Tag Archives: Professional Exemption

N.D.Ga.: Where Weekly Compensation of RNs and PTs Not Guaranteed and Comprised of Fees Per Visit as Well as Other Pay Based on Time Worked, Not “Salary” or “Fee Basis;” Clinicians Entitled to Overtime

Rindfleisch v Gentiva Health Services, Inc

As discussed here, this case was before the court on the parties’ respective cross-motions for summary judgment. Plaintiffs, registered nurses (RNs) and physical therapists (PTs)(collectively “clinicians”), paid in part by-the-visit to defendant’s patient’s homes asserted that they were entitled to unpaid overtime under the FLSA. Defendant contended that plaintiffs were exempt from overtime pursuant to the so-called “professional exemption.” Granting the plaintiffs’ motion and denying that of the defendant, the court held that the plaintiffs did not qualify for such exemption, because they were not paid on a “salary basis” or “fee basis,” a requisite element for application of the exemption.

Describing the pay policy at issue, the court stated:

Gentiva provides home healthcare services to patients throughout the United States[Doc. No. 508, 1].1 To provide these services, Gentiva employs registered nurses and physical or occupational therapists to provide in-home healthcare to Gentiva’s patients (collectively “Clinicians”) [Doc. No. 508, 1]. Since December of 2008, Gentiva pays the majority of its Clinicians on a pay per-visit plan (the “PPV Plan”) [Doc. No. 586, 4–5].2 Under the PPV Plan, Clinicians are paid a set fee for a “routine visit” to a patient’s home (“visit fees”) [Doc. No. 586, 14]. These visit fees do not vary based on the time it takes Clinicians to complete a specific in-home visit [id. at 15]. In addition, Clinicians under the PPV Plan are also paid on what Gentiva describes as a “flat rate” for non-visit related work (“non-visit fees”) [id. at 19]. In setting the amount of non-visit fees, Gentiva factors in the amount of time it takes Clinicians to perform a specific non-visit related activity [id.].

Gentiva maintains that the PPV Plan constitutes a “fee basis” payment under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq. [id. at 14]. Therefore, Gentiva classifies all of its Clinicians compensated under the PPV Plan as professional employees exempt from overtime compensation under the FLSA [id. at 10].

The court framed the issue before it as follows: 

In summary, the only issue for the Court to determine at this stage of the litigation process is whether or not the PPV Plan is unlawful under the FLSA.

After explaining the elements required for the application of the professional exemption, and noting that here it was undisputed that plaintiffs me the duties prong of the exemption, the court addressed whether or not the defendant’s pay scheme was a “fee basis” or “salary basis” within the meaning of the applicable regulation:

The DOL regulations state that, in order to satisfy the salary basis test, a professional employee can be paid “on a fee basis, as defined in § 541.605.” 29 C.F.R. § 541.600(a). Section 541.605 states an employee can be paid on a “fee basis” that satisfies the salary basis test if “the employee is paid an agreed sum for a single job regardless of the time required for its completion.” 29 C.F.R. § 541.605(a). Subsection (b) of section 541.605 states that, in order for a particular fee payment to satisfy the salary basis test, “the amount paid to the employee will be tested by determining the time worked on the job and whether the fee payment is at a rate that would amount to at least $455 per week if the employee worked 40 hours.” 29 C.F.R. § 541.605(b).

In the alternative, the DOL regulations, under section 541.604, allow an employee exempt from overtime pay to receive “extra” compensation that does not satisfy the salary basis test. Specifically, section 541.604 allows two forms of “extra” payment, articulated respectively in subsections (a) and (b). Anani v. CVS RX Servs., Inc., 788 F.Supp.2d 55, 66 (E.D.N.Y.2011). Subsection (a) of section 541.604 allows an employee to receive “additional compensation,” that does not satisfy the salary basis test, “based on hours worked for work beyond the normal workweek.” 29 C.F.R. § 541.604(a). Subsection (b) allows an employee to receive payment on an hourly, daily, or shift basis without losing the overtime exemption, so long as he is guaranteed weekly payment of at least $455 and there is a “reasonable relationship” between the guaranteed weekly payment and the employee’s usual weekly earnings. 29 C.F.R. § 541.604(b).

Summarizing the parties’ respective positions, the court explained:

In its motion for partial summary judgment, Plaintiffs argue that the PPV Plan, because the non-visit fees vary based on the amount of time it takes a Clinician to complete a non-visit activity, violates the salary basis test. Therefore, Plaintiffs argue the PPV Plan violates the FLSA and, as a result, that they are owed overtime compensation. In its response to Plaintiffs’ motion, as well as in its own motion for partial summary judgment on the lawfulness of its fee payments, Gentiva asserts the following two arguments: 1. Pursuant to subsection (b) of section § 541.605, the non-visit fees can vary based on the time it takes Clinicians to complete a non-visit activity and still satisfy the salary basis test; and 2. Even if Gentiva’s non-visit fees improperly consider time, Gentiva’s visit fees properly satisfy the salary basis test and, therefore, the non-visit fees constitute “extra” payments under section 541.604. The Court will discuss each of Gentiva’s arguments below.

The court rejected both of the defendant’s arguments in this regard. First, the court concluded that the defendant’s payment of non-visit fees did not satisfy the salary basis test under 29 C.F.R. § 541.605, because they were variable and depended on the amount of time a clinician spent on non-appointment activities:

Subsection (a) of § 541.605 clearly states that a fee for an activity, in order to satisfy the salary basis test, cannot be based on “the time required for [the activity's] completion.” 29 C.F.R. § 541.605(a). Subsection (a) further states that “[p]ayments based on the number of hours or days worked and not on the accomplishment of a given single task are not considered payments on a fee basis.” Id. Based on this clear and unambiguous language, a “fee” that varies based on the amount of time it takes to complete a specific activity does not satisfy the DOL regulation’s salary basis test. See Bread Political Action Comm. v. Fed. Election Comm’n, 455 U .S. 577, 580 (1982) (stating that, in the absence of clearly expressed legislative intention, the plain language of a statute controls its construction and must be considered conclusive); see also Evenson v. Hartford Life & Annuity Ins. Co., 244 F.R.D. 666, 667 (M.D.Fla.2007) (“As a general rule of interpretation, the plain meaning of a regulation governs.”).

Gentiva argues that subsection (b) of § 541.605 allows it to alter the amount of its non-visit fees based on the time it takes Clinicians to complete a non-visit activity. Subsection (b) of § 541.605 provides that, in order for a fee to satisfy the salary basis test, the fee must “amount to at least $455 per week if the employee worked 40 hours.” 29 C.F.R. § 541.605(b). To illustrate this point, subsection (b) provides the following example: “[t]hus, an artist paid $250 for a picture that took 20 hours to complete meets the minimum salary requirement for exemption since earnings at this rate would yield the artist $500 if 40 hours were worked.” Id. Based on this language, Gentiva argues that subsection (b) allows an employer to alter the amount of a fee based on the time it takes an employee to complete a specific activity, so long as the fee is not set on a straight hourly basis.

