New York Employment Lawyer Blog

The Overtime Adviser Blog issued a good post on computer help desk workers this month. At our law firm, we have a number of cases that concern this issue. Help desk workers are vital to most companies because they keep people working. Because help desk positions are so demanding, many help desk workers put in a lot of overtime. But, many companies do not pay help desk workers overtime pay.

I suspect that part of the problem is the computer employee exemption in the Fair Labor Standards Act. There is wide spread misunderstanding of this exemption. People seem to think that all computer related work is exempt from the overtime pay rules. The reality is that most all computer related work is not exempt - most all computer related work is subject to overtime pay and all of those help desk workers are entitled to overtime pay.

The computer employee exemption is narrow in scope. It only applies to higher level computer employees who design, create, program and engineer software or computer systems. The computer employee exemption, for example, would cover a network engineer who actually designs computer systems but it would not cover an employee who maintains computer systems. The computer employee exemption would cover an employee whose primary duty is to design and create computer programs. The normally day-to-day maintenance, installation and repair of computer systems and software is not covered by the computer employee exemption and that covers most computer works.

The Department of Labor issued a regulation which limits the reach of the computer employee exemption:

The exemption for employees in computer occupations does not
include employees engaged in the manufacture or repair of computer
hardware and related equipment. Employees whose work is highly
dependent upon, or facilitated by, the use of computers and computer
software programs (e.g., engineers, drafters and others skilled in
computer-aided design software), but who are not primarily engaged in
computer systems analysis and programming or other similarly skilled
computer-related occupations identified in Sec. 541.400(b), are also
not exempt computer professionals.

We have a number of cases pending against companies that do not pay their computer and technology employees overtime pay. Some of the companies just do not pay it. Others try to avoid the overtime issue by hiring so called "independent contractors" to do the computer work. True independent contractors are not entitled to overtime pay. But often the independent contract label is inaccurate and the workers are entitled to overtime pay.

If you are one of the thousands of medical case managers, or disability case managers, working for large health plan companies throughout the US, you should keep close tabs on the case of Ruggles v. WellPoint, Inc., No. 08-cv-00201, because the case is likely to have an enormous impact on the industry, your profession and, if the plaintiffs prevail, your own pocketbook. Ruggles and the putative class are seeking to certify a class of misclassified nurse case managers who work in call centers collecting documents and data requested by claims adjusters. According to the Ruggles complaint, the nurse case managers receive a salary and are misclassified as exempt from overtime requirements under federal (FLSA) and NY state law (NYLL).

Often, registered nurses are hired for these positions since their nursing experience is useful for interpretting medical data, but they do not provide "traditional" direct medical services to patients, render an opinion or make any medical diagnosis (which is prohibited by state law). Traditionally, registered nurses qualified for the “learned professional” exemption to FLSA overtime requirements under 29 C.F.R. § 541.301(a). According to the regulations, to qualify for the exemption, an employee’s primary duties must require consistent discretion and judgment. See id. § 541.301 (b). The regulations further state “[r]egistered nurses who are registered by the appropriate State examining board generally meet the duties requirements for the learned professional exemption.” See § 541.301(e)(2). The central inquiry in Ruggles is whether or not nurse case managers who are, for all intents and purposes, not using traditional nurse skills and training still qualify for the exemption. Certain Wage and Hour opinion letters suggest that registered nurses who are not expected to utilize "traditional" nursing skills and instead rely on company manuals to perform administrative services, or who do not need a nursing degree or license to qualify for employment, do not exercise independent judgment and do not qualify for the exemption. Our firm intends to file a complaint next week against one of the largest health care companies in the US seeking to certify a class of disability and medical case management nurses for overtime violations. According to our client, a social work degree and other non-nursing degrees are suitable qualifications for employment as disability or medical case manager. Also, our client was urged by her managers to perform case management services in states other than those she was licensed in as a nurse. If you are in a similar situation, call for a free screening. This appears to be the next big thing in overtime litigation - the big defense firms are already issuing scary "client alerts" to notify (i.e. frighten) potential management clients of the litigation timebomb that awaits them if they don't rapidly retain counsel and reform their policies. This is a telltale sign that a massive wave of litigation is on the horizon.

I was recently reprimanded by my wife for checking my work email at a wedding. She said it was rude and she was right.

As if on cue, my wife, who is also a lawyer and works for a low-tech government office which only allowed for external email four years ago, was issued a blackberry last week by her supervisor. Now she is one of many lawyers carrying two smart phones. My poor manners aside, there are virtually no social limitations on smart phone usage, including usage of smart phones for professional purposes.

Should you be paid for the time spent on your blackberry? Of course. Check out this NPR article on blackberry usage and overtime. Under the FLSA, time spent communicating with your employer or otherwise working on your crackberry is compensable. If you are a non-exempt employee who spends a tremedous amount of time on your blackberry and feels...well...instinctively undercompensated, you're probably right. Don't rest on your hunch, call for a free screening.

I have screened hundreds of overtime cases. In my practice, the following three categories of nonexempt employees under the FLSA are the most blackberry dependent, misclassified and undercompesated (i.e. abused):

1. IT employees, including help desk employees and systems engineers;
2. Pharmaceutical sales representatives;
3. Staffing recruiters (incredibly long hours and hard work - hats off to these employees - case law says you should be getting OT if you aren't involved in project management and post-recruitment supervision).

Smart phones are embedded in the culture. My 3 year old is adept with my iphone; she knows how to find the games she likes and will undoubtedly be asking for one before she is 10. Frightening. There's no turning back. However, you should not let your employer abuse the popularity of these phones by discounting the time you spend on them. Use your blackberry to call for a free screening.

