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The 2024 DOL FLSA Independent Contractor Rules: Similar to the Fourth Circuit’s Existing Standard

Effective July 1, 2024, the Department of Labor’s new independent contractor rules provide guidelines for distinguishing between employees and non-employee independent contractors, for purposes of the overtime and minimum wage requirements of the Fair Labor Standards Act. As explained below, the DOL rules closely parallel the test that the Fourth Circuit has historically applied in FLSA cases.

Statutory and Regulatory Background

The FLSA requires covered employers to pay minimum wages and overtime compensation to certain categories of employees. 29 U.S.C §§ 206 -207. The FLSA also imposes recordkeeping requirements on employers. 29 U.S.C. § 211. These requirements raise questions about what it means to be an “employer” or an “employee,” and, more specifically, about the nature of the employment relationship that falls within the scope of the FLSA’s minimum wage and overtime requirements.

The FLSA itself defines these terms broadly, but without great clarity. Section 203 of the FLSA defines “employer” to include “any person acting directly or indirectly in the interest of an employer in relation to an employee[.]” 29 U.S.C. § 203(d). The FLSA defines the term “employee” to generally mean “any individual employed by an employer.” 29 U.S.C. § 203(e). And it defines “employ” as “includes to suffer or permit to work.” 29 U.S.C. § 203(g).

In FLSA cases, disputes often arise as to whether a worker is an “employee,” entitled to minimum wages and overtime under the FLSA, or a non-employee “independent contractor” to which the FLSA does not apply. Sometimes, workers are misclassified as independent contractors, when under the FLSA they are really employees.

The Fourth Circuit’s Employee / Independent Contractor Test

The Fourth Circuit has historically assessed whether a worker is an employee or a non-employee independent contractor using a six-factor “economic realities” test. The factors are:

(1) the degree of control that the putative employer has over the manner in which the work is performed;

(2) the worker’s opportunities for profit or loss dependent on his managerial skill;

(3) the worker’s investment in equipment or material, or his employment of other workers;

(4) the degree of skill required for the work;

(5) the permanence of the working relationship; and

(6) the degree to which the services rendered are an integral part of the putative employer’s business.

Schultz v. Capital Int’l Sec., Inc., 466 F.3d 298 (4th Cir. 2006). “These factors are often called the ‘Silk factors.’ No single factor is dispositive; the test is designed to capture the economic realities of the relationship between the worker and the putative employer.” Id. (Derived from United States v. Silk, 331 U.S. 704, 67 S. Ct. 1463 (1947)).

The 2024 DOL Employee / Independent Contractor Test

The DOL’s 2024 employee / independent contractor regulations adopt a totality of the circumstances, economic realities test that is consistent with the historical Fourth Circuit test:

Of particular note, the regulations set forth in this final rule do not use “core factors” and instead return to a totality-of-the-circumstances analysis of the economic reality test in which the factors do not have a predetermined weight and are considered in view of the economic reality of the whole activity.

Employee or Independent Contractor Classification Under the FLSA, 89 Fed. Reg. 1638 (Jan. 10, 2024) (Amending 29 C.F.R. § 795).

The 2024 DOL factors closely parallel the Silk factors discussed above and historically applied by the Fourth Circuit. Shortened, they are:

(1) Opportunity for profit or loss depending on managerial skill,

(2) Investments by the worker and the potential employer,

(3) Degree of permanence of the work relationship,

(4) Nature and degree of control,

(5) Extent to which the work performed is an integral part of the potential employer’s business, and

(6) Skill and initiative.

29 C.F.R. 795.110. “Additional factors may be relevant in determining whether the worker is an employee or independent contractor for purposes of the FLSA, if the factors in some way indicate whether the worker is in business for themself, as opposed to being economically dependent on the potential employer for work.” Id. Thus, like the Fourth Circuit, the DOL embraces an economic realities test that balances the relevant factors.

And like the Fourth Circuit explained in Schultz, the ultimate inquiry in using the factors is still “whether the [workers] were, as a matter of economic reality, dependent on the business they served, or, conversely, whether they were in business for themselves.” Schultz v. Capital Int’l Sec., Inc., 466 F.3d 298 (4th Cir. 2006). See also Employee or Independent Contractor Classification Under the FLSA, 89 Fed. Reg. 1638 (Jan. 10, 2024) (Amending 29 C.F.R. § 795) (“The ultimate inquiry is whether, as a matter of economic reality, the worker is economically dependent on the employer for work (and is thus an employee) or is in business for themself (and is thus an independent contractor).”)