In essence, Gentiva argues that it can consider the amount of time it takes Clinicians to perform certain non-visit activities prospectively, thereby allowing its non-visit fees to vary based on time. Specifically, Gentiva argues that its non-visit fees factor in time “for the purpose of accommodating the clinician for missed visits that she would have otherwise performed” [Doc. No. 512–1, 25]. In support of this argument, Gentiva provides the following example:

in accordance with one of its conversion charts, Gentiva may pay a visit rate equivalent of $30 for a training that lasted 45 minutes and a rate of $60, equivalent to two visits, for a different training that lasted 3 hours. If, however, Gentiva simply set a flat rate for all trainings at the visit rate equivalent of $30, the training that took 3 hours would not qualify as a bona fide fee ($30 ÷ 3=$10 an hour or $400 over a 40–hour work week)

[id. at 54]. In comparison, Plaintiffs argue that subsection (b) of § 541.605 “describes how to evaluate the payments after the job is completed to determine whether the clinician has been compensated sufficiently to meet the exemption or is instead overtime eligible” [Doc. No. 584, 13]. In summary, Gentiva argues that subsection (b) is in place to allow an employer, in setting a fee for a specific activity, to vary the fee based on the amount of time it takes to complete said activity before it is complete. In contrast to Gentiva’s position, Plaintiffs argue subsection (b) is in place for the purpose of determining if a set fee satisfies the $455/40 hour requirement after the specific activity is complete.

The 2003 version of the fee basis regulation, former 29 C.F.R. § 541.313, is persuasive authority on this point. In the preamble to rule 29 C.F.R. § 541.605, the Department of Labor (the “DOL”) states that “[p]roposed section 541.605 simplified the fee basis provision in the current rule, but made no substantive change.” Dep’t of Labor, Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees, 69 Fed.Reg. 22122, 22184 (Apr. 23, 2004). Based on the lack of substantive change, it can be inferred that 29 C.F.R. § 541.605 is consistent with the language of former 29 C.F.R. § 541.313. See Belt v. Emcare, Inc., 444 F.3d 403, 414 (5th Cir.2006) (“The amendments effectively adopted § 541.314 after notice and comment, without substantive change, [ ] thereby tending to show that the text of § 541.3(e) does not contradict the former § 541.314.”).

Former 29 C.F.R. § 541.313 provides that “[t]he adequacy of a fee payment … can ordinarily be determined only after the time worked on the job has been determined.” 29 C.F.R. § 541.313(c) (2003) (emphasis added). To illustrate this point, 29 C.F.R. § 541.313 provides the following example:

An illustrator is assigned the illustration of a pamphlet at a fee of $150. When the job is completed, it is determined that the employee worked 60 hours. If the employee worked 40 hours at this rate, the employee would have earned only $100. The fee payment of $150 for work which required 60 hours to complete therefore does not meet the requirement of payment at a rate of $170 per week and the employee must be considered nonexempt.

29 C.F.R. § 541.313(d)(3) (2003). Based on this language, the Court agrees with Plaintiffs that 29 C.F.R. § 541.605(b) articulates how to determine a fee for a specific activity satisfies the salary basis test after the activity is completed. Therefore, 29 C.F.R. § 541.605(b) does not authorize an employer to prospectively alter a fee based on the amount of time it takes an employee to perform a specific work activity.

Without question, Gentiva’s non-visit fees vary based on the amount of time it takes Clinicians to complete a specific non-visit activity. Therefore, the non-visit fees violate the clear language of 29 C.F.R. § 541.605(a), which specifies a fee only satisfies the salary basis test when it is “an agreed sum for a single job regardless of the time required for its completion.” Subsection (b) of 29 C.F.R. § 541.605 merely provides a basis for determining whether or not a fee for a specific activity satisfies the salary basis test after the activity is complete. Therefore, Gentiva cannot rely on subsection (b) as justification for varying its non-visit fees based on the amount of time it takes Clinicians to complete a non-visit activity. Such a reading of subsection (b) would completely contradict and negate the clear and unambiguous language of subsection (a). Therefore, Gentiva’s non-visit fees do not satisfy the salary basis test under 29 C.F.R. § 541.605.

The court also rejected the defendant’s alternative argument that the non-visit fees constituted an “extra” payment under 29 C.F.R. § 541.604:

Section 541.604 provides that “[a]n employer may provide an exempt employee with additional compensation without losing the exemption or violating the salary basis requirement, if the employment arrangement also includes a guarantee of at least the minimum weekly-required amount [$455] paid on a salary basis.” 29 C.F.R. § 541.604(a). Gentiva argues that, because its visit fees satisfy the salary basis test, its non-visit fees constitute extra payments under section 541.604. The Court does not find this argument persuasive under either subsection (a) or subsection (b) of section 541.604.

Subsection (a) of section 541.604 allows an exempt employee to receive “extra” payment as “additional compensation … paid on any basis (e.g., flat sum, bonus payment, straight-time hourly amount, time and one-half or any other basis), and may include paid time off.” Id. However, such “extra” or “additional” compensation is only available under subsection (a) for “extra” or “additional” work, meaning “hours worked for work beyond the normal workweek.” Id. Under subsection (a), “beyond the normal workweek” signifies hours worked in excess of forty. See Anani, 788 F.Supp.2d at 67 (stating “common sense as well as the purpose of the FLSA supports the interpretation that the words ‘the normal workweek’ clearly contemplate a forty (40) hour workweek because the FLSA itself generally establishes the right to overtime for hours worked in excess of forty (40) hours.”) (internal quotation marks, alterations and citation omitted).

Here, Gentiva does not designate non-visit activities as additional work only performed after Clinicians have completed forty hours of in-home visits [Doc. No. 586, 34–35]. Instead, in the weeks non-visit activities are performed, non-visit fees are a part of the Clinicians’ compensation for a normal forty hour workweek. Therefore, non-visit fees are not a form of compensation separate from the Clinicians’ forty hour workweek, but are instead a part of the Clinicians’ compensation for a forty hour workweek that includes non-visit activities. Because non-visit activities, and by extension the non-visit fees, are not designated as separate from the Clinicians’ normal workweek, it is irrelevant that Gentiva’s visit fees satisfy the salary basis test. The visit fees do not encompass the complete form of payment for a Clinicians’ normal workweek and, therefore, do not justify payment of the non-visit fees which do not satisfy the salary basis test. As a result, the non-visit fees cannot be considered “extra” payment under subsection (a) of 29 C.F.R. § 541.604.

Subsection (a) of 29 C.F.R. § 541.604 does not allow an employee to receive two forms of payment, with one form failing to satisfy the fee basis test, for two forms of activities completed as part of an employee’s forty hour workweek. An additional form of payment that does not satisfy the salary basis test can only be awarded for work outside of an employee’s normal workweek. As Gentiva’s non-visit fees are a part of the Clinicians’ compensation for a normal workweek that includes non-visit activities, they do not constitute an “extra” payment under subsection (a) of section 541.604.

 Subsection (b) of section 541.604 allows an employer to pay its employee on an hourly, daily or shift basis without negating the overtime exemption “if the employment arrangement also includes a guarantee of at least the minimum weekly required amount paid on a salary basis [$455] regardless of the number of hours, days or shifts worked, and a reasonable relationship exists between the guaranteed amount and the amount actually earned.” 29 C.F.R. § 541 .604 (emphasis added). In summary, subsection (b) allows an employee to be paid on an hourly, daily, or shift basis without losing the overtime exemption, so long as the “reasonable relationship” test is met. Anani, 788 F.Supp.2d at 62. Subsection (b) provides that “[t]he reasonable relationship test will be met if the weekly guarantee is roughly equivalent to the employee’s usual earnings at the assigned hourly, daily or shift rate for the employee’s normal scheduled workweek.” 29 C.F.R. § 541.604(b).

