The Third Circuit sided with Bayada, finding that it did not make any improper deductions from salary when it docked exempt employees’ PTO.
On March 15, 2023, in Higgins v. Bayada Home Health Care Inc., No. 21-3286 (3d Cir.), the U.S. Court of Appeals for the Third Circuit held that paid time off (PTO) is not considered part of an employee’s salary under the Fair Labor Standards Act (FLSA). According to the Third Circuit, the dispute was an issue of first impression and clears the way for employers in Delaware, Pennsylvania and New Jersey to dock salaried employees’ PTO without violating the salary basis requirement for the so-called white-collar exemptions to overtime under the FLSA and exposing themselves to potential liability for overtime pay under the FLSA. Employers, however, must still ensure compliance with applicable state wage-and-hour laws and wage payment laws, which may not permit such deductions.
To qualify for an exemption from the FLSA’s overtime requirement, employees must be paid at least the minimum salary level (currently $684) per week on a salary basis. Employees must also satisfy the “duties” test for the applicable exemption, which was not at issue in this case. While the FLSA is silent as to what constitutes a “salary,” Section 541.602(a) defines the phrase “salary basis” to mean that the employee “receives each pay period on a weekly, or less frequent basis, a predetermined amount… not subject to reduction because of variations in the...
Dangote Group has dismissed as false and malicious a publication alleging that its President, Aliko Dangote, distanced himself from Tony Elumelu, describing the report as entirely baseless. In a s...