Who's entitled to overtime? It's not always clear

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.

Worker can't collect damages if she would have been fired anyway

An employee tore her rotator cuff, and her doctor gave her a note saying she shouldn’t be required to lift more than 10 pounds. Later, she was fired, and she sued under the Americans with Disabilities Act, claiming the firing was illegal because it was due to her perceived disability.

At trial, a jury agreed that the employee was fired because of her perceived disability. However, it also decided that she would have been fired anyway, even if she hadn’t had a perceived disability.

So who wins?

The employer wins in this case, according to a federal appeals court in Chicago.

Cases like this are known as “mixed-motive” cases, because there are multiple motives for a firing, some of which are legal and some of which are illegal.

But according to the court, as long as the employer would have done what it did anyway for legitimate reasons, the fact that it was also motivated by reasons that violate the disabilities law doesn’t matter and the employee can’t collect any damages.

Non-compete agreements valid despite moves, mergers

Suppose a Massachusetts employee signs a non-compete agreement, but then leaves to work for a competitor in California - a state that generally doesn’t approve of non-compete agreements. Can the agreement still be enforced against him?

Yes, according to a recent decision by a Massachusetts court.

The employee was a vice president at the EMC computer company in Massachusetts. After 20 years with EMC, he quit to become vice president at Hewlett-Packard in California.

The employee had signed an agreement saying that if he left, he wouldn’t work for a competitor for a year. When EMC sued, he argued that the agreement wasn’t valid because it violated the law of California.

But the Massachusetts court said that while that might be true, the agreement was still valid in Massachusetts, and Massachusetts law applied - so the employee was out of luck.

In another case involving non-competes, the Nevada Supreme Court decided that a non-compete agreement continued to be valid even though the employer had merged with another company.

The employee argued that the agreement couldn’t be enforced because the company that was trying to enforce it was the product of several mergers and the original agreement was only with one of the companies involved in the mergers. 

But the court said this didn’t matter, because the surviving company had the right to enforce agreements made by the merged corporation.

Genetic discrimination law now in effect

The employment provisions of the federal Genetic Information Nondiscrimination Act have now taken effect.

This new federal law says that a company can’t refuse to hire people because they are genetically disposed to develop a particular disease or condition, even if this would cause the company’s health care costs to skyrocket.

The law not only prohibits discrimination based on genes, but also creates a new right to medical privacy for employees. In some cases, employers can get into big trouble if they violate this right to privacy, such as by requesting, requiring or disclosing genetic information about employees.

'Tomboy' sues for sex discrimination

A female employee who claims she was fired because she didn’t have a sufficiently “feminine” appearance can sue for sex discrimination.

That’s the word from a federal appeals court in St. Louis.

The woman was hired to work at the front desk of a hotel. She was fired after less than a month on the job, allegedly after a company executive commented that she wasn’t a “good fit” for the front desk because she didn’t have a “Midwestern girl look.”

Co-workers described the woman as being “tomboyish” in appearance. She had short hair, preferred to go without makeup, and wore loose-fitting clothing including men’s button-down shirts and slacks.

The woman sued, saying the company illegally required that female employees be “pretty” in order to work at the front desk.

The hotel argued that the woman wasn’t treated differently from men who had similar jobs. But the court allowed her suit to go forward.

According to the court, “The question is whether [the hotel's] requirements that [the woman] be ‘pretty’ and have the ‘Midwestern girl look’ were because she is a woman. A reasonable [jury] could find that they were since the terms by their nature apply only to women.”

COBRA coverage extended for the unemployed

Congress has extended the law that allows additional COBRA coverage for workers laid off because of the recession.

The new law grants a six-month extension of the 65-percent COBRA health insurance subsidy to cover workers laid off through February 28, 2010. Under the original law, the benefit extension was available only to workers who were laid off on or before December 31, 2009.

The six-month extension will be provided for workers whose normal nine-month coverage has run out.