Perhaps most significantly, the court noted that the defendant apparently conceded that there was no guarantee that the clinicians would receive at least $455.00 per week, regardless of the characterization of the non-visit fees:

In its reply brief regarding its motion for summary judgment on the lawfulness of its fee payments, Gentiva appears to concede that the visit fees do not guarantee Clinicians paid under the PPV Plan even $455 in a given week [Doc. No. 617, 24–25]. Based on this concession, Gentiva argues that “fee-based employees need not be guaranteed pay of at least $455 per week to be eligible for extras under section 541.604, they only need to be guaranteed fees that pay them at a rate that would result in at least $455 if they were to work a full 40–hour week performing those fee-compensated tasks” [id. at 25]. This argument, when applied to Clinicians and their usual weekly earnings, supports the very form of payment scheme that the reasonable relationship test of subsection (b) is attempting to guard against…

Here, Gentiva argues in favor of a compensation framework, without even establishing a set amount of “guaranteed” weekly payment, that allows an even greater discrepancy between the Clinicians’ normal weekly earnings and their “guaranteed” weekly payment. Specifically, Gentiva argues that Clinicians can receive one visit fee in a given week and still meet the guarantee requirement of subsection (b), so long as that single fee satisfies the fee basis test under section 541.605. However, under that scenario, Clinicians would have to receive an amount of non-visit fees that is significantly greater than the amount received from the one visit fee. For example, Gentiva asserts “the more productive opt-in clinicians in this action were able to earn more than $150,000 per year, and one plaintiff earned over $240,000″ [Doc. No. 512–1, 15].11 To earn this amount of compensation in a given year, Clinicians have to receive a weekly amount of earnings that greatly exceeds $455, let alone an undetermined amount that is less than $455. Therefore, under the compensation framework put forth by Gentiva, Clinicians’ “guaranteed” payment is an illusion, having no reasonable relationship to the amount of pay that Clinicians usually receive in a given week. See Dep’t of Labor, 69 Fed.Reg. at 22184 (stating “if an employee is compensated on an hourly basis, or on a shift basis, there must be a reasonable relationship between the amount guaranteed per week and the amount the employee typically earns per week. Thus, if a nurse whose actual compensation is determined on a shift or hourly basis usually earns $1,200 per week, the amount guaranteed must be roughly equivalent to $1,200; the employer could not guarantee such an employee only the minimum salary required by the regulation.”). Therefore, Gentiva’s non-visit fees do not constitute an “extra” payment under subsection (b) of 29 C.F.R. § 541.604.

Thus, the court held that the defendant’s payment plan failed to satisfy the salary or fee basis requirement and thus the professional exemption was inapplicable to the plaintiffs.

Click Rindfleisch v. Gentive Health Services, Inc to read the entire Order.

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E.D.Pa.: Hourly-Paid Physician Assistant (PA) Not Professional Exempt; Not A Practitioner “Licensed and Practicing In The Field Of Medical Science”

Cuttic v. Crozer-Chester Medical Center

This case was before the court on the parties’ cross-motions for summary judgment regarding whether plaintiff was exempt from the FLSA’s overtime provisions under the professional exemption.  Because it was undisputed that Plaintiff was paid on an hourly rather than salary basis, the sole issue before the court was whether plaintiff, a physician assistant (PA), qualified as a “professional” within the meaning of § 541.304, the regulation that exempts certain “other practitioners licenced and practicing in the field of medical science” from the typical salary requirements for the professional exemption.  Holding that PA’s do not fall within this definition, the court granted plaintiff’s motion and denied defendant’s motion.

The court reasoned:

“The issue in dispute is whether PAs are intended to be included within § 541.304 and, thus, exempt from the salary requirement in § 541.300(a)(1). In particular, the parties contest whether the language “other practitioners licenced and practicing in the field of medical science” includes PAs. See 29 C.F.R. § 541.304(b).

Defendant argues that PAs are explicitly included among those who qualify for the salary-basis exemption enunciated in § 541.304 because the regulation makes an exception to the salary-basis requirement for employees holding valid licenses or certifications permitting the practice of medicine and actually engaging in the practice thereof. 29 C.F.R. § 541.304(d). Defendant states that because Plaintiff admitted he possesses a valid licence to practice as a PA in Pennsylvania and that he “practice[s] medicine under the direct supervision of [his] attending physicians,” Plaintiff is a “practitioner licensed and practicing in a field of medical science” and qualifies under the salary-basis exemption. (Def.’s Mot. for Summ. J. at 9-12.)

Plaintiff, on the other hand, argues that the salary-basis exemption is narrow in scope and does not include PAs. To support this argument, Plaintiff compares the examples given in § 541.600(e) and § 541.304(b). Section 541.600(e) states that “[i]n the case of medical occupations, the exception from the salary or fee requirement does not apply to pharmacists, nurses, therapists, technologists, sanitarians, dieticians, social workers, psychologists, psychometrists, or other professions which service the medical profession.” 29 C.F.R. § 541.600(e) (emphasis added). Section 541.304(b) states that “the exemption applies to physicians and other practitioners…. The term ‘physicians’ includes doctors including general practitioners and specialists, osteopathic physicians …, podiatrists, dentists …, and optometrists ….” 29 C.F.R. § 541.304(b).

Plaintiff argues that a PA is more akin to one of the named professions which “service the medical profession” as opposed to a doctor, osteopathic physician, podiatrist, dentist, or optometrist. Plaintiff points out that any work he does as a PA must be performed under the direct supervision of a physician, and his main function “is to serve and provide support to the medical profession .” (Pl.’s Mot. for Summ. J. at 8.)

B. Examination of § 541.304

In interpreting the language and meaning of § 541.304, the Court must first determine whether the terms used in § 541.304 are ambiguous as to PAs. Defendant argues that PAs unambiguously practice medicine or a branch of medicine within the meaning of § 541.304, and Plaintiff maintains that the regulation does not speak to this issue. “A regulation is ambiguous when it is not free from doubt … and where no particular interpretation of the regulation is compelled by the regulation’s plain language or by other indications of the [agency's] intent at the time of promulgation of the regulation.” Sec’y of Labor v. Beverly Healthcare-Hillview, 541 F.3d 193, 198 (3d Cir.2008) (internal marks omitted) (holding the term “cost” in Bloodborne Pathogens Standard regulation was ambiguous based on preamble language and fact that neither party “pointed to any indication contemporaneous with promulgation unequivocally stating the agency’s intent to interpret the provision in a particular way”).