Thus, the DOL’s 2024 FLSA independent contractor test is similar to the economic realities test historically applied in the Fourth Circuit. Both tests consider the same basic factors in their totality.

Special thanks to Hannah Wyatt for her work on this post!

This site is intended to provide general information only. The information you obtain at this site is not legal advice and does not create an attorney-client relationship between you and attorney Tim Coffield or Coffield PLC. Parts of this site may be considered attorney advertising. If you have questions about any particular issue or problem, you should contact your attorney. Please view the full disclaimer. If you would like to request a consultation with attorney Tim Coffield, you may call 1-434-218-3133 or send an email to info@coffieldlaw.com.

Muldrow v. City of St. Louis: Revised Standard of Harm in Discrimination Cases

In Muldrow v. City of St. Louis, 144 S. Ct. 967 (2024), the Supreme Court held that an employee challenging a job transfer under Title VII must show that the transfer brought about “some harm” with respect to an identifiable term or condition of employment, but that harm need not be significant. The case is important because it departs from the traditional view that an adverse employment action in discrimination cases generally requires a pecuniary harm. The revised “some harm” standard also calls into question the traditional standard for hostile work environment harassment established in Meritor Savings Bank, FSB v. Vinson, 477 U.S. 57, 106 S. Ct. 2399 (1986) and Harris v. Forklift Sys., 510 U.S. 17, 114 S. Ct. 367 (1993), which included a “severe or pervasive” treatment element. Meritor Savings Bank and Harris call for a showing of pervasiveness or severity to establish discriminatory harassment. Since harassment is a type of discrimination, however, Muldrow’s recent decision that “some harm” suffices to show a discriminatory action under Title VII may call into question the Harris standard for harassment. .

Statutory Background

Title VII of the Civil Rights Act of 1964 makes it unlawful for an employer “to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s . . . sex.” 42 U.S.C. § 2000e–2(a)(1). While a discriminatory adverse employment action is one route to establish Title VII discrimination, the Supreme Court has also interpreted this prohibition to encompass claims based on a discriminatory hostile work environment, rather than solely economic or tangible discrimination. The Harris Court elaborated on the previous Supreme Court ruling in Meritor Savings Bank, FSB v. Vinson, 477 U.S. 57, 106 S. Ct. 2399 (1986) in describing hostile work environment discrimination:

As we made clear in Meritor Savings Bank, this language is not limited to ‘economic’ or ‘tangible’ discrimination. The phrase ‘terms, conditions, or privileges of employment’ evinces a congressional intent ‘to strike at the entire spectrum of disparate treatment of men and women’ in employment, which includes requiring people to work in a discriminatorily hostile or abusive environment. When the workplace is permeated with ‘discriminatory intimidation, ridicule, and insult’ that is ‘sufficiently severe or pervasive to alter the conditions of the victim’s employment and create an abusive working environment,’ Title VII is violated.

Harris, 510 U.S. at 21.

As discussed below, this “severe or pervasive” standard may be called into question by the Muldrow decision.

Facts

Muldrow addresses whether the transfer of an employee could qualify as Title VII discrimination when her rank and pay did not change, but her responsibilities did. Slip op. at 2.

In short, Muldrow was a sergeant with the St. Louis Police Department who was transferred to a different department against her wishes. Id. She was transferred because her new superior explicitly wanted to replace her with a man, which he thought to be a better fit for the division’s “very dangerous” work. Id. The transfer was approved, and while her rank and pay remained the same, her “responsibilities, perks, and schedule did not.” Id.

The question for the Supreme Court in Muldrow was thus what level of harm must a plaintiff show to successfully challenge a job transfer as discriminatory under Title VII.

The Court’s Decision

The Muldrow Court reversed the decision of the lower court, finding that there is no heightened threshold of harm requirement imposed by Title VII, and that there need only be some “disadvantageous” change in an employment term or condition. Slip op. at 5.

