E.M.D. Sales: A Reminder That California Stands Out From The Crowd

• Published date: 05 March 2025
• Subject Matter: Employment and HR, Employee Rights/ Labour Relations
• Law Firm: Greenberg Traurig, LLP
• Author: Timothy Long and Kristina Lee

While welcome news to most employers, those in California are unlikely to be impacted by the U.S. Supreme Court's recent ruling in E.M.D. Sales, Inc. v. Carrera, 220 L. Ed. 2d 309 (2025). In E.M.D. Sales, the Court rejected the argument that employers must prove an overtime exemption under the Fair Labor Standards Act (FLSA) by clear and convincing evidence. The standard, the Court said, should be no greater than by a preponderance of the evidence. But this ruling does not change the burden for California employers under state law.

E.M.D. Sales

The plaintiffs in E.M.D. Sales claimed they were improperly classified under the FLSA asoutside salespersons exempt from overtime. Exemptions are considered a defense to overtime claims, and the burden to prove the defense is on an employer. The District Court sided with the plaintiffs, holding that the employer had not proved by "clear and convincing" evidence¹ that they were properly classified. This aligned with precedent in the Fourth Circuit, which affirmed the lower court's ruling. When the case made its way to the U.S. Supreme Court, however, the Court instead sided with precedent from the Fifth, Sixth, Seventh, Ninth, Tenth, and Eleventh Circuits, holding an employer must only satisfy the lower (and easier to meet) "preponderance of the evidence" burden of proof.

The plaintiffs argued that the higher, "clear and...