Here, the regulations do not define the terms used in § 541.304. In particular, the term “other practitioners licensed and practicing in the field of medical science” is broad and undefined. See Belt v. Emcare, Inc., 444 F.3d 403, 409-12 (5th Cir.2006) (finding § 541.304‘s language is ambiguous and resorting to DOL for interpretative guidance); Clark v. United Emergency Animal Clinic, Inc., 390 F.3d 1124, 1127 (9th Cir.2004) (considering the applicability of § 541.304 to veterinarians); Parker v. Halpern-Ruder, M.D., No. 07-401S, 2008 WL 4365429, at *1 (D.R.I. Sept.16, 2008) (considering the applicability of § 541.304 to registered nurse practitioners and holding nurse practitioners do not fall within § 541.304). Consequently, the Court must construe the language of § 541.304 by giving controlling weight to the agency’s interpretations unless they are “arbitrary, capricious, or manifestly contrary to the statute.” Chevron U.S.A., Inc. v. Natural Res. Defense Council, Inc., 467 U.S. 837, 842-44, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). An agency’s interpretation is controlling “unless plainly erroneous or inconsistent with the regulation.” Auer v. Robbins, 519 U.S. 452, 461, 117 S.Ct. 905, 137 L.Ed.2d 79 (1997) (internal marks omitted).

There is limited law on the question of whether PAs are exempt from the overtime requirements of the FLSA pursuant to § 541.304. The Fifth Circuit, the only circuit to consider the matter, gave deference to the DOL’s informal interpretative statements because that court held that there was limited law on the matter. Belt, 444 F.3d at 405 (using DOL interpretative statements to determine that PAs are not exempt from the salary-basis test); see also Parker, No. 07-401S, 2008 WL 4365429, at *4 (denying Defendant’s motion to dismiss because Defendant did not establish that nurse practitioners are subject to salary-basis exemption in § 541.304). This Court will do the same.

The DOL has consistently interpreted the regulations set forth in § 541 to require a PA to satisfy both the duties test and the salary-basis test, as set forth in § 541.300(a)(1)-(2), in order to qualify for an exemption from the FLSA’s overtime requirements. The DOL has refused to extend § 541.304‘s exception to the salary-basis requirement beyond actual physicians and has consistently taken the position that the salary-basis exception does not apply to PAs. The DOL issued an interpretative regulation in 1949, which was revised in 1973, regarding the meaning of § 541.304(a)‘s phrase “or any of its branches”. See Belt, 444 F.3d at 413 (examining DOL’s interpretative regulations to interpret 29 C.F.R. § 541.3(e) which is a predecessor to 29 C.F.R. § 541.304). This interpretative regulation stated:

Exception for physicians, lawyers, and teachers.

(a) … The exception applies only to the traditional professions of law, medicine, and teaching and not to employees in related professions which merely serve these professions.

(b) In the case of medicine:

(1) … The term physicians means medical doctors including general practitioners and specialists, and osteopathic physicians…. Other practitioners in the field of medical science and healing may include podiatrists …, dentists …, optometrists….

(2) [omitted]

(3) In the case of medical occupations, the exception from the salary or fee requirement does not apply to pharmacists, nurses, therapists, technologists, sanitarians, dieticians, social workers, psychologists, psychometrists, or other professions which service the medical profession.

Id. (quoting 29 C.F.R. § 541.314(a), (b)(1)-(3) (1973)) (emphasis added). This language indicates that the DOL intended for the salary-basis exemption, set forth in § 541.304, to only apply to the “traditional professions of law, medicine, and teaching….” Defendant does not assert any arguments as to why PA’s should be considered members of the “traditional professions of law, medicine, and teaching.” The PA occupation did not develop until 1960; as such, it could not have been within the traditional practice of medicine when the exception was first enacted in 1940.

The 2004 amendments to the regulations continue to use a salary-basis test to determine whether an employee qualifies for the “bona fide professional” exemption pursuant to § 541.300. Additionally, the 2004 amendments specifically reference PA’s. Section 541.301(e)(4) states that PAs who meet certain educational and certification requirements “generally meet the duties requirements for the learned professional exemption.” 29 C.F.R. § 541.301(e)(4). The learned professional exemption that is referenced is found in § 541.300, and this exemption requires an employee to meet the duties and salary requirements. Other occupations explicitly recognized in § 541.301 include registered or certified medical technologists and nurses. See § 541.301(e) (1)-(2). These recognized professions are explicitly excluded from § 541.304‘s salary-basis exemption in § 541.600(e). Further support for the Plaintiff’s position is found directly in the DOL’s statements. In Belt, the DOL, as amicus curiae, “unambiguously adopt[ed] the position that [nurse practitioners] and PA’s do not qualify for the professional exemption.” 444 F.3d at 415; see also Auer, 519 U.S. at 462 (finding that Secretary’s amicus brief sufficed to show how the DOL interpreted its own ambiguous regulation).

Under these circumstances, the Court will give deference to the DOL’s position which is consistent with the 1973 interpretative regulations and 2004 amendments. In deferring to the DOL’s interpretive statements, the Court holds that PAs are not included in the salary-basis exemption found in § 541.304.”

Click Cuttic v. Crozer-Chester Medical Center to read the entire opinion.

If you are an hourly-paid Physician Assistant, call us at 1-888-OVERTIME to discuss your rights.

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D.Kan.: “A & P Mechanic” Was Non-Exempt; Learned Professional Exemption Was Inapplicable, Because Plaintiff’s Work Was Routine Mechanical Work

Dressler v. Kansas Copters and Wings, Inc.

This decision was rendered following a bench trial.  Plaintiff an “A&P Mechanic” sought unpaid overtime pursuant to the Fair Labor Standards Act (“FLSA”).  The Defendant asserted that Plaintiff was exempt from overtime under the professional exemption.  Rejecting Defendant’s assertions, the Court ruled that Plaintiff was not professionally exempt, because his job duties did not meet any of the duties requirements for the application for such exemption.

Reciting its findings of fact, the Court stated:

“Plaintiff David Dressler is a certified A & P mechanic. After graduating from high school, plaintiff joined the United States Marine Corps. For five years, plaintiff worked as an aviation hydraulics mechanic in the Marines. Plaintiff then worked several years as a dental assistant. In January 2005, plaintiff enrolled in the Aviation Institute of Maintenance. Plaintiff obtained his A & P certification in August 2006. Plaintiff was then employed by Midwest Corporate Aviation and Wells Aircraft. On March 15, 2008, plaintiff applied for a position with Kansas Copters & Wings, Inc.

Kansas Copters is a factory authorized dealer and service center for the Robinson R22 helicopter. The president of the company, defendant Earl Schreiber, decided to offer plaintiff a position because of plaintiff’s experience with helicopters in the military and his education. On March 21, plaintiff signed an employment agreement with Kansas Copters. Plaintiff additionally signed a non-compete agreement in which he agreed to not accept employment for any company that offers the same services as defendants.

The employment agreement states in pertinent part:

Your primary function would be to work as an A & P mechanic. All of our employees are responsible for facility maintenance and janitorial duties…. You may be required to work on your days off and/or holidays from time to time. You will be required to travel and attend courses as needed by the company.

Should you terminate your employment we require a thirty (30) day advance notice. Any notice of less than thirty (30) days and/or employment of less than three years would require for you to reimburse the company(s) any funds spent on your training, attending courses, and any other expenses …

As such, the starting salary for this overtime exempt position considering your qualifications is $600.00 per week … Compensatory time is earned hour for hour for every hour in excess of Sixty (60) hours per work week…. The company(s) reserve the right to withhold compensatory time and/or regular pay, and/or vacation time and/or holiday pay in the amount equal to what the company(s) have paid for aforementioned training and expenses, etc., until you have served at least three (3) years continued employment.