The Court explained that the language of Title VII, i.e. “discriminate against,” refers to “differences in treatment that injure” employees. Id. The Court further explained, “To make out a Title VII discrimination claim, a transferee must show some harm respecting an identifiable term or condition of employment.” Id., at 6. A plaintiff does not have to show “…that the harm incurred was significant … Or serious, or substantial, or any similar adjective suggestive that the disadvantage to the employee must exceed a heightened bar.” Id., at 6. The Court also explained that while “discriminate against” means to treat worse, imposing a threshold for the level of harm needed to show discrimination would be inconsistent with the text of the statute:

There is nothing in the provision to distinguish, as the courts below did, between transfers causing significant disadvantages and transfers causing not-so-significant ones. And there is nothing to otherwise establish an elevated threshold of harm. To demand “significance” is to add words—and significant words, as it were—to the statute Congress enacted. It is to impose a new requirement on a Title VII claimant, so that the law as applied demands something more of her than the law as written.

Slip op. at 6.

Accordingly, the Court held that the lower courts erred in reading a heightened standard of harm into their analysis, and that if Muldrow’s allegations are proven, then she was in fact left worse off several times over. Id. at 10-11. The Court therefore remanded the case for further proceedings under the “proper Title VII standard,” which does not demand that the plaintiff demonstrate her transfer caused “significant” harm. Id.

Analysis

In sum, Muldrow held that an employee challenging a job transfer under Title VII must show that the transfer brought about “some harm” with respect to an identifiable term or condition of employment, but that harm need not be significant. This case marked a departure from the traditional view that an adverse employment action under Title VII required a pecuniary harm. It also calls into question the traditional “pervasiveness or severity” standard in discriminatory hostile work environment cases.

Muldrow held that a plaintiff must show “some harm,” but is not required to show a heightened level of harm to make out a discrimination claim, as Title VII is intended to address any harmful discriminatory treatment, not just treatment that causes significant harm. Thus, a plaintiff need not necessarily suffer an economic loss to make out an adverse employment action. This revised standard may also suggest that a workplace permeated with discriminatory intimidation, ridicule, and insult that alters the conditions of the plaintiff’s employment and creates an abusive working environment could be enough to establish a hostile work environment under Title VII, so long as the plaintiff can show some harm.

Special thanks to Hannah Wyatt for her work on this post!

FLSA Seasonal Amusement or Recreational Establishment Exemption: Seasonal Operations and Seasonal Receipts Tests

The Fair Labor Standards Act requires covered employers to pay minimum wages and overtime compensation to certain categories of employees. However, the law contains several exceptions or “exemptions” from these requirements. This post will focus on the exemption for employees of seasonal amusement or recreational establishments under 29 U.S.C. § 213(a)(3). The Department of Labor Fact Sheet #18 is an excellent resource for information about this exemption. Some DOL implementing regulations relevant to the seasonal amusement or recreational establishment exemption are generally located at 29 C.F.R. §§ 779.385, 779.23, 779.203, and 779.302-311.

Two Alternative Tests for the Exemption

The FLSA provides an exemption from the law’s minimum wage and overtime requirements (found at 29 U.S.C. §§ 206 and 207, respectively) for employees “employed by an establishment which is an amusement or recreational establishment, organized camp, or religious or non-profit educational conference center”, if either of the following two tests are met.

The establishment “does not operate for more than seven months in any calendar year,” or
“[D]uring the preceding calendar year, its average receipts for any six months of such year were not more than 33⅓ per centum of its average receipts for the other six months of such year[.]”

29 U.S.C. § 213(a)(3). However, the FLSA also provides a limited exception from this exemption for certain employees of private entities operating in a national park, national forest, or on lands in the National Wildlife Refuge System:

[E]xcept that the exemption from sections 206 and 207 of this title [minimum wage and overtime requirements] provided by this paragraph does not apply with respect to any employee of a private entity engaged in providing services or facilities (other than, in the case of the exemption from section 206 of this title, a private entity engaged in providing services and facilities directly related to skiing) in a national park or a national forest, or on land in the National Wildlife Refuge System, under a contract with the Secretary of the Interior or the Secretary of Agriculture…

29 U.S.C. § 213(a)(3).

Establishment Compared to Enterprise

Because this exemption only applies to employees of certain “establishments”, FLSA regulations on the distinctions between an “establishment” and an entire business or “enterprise” can be relevant. In short, the regulations clarify that an “establishment” refers to a distinct physical place of business:

As used in the [FLSA], the term establishment…refers to a “distinct physical place of business” rather than to “an entire business or enterprise” which may include several separate places of business. This is consistent with the meaning of the term as it is normally used in business and in government, is judicially settled, and has been recognized in the Congress in the course of enactment of amendatory legislation[.]

