The Supreme Court of the United States recently settled a circuit split on the standard of proof required to classify employees as exempt from the Fair Labor Standards Act’s (FLSA) minimum wage and overtime pay provisions. In a unanimous opinion, SCOTUS held in EMD Sales, Inc. v. Carrera that the “preponderance of the evidence” standard–and not the more stringent “clear and convincing” standard–applies.
The FLSA mandates federal minimum wage and overtime pay for all employees except those employed in a bona fide executive, administrative, professional, computer or outside sales capacity. “Outside sales” employees have the primary job duties of making sales or obtaining orders or contracts for services or the use of facilities in exchange for consideration paid by a client, and they also primarily work away from their employer’s place of business.
EMD, a distributor of food products in the Washington, DC area, employed sales representatives who managed inventory and took orders at grocery stores. Several sales representatives sued EMD, alleging that the company violated the FLSA by not paying them overtime. EMD argued that the sales representatives were outside sales employees and thus exempt from the FLSA’s overtime pay requirement.
The US District Court for the District of Maryland ruled that EMD did not prove by “clear and convincing” evidence that its sales representatives met the FLSA exemption standard for outside...
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