Earl Schreiber drafted the employment agreement after consulting with his attorney. Schreiber determined that an A & P mechanic at his company would be exempt from the overtime provisions in the FLSA due to the specialized training and unique services offered by defendants. In making his determination, Schreiber researched the issue of overtime by reviewing brochures from the federal government and browsing the internet. Schreiber also contacted other businesses which contracted with Robinson aircraft. Schreiber learned that these businesses also paid their mechanics a weekly rate. Schreiber therefore determined that the position of an A & P mechanic would be exempt from overtime.

Plaintiff’s work at Kansas Copters was supervised by Laurence Schreiber, who was also an A & P mechanic. Plaintiff was required to perform routine maintenance on Robinson helicopters. Plaintiff was also required to diagnose issues that arose with Kansas Copters’ customers’ aircraft for non-scheduled maintenance. Plaintiff would adjust flight control surfaces, make repairs and adjustments to the engine, and replace parts. Plaintiff would then certify whether the aircraft was safe for flight. In addressing and diagnosing problems, plaintiff would review the flight history and utilize the manuals that were specific to the aircraft. Plaintiff did not deviate from the manuals. Plaintiff did not modify the flight systems and he was not hired to design modifications to the aircraft.

In addition to making repairs at the airport in Augusta, plaintiff was also expected to service Robinson helicopters at other locations. On one occasion during his employment, plaintiff traveled to Nebraska to make repairs on a Robinson helicopter. Plaintiff was also required to perform maintenance on the facility. Plaintiff would clean the floors, paint the hangar and pull weeds. All employees at Kansas Copters were required to assist in the upkeep of the facility. Plaintiff was required to do this type of work when he was not working on a helicopter.

Plaintiff’s work schedule initially required him to work from 8 a .m. to 5 p.m., Monday through Friday. Plaintiff then attended the Robinson Training Course in California during the week of May 11. After returning from the course, plaintiff was certified to work on Robinson helicopters. Plaintiff then began working on Saturdays for eight hours in addition to his regular forty-hour work week. Plaintiff’s compensation rose to $625 a week due after successful completion of the training course.

Plaintiff’s last day of employment with Kansas Copters was August 20, 2008. Instead of issuing plaintiff his final check in the amount of $625, Kansas Copters withheld plaintiff’s pay for reimbursement for the Robinson course.”

Determining that Plaintiff was not professional exempt, the Court reasoned:

“To qualify for the learned professional exemption, an employee’s primary duty must be the performance of work requiring advanced knowledge in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction. This primary duty test includes three elements:

(1) The employee must perform work requiring advanced knowledge;

(2) The advanced knowledge must be in a field of science or learning; and

(3) The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.

29 C.F.R. § 541.301(a).

First, in determining whether the initial element is met, the court is guided by the definition set forth in the regulations:

The phrase “work requiring advanced knowledge” means work which is predominantly intellectual in character, and which includes work requiring the consistent exercise of discretion and judgment, as distinguished from performance of routine mental, manual, mechanical or physical work. An employee who performs work requiring advanced knowledge generally uses the advanced knowledge to analyze, interpret or make deductions from varying facts or circumstances. Advanced knowledge cannot be attained at the high school level.  29 C.F.R. § 541.301(b).

The testimony in this case established that plaintiff performed his position as an A & P mechanic in strict compliance with guidelines set forth by the manufacturer. Plaintiff could not deviate from the design of the helicopter or make any modifications without specific input from the manufacturer. Plaintiff’s work was routine and he worked on the same type of aircraft. The court finds that plaintiff’s work was not predominantly intellectual in character. Plaintiff’s work was routine mechanical work and therefore does not qualify for the learned professional exemption.

Even if the court were to find that the first element was met, the final two elements have not been proven. The second element is as follows:

The phrase “field of science or learning” includes the traditional professions of law, medicine, theology, accounting, actuarial computation, engineering, architecture, teaching, various types of physical, chemical and biological sciences, pharmacy and other similar occupations that have a recognized professional status as distinguished from the mechanical arts or skilled trades where in some instances the knowledge is of a fairly advanced type, but is not in a field of science or learning.  29 C.F.R. § 541.301(c).

Clearly, an aircraft mechanic does not fall into the traditional professions listed in the regulation. Defendants cite Paul v. Petroleum Equip. Tools Co., 708 F.2d 168 (5th Cir.1983) to support the position that pilots have been found to qualify for the professional employee exemption. In Paul, the court determined that flying is a field of science or learning because the pilot “must acquire extensive knowledge of aerodynamics, airplane regulations, airplane operations, instrument procedures, aeronautical charts, and weather forecasting.” 708 F.2d at 173. Plaintiff, however, is not a pilot. Plaintiff’s knowledge is not similar to what is required of a pilot. Plaintiff’s learning is of a mechanical nature and that is excluded by the regulation.

The final element has also not been met. The regulations explain the element as follows:

The phrase “customarily acquired by a prolonged course of specialized intellectual instruction” restricts the exemption to professions where specialized academic training is a standard prerequisite for entrance into the profession. The best prima facie evidence that an employee meets this requirement is possession of the appropriate academic degree. However, the word “customarily” means that the exemption is also available to employees in such professions who have substantially the same knowledge level and perform substantially the same work as the degreed employees, but who attained the advanced knowledge through a combination of work experience and intellectual instruction. Thus, for example, the learned professional exemption is available to the occasional lawyer who has not gone to law school, or the occasional chemist who is not the possessor of a degree in chemistry. However, the learned professional exemption is not available for occupations that customarily may be performed with only the general knowledge acquired by an academic degree in any field, with knowledge acquired through an apprenticeship, or with training in the performance of routine mental, manual, mechanical or physical processes. The learned professional exemption also does not apply to occupations in which most employees have acquired their skill by experience rather than by advanced specialized intellectual instruction. 29 C.F.R. § 541.301(d).

While plaintiff clearly gained his education from technical school and Marine Corps experience, advanced education is not required in order to gain FAA certification. Plaintiff’s short course of training with the manufacturer of Robinson helicopters does not amount to a prolonged course of specialized intellectual instruction. Defendants have again cited cases which deal only with pilots. Plaintiff is not a pilot. The language in the regulation contemplates that some individuals may qualify for the exemption without formal education but then cites rare examples of occupations which routinely required advanced education. The examples cited are clearly those professions which are highly intellectual in nature and not mechanical, like that of an A & P mechanic.

The court finds that plaintiff’s position as an A & P mechanic is not exempt under § 213(a)(1) because he does not qualify as a professional.”

To read the entire decision, click here.

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3rd Cir.: Helicopter Pilots Are Not “Learned Professional” Exempt, Because No Specialized Academic Training Required

Pignataro v. Port Authority of New York and New Jersey

This case was before the Court on the parties cross-appeals.  The Court below granted Plaintiffs, helicopter pilots employed by Defendants, summary judgment, holding that, as a matter of law, helicopter pilots are not exempt from the Fair Labor Standards Act (FLSA) under the so-called “learned professional” exemption.  The Court below determined that Defendants’ FLSA violations were not willful.  The Third Circuit agreed on all counts, affirming the lower Court’s decision.

