On June 10, 2019, the United States Supreme Court unanimously held that state law does not apply to the Outer Continental Shelf (OCS) in situations when federal law addresses the relevant issue at hand.

In Parker Drilling Management Services, Ltd. v. Newton, the Supreme Court declined to extend California’s wage and hour laws to employees working on offshore drilling platforms subject to the Outer Continental Shelf Lands Act.

The OCSLA extends federal law to the subsoil and seabed of the outer continental shelf and to all structures permanently or temporarily attached to the seabed for the purpose of developing, producing or exploring for oil. Under the OCSLA, the laws of an adjacent state only apply to the OCS to the extent “they are applicable and not inconsistent with” federal law.

Here, the US Supreme Court ruled that because the federal Fair Labor Standards Act (FLSA) addressed the relevant issues, the adjacent state law was inapplicable.


Continue Reading

On March 28, 2019, the US Department of Labor announced a proposed rule to clarify that certain types of compensation and benefits can be excluded from an employee’s “regular rate” of pay, which is used to calculate overtime under the FLSA. This announcement follows the DOL’s recent proposal to increase the minimum salary requirements for the FLSA’s white-collar overtime exemptions, continuing the DOL’s efforts to update and modernize FLSA regulations.

Continue Reading

In a welcome decision for franchisors, and first of its kind in the Second Circuit, the Southern District of New York ruled that Domino’s Pizza Franchising LLC, the franchisor (Domino’s), did not exert enough control over its franchisee to warrant joint employer status. This determination means Domino’s will not have to face claims brought under

In August, the United States Court of Appeals for the Sixth Circuit (covering Kentucky, Michigan, Ohio and Tennessee) upheld an arbitration agreement that required individual arbitration of claims under the federal Fair Labor Standards Act (FLSA). The Court’s decision is in line with the United States Supreme Court’s decision in Epic Systems Corp. v. Lewis.

Continue Reading

Last week, in Troester v. Starbucks Corporation (Case No. S234969), the California Supreme Court weighed in for the first time on the viability of a de minimis defense to California wage and hour claims.

Many commentators have since rushed to declare that “de minimis” is dead. Not so.


Continue Reading

On June 14, franchisors received good news when the US District Court in the Eastern District of Illinois ruled that Jimmy John’s Franchise, LLC is not a joint employer of its franchisees’ employees.

In 2014, former employees of various Jimmy John’s franchisees brought a collective action against their former franchisee employers and against Jimmy John’s

As we previously posted, on January 5, 2018, the Department of Labor did away with its previous six-factor test and announced a new “primary beneficiary” test to determine whether interns and students working for “for-profit” employers are entitled to minimum wages and overtime pay under the Fair Labor Standards Act. See our previous post HERE

On December 22, 2017, the Tax Cuts and Jobs Act was signed into law bringing significant changes to US tax law. One provision of the Act may further incentivize individuals to work as independent contractors instead of as traditional employees.

The new provision allows for independent contractors, and for service providers structured as a partnership or other flow-through entities, the potential to deduct up to 20% of their revenue from their taxable income. And while some companies might view the opportunity to re-classify individuals from employees to independent contractors as a “win–win” scenario, it could create substantial legal exposure for employers.


Continue Reading

On January 5, 2018, the Department of Labor did away with its previous six-factor test and announced a new “primary beneficiary” test to determine whether interns and students working for “for-profit” employers are entitled to minimum wages and overtime pay under the Fair Labor Standards Act. Employers are required to pay employees for their work, but in some circumstances, interns may not actually be employees under the FLSA, and therefore, can be unpaid. The DOL stated that the new test “allows increased flexibility to holistically analyze internships on a case-by-case basis.”

The new “primary beneficiary” test looks at whether the intern or the employer is the primary beneficiary of the relationship. Several circuit courts, including the Second and Ninth, have previously favored the “primary beneficiary” test, viewing it as being more up to date and aligned with the underlying purpose of an unpaid internship.


Continue Reading

Medical care providers have been experiencing an uptick in Fair Labor Standards Act lawsuits based on automatically deducted meal periods. Recently, a nurse filed a collective action lawsuit against St. Luke’s Health System Corporation and various affiliates, claiming that they failed to pay nurses for work performed during meal breaks. Specifically, the nurse alleges that St. Luke’s automatically deducts 30 minutes from each shift for meal periods, assuming that its nurses are able to find a 30-minute block of time to eat. The nurse further claims that, in reality, nurses remain on duty when attempting to eat, and that their meal periods are frequently interrupted. Given the potential for large liability and the likelihood of copycat lawsuits, employers—particularly medical care providers—should examine their meal period policies to ensure the policies are compliant with the Fair Labor Standards Act.
Continue Reading