Recent Case Provides Food for Thought on “Primary Duty” of FLSA Overtime-Exempt Managers

Prendergast, Mike - 300dpi
Mike Prendergast

In Clendenen v. Steak N Shake Operations, Inc., Case No. 4:17-cv-01506-JAR, 2018 U.S. Dist. LEXIS 167101 (E.D. Mo. Sept. 28, 2018), the U.S. District Court for the Eastern District of Missouri recently granted conditional class certification under the Fair Labor Standards Act (“FLSA”) to Steak ‘n Shake restaurant managers challenging their classification as overtime-exempt under the FLSA’s executive and administrative exemptions.  Conditional certification is the first step toward maintaining an FLSA collective action.  The Clendenen court found evidence to support conditional certification, including evidence that the managers’ duties were “largely the same as the non-exempt employees they supervised.”  Continue reading

Inching Closer to a New Overtime Rule?

Adams, Julie 300dpi
Julie Adams

In 2016, the U.S. Department of Labor (“DOL”) modified 29 C.F.R. § 541 – which regulates  the Fair Labor Standards Act’s (“FLSA”) white-collar exemptions (administrative, executive, professional, computer, and outside sales) – often referred to as the “Overtime Rule.”  Among other changes, the new Overtime Rule increased the salary threshold for white-collar employees from $23,660 to $47,476.  Before the new Overtime Rule took effect, Judge Amos Mazzant, a federal district judge in Texas, temporarily blocked the rule by entering an injunction in Nevada v. United States Dep’t of Labor, 227 F. Supp. 3d 696 (E.D. Tex. 2017).  Rather than appeal Judge Mazzant’s decision and pursue implementation of the revised 2016 rule, the DOL elected, instead, to proceed with a new rulemaking.  Continue reading

What Issues May Employers Be Required to Address as Hurricane Florence Threatens?

florenceExecutive Summary: As the East Coast of the U.S. braces for Hurricane Florence, the approaching storm serves as a reminder that employers should be prepared to address storm-related issues if they are required to close their businesses and as they prepare to resume normal operations. For example, employers need to determine whether closing the office means having to pay workers who stay home, being on the hook for unemployment compensation, and whether workers’ compensation applies to weather-related injuries. Continue reading

Tip Credits and Florida Minimum Wage Laws

Gomez, Rudy - 300dpi
Rudy Gomez

Background: The Fair Labor Standards Act (“FLSA”) and Florida minimum wage law allow an employer to take a tip credit toward its minimum wage obligation for “tipped employees”. A “tipped employee” is an employee who customarily and regularly receives more than $30 per month in tips. 29 U.S.C. § 203(t). An employer is permitted to take a tip credit equal to the difference between the minimum wage (currently $8.25 in Florida) and the required cash wage (currently must be at least $5.23 in Florida). Thus, the maximum tip credit that an employer can currently claim under the FLSA and Florida law is $3.02 per hour ($8.25 – $5.23).  Continue reading

Illinois Court Highlights Individual Liability Risk in FLSA Claims

Russell_Jackson_IL
Russell Jackson

Executive Summary: Under the FLSA, personal liability can attach to individual employees in supervisory, management, and executive positions.  To be held liable, the individual defendant must be considered an “employer,” defined as “any person acting directly or indirectly in the interest of an employer in relation to an employee”.  29 C.F.R. § 570.113(a).  While the FLSA’s definition is relatively broad, recently, in Foday et al v. Air Check, Inc. et al, 2018 U.S. Dist. LEXIS 140552 (N.D. Ill. Aug. 20, 2018), the Northern District of Illinois clarified when individual employees can properly be named as defendants, holding that a company’s President could be held liable because he possessed certain supervisory functions and knowledge of the company’s relevant pay and scheduling practices.  Continue reading

The Fate of the DOL’s 80-20 Rule: Will the 80-20 Rule Survive?

Douglas, Jeff - 300dpi
Jeffrey Douglas

The U.S. Department of Labor’s (“DOL”) “80/20 Rule” has caused significant anxiety and concern for employers in the restaurant industry and other industries with tipped employees.  A recent spate of nation-wide class action litigation is leading to record-setting settlements for restaurant employers.  However, in a recent lawsuit filed in the Western District of Texas, Restaurant Law Center, et al. v. United States Department of Labor, 18-cv-567 (W.D.Tex.), national and local restaurant groups hope to bring an end to this wave of litigation by seeking to invalidate the 80/20 Rule. Continue reading