Discussing the non-exempt status of helicopter pilots, the Court said:

“The applicable exemption from the FLSA urged here encompasses employees who are determined to be members of the “learned” professions, as defined by 29 C.F.R. §§ 541.3 and 541.301. An employee’s status as a “learned professional” is determined by his or her duties and salary. 29 C.F.R. § 541.3. In order to qualify as a “learned professional” an employee’s primary duties must consist of:

[w]ork requiring knowledge of an advance [sic] type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general academic education and from an apprenticeship, and from training in the performance of routine mental, manual, or physical processes.  29 C.F.R. § 541.3(a)(1); see also29 C.F.R. § 541.301(a).

While there are additional requirements for “learned professional” status, namely receipt of compensation exceeding $250 or more per week and duties requiring the exercise of discretion, we concern ourselves initially with whether Port Authority helicopter pilots satisfy the requirements under § 541.3(a)(1). See29 C.F.R. § 541.3(e). We thus consider what advanced knowledge “in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction” entails, and then examine whether Pignataro and Chase’s primary duties required such advanced knowledge.

Advanced knowledge is knowledge “which cannot be attained at the high school level,” 29 C.F.R. § 541.301(b), and which has been obtained through “prolonged study.” 29 C.F.R. § 541.300. The learned professional exemption is available for professions where, in the “vast majority of cases,” the employee is required to have “specific academic training.” 29 C.F.R. § 541.301(d). The exemption does not apply to occupations in which “the bulk of the employees have acquired their skill by experience.” Id. An “advanced academic degree is a standard (if not universal) prequisite [sic]” and is, in fact, “the best prima facie evidence of [professional training].” 29 C.F.R. § 541.301(e)(1). The requirement that the employee’s knowledge be from a field of science or learning “serves to distinguish the professions from the mechanical arts where in some instances the knowledge is of a fairly advanced type, but not in a field of science or learning.” 29 C.F.R. § 541.301(c). Examples of professions included in the “learned professional” exemption are the fields of “law, medicine, nursing, accounting, actuarial computation, engineering, architecture, teaching, various types of physical, chemical, and biological sciences, including pharmacy.” 29 C.F.R. § 541.301(e)(1).

Although a college or other specific degree may not be per se required to qualify as a “learned professional,” it is clear that employees must possess knowledge and skill “which cannot be attained at the high school level” and which has been obtained through “prolonged study.” 29 C.F.R. §§ 541.301(b); 541.300. Furthermore, some type of academic degree is required, as opposed to skill acquired through experience. 29 C.F.R. § 541.301(e)(1).

We next examine whether the training and study Pignataro and Chase were required to complete constitute “advanced knowledge in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction.”  In order to qualify for their jobs, Port Authority helicopter pilots must fulfill the following requirements: (1) log 2,000 hours of flying time in helicopters; (2) earn a commercial helicopter pilot certificate with a helicopter instrument rating; (3) earn a Federal Aviation Administration (“FAA”) Second Class Medical certificate; (4) have knowledge of FAA rules and regulations governing helicopter flights; and (5) earn a high school diploma or GED. (App.182, 318.) In order to earn a commercial certificate, applicants must already hold a private pilot certificate and pass both a knowledge and practical test. 14 C.F.R. § 61.123. The Port Authority sends helicopter pilots to Florida for a one-week training, twice each year.

None of the certifications that helicopter pilots are required to have are academic degrees. Helicopter pilots are not required to spend a significant amount of time in a classroom in order to earn their certifications-nearly all of the instruction takes place in the air. Logging in-flight hours, in-flight instruction, and passing practical and written tests do not qualify as a “prolonged course of specialized intellectual instruction and study.” While the Port Authority is correct that helicopter pilots have “specialized knowledge” and “unique skills” (Port Authority Br. 12-13), this is not sufficient to qualify under the learned professional exemption because pilots’ knowledge and skills were acquired through experience and supervised training as opposed to intellectual, academic instruction. The District Court reasoned that pilots’ flight certificates require specialized instruction beyond a high school education, but do not constitute advanced academic degrees. Thus, the District Court determined that helicopter pilots are “ ‘merely highly trained technicians’ … and therefore do not qualify as professional employees under the FLSA.” (App. 7-8 (citing Martin v. Penn Line Serv. Inc., 416 F.Supp. 1387, 1389 (W.D.Pa.1976))). We agree and conclude that Port Authority helicopter pilots’ work does not require advanced knowledge that is customarily acquired from a prolonged course of specialized instruction. We therefore do not reach the issues of whether Pignataro and Chase were salaried employees or consistently exercised discretion in their work. Our reading of the regulation in light of the requirements for the job leads us to the same conclusion as the District Court. Port Authority helicopter pilots are, therefore, not “learned professionals” and are not exempt from the provisions of the FLSA.

The Department of Labor has reached the same conclusion. As we agree with the agency, we need not discuss the degree of deference we would owe to the agency’s view on the issue.  The Department of Labor Wage and Hour Division has noted that the Department has taken the position that pilots are not exempt professionals because “aviation is not a ‘field of science or learning,’ and … the knowledge required to be a pilot is not ‘customarily acquired by a prolonged course of specialized intellectual instruction.’ “ Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees, 69 Fed.Reg. 22122, 22156 (Apr. 23, 2004) (citation omitted).

The Department of Labor Review Board (the “Board”) has also decided that airline pilots are not “learned professionals” as defined by 29 C.F.R. §§ 541.3 and 541.301 because there is “no doubt” that airline pilots do not meet the “threshold prerequisite” of “formal specialized academic training in a field of science or learning.” In re U.S. Postal Serv. ANET & WNET Contracts Regarding Review & Reconsideration of Wage Rates for Airline Captains and First Officers, ARB Case No. 98-131, 2000 WL 1100166, at *13-14 (Dep’t of Labor Admin. Rev. Bd. Aug. 4, 2000). The Board found that almost all of the professions delineated in the C.F.R. as “professional” require college or graduate-level study (one exception being certain nursing degrees that require completing a college-like academic program). Id. In contrast:

the training of airline pilots in this country typically does not revolve around specialized college-type academic instruction, but more-closely resembles the classic apprenticeship model-a “structured, systematic program of on-the-job supervised training” coupled with a program of related instruction.  Id. at *16 (citing 29 C.F.R. § 29.4 (1999)).

The Board further noted that many courts have held that a specialized college degree is required to meet the “learned professional” exemption. Id. at *29 n. 11. For example, the Court of Appeals for the Eighth Circuit held that “airfield operation specialists” are not learned professionals because they are only required to have a bachelor’s degree in aviation management or a related field, or four years of full-time experience, or an equivalent combination of education and experience. Fife v. Harmon, 171 F.3d 1173, 1177 (8th Cir.1999). The Fife Court held that “[t]his is advanced knowledge from a general academic education and from an apprenticeship, not from a prolonged course of specialized intellectual instruction.” Id. (internal quotation marks omitted). In addition, the Court of Appeals for the Eleventh Circuit held that probation officers are not “learned professionals” because their educational requirement (a four-year college degree) is general and not specialized. Dybach v. State of Fla. Dep’t of Corr., 942 F.2d 1562, 1565-66 (11th Cir.1991).

