This Littler Lightbulb highlights some of the more significant employment and labor law developments at the U.S. Supreme Court and federal courts of appeal over the last month.

At the Supreme Court

• Salary Basis Test for Overtime. On February 22, 2023, the United States Supreme Court issued its opinion in Helix Energy Solutions Group, Inc. v. Hewitt, holding that paying an employee a “day rate” does not satisfy the salary basis test under the white-collar exemptions to the Fair Labor Standards Act (FLSA). Because of this ruling, even highly compensated employees may be eligible to receive overtime if they are paid solely on a day-rate basis.

The Court held that a worker is not compensated on a salary basis, and therefore cannot qualify for the FLSA’s white-collar exemptions, when the employee’s paycheck is based solely on a daily rate, meaning the employee receives a certain amount if the employee works one day in a week, twice as much for two days, three times as much for three, and so on. Employees paid on this day-rate arrangement are thus entitled to overtime pay unless they qualify for some other exemption.

A dissenting opinion by Justice Kavanaugh questioned whether the regulations supporting the Court’s reasoning are even consistent with the FLSA’s statutory language in the first place. Kavanaugh noted that the statutory text of the FLSA focuses on the duties of an individual, and makes no mention of how or how much an employee is paid, and questioned whether...

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