DOL Issues Six New Opinion Letters And Establishes A New Office Of Compliance Initiatives

The U.S. Department of Labor (DOL) has issued six new opinion letters addressing various matters under the federal Fair Labor Standards Act (FLSA) and Family and Medical Leave Act (FMLA). According to the DOL, the release of this guidance "demonstrates the agency's continued commitment to providing meaningful compliance assistance to help employees understand their rights and ensure that employers have the information they need to comply with federal labor laws." The DOL also announced the formation of an Office of Compliance Initiatives to strengthen employer compliance assistance.

FLSA Opinion Letters

Business-to-Business Sales Can be Considered "Retail" for Purposes of Exemption

The DOL has issued further guidance regarding whether a company constitutes a "retail or service establishment" under 29 U.S.C. § 207(i) ("Section 7(i) exemption"), such that its employees may be classified as exempt. Specifically, the DOL examined whether a company selling a technology platform to other businesses can be considered a "retail or service establishment," such that the Section 7(i) exemption applies to its sales employees.

The FLSA exempts from its overtime pay requirements certain employees of "retail or service establishment[s]." 29 U.S.C. § 207(i). The exemption applies to any employee for whom the following three requirements are satisfied:

The employee works at a retail or service establishment, The employee's regular rate of pay exceeds one and one-half times the applicable minimum wage in the workweek in which he or she works overtime, and More than half of the employee's earnings in a representative period consist of commissions. Marking a significant departure from past guidance, the DOL concluded that employees of a company selling a technology platform to other businesses qualify for the Section 7(i) exemption, notwithstanding that the customers and end-users are predominantly commercial entities purchasing the platform. The DOL also highlighted the specific facts that the company's sales of its platform are retail sales, not wholesales sales, and the platform is not resold.

In light of this new opinion, many employers may want to determine whether any of their sales employees should be reclassified as exempt under Section 7(i).

Voluntary Participation in Wellness Activities is Noncompensable Time

The DOL issued a long-awaited opinion that an employee's time spent voluntarily participating in wellness activities, biometric screenings, and...