The Board and the Wage and Hour Division also noted, however, that the Court of Appeals for the Fifth Circuit in Paul v. Petroleum Equipment Tools, Co., 708 F.2d 168, 175 (5th Cir.1983), concluded that an airplane pilot was a “learned professional” and was therefore exempt from the overtime provisions of the FLSA. 69 Fed.Reg. at 22156;In re U.S. Postal Serv., 2000 WL 1100166 at *13-14. The Board “respectfully disagree[d] with the Paul majority’s analytical approach and conclusion.” In re U.S. Postal Serv., 2000 WL 1100166 at *14. Despite Paul, the Wage and Hour Division decided not to modify its position that pilots are not exempt professionals. 69 Fed.Reg. at 22156. Not surprisingly, the Port Authority urges that we should follow Paul. We note that Paul was decided approximately two decades prior to the Board’s decision and the Wage and Hour Division’s interpretation of the exemption that we cite, and the Paul Court stated that the Wage and Hour Division’s interpretations are entitled to “great weight.” 708 F.2d at 173 (citation omitted).

The Paul Court reasoned that, in order to obtain a commercial license and instrument rating, a pilot must “acquire extensive knowledge of aerodynamics, airplane regulations, airplane operations, instrument procedures, aeronautical charts, and weather forecasting.” 708 F.2d at 172. Additionally, pilots are required to receive instruction from a flight instructor, log a certain number of hours of flight time, and pass written and practical tests . Id. The Paul Court determined that this is “extensive, formal, and specialized training” that is comparable to that undergone by nurses, accountants, and actuaries. Id. at 173. However, in light of our own analysis set forth above, that is consistent with the Department of Labor’s interpretation of the regulations, we decline to follow the reasoning of the Paul Court.

Thus, in a field where most employees gain their skills through intellectual instruction, an individual employee who gained his skills through experience may still be exempt under the FLSA. The Paul Court seems to have focused more on Paul’s individual situation than the regulations permit. See708 F.2d at 174 (“[W]e do not decide that company pilots as a class perform exempt professional work. We face here only a pilot like Paul with the highest flight rating, considerable training, and job experience.”). We cannot endorse this approach. See also Dybach, 942 F.2d at 1565 (finding that the determinative factor is the education that the job requires, not the education that the employee actually has); In re U.S. Postal Serv., 2000 WL 1100166 at *14:

[A] close analysis of the specialized academic training provided to members of a job classification is a threshold step in determining whether the occupation generically meets the professional exemption test. Consequently, we share the view of the dissenting opinion in Paul that it is analytically incorrect to “work backwards” from the level of an employee’s knowledge and skill in order to infer that the occupation requires the kind of advanced academic instruction contemplated by the regulations.

Based on the above analysis, we will affirm the District Court’s grant of summary judgment.”

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2d. Cir.: Employee Is Not Professionally Exempt Unless His Work Requires Knowledge Customarily Acquired After A Prolonged Course Of Specialized, Intellectual Instruction And Study

Young v. Cooper Cameron Corp.

The U.S. District Court for the Southern District of New York held on summary judgment that, as a matter of law, plaintiff, a “Product Design Specialist,” was not subject to the “professional exemption” to the overtime requirements of the Fair Labor Standards Act.  Defendant appealed and the Second Circuit affirmed, holding that an employee is not an exempt professional unless his work requires knowledge that is customarily acquired after a prolonged course of specialized, intellectual instruction and study.

Describing the relevant facts and the holding below, the Court stated, “Young is a high school graduate. He enrolled in some courses at various universities, but did not obtain a degree. Before he was hired by Cameron, he worked for 20 years in the engineering field as a draftsman, detailer, and designer. He was a member of the American Society of Mechanical Engineers, a membership that required the recommendation of three engineers. For three of the 20 years, Young worked with what are known as hydraulic power units (“HPUs”).

In the spring of 2001, Young applied for a job with Cameron, and he was offered the position of Mechanical Designer in the HPU group. This position paid an hourly wage of $26 and was classified as non-exempt under the FLSA. Young, seeking higher pay, declined.

Soon after, Young met again with Cameron. This time, Cameron offered to hire him as a PDS II-a position that Cameron had determined, through multiple internal and external analyses, was exempt from the FLSA’s overtime provisions. This job paid an annual salary of $62,000 (an effective hourly wage of $29.81). Applicants were required to have twelve years of relevant experience; but no particular kind or amount of education was required, and no PDS II had a college degree. Young accepted Cameron’s offer on July 23, 2001, understanding that the position was exempt from the FLSA’s overtime provisions. For his three-year tenure at Cameron, Young worked as a PDS II in the HPU group.

HPUs contain fluid under pressure for use in connection with oil drilling rigs. They are large and complex, and they are subject to a variety of industry standards, codes, and government specifications. Young was the principal person in charge of drafting plans for HPUs. This work required depth of knowledge and experience, and entailed considerable responsibility and discretion. For example, Young assimilated layers and types of specifications into a safe, functional, and serviceable design that met consumer demands, engineering requirements, and industry standards. Young personally selected various structural components of the HPU and modified certain specifications to account for new technology. In these ways, Young operated at the center of both the conceptual and physical processes of HPU creation and development.

On August 2, 2004, after losing his job in a reduction-in-force, Young sued Cameron in federal court, alleging that Cameron had improperly and willfully classified him as an exempt professional. The district court, adopting a report and recommendation from the magistrate judge (Gorenstein, M.J.), granted partial summary judgment to Young on the exemption issue. The court held as a matter of law that the work of a PDS II is ‘not of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study.’ “

Affirming the lower Court’s Order finding Plaintiff not subject to the professional exemption, the Court stated:

“The typical symbol of the professional training and the best prima facie evidence of its possession is, of course, the appropriate academic degree, and in these professions an advanced academic degree is a standard (if not universal) prerequisite.” 29 C.F.R. § 541.301(e)(1). So it is not the case that “anyone employed in the field of … engineering … will qualify for exemption as a professional employee by virtue of such employment.” Id. § 541.308(a). At the same time, “the exemption of [an] individual depends upon his duties and other qualifications.” Id. “The field of ‘engineering’ has many persons with ‘engineer’ titles, who are not professional engineers, as well as many who are trained in the engineering profession, but are actually working as trainees, junior engineers, or draftsmen.” Id. § 541.308(b). Thus “technical specialists must be more than highly skilled technicians” to be eligible for the professional exemption. Id. § 541.301(e)(2); see also id. (“The professional person … attains his status after a prolonged course of specialized intellectual instruction and study.”).

As the Secretary interprets the regulations, a three-part test determines whether an employee has the type of knowledge sufficient to qualify as an exempt professional. First, the employee’s “knowledge must be of an advanced type … generally speaking, it must be knowledge which cannot be attained at the high school level.” 29 C.F.R. § 541.301(b). Second, the knowledge must be in a field of science or learning. Id. § 541.301(c). Third, the knowledge “must be customarily acquired by a prolonged course of specialized intellectual instruction and study.” Id. § 541.301(d). The word “customarily” is key:

The word ‘customarily’ implies that in the vast majority of cases the specific academic training is a prerequisite for entrance into the profession. It makes the exemption available to the occasional lawyer who has not gone to law school, or the occasional chemist who is not the possessor of a degree in chemistry, etc., but it does not include the members of such quasi-professions as journalism in which the bulk of the employees have acquired their skill by experience rather than by any formal specialized training. Id.