29 C.F.R. § 779.23 (emphasis in original; citations omitted). FLSA regulations further provide that the “[a]musement or recreational establishments” referenced in the exemption are “establishments frequented by the public for its amusement or recreation and which are open for 7 months or less a year or which meet the seasonal receipts test provided in clause (B) of the exemption.” 29 CFR § 779.385. Typical examples of such establishments are “the concessionaires at amusement parks and beaches.” Id.

Application to Multiunit Operations

This distinction between an establishment and an enterprise, in the context of a business operating at multiple locations, is further detailed in 29 C.F.R. §§ 779.303:

As previously stated in § 779.23, the term establishment as used in the [FLSA] means a distinct physical place of business. The “enterprise,” … may be composed of a single establishment. The term “establishment,” however, is not synonymous with the words “business” or “enterprise” when those terms are used to describe multiunit operations. In such a multiunit operation some of the establishments may qualify for exemption, others may not. For example, a manufacturer may operate a plant for production of its goods, a separate warehouse for storage and distribution, and several stores from which its products are sold. Each such physically separate place of business is a separate establishment. In the case of chain store systems, branch stores, groups of independent stores organized to carry on business in a manner similar to chain store systems, and retail outlets operated by manufacturing or distributing concerns, each separate place of business ordinarily is a separate establishment.

29 C.F.R. § 779.303 (emphasis added). In other words, a business or enterprise can have multiple establishments, and this exemption may apply to employees at some, but not all, of those establishments. For additional regulations addressing the meaning of “establishment”, see 29 C.F.R. §§ 779.302-311 and 779.203; see also 29 U.S.C. §§ 203(r) and (s) for “enterprise” definitions and tests.

Bartels v. Birmingham: Early Economic Reality Test For Employment Relationship in Music Industry

In Bartels v. Birmingham, 332 U.S. 126, 67 S. Ct. 1547 (1947), the Supreme Court held that members of musical bands were employees of the bands’ leaders, rather than of the operators of the dance halls where the bands played, within the meaning of the Social Security Act. The Court emphasized that, inter alia, the band leader organized and trained the band, that the leader’s musical skill determined the success or failure of the band, and the relationship between the leader and the band members was permanent. The case is important because, inter alia, it applied an “economic reality” test, using the reasoning in United States v. Silk, 331 U.S. 704 (1947), for determining the existence of an employment relationship. This test for determining whether a worker is an employee or an independent contractor, and which entities are employers, came to be applied in cases under the Fair Labor Standards Act. See Schultz v. Cap. Int’l Sec., Inc., 466 F.3d 298, 304–05 (4th Cir. 2006).

Statutory and Regulatory Background

While Bartels and Silk involved cases brought under a different law, the Social Security Act, the “economic realities” test they articulated for determining whether a worker is an employee or an independent contractor came to be applied in FLSA cases. See Schultz v. Cap. Int’l Sec., Inc., 466 F.3d 298, 304–05 (4th Cir. 2006).

Facts

Bartels examined relationships between the operators of dance halls, the leaders of bands that played in these dance halls for “limited engagements”, and the musicians in those bands.

In a nutshell, the band leaders contracted with various ballroom operators to play at their establishments for a contract price. 332 U.S. 126, 127. Most of the engagements at issue were one-night performances, although some were for performances over several successive nights. 332 U.S. at 127–28.

As a practical matter, the Court observed that the “leader exercise[d] complete control over the orchestra.” 332 U.S. at 128. The leader set the musicians’ salaries, paid them, and told them what and how to play. Id. He provided the sheet music and arrangements, the public address system, and the musicians’ uniforms. Id. He hired and fired the musicians. The band leader paid for expenses, including agents’ commissions, transportation and other expenses out of the payments received from the dance hall operators. Id. Any extra money left over after the expenditures was “his profit and any deficit his personal loss.” Id. The operators of the dance halls provided the piano but not the other instruments. Id.

