A major national staffing services company could end up in legal hot water regarding the way it handled its time-keeping practices for some of its remote workers. A class of “virtual call center” employees launched a collective action accusing the company of violating the Fair Labor Standards Act by failing to pay them for all of the time they worked. In an important recent step in the case, the federal district court for the Eastern District of Michigan declared the arbitration clause in the workers’ contracts to be invalid and unenforceable, short-circuiting the company’s efforts to obtain a dismissal and a court order compelling binding arbitration of the case.
A multi-million dollar class action case involving numerous Tennessee cable TV installers who were wrongly denied overtime pay will once again go before the Sixth Circuit Court of Appeals. In a very short order, the U.S. Supreme Court ordered the Sixth Circuit to take another look at the installers’ case in light of another case that, like the installers’ case, involved using statistical evidence to arrive at the amount of damages.
The Fair Labor Standards Act allows employers to use various different methods to pay employees while still remaining compliant with the law. One of these methods is the “fluctuating workweek method,” or paying a base weekly salary to an employee regardless of the hours the employee worked. The key to using this method and remaining in compliance with the law is establishing a clear understanding about how the employee will be paid. In a recent 11th Circuit Court of Appeals case of note to Georgia employers and employees, the employee’s testimony in a deposition proved that the required level of “clear understanding” existed in this case, and the employer was not in violation of the law’s overtime pay rules.
A recent ruling by the 11th Circuit Court of Appeals is an important one for Georgia employers and employees to note, since it may affect some potential minimum wage and overtime cases. In the new decision, the 11th Circuit decided that it would join numerous other circuits in concluding that the Fair Labor Standards Act does not prohibit employees from bringing a case that contains within it both a FLSA collective action and a state-law class action.
A decision from a federal court in Atlanta this summer became the latest in a group to reject a recently created regulation by the U.S. Department of Labor declaring tips to be the property of employees in all circumstances, regardless of whether the tips were needed to raise the employee’s pay to a level that satisfied the minimum wage. The court decided that the plain language of the Fair Labor Standards Act is clear that employers are only required to hand over tip money when they pay a base wage below the applicable minimum wage.
Recent court cases have addressed a steadily wider array of workers — from exotic dancers to NFL cheerleaders to home health workers to, most recently, a hip-hop music producer’s bodyguard — and whether those workers’ employment situations qualify them for the minimum wage and overtime protection of the Fair Labor Standards Act. The 11th Circuit Court of Appeals’ recent ruling in the bodyguard’s case upheld a lower court ruling in his favor, concluding that the guard’s employment situation clearly met the FLSA’s “economic dependence” standard for qualifying as an employee under the statute.
Georgia employers and employees will soon be operating by a new set of rules when it comes to overtime pay for certain salaried employees. On May 18, the White House and the US Department of Labor announced new rules that will greatly expand the range of salaried employees who qualify to receive overtime. The new rules more than double the salary cap for eligible employees and, according to the White House, make an additional 4.2 million workers eligible for overtime. The White House also expects the new rules to increase earnings by roughly $12 billion over the next decade.
The rules governing salaried employees’ eligibility for overtime contain within them a maximum salary above which salaried workers cannot receive overtime pay. Prior to the adoption of the new rules, the salary cap was $23,660. The new rules hike that eligibility maximum to $47,476. These new rules arose from a 2014 Presidential Memorandum in which President Obama directed the Labor Department to update the regulations related to who is covered by the Fair Labor Standards Act’s overtime provisions. This was done in order to further “the President’s goal of ensuring workers are paid a fair day’s pay for a hard day’s work.”
In a recent case (and a noteworthy one to Tennessee employers and employees) that continues the exploration of which employees are, or are not, qualified under the Fair Labor Standards Act to receive overtime pay, the Sixth Circuit Court of Appeals ruled that a bank’s failure to pay its residential mortgage loan underwriters overtime did not violate the FLSA. The underwriters performed tasks that were integral to one of the employer’s primary business objectives (lending money) and did their jobs using a substantial degree of discretion and independent judgment, so they were exempt from receiving overtime.
In this situation, a group of residential mortgage loan underwriters sued their employer, Huntington Bancshares, Inc., for failing to pay them overtime in violation of the FLSA. A federal district court in Ohio concluded that the underwriters were exempt from receiving overtime pay under 29 U.S.C. § 207(a)(1) because they qualified as administrative employees.
Workers at a business that housed, raised, and sold worms for fishing bait lost another round in their case seeking compensation for unpaid overtime. The Sixth Circuit Court of Appeals agreed with a Chattanooga-based federal district judge that the agriculture exception to the Fair Labor Standards Act’s overtime pay requirement applied to the worm farm. The worm farm, the Sixth Circuit decided, reasonably resembled an ordinary agricultural operation in almost every relevant way. The only major difference was the unfamiliar item that the farm was farming.
The business under scrutiny in this case was one run by Bruno Durant, a French immigrant who relocated to Georgia to grow and raise worms that he then sold for use as fishing bait. After a decade in Georgia, Durant moved his operation to rural Tennessee. The business consisted of importing baby worms from Europe before housing and feeding them on his property in Tennessee. Once the worms reached maturity and grew to a sufficient size to be fit for sale as bait (roughly double their size during their time on Durant’s farm), the farm sold them to retailers.
A woman who previously worked as an exotic dancer at an Athens club recently launched a class action lawsuit accusing her former employer of violating the Fair Labor Standards Act. According to the former employee, the club improperly withheld wages, overtime pay, and tips by improperly classifying her as an independent contractor when she was really an employee, the Athens Banner-Herald reported on its website, OnlineAthens.com. The Athens case is the latest in a string of lawsuits in which exotic dancers have challenged the legality of the way their clubs pay them.
In the recent case, Christie Burrell danced for three years at Toppers International Showbar, a well-known club in downtown Athens. During her entire employment, the club classified Burrell and all its other dancers as independent contractors, not employees. By doing so, the club avoided some of the requirements the FLSA imposes on employers regarding the payment of employees, specifically compliance with minimum wage and overtime rules. Burrell’s action claimed that, even though the club permitted, and sometimes demanded, dancers to work 40 hours or more per week, the dancers never received wages or overtime. Instead, the only compensation the dancers at the club received was their tips. To make matters worse, the club allegedly didn’t even pay the dancers all of the tips they earned, since the club engaged in “siphoning away” part of that money “to distribute to non-tip eligible employees.”