Salary, duties exempted organ procurement coordinator from overtime

Dive Brief:

An organ procurement coordinator for a Louisiana health care provider wasn't entitled to overtime pay, the 5th U.S. Circuit Court of Appeals ruled (Smith v. Ochsner Health System, et al. No 18-31264 (5th Cir. April 17, 2020)).
Daniel Smith sued his former employer, Ochsner Health System, alleging unpaid overtime under the Fair Labor Standards Act (FLSA). A district court concluded that Smith was exempt from overtime under the FLSA's "highly compensated employee" exemption and granted summary judgment to Ochsner.
The 5th Circuit affirmed. Ochsner argued, and the court agreed, that Smith engaged in procurement — one of the duties listed under the FLSA's administrative exemption as directly related to the running of the business — for the company. Additionally, the 5th Circuit said it didn't need to conduct a particularly detailed analysis of his job duties because Smith's compensation between 2014 and 2017 surpassed $120,000; the law's implementing regulations exempt from overtime employees earning at least $107,432 who also performing office or non-manual work; and customarily and regularly performs at least one of the exempt duties or responsibilities of an exempt executive, administrative or professional employee.

Dive Insight:

Misclassification of employees under the FLSA is a common problem for employers, especially where overtime pay is concerned. Failure to properly classify employees can lead to costly litigation. Last year, Steak 'n Shake was ordered to pay more than $7.7 million after a court ruled that it denied overtime pay to employees who were misclassified as managers.

Employers must pay employees at least the minimum wage for all hours worked, plus time-and-one-half their regular pay for all hours worked over 40 in a workweek, unless an employee qualifies for an exemption. The FLSA provides several exemptions for white collar workers. Employers may not need to pay overtime to executive, administrative, professional, computer and outside sales employees, the U.S. Department of Labor (DOL) said in a fact sheet, if certain criteria are met.

Workers must meet two basic tests — salary basis and job duties — to qualify for such exemptions, sources previously told HR Dive. All the exemptions except the outside sales exemption require employees to make more than $684 per week. Once the minimum salary threshold is met, the employee's job duties are considered. The required job duties vary, depending on the exemption.

Employers should be aware that exemptions from the FLSA's overtime pay requirements are not dependent on employer-determined job titles but on legal standards, job duties and pay, according to DOL.