The relationship between the parties was complicated, however, by the contracts between the dance hall operators and the union that band leaders and musicians belonged to. 332 U.S. at 128. The Court observed that the form contract stated “that the ballroom operator is the employer of the musicians and their leader, and ‘shall have complete control of the services which the employees will render under the specifications of this contract.’” Id.

The Circuit Court of Appeals had placed great weight on the terms of the contract. It applied the “common law test of control, i.e., that one was an employer if he had the ‘right’ to direct workers in what should be done and how it should be done.” Id. at 129. It concluded that the contract between the parties gave the ballroom operators the “‘right’ to control the musicians and the leader, whether or not the control was actually exercised.” Id. The Circuit Court of Appeals determined that while the contract was not binding on the government, it was binding on the parties, and therefore the leader and musicians were employees of the dance hall operators under the SSA if taxing authorities accepted the arrangement as valid. Id.

The question for the Supreme Court in Bartels was whether the facts showed that the musicians were “employees” of the band leader, or of the ballroom operators, within the meaning of the Social Security Act.

The Court’s Decision

The Bartels Court reversed. It held that the musicians were “employees” of the band leader within the meaning of the SSA.

The Court observed that under Silk, the employment relationship was to be determined a multi-factor test that examined the “economic reality” of the situation:

In United States v. Silk … we held that the relationship of employer-employee, which determines the liability for employment taxes under the Social Security Act was not to be determined solely by the idea of control which an alleged employer may or could exercise over the details of the service rendered to his business by the worker or workers. Obviously control is characteristically associated with the employer-employee relationship but in the application of social legislation employees are those who as a matter of economic reality are dependent upon the business to which they render service. In Silk, we pointed out that permanency of the relation, the skill required, the investment if the facilities for work and opportunities for profit or loss from the activities were also factors that should enter into judicial determination as to the coverage of the Social Security Act. It is the total s[it]uation that controls.…

332 U.S. at 130.

Applying these “economic reality” factors to the facts in Bartels, the Court concluded that the musicians were employees of the band leader, not the dance hall operator:

We are of the opinion that the elements of employment mark the band leader as the employer in these cases. The leader organizes and trains the band. He selects the members. It is his musical skill and showmanship that determines the success or failure of the organization. The relations between him and the other members are permanent; those between the band and the operator are transient. Maintenance costs are a charge against the price received for the performance. He bears the loss or gains the profit after payment of the members’ wages and the other band expenses.

332 U.S. at 132. Thus, the Court reasoned that the totality of the circumstances indicated an employer-employee relationship between the band leader and the musicians. The Court accordingly held that under this analysis — applying the economic reality test described in Silk — the musicians were “employees” of the band leader within the meaning of the SSA.

Analysis

In sum, Bartels held that members of a musical band were employees of the band’s leader, rather than of the operators of the ballrooms where the band played, within the meaning of the Social Security Act. The case is important because, inter alia, it applied an “economic realities” test, using the reasoning in Silk, 331 U.S. 704 (1947), for determining the existence of an employment relationship. This test for determining whether a worker is an employee or an independent contractor, and which entities are employers, came to be applied in cases under the Fair Labor Standards Act. See Schultz, 466 F.3d 298, 304–05 (4th Cir. 2006).

Meet Timothy Coffield, Attorney in VA

Tim Coffield is a seasoned attorney based in Charlottesville, Virginia, known for his dynamic legal practice at Coffield PLC. Since founding the firm in 2012, Tim has established himself as a dedicated advocate, offering strategic and personalized legal representation to clients across central and western Virginia.

With a comprehensive background in civil litigation, employment law, civil rights, and estate planning, Tim Coffield has honed his expertise in developing innovative legal strategies tailored to each client’s unique circumstances. He is committed to delivering assertive and client-focused representation, aiming to achieve favorable outcomes in both federal and state courts.

One of Tim’s notable achievements includes his role as Class Counsel in a significant employment equity lawsuit against Panera Bread Company and Panera, LLC, collaborating with esteemed attorneys from Popham Law Firm. This experience underscores Tim Coffield’s proficiency in complex multi-party litigation, mediation, and successful settlement negotiations.

Tim Coffield’s legal prowess extends to various employment-related matters, including discrimination cases, retaliation claims, and disputes over employment contracts. He served as co-class counsel in a nationwide employment class action suit, securing a multi-million dollar judgment for plaintiff employees.

