Although the U.S. government has required employers to pay their workers overtime ever since the 1930s, it’s still unclear in many cases whether certain workers are eligible. A big reason is that the nature of people’s jobs and the workplace itself continues to evolve…so new questions keep coming up about eligibility.
For instance, the federal overtime law says that workers don’t have to be paid overtime if they have “administrative” jobs, which are jobs that involve using one’s discretion to make choices. In the old days, it was clear that factory workers on an assembly line weren’t making choices, whereas the factory managers were. But today, the line between administrators and non-administrators can often be blurry.
For instance, what about underwriters at a bank? Do they exercise discretion? Recently, a federal appeals court in New York ruled that a bank had to pay overtime to its underwriters because they weren’t “administrative” employees. The court said that at this particular bank, the job of underwriter fell under the category of “production” rather than “administration.”
In another case, the same court decided that a regional sales director responsible for generating advertising sales was entitled to overtime pay because she wasn’t an administrative employee. But a federal appeals court in Washington, D.C., came up with a different result in a case involving insurance adjusters. In that case, the court said that the adjusters exercised “some” discretion in their jobs, which meant the company didn’t have to pay them time-and-a-half. The court said that a typical auto damage adjuster “exercises discretion as often as 60 times per year in negotiations with customers over total loss claims.”
Another issue that comes up is whether employees are entitled to overtime for duties they have to perform before and after they are actually “working.”
For instance, a federal appeals court in Chicago recently ruled that maintenance workers at a paper mill weren’t entitled to overtime pay for the time they spent changing clothes and showering at the end of each work shift. On the other hand, the mill had a policy that allowed an employee to shower immediately after a suspected exposure to hazardous chemicals, and the court said such a worker would be entitled to overtime in that case.
Meanwhile, a federal appeals court in Virginia decided that poultry workers were not entitled to be paid time-and-a-half for the extra time they spent putting on and taking off personal protective gear required for their jobs…but that was because the employer had reached an agreement with the employees’ union that time spent changing clothes wasn’t compensable work time. If you’re unsure or have questions about eligibility for overtime, we’d be happy to answer your questions.