Supreme Court affirms that FLSA doesn’t apply to all employees

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in Discrimination and Harassment,Employee Benefits Program,Employment Law,Human Resources

The U.S. Supreme Court ruled unanimously in a closely watched overtime case that employees classified as home care workers aren’t entitled to some Fair Labor Standards Act (FLSA) protections. The ruling upholds a U.S. Labor Department regulation that says such workers aren’t entitled to overtime for hours worked in excess of 40 per week.

The decision is part of an important trend and shows that the court—with conservative Bush appointees added to the mix—seems inclined to give great deference to agency interpretations of the law even when those interpretations limit employee rights.

At issue in the case was a potential billion dollars plus liability for companies in the home health care industry.

Evelyn Coke, a 73-year-old woman who had worked for over 20 years as a home care aide, filed the original lawsuit. She argued that a 1975 Labor Department regulation exempting over one million home health care workers from overtime was invalid. She was assisted by the Service Employees International Union (SEIU), which has among its members many in the nursing and related health care industry.

The 2nd Circuit Court of Appeals agreed with Coke. Long Island Care at Home, her former employer appealed to the U.S. Supreme Court.

The Bush administration supported the Labor Department regulation, telling the court that it was up to Congress to say whether home health care workers employed by agencies should get overtime. Congress has never specifically said that they should, and the Labor Department interpreted their silence as an indication such workers were not entitled to FLSA overtime protection. (Long Island Care at Home v. Coke, No. 06-593. U.S. Supreme Court 2007)

Looking forward

This unanimous decision indicated the court’s willingness to side with agency interpretations of the law. That’s important, because the court may soon consider another controversial agency interpretation that may impact how you set benefits for older employees.

Just last week, the 3rd Circuit Court of Appeals upheld an EEOC interpretation of the Age Discrimination in Employment Act (ADEA) that allows employers to differentiate between “younger” old employees and “older” old employees when creating retiree health insurance benefits.

In that case, AARP sued the EEOC over the regulations, alleging they were a misinterpretation of the ADEA’s age discrimination rules.

The 3rd Circuit Court of Appeals disagreed, and said the EEOC regulations could go into effect because they were a reasonable interpretation of Congress’ intent when it passed the ADEA. (AARP v. EEOC, No. 05-4594, 3rd. Cir. 2007)

If the AARP appeals the decision to the Supreme Court, the reasoning it applied in the overtime case may be applied in this one, too.

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