Tim’s academic journey laid a strong foundation for his legal career. He attended the University of Virginia School of Law, where he actively participated in the First Amendment Law Clinic and gained valuable experience interning in the United States District Court for The Eastern District of Virginia. His commitment to public service was evident during his volunteer work with the Legal Aid Society in Charlottesville.

Before starting his legal career, Tim Coffield enriched his skill set as a law clerk at Trout Unlimited, focusing on water conservation issues. His diverse background includes experiences as a wilderness guide, a paralegal, and an educator, reflecting a deep-seated commitment to environmental and social causes.

A dedicated member of professional organizations like the National Employment Lawyers Association and the Virginia Employment Lawyers Association, Tim Coffield remains actively engaged in advancing legal standards and advocating for employee rights.

Tim’s multifaceted journey—from the baseball fields of North Carolina State University, where he pursued degrees in Philosophy and English, to his role as a trusted attorney and founder of Coffield PLC—demonstrates his unwavering dedication to seeking justice and delivering exceptional legal services to his clients.

This piece was originally published on Patch. View the original article here.

Tim Coffield’s Interview on Ideamensch

Tim Coffield, Attorney, is a licensed law professional based in Charlottesville, Virginia. After an extensive education and dedicated work, Tim founded his legal practice, Coffield PLC, in 2012. Prior to his start as an attorney, Tim obtained his B.A degrees from North Carolina State University in Philosophy and English. His education continued to the University of Montana, where he earned his M.F.A in Creative Writing and taught undergraduate writing courses. In 2011, Tim graduated from the University of Virginia School of Law and began his profession as a dedicated attorney.

From his early years in the law and litigation field, Tim has had a passion for law, and serving different areas as a dedicated and trusted attorney. His early career, through law school and after, began with a focus on environmental and natural resources law where he worked towards addressing state and federal environmental issues and clean water laws. As a Law Clerk/Fellow at Trout Unlimited, Tim focused much of his time on regulatory matters regarding gas pipelines and state water use regulations. He also has additional experience in collaborating and working with environmental conservation groups.

As owner and operator of Coffield PLC, Tim has a primary focus on areas such as employment and civil rights law, civil litigation, business and estate planning, and contract disputes. Much of his experience comes from managing and resolving various civil cases in both federal and state court. Tim has a passion for representing and helping employees and has dedicated a majority of his practice to doing so. One of Tim’s most notable accomplishments is his serving as a co-class counsel in Boswell v. Panera Bread Co. 2016 WL 1161573 (E.D. Mo. Mar. 24, 2016). This case was not only nationwide, but obtained a multi-million dollar judgment on behalf of the class members. Other notable cases that Tim has represented include Goines v. Valley Cmty. Servs. Bd., 822 F.3d 159 (4th Cir. 2016), where he was successfully able to argue before the Fourth Circuit Court of Appeals and obtained a partial reversal in the case; and Smith v. Loudoun County Public Schools, Case No. 1:15-CV-956,Dkt. No. 128 (E.D Va. November 15, 2016), where he obtained a jury verdict in the Eastern District of Virginia under the Americans with Disabilities Act.

Tim Coffield founded Coffield PLC with the goal of running a practice that is not only defined by its clients but is trusted and dedicated to serving clients based on individual needs. He understands that each client and business faces different challenges, and has different legal issues; there is no cookie cutter solution. He is passionate about crafting personalized legal strategies for each of his clients and is dedicated to serving them with his best foot forward.

In addition to his extensive education and experience, Tim is affiliated with various professional organizations, including the Virginia Employment Lawyers Association, the National Employment Lawyers Association, and the Metropolitan Washington Employment Lawyers Association.

Where did the idea for your company come from?

I’m an attorney. When I first started out, I noticed a lot of prospective clients had questions about their legal rights and responsibilities in the context of the employer-employee relationship. The laws governing these rights and responsibilities are often nuanced and fact-specific, and not always well-publicized. It seemed like there was an opportunity to provide a useful service by focusing my legal practice on these laws, and on employment rights and responsibilities generally.

What does your typical day look like and how do you make it productive?

