions became effective in August 2004.  See 29 C.F.R. §§541.0, et seq.  Under these “white collar” exemptions, companies can avoid paying overtime to workers who receive a weekly salary of over $455 and perform executive, administrative, and professional.  The regulations generally sought to expand the scope of the exemptions, leaving fewer workers with FLSA overtime benefits.

Fortunately, the revised regulations have not deterred trial lawyers from protecting the wage and hour rights of salaried workers who are managerial in job title only.  For example, The Winebrake Law Firm recently obtained federal court settlements for various salaried employees who alleged that they were misclassified as exempt under the white collar exemptions.  These workers include:  a “store manager” who spent much of her time stocking shelves and working the cash register; an “assistant hotel manager” who spent most of her time working at the hotel’s front desk; four “sales managers” who spent most of their time performing pest extermination duties; an “assistant engineer” who spent most of his time performing manual labor; and a “chef” who spent most of his time performing routine kitchen duties.

Notwithstanding the DOL’s recent attempt to expand the white collar exemptions, the law remains clear that, in deciding whether a salaried worker is exempt, the court’s analysis must extend beyond the worker’s job title.  See 29 C.F.R. §541.2.  Moreover, under the FLSA, exemptions must be “narrowly construed against the employers seeking to assert them.”  Arnold v. Ben Kanowski, Inc., 361 U.S. 388, 392 (1960).  Recognizing this, trial lawyers continue to challenge companies’ use of the white collar exemptions to deny overtime pay to workers with few real managerial responsibilities.  According to Bob DeRose, a Columbus, Ohio trial lawyer concentrating in wage and hour law:  “Trial lawyers should not be deterred by the 2004 regulatory amendments because, in the end, judges are likely to apply a fact-specific and common sense approach in evaluating white collar misclassification.”

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