Join Constangy attorney Jonathan Martin as he addresses the U.S. Department of Labor's Final Rule on white-collar overtime exemptions, which has an effective date of December 1, 2016, as well as practical advice concerning other wage and hour conundrums.

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3. Today’s Presenters
Mark Boutilier | Senior Solutions Engineer
Net@Work
Jonathan Martin | Partner
Constangy, Brooks, Smith & Prophete, LLP

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5. A wider lens on workplace law
The DOL Wage and Hour Division is Active:
Navigating and Understanding Changes under the FLSA

6. A wider lens on workplace law
Meet the Presenter
Bar & Court Admissions
Georgia, 1994
Georgia Superior Courts, 1994
Georgia Court of Appeals, 1998
Georgia Supreme Court, 1998
Middle District of Georgia, 1994
Northern District of Georgia, 1998
Southern District of Georgia, 2000
Eleventh Circuit Court of Appeals, 1998
Court of Military Appeals, 1994
Air Force Court of Criminal Appeals, 1994
U.S. District Courts, AL & GA,
U.S. Supreme Court
Education
Mercer University School of Law
J.D., magna cum laude
University of Georgia
B.B.A. cum laude
Jonathan Martin focuses his practice
in employment discrimination
litigation for management, defending
corporations in law suits arising
under Title VII of the Civil Rights Act
of 1964, the Age Discrimination in
Employment Act (ADEA), and the
American’s with Disabilities Act
(ADA), as well as related state laws.
Mr. Martin also represents
management in traditional labor law
issues under the National Labor
Relations Act (NLRA) and in wage &
hour issues under the Fair Labor
Standards Act (FLSA).

7. A wider lens on workplace law
Let’s Talk About Numbers
• $210 million paid by Farmers Insurance
• $135 million paid by State Farm
• $35 million paid by Pacific Bell
• $30 million paid by Radio Shack
• $22 million paid by Bank of America
• $20 million paid by Perdue Farms
• $18 million paid by Starbucks
• $18 million paid by UPS

8. A wider lens on workplace law
Federal Class Actions Trends

9. A wider lens on workplace law
Federal Class Actions Trends

10. A wider lens on workplace law
What’s New

11. A wider lens on workplace law
What is the DOL Final White Collar Exemption Rule?
• The U.S. Department of Labor announced May 18, 2016 its final
rule that raises the minimum salary threshold required to qualify
for the Fair Labor Standards Act's “white collar” exemption to
$47,476 per year, $913 a week; Becomes effective December
1, 2016.
• Employees that qualify are exempt from overtime and time
keeping requirements.

12. A wider lens on workplace law
New Salary Level Comparison
• Standard salary level: Currently $455; Effective 12.1.16
$913 per week (40th percentile)
• Highly Compensated Employee: Currently $100,000;
Effective 12.1.16 $134,004 per annum (90th percentile)

13. A wider lens on workplace law
Who Benefits from New Overtime Rule according to DOL?

14. A wider lens on workplace law
What are the Three Tests for the Salary Exemption under FLSA?
• Salary Basis Test (unchanged except for 10% bonus)
• Salary Level Test (increased 100% effective 12.1.16)
• Job Duties Test (unchanged)
Critical: All 3 tests must be met to qualify. Each test is simple
to say but complex to understand.

15. A wider lens on workplace law
What are the 3 New Critical Final Rule Changes?
• 100% Salary Level Test Increase
• Nondiscretionary bonus up to 10% to meet salary level test
• Automatic Salary Level Updates (every 3 years beginning
January 1, 2020)

16. A wider lens on workplace law
What Does Exempt and Non-Exempt Mean?
• Exempt from overtime provisions
OR
• NOT exempt from overtime provisions

17. A wider lens on workplace law
“White Collar” Exemptions
• Section 13(a)(1) of the FLSA provides an exemption from
both minimum wage and overtime pay for employees
who are employed in a bona fide:
• Executive;
• Administrative;
• Professional; or
• Outside Sales capacity.
• Certain computer employees may be exempt
professionals under Section 13(a)(1) or exempt under
Section 13(a)(17) of the FLSA.

18. A wider lens on workplace law
The Executive Exemption

19. A wider lens on workplace law
Executive Duties
• Primary duty is management of the enterprise or of a
customarily recognized department or subdivision;
• Customarily and regularly directs the work of two or more
other employees; and
• Authority to hire or fire other employees or whose
suggestions and recommendations as to hiring, firing,
advancement, promotion or other change of status of
other employees are given particular weight.

