We write this article to inform SIOP members interested in the Fair Labor Standards Act (FLSA) and in employee protections in general of important proposed changes to this law by the Department of Labor as a result of a directive from President Obama “to modernize and streamline” the FLSA regulations. Should these changes be put in place, the number of employees covered under this law will expand by millions of new nonexempt employees. Other important changes are a result of the Department of Labor’s cooperation with the IRS to crack down on misclassified independent contractors and the treatment of expert testimony involving sampling and statistical evidence in wage and hour class actions. The ramifications of such pivotal changes are extensive
and will have immediate and dramatic effects on organizations when and where these changes take effect.
Three primary changes have been proposed: (a) changes to FLSA overtime exemption criteria, (b) increased enforcement of the independent contractor misclassification, and (c) increased scrutiny regarding the use of sampling and statistical evidence in wage and hour class actions. We discuss these
changes and anticipated consequences below.