On days when I’m not in court, in the morning I typically have consultations with existing or prospective clients, and take phone calls or exchange correspondence with other attorneys. In the afternoon, I typically focus on moving existing projects forward — preparing memoranda, court filings, or administrative filings for agencies like the Equal Employment Opportunity Commission or Virginia’s Office of Equal Employment and Dispute Resolution.

How do you bring ideas to life?

I make a list of small, achievable tasks that serve the idea. Then I tackle the list item by item.

What’s one trend that excites you?

The trend towards electronic filing and electronic evidence presentation in courts and administrative agencies. Compared to paper filings and preparing large binders of paper exhibits, I think electronic means of exchanging and presenting evidence in court and administrative proceedings saves time and money. It’s a more efficient and effective way to share information.

What is one habit of yours that makes you more productive as an entrepreneur?

I don’t know if this qualifies as a habit, but I make a concerted effort to keep in close touch with my clients throughout the representation. Phone calls, emails, texts. Whatever works best. A good friend once told me that more communication is always better, and I’ve found this to be true in life and in business. I think it’s especially true in the attorney-client context, where clear communication about goals and expectations is vital to a lasting and effective relationship.

What advice would you give your younger self?

Don’t drive the truck onto a sandbar in the inlet waterway. The tide will come in.

Tell us something that’s true that almost nobody agrees with you on.

If almost nobody agrees with you about something you believe is true, chances are you may be wrong. Always be open to reconsidering what you think you know.

As an entrepreneur, what is the one thing you do over and over and recommend everyone else do?

This goes well beyond building a business, but I think it’s important to work hard at building healthy, trusting relationships with everyone we encounter. This includes relationships with purported rivals and those who don’t always share our perspectives or objectives.

What is one strategy that has helped you grow your business?

Asking clients to consider referring friends or family members to me. This a classic, old school form of business development, and if you build strong relationships with existing clients, it can be wonderfully effective.

What is one failure you had as an entrepreneur, and how did you overcome it?

Early on, I could have done a better job meeting and building relationships with other attorneys. I was a little shy. I’ve worked to overcome this by making a concerted effort to spend quality time with other folks in the same line of work — by attending conferences, having lunch, trying to help answer questions on attorney listservs. That sort of thing. Strong relationships are the center of everything, personally and professionally.

What is one business idea that you’re willing to give away to our readers?

Gyms in airports. Or at least some pullup bars sprinkled in between the newsstands.

What is the best $100 you recently spent? What and why?

Adobe Sign. This software makes it infinitely easier for people to review and sign documents, through email, even on their phones — without having to waste paper or spend money on a scanner.

What is one piece of software or a web service that helps you be productive?

As an attorney with a nearly paperless office, I need reliable software to manage electronic documents and client information, keep track of my time, and perform accounting tasks. I use a web service called Clio to organize documents, organize client matters, track time, and keep the books — among many other administrative tasks involved in running a law practice. The company’s customer service is outstanding. I recommend it.

What is the one book that you recommend our community should read and why?

Terkel’s Working. The book collects interviews with people about what they do for a living. It opened my eyes to how vital a job can be, not just to a person’s economic well-being, but to her sense of self and place in the greater community.

What is your favorite quote?

“If people sat outside and looked at the stars each night, I’ll bet they’d live a lot differently. ” – Bill Waterson, Calvin & Hobbes.

Originally published on Ideamensch.

North Carolina Equal Employment Practices Act: Anti-Discrimination Policy Protections for North Carolina Employees

The North Carolina Equal Employment Practices Act (NCEEPA) prohibits employment discrimination based on race, color, national origin, religion, age, sex, or handicap.

The law is codified at N.C. Gen. Stat. Ann. §§ 143-422.1 to 143-422.3. The NCEEPA applies to employers who regularly employ 15 or more employees. While the statute does not provide a private cause of action, it can be the basis for a common law claim of wrongful discharge in violation of state public policy.

Covered Employers

The NCEEPA covers employers which “regularly employ 15 or more employees.” N.C. Gen. Stat. Ann. §§ 143-422.2(a).

Policy Statement and Protected Classes

The NCEEPA provides that it is the public policy of North Carolina to “protect and safeguard the right and opportunity of all persons to seek, obtain and hold employment without discrimination or abridgement on account of race, religion, color, national origin, age, sex or handicap[.]” The statute therefore prohibits employment discrimination based on membership in these protected classes. N.C. Gen. Stat. Ann. §§ 143-422.2(a).

