The opening of the federal Fifth Circuit Court of Appeals’ opinion in a long-running lawsuit brought by two Travis County, Texas detectives is one of the best descriptions of FLSA litigation to find its way into a court opinion:
“Whether a worker is entitled to the FLSA’s time-and-a-half requirement for overtime pay is an important question for both employers and employees. Unfortunately, the answer is not always straightforward. A number of exemptions take employees outside the FLSA. Byzantine regulations define those exemptions. Informal Department of Labor guidance in the form of opinion letters also tries to clarify the exemptions. Then there can be exceptions to the exemptions. Figuring out if an exception brings the employee back under the FLSA may require looking at yet another set of regulations and agency guidance.”
The case involved whether detectives were entitled to overtime under the FLSA or whether they fell within one of the FLSA’s exemptions. The pertinent exemptions all provide that to be exempt, an employee must be salaried. The two exemptions at issue were the “highly-compensated employee” exemption, then applicable to employees with a salary of at least $100,000 annually, or the “executive” exemption, usually applicable to high-ranking supervisors.
A jury found that the detectives were not salaried and thus were not exempt, then went on to determine the detectives’ damages. However, the trial court overruled the jury and found as a matter of law that the detectives were paid a salary. Having vacated the jury’s finding on this first requirement of the exemptions, the trial court also granted the detectives’ request for a new trial. At a new trial, the Court explained, the jury would determine whether the detectives primarily performed office work and, as a result, were exempt as highly-compensated employees.
The detectives sought reconsideration and the Court explained that undoing the jury’s “no-salary” finding left the ultimate exemption question unresolved. With the Court now having ruled that the County had proven the first element of both the executive and highly-compensated-employee exemptions, a new trial would be needed to determine if the County could prove the remaining elements of either exemption. The Court asked the detectives to clarify how they wanted to proceed.
As the appeals court put it, “Rather than taking the hint that they needed to challenge both exemptions in a new trial, the detectives changed course; they no longer wanted a new trial. The detectives instead moved for the reentry of judgment in their favor on the ground that the County had failed to prove an exemption at trial.”
After again explaining why vacating the jury’s no-salary finding meant a new jury needed to answer the remaining questions about the exemptions, the trial court refused to enter judgment for the detectives. It then withdrew the detectives’ request for a new trial given that they no longer wanted one.
The appeals court described what happened next: “Standing their ground, the detectives again sought judgment on the jury’s verdict. The Court repeated what it had already explained several times. Its posttrial ruling that the County paid the detectives on a salary basis meant the only way to move forward with the case was for a new trial that would answer the remaining questions about whether the FLSA covered the detectives. Despite the detectives’ insistence that they no longer wanted a new trial, the Court gave them about a month to request one. If the detectives did not seek a trial within that period, the Court would dismiss the case for want of prosecution.
“The broken record kept playing. Rather than asking for the new trial, the detectives yet again asserted – out of procedural vehicles, this time in a ‘motion for clarification’ – that they had stated a FLSA overtime claim; that the grant of judgment on the salary issue did not invalidate the ‘prima facie portion of the verdict’; and that the County was not entitled to another opportunity to prove its affirmative defenses. The detectives also contended that dismissal for failure to prosecute would be ‘an incredibly unjust result.’ If the Court did not enter judgment in favor of the detectives based on the jury’s verdict, the detectives asked for entry of final judgment so they could appeal.”
Because the detectives did not want a new trial, the trial court entered a final judgment. The detectives then appealed.
The appeals court dismissed the appeal. The Court commented that the detectives made “an unwise decision because the impact of the Court’s ruling that the detectives were paid a salary was obvious – the other disputed elements of the FLSA exemptions and exception needed to be answered. According to the detectives, the County was entitled to one trial to prove its exemptions, but not a second one as it failed to prove an exemption the first time. That argument does not make sense. The district court correctly concluded that the County paid the detectives a salary. Although that ruling did not fully resolve whether the detectives were entitled to overtime pay, years of litigation never answered that ultimate question. A second trial would have.”
Escribano v. Travis County, 2020 WL 113989 (5th Cir. 2020).
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