20. A wider lens on workplace law
Primary Duty
• The principal, main, major or most important duty that the
employee performs.
• Factors to consider include, but are not limited to:
• Relative importance of the exempt duties;
• Amount of time spent performing exempt work;
• Relative freedom from direct supervision; and
• Relationship between the employee’s salary and the wages paid
to other employees for the same kind of nonexempt work.

21. A wider lens on workplace law
Primary Duty
• Employees who spend more than 50% of their time performing
exempt work will generally satisfy the primary duty requirement
• However, the regulations do not require that exempt employees
spend more than 50% of time performing exempt work

22. A wider lens on workplace law
Management
• Interviewing, selecting, and training employees
• Setting and adjusting pay and work hours
• Maintaining production or sales records
• Appraising employee productivity and efficiency
• Handling employee complaints and grievances
• Disciplining employees
• Planning and apportioning work among employees

23. A wider lens on workplace law
Management
• Determining the techniques to be used; the type of materials,
supplies, machinery, equipment or tools to be used; or the
merchandise to be bought, stocked and sold
• Providing for the safety and security of employees or property
• Planning and controlling the budget
• Monitoring or implementing legal compliance measures

24. A wider lens on workplace law
The Administrative Exemption

25. A wider lens on workplace law
Administrative Duties
• Whose primary duty is the performance of office or non-manual
work directly related to the management or general business
operations of the employer or the employer’s customers; and
• Whose primary duty includes the exercise of discretion and
independent judgment with respect to matters of significance.

26. A wider lens on workplace law
Management or General Business Operations
• Refers to the type of work performed by the
employee
• Work must be directly related to assisting with
the running or servicing of the business
• Does not include working on a
manufacturing production line or selling a
product in a retail or service establishment

27. A wider lens on workplace law
Discretion and Independent Judgment
• Factors include, but are not limited to:
• Whether the employee has authority to commit the employer in
matters that have significant financial impact
• Whether the employee has authority to waive or deviate from
established policies and procedures without prior approval
• Whether the employee has authority to negotiate and bind the
company on significant matters
• Whether the employee provides consultation or expert advice to
management

28. A wider lens on workplace law
Discretion and Independent Judgment
• Factors include, but are not limited to:
• Whether the employee is involved in planning long- or short-term business
objectives
• Whether the employee investigates and resolves matters of significance on
behalf of management
• Whether the employee represents the company in handling complaints,
arbitrating disputes or resolving grievances

29. A wider lens on workplace law
Discretion and Independent Judgment
• Discretion and independent judgment does not include:
• Applying well-established techniques, procedures or specific standards
described in manuals or other sources
• Clerical or secretarial work
• Recording or tabulating data
• Performing mechanical, repetitive, recurrent or routine work

30. A wider lens on workplace law
Common Overtime Violations
• Straight time for all hours worked
- Employee works multiple jobs or locations
Failure to pay for all hours worked
- Work before clocking in or after clock out
- Donning and doffing required uniforms
- Working during unpaid lunch hours
Errors calculating “regular rate” of pay
- Failure to include bonuses, premiums
Misclassification

31. A wider lens on workplace law
Litigation Trends
• Misclassification
- First-level supervisors
- Insurance claims adjusters
- Inside sales (real estate, financial services)
- Computer help desk employees
- Retaliation claims
Off-the-Clock
- Call centers
- Meal breaks

32. A wider lens on workplace law
FLSA Retaliation (cont’d)
• Lilli Morse v. J.P. Morgan Chase (2011)
• Employee complained on Facebook page
about failure to pay overtime
• Court: Facebook complaint is not the “filing”
of a complaint; not protected by FLSA
• Contrast with NLRB rule

33. A wider lens on workplace law
FLSA Retaliation (cont’d)
• Kasten v. Saint-Gobain Performance Plastics Corp (S. Ct. 2011)
• Verbal complaint about minimum wage or overtime constitutes
the “filing” of a complaint under FLSA retaliation provision

34. A wider lens on workplace law
7 “Leaders” You Can’t Afford
• I’m The Boss . . . Don’t You Forget It!
• Uncertain (“My Boss Is Telling Me . . .”)
• Inconsistent “Leaders” (Favoritism)
• Deceptive (Promises They Don’t Intend To
Keep)
• Foul Language “Leaders”
• Negative “Leaders”
• Absent “Leader” (Always In Office)

35. I’m Still Fully Employed . . .
Insanity: doing the
same thing over and
over again and
expecting different
results.
Albert Einstein
US (German-
born) physicist
(1879 - 1955)

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38. Thank You For Attending!
Mark Boutilier | Net@Work
Senior Business AnalystConsultant
(P) 800-719-330 Ext 4805
mboutilier@netatwork.com
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