In February of 2012 the United States Court of Appeals for the Sixth Circuit heard a case involving the FLSA and whether the employee was an exempt salaried employee or not. (See Orton v. Johnny’s Lunch Franchise, LLC, 668 F.3d 843 (6th Cir. 2012)). The Plaintiff in this case sued his former Kentucky employer for unpaid wages for the time period of August 2008 to December of 2008. Plaintiff sued his Kentucky employer under the Fair Labor Standards Act (“FLSA”). The trial court dismissed the Kentucky case. But, this appellate court reversed for the following reasons.
Plaintiff was hired by this Kentucky company in September of 2007 as Vice President of Real Estate and Site Selection and was paid a base salary of $125,000. Id. During 2008 the Defendant had trouble making payroll and Plaintiff was not paid his salary. On December 1, 2008 Plaintiff along with the other Kentucky employees was fired. He then filed his Kentucky overtime FLSA case.
Plaintiff sued the company and the named owner individually under the FLSA. The defendants moved to dismiss arguing that Plaintiff was not a nonexempt employee and thus not entitled to overtime or the past wages owed.
“The FLSA requires employers to pay minimum wages to certain employees. (cites omitted). Employers must also pay overtime to employees who work more than forty hours a week.” (cites omitted).
The court looked at the three tests to see if the employee had a qualified exemption to the FLSA under thither a duties test, a salary-level test or a salary-basis test. The Plaintiff did not challenge the first two tests but did challenge the salary-basis test. Id. This salary-basis test was updated in 2004 to focus on the pay received rather than the terms of the employment agreement. Id. The regulation still requires the employer to show that the plaintiff was paid 1, a predetermined amount, which 2, was not subject to reduction, 3, based on quality or quantity of work performed. Id. In the case at hand the Kentucky plaintiff clearly alleged that his pay was reduced to zero.
Based on Plaintiff’s allegations in his Kentucky overtime FLSA complaint it was then defendant’s burden, not the plaintiff’s to establish that the reason for the deduction was proper. (cites omitted). The regulation makes no exception for deductions in pay just because they were motivated by cash flow shortages. Id.
If you have been the subject of a Kentucky overtime FLSA case, please call and speak to a Kentucky overtime FLSA lawyer at the Law Offices of Andrew Alitowski, P.A. at 888-ASK-ANDREW (888-275-2637) or contact us. We are available 24 hours a day, 7 days a week.
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