Legal Hotline: (844) 804-2016

Could district managers be exempt?

Posted

Question: Our district managers regularly deliver down routes, including home delivery. Could our newspaper use the Section 13(d) exemption from minimum wage and overtime requirements to avoid the higher salary requirements of the U.S. Department of Labor's new rule?

Answer: Two reported newspaper cases – one from 2008 and one from 2012 – make a compelling argument that the delivery of down routes by circulation department district managers may be enough to make the Section 13(d) exemption applicable.

The net result is that the increased salary requirements of the new DOL rule would not apply. Assuming analogous facts, these cases could be relied upon. They have not been overruled or reversed. There has not been a lot of litigation under Section 13(d).

In both cases, the job description of the district manager-type position included responsibility for delivering non-contracted routes in the absence of a contracted independent contractor. The two courts focused on the precise language of the Section 13(d) exemption:

"The provisions of Sections 6, 7, and 12 (minimum wage, overtime, and child labor) shall not apply with respect to any employee engaged in the delivery of newspapers..."

The 13(d) exemption is different than the exemption for bona fide executive, administrative, professional and outside sales positions. That provision in the statute provides that the secretary of labor may "define and delimit" those terms by regulations pursuant to the Administrative Procedure Act. No such proviso is present in the statutory language of the 13(d) exemption.

Thus, the secretary of labor has promulgated regulations imposing a "primary duty" requirement for the executive, administrative, professional and outside sales positions. A part of those regulations has included a salary requirement. Those regulations specifically provide that the salary requirement does not apply to the outside sales exemption. Therefore, with respect to the Section 13(d) exemption, the statutory language is distinct and different. It contains neither a "primary duty," nor a salary requirement.

The cases make the following points:

  • "Engaged in" is a much lesser requirement than "primary duty."
  • A minimal amount of participation is required to constitute "engaging in" an activity.
  • If the activity is "regular and reoccurring" even though "small in amount," it qualifies.
  • So long as the employee is consistent in performing the exempt duty, he is exempt from the provisions of the Fair Labor Standards Act.
  • The district manager must deliver newspapers (including shopping news) to a subscriber's address.

In these cases, the plaintiff district managers delivered down home delivery routes as infrequently as twice a week. This regularity, as well as job descriptions and mileage logs kept by the district managers, appeared to be key to the decision.

Based upon these facts and the analysis of these two cases, many newspaper circulation department district managers could qualify for the Section 13(d) exemption. At this time, I have not located any stated position of the U.S. Department of Labor with respect to these cases.

This article addresses only the federal law. Individual states may have Wage and Hour laws that must be checked as well.

Note: Nothing in this SNPA Legal Hotline Q&A should be relied upon as legal advice in any particular matter.

L. Michael Zinser is the founding partner of The Zinser Law Firm in Nashville, Tenn. The firm, which has a heavy concentration of clients in communications media, represents management in the area of labor and employment. Zinser can be reached at (615) 244-9700 or mzinser@zinserlaw.com.


SNPA's free Legal Hotline for members – (844) 804-2016 – is designed to assist newspapers with a broad range of legal issues. Hotline attorneys and CPAs will tackle questions about circulation, independent contractors, labor and employment law, taxes, finances and accounting, employment benefits, open records, libel and privacy, and other issues newspapers encounter.

The attorneys and CPAs who will take calls from SNPA member newspapers are the best in the business:  The Bussian Law Firm PLLC, Fisher & Phillips, Way, Ray, Shelton & Co., P.C. and The Zinser Law Firm.

Comments

No comments on this story | Please log in to comment by clicking here
Please log in or register to add your comment