Rebutting Employer’s Half-Time Arguments in FLSA Misclassification Cases September 24th, 2008

Employers who lose white collar misclassification cases often try to blunt the worker’s damages by arguing that, under 29 CFR 778.113, the salary must be spread across all hours worked, leaving the employer to merely pay half-time for the overtime hours. This argument often is misplaces. 29 CFR 778.113(a) provides: “If the employee is employed solely on a weekly basis, his regular hourly rate of pay on which time and a half must be paid, is computed by dividing the salary by the number of hours which the salary is intended to compensate.” The determination of the “number of hours which the salary is intended to compensate” is a question for the jury. See Rodriguez v. Farm Stores Grocery, Inc., 2008 U.S. App. LEXIS 4817, *21-26 (11th Cir. Mar. 6, 2008). Moreover, as with most FLSA provisions, the defendant bears the burden of proof on this issue. See Giles v. City of New York, 41 F. Supp. 2d 308, 317 (S.D.N.Y. 1999). Most importantly, the mere fact that employees worked excessive hours without receiving any pay beyond their salary is not dispositive. As observed by Judge Motley in Giles: “The fact an employee regularly works 60 or more hours does not, without more, indicate that the employee’s weekly salary was intended to include the FLSA overtime premium for all hours in excess of 40.” Giles, 41 F. Supp. 2d at 316-17. The Eleventh Circuit Court of Appeals (as well as other courts) recently agreed: “In the situation here, where the employee is paid solely on a weekly salary basis, the number of hours the employee’s pay is intended to compensate – not necessarily the number of hours he actually worked – is the divisor. Rodriguez, 2008 U.S. App. LEXIS 4817, at *22-23. Similar cases abound, but this posting is not intended to serve as a legal brief.

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