It is uncontested that the job of a PDS II requires no formal advanced education. The issue is whether a position can be exempt notwithstanding the lack of an educational requirement, if the duties actually performed require knowledge of an advanced type in a field of science or learning. Cameron argues for a stand-alone “duties test” independent from any educational considerations. Young argues, and the district court held, that if advanced and specialized education is not customarily required, the exemption cannot apply, regardless of the employee’s duties.

We agree with Young and the district court. The regulations state that a professional is someone “[w]hose primary duty consists of the performance of [w]ork requiring knowledge of an advance type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study. 29 C.F.R. § 541.3(a)(1) (emphasis added). As noted above, “customarily” in this context makes the exemption applicable to the rare individual who, unlike the vast majority of others in the profession, lacks the formal educational training and degree. But where most or all employees in a particular job lack advanced education and instruction, the exemption is inapplicable: hence, the Secretary’s interpretation advising that “members of such quasi-professions as journalism in which the bulk of the employees have acquired their skill by experience rather than by any formal specialized training” are not properly considered exempt professionals. See 29 C.F.R. § 541.301(d).

We therefore hold that an employee is not an exempt professional unless his work requires knowledge that is customarily acquired after a prolonged course of specialized, intellectual instruction and study. If a job does not require knowledge customarily acquired by an advanced educational degree-as for example when many employees in the position have no more than a high school diploma-then, regardless of the duties performed, the employee is not an exempt professional under the FLSA.

With these principles in mind, it is clear that Young is not exempt. The undisputed evidence is that the PDS II position required no advanced educational training or instruction and that, in fact, no PDS II had more than a high school education.

Two sister courts have issued persuasive opinions on this subject. In Vela v. City of Houston, 276 F.3d 659, 675 (5th Cir.2001), the only decisive factors were education and discretion (the exercise of professional judgment on the job). On that basis, the court distinguished emergency medical technicians and paramedics (who are not required to have college degrees) from nurses and athletic trainers (who are so required). Id. (explaining that EMTs and paramedics are not exempt professionals because they “lack the educational background to satisfy the education prong of the Learned Professional exemption”).

In Fife v. Harmon, 171 F.3d 1173, 1177 (8th Cir.1999), the minimum qualifications for the plaintiffs’ position as Airfield Operation Specialists were “a Bachelor’s degree in aviation management or a directly related field, or four years of full-time experience in aviation administration, or an equivalent combination of experience and education.” The court held the exemption inapplicable: “This is advanced knowledge from a general academic education and from an apprenticeship, not from a prolonged course of specialized intellectual instruction.” Id. (internal quotation marks omitted). The court did not separately consider the nature of the plaintiffs’ duties.

Other cases similarly tie the exemption analysis to the academic requirements of the position at issue. See, e.g., Reich v. Wyoming, 993 F.2d 739, 743 (10th Cir.1993) (concluding that game wardens are subject to the professional exemption because they must have a degree in wildlife management, biology, or a similar field); Dybach v. Fla. Dep’t of Corr., 942 F.2d 1562, 1566 (11th Cir.1991) (“Dybach’s position [as a probation officer] did not rise to the level of a section 213(a)(1) [exempt] professional because it did not require a college or an advanced degree in any specialized field of knowledge.”).

Finally, the case law advanced by Cameron is neither binding on this Court nor inconsistent with our conclusion. Some of these cases either misapply (or ignore altogether) the requirement that the plaintiff’s knowledge be of the type customarily acquired by a prolonged course of advanced intellectual study. See Debejian v. Atl. Testing Labs., Ltd., 64 F.Supp.2d 85, 88 (N.D.N.Y.1999); Stevins v. Provident Constr. Co., No. 04-15189, 137 Fed.Appx. 198, 199 (11th Cir. Apr. 18, 2005). Another case cited by Cameron provides minimal justification for its holding. See Dingwall v. Friedman Fisher Assocs., P.C., 3 F.Supp.2d 215, 218 (N.D.N.Y.1998) (holding, without explanation, that designing electrical systems is “clearly an area requiring advanced knowledge in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study”).

On the basis of the foregoing, we conclude that, as a matter of law, Young was not an exempt professional because he did not do work which required knowledge customarily acquired by a prolonged course of advanced intellectual study.”

Therefore, the Court affirmed the lower Court’s ruling that Plaintiff, who lacked a prolonged course of specialized, intellectual instruction and study, was not professionally exempt.

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D.S.C.: “Salaried” Accountant May Be Hourly After All; Question of Fact For Jury

Holladay v. Burch, Oxner, Seale Co., CPA’s, PA

In this FLSA case, the parties cross-moved for summary judgment, regarding the applicability of the professional exemption. It was not disputed that Plaintiff was an accountant, who performed exempt duties. The sole issue before the Court was whether Plaintiff received at least $455.00 per week on a salary basis.

Plaintiff stated that the amount she was paid was based on an hourly rate computed by dividing the total estimated compensation by 2300, the expected hours worked per year. She took the position in her brief that the firm’s pay scheme was based on an expectation that she would work 44.23 hours per week (based on 2300 hours divided by 52 weeks) and that her guaranteed wages compute to 32.31 hours per week (for 2006).

The parties did not dispute that the Plaintiff was working in a professional capacity and that she received at least $455 per week in compensation.  However, the Plaintiff contended that her status as an exempt salaried employee was lost as a matter of law since her pay was in fact calculated on an hourly basis and that her guaranteed pay did not bear a reasonable relationship to her actual earnings for her normal workweek as set forth in 29 C.F.R. 541.604(b).  Defendant contended that the Plaintiff retained her exempt status as a matter of law and that her method of pay placed her under subsection (a) of 541.604.

In denying both parties’ motions for summary judgment, after a lengthy discussion of the issue presented—hourly vs. salary basis – the Court determined it was a question of fact whether the guaranteed salary amount paid to the plaintiff was for forty (40) hours (the normal workweek) or for only 32.31 hours (for example, in 2006) as the plaintiff suggests. The Court further explained, If the jury determined the guaranteed salary amount was for a normal workweek (i.e., 40 hours) then the defendant would not have lost the exemption and the plaintiff could not recover. However, if the jury determined the guaranteed amount was in fact for fewer hours than a normal workweek of forty (40) hours, such as 32.31 hours as Plaintiff contends for 2006, then the exemption is lost and the plaintiff would be entitled to damages. The jury would determine the number of overtime hours, the hourly rate of pay for each period, as well as wilfulness. The Court would then make the mathematical calculations. After reviewing the record submitted, the Court is simply unable to make a ruling as a matter of law for either party on the issue of whether the plaintiff is an exempt employee without additional factual findings. See, e.g., Archuleta v. Wal-Mart Stores, Inc., 543 F.3d 1226, 1236 (10th Cir.2008); Davis v. Lenox Hill Hospital, 2004 WL 1926087 (S.D.N.Y.2004).

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