A $35.8M ruling just changed who your business can legally call exempt
Employers face new wage risks after a federal appeals court reset overtime exemption standards in a $35.8 million wage-and-hour case.
On June 3, 2026, the US Court of Appeals for the Third Circuit ruled in a wage case the Department of Labor brought against Comprehensive Healthcare Management Services, an operator of 15 nursing, rehabilitation, and assisted living facilities in Pennsylvania. The government sued in 2018 for nearly 6,000 workers, saying the company violated the Fair Labor Standards Act, the federal law that governs minimum wage, overtime, and recordkeeping.
After a bench trial, the District Court ruled for the government and awarded $35,804,438.20. The judge found the company's time clock system logged punches inaccurately or missed them altogether, leaving hundreds of thousands of punches unaccounted for. Workers were often paid for scheduled hours instead of hours actually worked. The system automatically deducted pay for meal breaks even when staff worked through lunch, and the trial court found the process to recover that pay was inconsistently administered and not remotely accurate. Overtime was miscalculated because shift differentials, bonuses, and other additional pay were left out of the regular rate. The judge described these as systemic errors.
Credibility mattered too. The court found the government's 34 employee witnesses clear, consistent, and credible, while concluding the...
With names including "Hockey Lovers Hub" and "Montreal Hockey Pulse," the dozens of pages identified by AFP were churning out a constant stream of claims primed to attract NHL fans. Combined, the ...