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Fifth Circuit: Clarity on Highly Compensated Employee Exception to FLSA Overtime Requirements

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August 21, 2019

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In Faludi v. U.S. Shale Solutions, the Fifth Circuit Court of Appeal confirmed that an employee’s guaranteed day rate satisfied the Fair Labor Standard Act’s (FLSA) highly compensated employee (HCE) exemption, even though the employee was only paid twice monthly.  The HCE threshold—which currently requires the employee to be paid more than $100,000 per year and at least $455 a week on a salary or fee basis—only requires that the employee “regularly receive[s]” the predetermined amount on a weekly or less frequent basis.  There is no requirement that the cash amount be calculated on weekly or less basis.

In addition, the Fifth Circuit also stated that the amount the HCE is paid is not required to bear a “reasonable relationship” to the amount actually earned. Employers should take care when setting highly compensated exempt employee pay to ensure compliance with FLSA requirements.

Action Items

  1. Have highly compensated exempt employee pay reviewed for consistency with this ruling.
  2. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2019 ManagEase

Fifth Circuit: Day Rate Can Meet Salary Requirements Under FLSA White Collar Overtime Exemption

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All Employers with LA, MS, and TX Employees

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August 21, 2019

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In Faludi v. U.S. Shale Solutions, L.L.C., the U.S. Court of Appeal for the 5th Circuit stated that a guaranteed day rate providing compensation over $455 can meet the Fair Labor Standard Act (FLSA) salary requirements for the white collar overtime exemption. Further, the FLSA’s reasonable relationship test does not apply to the highly compensated exemption.

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Fifth Circuit: Clarification on Small Vehicle Exception to the Motor Carrier Act Overtime Exemption

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All Employers with LA, MS, TX Employees Operating Commercial Motor Vehicles

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May 16, 2018

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In Carley v. Crest Pumping Technologies, LLC, the Fifth Circuit recently clarified ambiguities in the small vehicle exception to the Motor Carrier Act (MCA) overtime exemption. Generally, the overtime requirements under the Fair Labor Standards Act (FLSA) do not apply to employees covered by the MCA, except for employees who operate vehicles weighing 10,000 lbs. or less under certain conditions (“small vehicle exception”).

Louisiana: Pregnancy Disability Has Different Meanings Under the State’s Employment Discrimination Laws

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All Employers with LA Employees

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March 15, 2018

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In Brown v. The Blood Center, the Louisiana Court of Appeal recently stated that the standard for pregnancy disability under the state’s Pregnancy Discrimination Act (PDA) does not apply to the definition of disability under the Employment Discrimination Law (EDL), because of limiting language in the PDA. The EDL states that a disability includes a physical impairment that limits one or more major life activities, while the PDA states that pregnancy or related conditions are treated as any other temporary disability.

There, a pregnant employee became ill and abandoned her post without first notifying her supervisor. Two hours later, she called her supervisor to tell him what happened.  The employer had a policy of termination for post abandonment and terminated the employee.  She claimed that she was discriminated against for a pregnancy disability, but only claimed she was having a difficult pregnancy. Because the pregnancy disability definition did not apply to the EDL, the court stated, in part, the employee did not demonstrate that she suffered from an applicable disability.

Action Items

  1. Review policies and procedures related to attendance and notification, as well as disability claims, for changes consistent with this ruling.
  2. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2018 ManagEase

Fifth Circuit: Mandatory Class Action Waivers Do Not Violate the NLRA

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All Employers with LA, MS, TX Employees

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August 7, 2017

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In a recent decision, the Fifth Circuit reaffirmed its positions that mandatory class action waivers do not violate Section 7 of the National Labor Relations Act (“NLRA”). In Convergys Corp. v. NLRB, the Fifth Circuit stated that an employee’s right to a collective action is procedural, not substantive, and signing a waiver therefore did not violate any substantive rights under the NLRA.

July Updates

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This Short List addresses the following topics:
  1. USCIS Updates: L-1B Visas, H-1B Cap Exemptions, and Visa Program Fraud and Abuse
  2. California: Workers Are Entitled to Wage & Hour Protections, Regardless of Work or Immigration Status
  3. California: Poster Requirements for Barbers and Cosmetology License Holders
  4. California: New Notice Employers are Required to Provide at Hire
  5. Louisiana: Court Rejects Whistleblower Complaint from Independent Contractor
  6. Missouri: Recent Changes Made to State Anti-Discrimination Statutes
  7. Texas: Texting While Driving Banned
  8. New York City: New Rules Issued to Clarify Freelance Isn’t Free Act

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September Updates

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This HR Alert addresses the following topics:
  1. Prior Use of an Invalid Social Security Number Leads to Million Dollar Verdict
  2. 2016 EEO-1 Filing is Due September 30
  3. Ninth Circuit: New Remedy Available for Public Employees Making Age Discrimination Claim
  4. California: Employees/Volunteers at Day Care Centers Now Required to be Immunized
  5. San Diego, California: REMINDER – Amendments to Paid Sick Leave Are In Effect
  6. San Mateo, California: Minimum Wage Increases on January 1, 2017
  7. Colorado: Pregnant Workers Fairness Act Poster Now Available
  8. Illinois: Non-Compete Agreements for “Low-Wage Employees” are “Illegal and Void” in 2017
  9. Louisiana: New Poster for Hospitality Employers Required August 1, 2016
  10. New Orleans, LA: City Contractors Prohibited From Conducting Credit Checks
  11. Nevada: Overly Broad Non-Compete Agreements are Wholly Unenforceable
  12. Cleveland, Ohio: Transgender Individuals Must Have Access to Facilities Consistent with their Gender Identity

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Fifth Circuit Affirms Employers Cannot Withhold Optional Expenses from Credit Card Tips

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All Employers with Louisiana, Mississippi, and Texas Employees

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June 14, 2016

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Generally in the Fifth Circuit, employers can pay employees, who earn tips, less than the minimum wage as long as the employee receives enough in tips to make up the difference.  If not, the employer must make up the difference to ensure the minimum wage is met.  Though the rule seems simple, the complexity of tip credits—including situations such as when tips are shared—can get employers in trouble.  The Fifth Circuit recently highlighted another danger zone, stating that employers cannot hold back portions of credit card tips to pay for optional expenses.