Dive Brief:

• Travis County, Texas, is on the hook for unpaid overtime to lieutenants in its Sheriff's Office after a federal appellate court ruled that the employees were not executives exempt from the Fair Labor Standards Act's (FLSA) requirements (Miller et al v. Travis County, Texas et al., No. 19-50360 (5th Cir. March 26, 2020)).
• The plaintiffs' main responsibility was to manage operation of units of sergeants and deputies, according to the court's opinion. The lieutenants sometimes sat on boards that conducted interviews for hiring and promotion and also participated in discipline and termination decisions.
• When the lieutenants sued, believing they were owed overtime pay, the county argued they were exempt from the FLSA's overtime requirements because they are executive employees. A jury disagreed, deciding the county had not shown that the lieutenants' primary duty was management instead of law enforcement or that the lieutenants' recommendations as to hiring, promotion, discipline and termination were given particular weight. The 5th U.S. Circuit Court of Appeals upheld the jury's decision.

Dive Insight:

Misclassification of employees under the FLSA is a common issue, especially as it pertains to overtime pay, and it can lead to costly litigation. The law requires that workers be paid at least the minimum wage and overtime for all hours worked over 40 in a workweek unless an exemption applies. 

To determine whether workers are exempt, employers should consider both salaries and job duties, sources previously told HR Dive. If employers want to avoid paying overtime, workers must meet two basic tests — salary basis and job duties. All of the exemptions except the outside sales exemption require employees to make more than $684 per week. Once the salary threshold is met, the employee's job duties are considered. The required job duties vary, depending on the exemption.

As the Miller court noted, a required element of the executive exemption is that the employee has the authority to hire or fire other employees or that his or her suggestions and recommendations regarding hiring, firing or promotion of other employees is given "particular weight." The factors in determining "particular weight" include whether it is part of the employee's job duties to make such suggestions and recommendations; the frequency with which such suggestions and recommendations are made or requested; and the frequency with which the employee's suggestions and recommendations are relied upon, the appeals court said. Occasional suggestions don't meet that standard, the court noted.