Supreme Court wage and hour cases to watch

This term, the Supreme Court is hearing seven employment cases, addressing a range of topics from whistleblower protection to pregnancy discrimination. In a two part series from Wage & Hour Insights, Doug Hass examines two of the seven employment cases that will impact wage and our litigation going forward.

Integrity Staffing Solutions v. Busk

The first article in the series focuses on Integrity Staffing Solutions v. Busk, in which the Supreme Court will consider if time spent in security screenings should be compensated under the Fair Labor Standards Act (FLSA). In this case, the plaintiffs allege they were required to spend up to 25 minutes in security screenings at the end of shifts and not paid for their time.

The district court initially dismissed the case, but the Ninth Circuit reversed the decision finding that the security screenings did meet the requirements to be covered under the FLSA, ‘integral and indispensable’ to the principal job activities of employees. Hass points out that the Justices had a challenging time determining the scope of a ‘principal’ activity.

If the Supreme Court offers an ‘opaque opinion’, it could mean greater challenges for employers. A broadly worded opinion could blur the lines between compensable and non-compensable activities performed before and after shifts. The decision is expected in early 2015.

Perez v. Mortgage Bankers Association

The second article examines Perez v. Mortgage Bankers Association, a case that deals with wage and hour interpretation, but could have wide-reaching implications. The central question of this case is if federal agencies can change wage and hour interpretations each time there is a change in administration, or if they instead have to create new regulations.

In 2006, the Department of Labor (DOL) under the Bush administration announced it had interpreted the 2004 FLSA rules as making mortgage loan officers exempt from overtime under the administrative exemption. In 2010 the DOL withdrew its 2006 opinion letter and issued a new interpretation deeming loan officers not-exempt from overtime pay.

The Mortgage Bankers Association sued to overturn the 2010 change in interpretation, but the challenge was dismissed, and then reversed, resulting in circuits currently having different interpretations. The Supreme Court aims to resolve this matter.