New York pharmaceutical sales representatives won a victory this week in a decision that granted them the right to overtime pay. The sales representatives worked for Novartis and their job was to visit doctors to promote the companies drugs. Novartis did not pay them overtime pay even though the sales representatives worked long hours and sometimes would not return home until 10 p.m. after wining and dining the doctors.

Novartis did not pay them overtime because it relied on the "outside sales" exemption under the Fair Labor Standards Act. Under this law, outside sales representatives are not entitled to overtime pay. The sales representatives succeeded in court by arguing that they were not really sales people because they did not actually sell the drugs, rather they just promoted the drugs. The actual sale of the drugs took place at the drug stores when the patients would pick up their prescriptions. The sales representatives had nothing to do with the actual sale of the drugs because it was illegal for them to sell the drugs themselves. All the Novartis reps could do was visit the doctors and persuade the doctors to prescribe the drugs to their patients.

The court found that the "outside sales" exemption did not apply to the Novartis sales reps because they did not sell anything. Under the FSLA, an outside sales person must actually sell a product or service in order to fall within the exemption. The exemption does not apply to promoters, marketers or other sales support people who do not actually cause the sale to take place.

In this case, the court strictly and narrowly construed the law and limited the scope of the exemption. According to the court, a true outside salesperson has to be more like a door to door salesman who sells the goods himself. A door to door vacuum salesman would qualify as a true outside sales person if he actually produced sales himself by obtaining orders for vacuum cleaners. But if he did not actually solicit and obtain orders and instead just promoted the product and only asked the prospects to consider using his companies vacuum cleaners, then he would not be an outside salesperson. The bottom line here is that overtime pay must be provided to everyone who helps promote or market a product and only people who actually consumate sales are exempt from the overtime pay requirements. For more on this case and access to a copy of the decision, please see the Connecticut Employee Rights Blog.

Many people who are paid on a salary basis believe that they are not entitled to overtime pay. We get calls all the time from workers who assume that overtime pay is not an option since they are on a salary. Salaried employees, however, are presumed to be entitled to overtime pay.

A salaried employee must be paid overtime unless they meet the test for an exempt employee under the Fair Labor Standards Act. The Fair Labor Standards Act is probably one of the most confusing and poorly drafted laws on the books. However, over the years, the courts have courts have carved out certain exemptions. The exemptions exclude certain kinds of jobs from overtime pay. The broad idea is that certain higher level positions are not entitled to overtime pay. Here are the main exemptions:

1. Executive - a person who is employed as an executive is exempt from overtime pay. An executive is generally any person who manages the business or part of the business and who also manages two or more employees, has the power to hire and fire employees and who regularly exercises independent judgment.

2. Administrative - a person who is employed in a higher level administrative position is exempt from overtime pay. This is one of the more challenging exemptions as the definition is vague and tends to change over time. In any event, an administrator is someone who helps run the operation of a business such as an accountant or a human resources director. They have to help keep the business running and they also have to regularly exercise independent judgment and not operate under close supervision or engage in clearly defined tasks or work.

3. Professionals - highly educated types with fancy degrees are exempt from overtime pay. This includes doctors, lawyers, scientists, researchers and the like. They are not entitled to overtime pay.

4. Outside Sales - Salespeople who spend the majority of their time outside of the office visiting clients are exempt from overtime pay.

5. Union Employees - employees who are covered by a valid collective bargaining agreement are exempt from overtime pay.

These are the more common exemptions from overtime pay. Many people who are paid on a salary do not fall into any of the above exemptions and are therefore entitled to overtime pay. If you think that you are entitled to overtime pay, you should call an experienced employment law firm. We would be happy to help. We answer these kinds of questions for free as do many other firms.

In New York, it is assumed that all employees are entitled to overtime pay, even if the employee is paid a salary. It does not matter how a person is paid. There are exceptions, but it is the employers burden to prove that an employee is exempt from overtime pay. In New York, an employee is entitled to overtime pay for each hour worked over 40 in a workweek. An employee must be paid "time and a half" for each hour of overtime worked. "Time and a half" means a 50% increase in pay. For example, if an employee's normal pay rate is $50 an hour, her overtime rate will be $75 an hour. This is a steep increase in pay and this is why many companies try to avoid paying their employees overtime pay.

As mentioned above, some employees are "exempt" from overtime pay. This means they don't get paid an increased rate for overtime. Here is a general summary of the common overtime pay exemptions:

1. Highly Compensated Employees - if an employee earns more than $100,000 a year, then they may be exempt.

2. Managers - employees who manage more than two full time employees and spend most of their time managing these people may be exempt.

3. Professionals - employees with advanced degrees such as doctors, lawyers, and scientists are exempt from overtime pay.

4. Administrators - employees who exercise independent judgment and discretion regarding matters of substantial importance to the employer are exempt. To fit within this exemption, the employee's work must involve running the companies business and not involve producing the goods or services provided by the company. Also, support functions are not exempt. In addition, the employee's work must be free from close supervision, not routine, repetitive, or governed by established procedures.

There are a number of other more specific exemptions, but the four listed above are the more common exemptions. Remember, it does not matter how an employee is paid. The fact that an employee is paid a salary is irrelevant. A person is presumed to be entitled to overtime pay unless their position fits within an exemption.

Our law firm, The Ottinger Firm, recently filed a class action suit against Goldman Sachs for overtime pay violations. The law suit alleges that Goldman Sachs improperly classified certain IT employees as independent contractors and then failed to provide them with overtime pay. The misclassification of employees as independent contractors is a common corporate scheme to lower costs. By classifying employees as independent contractors, a company avoids overtime pay, health benefits, workers compensation insurance and even certain tax obligations. In this case, the IT employees did not fall into the category of independent contractors because they were treated like Goldman Sachs employees - they were not actually independent contractors. The case was filed in federal court in New York City.