HR Management & Compliance

Public-sector Employers Face Additional FLSA Classification Risks

Local governments and municipalities face many of the same wage and hour challenges as other employers, but they must deal with unique issues that could subject them to litigation if they aren’t fully up-to-speed on their compliance obligations. One tricky issue involves the proper classification of all workers — whether they fall under one of the major exemptions under Fair Labor Standards Act, or under a government-specific requirement. A trio of recent cases illustrates how tricky these determinations can be.

Public-sector employers must comply with the major exemptions under the FLSA that apply in all work sectors (the administrative, executive and professional exemptions). However, elected officials and their personal staff members are also exempt from the FLSA if they meet specific requirements.

The exemption for the personal staff of an elected official can be complicated. The term “personal staff member” has caused confusion, despite regulations from the U.S. Department of Labor which construed the term “personal staff member” to mean only employees: (1) under the direct supervisions of the elected official who selected them; and (2) who also have regular contact with that official. The term does not apply to individuals supervised by someone other than the official, regardless of who appointed them.

A recent wage-and-hour lawsuit highlights the complexity of personal staff classifications. A former city clerk, Lorinda Southard, filed a lawsuit against the City of Oronogo, Mo. in the Western District of Missouri alleging that she was eligible for overtime under the FLSA (Southard v. City of Oronogo (2013 WL 352943 (W.D. Mo.))). Southard lost her job when the city’s Board of Alderman failed to approve her reappointment as clerk. The City of Oronogo argued that Southard was not an “eligible employee as required by law,” although it never explicitly asserted that Southard was FLSA exempt.

Assuming the city would eventually argue she was an exempt worker, Southard preemptively asserted that she was not exempt from the FLSA under either the exemptions for elected official’s personal staff or bona fide executive employees. She filed a summary judgment request asking the court to rule on her exempt/nonexempt status.

In a Jan. 29 order submitted in response to Southard’s request, the court held that the fact that the Board of Aldermen failed to approve Southard’s reappointment showed that Southard was not truly part of the mayor’s personal staff.

Specifically, the order said that, “[g]iven this fact, it is clear that plaintiff did not ‘serve solely at the pleasure or discretion of’ the mayor and, thus, did not meet the statutory term ‘member of personal staff.’ Plaintiff is entitled to judgment as a matter of law that she was not a member of an elected official’s personal staff.”

The court concluded that the mayor did appoint Southard, but because her employment was terminated when the Board of Alderman failed to confirm her appointment, she was not really a member of the mayor’s personal staff under the FLSA.

Public-sector employers need to keep not only the widely applicable federal and state FLSA and wage and hour provisions and exemptions, but they must keep track of additional rules that apply only in the public sector. Municipal governments are subject to a complicated web of rules, both as employers and as public entities with particular needs and requirements. Keeping on top of all these moving parts may be challenging, but it’s an important first line defense against litigation, which can be costly even when a court upholds an employer’s practices.

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