DOL Revives Prior Practice of Issuing Fact-Specific Opinion Letters In Response to Employer Wage & Hour Questions
The Department of Labor’s Wage and Hour Division recently made good on its promise to revive wage and hour Opinion Letters by issuing seventeen (17) such letters addressing whether a variety of occupations are exempt from overtime under the Fair Labor Standards Act. In addition, the WHD reports that it has received requests for opinion letters regarding hot topics such as how the FLSA interacts with the burgeoning gig economy and the growing use of mobile technology to work outside the office. Opinion letters provide employers with fact-specific legal clarity and that they potentially can use to support a “good faith reliance defense” for actions that may otherwise constitute federal wage and hour violations. Clark Hill will continue to monitor and keep you updated on the issuance of opinion letters that may impact your business.
Why the Shift from Administrator’s Interpretations to Opinion Letters Matters
Under President Barack Obama’s administration, the WHD began issuing general Administrator Interpretations on the proper application of federal wage and hour laws (e.g., the FLSA). In January, the Trump-administration formally abandoned this practice and reverted back to the prior longstanding practice of issuing fact-specific opinion letters in response to employer requests. The WHD’s shift back to issuing opinion letters is good news for employers.
First, the employer “good faith reliance defense” will be available in more situations with each newly-issued WHD opinion letter addressing unique real world fact patterns. Section 9 of the Portal-to-Portal Act (29 USC § 259(a)) explicitly provides an employer with an absolute defense (i.e., no back wages owed) to FLSA unpaid minimum wage or overtime violations if the employer can show its complained of actions were taken in good faith, in conformity with, and in reliance on any written ruling of the WHD Administrator (or Acting Administrator). An employer can rely on WHD opinion letters to establish the defense, since the letters are a written ruling (note: only letters signed by the Administrator or Acting Administrator qualify) and they each analyze a highly-specific real life fact pattern.
Second, the WHD’s shift is an example of how the DOL is now focused on enforcing wage and hour laws by helping employers, as opposed to the prevalence of enforcement lawsuits over the past 8 years. Although the DOL will continue to file lawsuits and take other legal actions to enforce wage and hour laws, it is now focusing those tactics on willful violators.
WHD Made the Request Process Simple
The WHD has set up a website to help potential requestors (i.e., employers or their legal counsel) with the WHD opinion letter request process. The WHD strongly suggests employers review the previously-issued WHD opinion letters before submitting an opinion letter request. For employers who do not find an on-point WHD opinion letter, the website also details the specific information an employer will need to provide, while also cautioning against including any confidential (e.g., trade secret) or private (e.g., social security number) information in the written request.
Employers should be on the lookout for new WHD opinion letters on modern day wage and hour issues (e.g., how to avoid FLSA liability for off-the-clock employee use of an employer-provided mobile electronic devices) once President Trump’s WHD Administrator nominee (Cheryl Stanton) is confirmed by the Senate. Of course, employers should always consult with legal counsel before implementing changes based on an opinion letter. Among other issues, employers should be aware that applicable state or local (e.g., San Francisco, CA) wage and hour laws may be more generous for employees, and the letters can only support an absolute bar to an unpaid minimum wage or overtime violation where the facts are virtually identical.
If you have any questions about wage and hour compliance issues, contact Stephen R. Gee at (616) 608-1144, email@example.com or another member of Clark Hill's Labor and Employment Practice Group.