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Feb 2011
10
February 10, 2011

Warner's Dubault discusses FSLA enforcement with MiBiz

Rob Dubault, a member of the Labor and Employment Law Group at Warner Norcross & Judd, was featured in a Feb. 10, 2011 MiBiz article about stepped-up enforcement of the Fair Labor Standards Act. The article appears here with permission.

Although the Fair Labor Standards Act has been around for decades, the Department of Labor has stepped up its enforcement activity.

The level of enforcement has varied with changes in administrations with the Obama Administration widely perceived as more employee friendly, according to Rob Dubault, partner with Warner Norcross & Judd, who specializes in labor and employment law. He regularly counsels and represents employers on FLSA.

"The level of enforcement that we see varies a little bit as the politics in Washington change," Dubault told MiBiz. "The Department of Labor has hired a number of new investigators and lawyers with the intention of more vigorously enforcing the FLSA."

Many FLSA cases deal with overtime pay with some classes of employees exempt from the requirement to pay overtime for more than 40 hours per week. Dubault said one recent interpretation of the law dealt with whether mortgage loan originators and officers were exempt from overtime and minimum wage requirements under what is called the "administrative employee exemption."

"The Department of Labor concluded that the typical mortgage loan officer is not exempt from overtime and minimum wage requirements under FLSA," Dubault said.

He said the issue with mortgage loan officers has been a "murky area for many years" in light of the fact that many people in that occupation earn more than $100,000 per year. The DOL's interpretation has garnered a lot of attention.

Another recent interpretation applies to employers with collective bargaining agreements and whether certain types of protective equipment constitute "clothes" under a section of the FLSA. The Department of Labor has ruled that protective equipment such as hairnets, earplugs, steel-toed shoes and body armor are not clothes. Employers requiring people to use the protective equipment as part of their job must pay for the time spent putting on and taking off the protective gear.

"Over the last several years there has been a huge increase in litigation under FLSA. Many cases deal with time spent putting on and taking off clothes or other unpaid time during the work day," Dubault said.

He noted that although the Department of Labor made the interpretation that employees' time should be paid, there have been some federal courts, including the Sixth Circuit Court of Appeals, that have disagreed.

Recent healthcare reform will also require employers to provide break time for new mothers to express or pump breast milk — a change that applies only to non-exempt employees.

"Essentially, this requires that employers allow those folks to take a break and have a place to go other than a restroom if they need to express," said Dubault, noting these breaks do not need to be paid under FLSA.

Dubault said there has been a tremendous increase in FLSA litigation over the past 10-15 years including many class action lawsuits. Oftentimes, the class action lawsuits involve a large group of people who want to be paid for all the time they work and make claims that they are "working off the clock." They may claim they are working before they are being paid, working through unpaid meal periods or taking work home and not getting paid.

"A lot of very large retailers have been the target or subject of those lawsuits," Dubault said.

He said some lawsuits lump hundreds or thousands of employees, but he expects the lawsuits to filter down to smaller and medium-sized employers.

The economic downturn with high unemployment has not lead to less litigation. With a lot of employees out of jobs, many are seeking legal help because they feel they weren't treated properly. Dubault said there is big money at stake in FLSA lawsuits with the prevailing party entitled to attorney fees paid for by the other side.

Dubault advises employers to make sure they have the right policies and procedures in place and make sure they are being followed.

"If supervisors are not adhering to the policy, you're potentially going to have a problem. Make sure people are doing the right thing on the floor," Dubault said.

Katherine Smith Kennedy, a labor and employment attorney with Pinsky, Smith, Fayette & Kennedy LLP, advises employers to run their pay practices by an employment attorney. She represents employees on labor, employment, discrimination and wage matters.

"Do a good analysis of the jobs that people are doing. Check this information out with an employment attorney," Kennedy told MiBiz.

Kennedy said she typically relies on the court's interpretation of FLSA. Most of the claims she handles are blatant violations of FLSA. Most of her cases involve individuals, although she has been a part of collective action cases in the past couple of years. Some cases involve hourly employees not being paid for travel time or workers put on salary without the duties to go with a salaried position.

Oftentimes, her clients are workers who believe they were terminated unfairly and who often were paid illegally. Kennedy said many types of businesses from manufacturers to offices violate FLSA.

"I find when an employer violates the Fair Labor Standards Act, it's not the only law they're violating," Kennedy said.

She noted an employee cannot agree to accept a job and not be paid overtime — they are still entitled to overtime under the law. In these cases, she goes forward with pursuing back pay.

Kennedy said she will only take a case if it's a good one, with about 1 percent of cases going to trial. Her court cases have resulted in favorable decisions for the employee "almost all of the time."

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