The NCEEPA further explains that “the practice of denying employment opportunity and discriminating in the terms of employment foments domestic strife and unrest, deprives the State of the fullest utilization of its capacities for advancement and development, and substantially and adversely affects the interests of employees, employers, and the public in general. N.C. Gen. Stat. Ann. §§ 143-422.2(b).

Definition and Scope of Discrimination

The NCEEPA does not define what constitutes the prohibited “discrimination or abridgement” on account of the above protected classes. However, it does make clear that the right to be free from discrimination or abridgement applies to both job applicants and current employees (“the right of and opportunity of all persons to seek, obtain, and hold employment…”). N.C. Gen. Stat. Ann. §§ 143-422.2(a).

Administrative Investigations

The NCEEPA provides that the state Human Relations Commission in the Civil Rights Division of the Office of Administrative Hearings has the authority to:

Receive charges of discrimination from the Equal Employment Opportunity Commission (EEOC) pursuant to an agreement under Section 709(b) of the Civil Rights Act of 1964 (42 U.S.C. § 2000e-8), Public Law 88-352, as amended by Public Law 92-261, and
Investigate and conciliate charges of discrimination.

N.C. Gen. Stat. Ann. §§ 143-422.3. The law further instructs the agency to use its resources to “effect an amicable resolution of the charges of discrimination.” Id. There are strict time limits on filing charges of discrimination with the EEOC, which investigates violations of certain federal employment discrimination laws. Here is a helpful link to the EEOC website with more information on those time limits.

Enforcement

The NCEEPA does not provide employees with a private right of action. However, the statute’s policy statement can be the basis for a common law claim of wrongful discharge in violation of public policy. See, e.g., Considine v. Compass Grp. USA, Inc., 145 N.C.App. 314, 317, 551 S.E.2d 179, 181 (2001). (“[North Carolina] Courts have recognized an exception to the employment at will doctrine by identifying a cause of action for wrongful discharge in violation of public policy. Under the exception, the employee has the burden of pleading and proving that the employee’s dismissal occurred for a reason that violates public policy.” Id. (collecting cases).

North Carolina courts have held that the limitations period for a claim of wrongful discharge in violation of public policy is three years. See, e.g., Winston v. Livingstone Coll., Inc., 210 N.C. App. 486, 488, 707 S.E.2d 768, 770 (2011) (“The limitations period for a tort action based upon wrongful discharge in violation of public policy is three years.” (citing N.C. Gen. Stat. Ann. § 1-52(1) (2011)); Brackett v. SGL Carbon Corp., 158 N.C. App. 252, 260, 580 S.E.2d 757, 762 (2003) (“The statute of limitations for such a claim [wrongful discharge in violation of public policy] is three years.” (citing N.C. Gen. Stat. Ann. § 1–52(5) (2003)).

This article was also published to TimCoffieldAttorney.net.

FLSA Executive Employee Exemption: Management and Direction

The Fair Labor Standards Act requires covered employers to pay minimum wages and overtime compensation to certain categories of employees. However, the law contains several exceptions or “exemptions” from these requirements, most of which turn on a combination of the employees’ pay and the nature of their job duties. For example, Section 13(a)(1) of the FLSA, a.k.a. 29 U.S.C. § 213(a)(1), provides an “exemption” from both minimum wage and overtime pay for certain categories of so-called “white collar” employees — namely, employees working as bona fide executive, administrative, professional, or outside sales employees. Section 13(a)(1) and Section 13(a)(17) also exempt certain categories of computer employees.

To qualify for a white collar exemption, employees must be paid on a salary basis at not less than $684 per week (as of January 1, 2020) and have job duties that satisfy certain requirements. Importantly, job titles do not determine whether an employee is exempt from the FLSA. For an employee to be exempt, her actual real-life job duties and salary must meet all the requirements of the FLSA and the Department of Labor’s implementing regulations.

This post will focus on the exemption for executive employees. The Department of Labor is also an excellent resource for information about the executive employee exemption. The DOL’s implementing regulations with respect to the executive employee exemption are generally located at 29 CFR §§ 541.100-106.

Read the full article at TimCoffieldAttorney.net.