Fair Labor Standards Act

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U.S. Supreme Court, in Viking River Cruises, Inc. v. Moriana

On January 15, 2025, the U.S. Supreme Court issued a rare unanimous decision in EMD Sales Inc. v. Carrera, addressing the standard of proof employers must meet to establish that an employee is exempt from the minimum wage and overtime requirements under the Fair Labor Standards Act (FLSA). The Court held employers need only prove employees meet an FLSA exemption by a preponderance of the evidence (more likely true than not), rejecting the Fourth Circuit’s use of the higher “clear-and-convincing-evidence” standard. This ruling carries significant implications for employers in the context of employee classification and defending against unpaid overtime claims.

Under the Fair Labor Standards Act (FLSA), employers must provide overtime pay to employees at one and one-half times an employee’s regular pay rate for every hour the employee works beyond 40 hours in a workweek, unless the employee falls within a specified exemption. Under current U.S. Department of Labor (DOL) regulations, exempt employees include executive, administrative, professional, and computer employees who perform certain duties, and earn at least $684 per week ($35,568 annually). Highly compensated employees who perform office or nonmanual work and are paid a total annual compensation of $107,432 are also exempt.