Cooperman weighs in on Encino Motorcars v. Navarro decision in Law 360
Harriet E. Cooperman, a partner in Saul Ewing’s Labor and Employment Practice, shares her opinion on the U.S. Supreme Court’s decision to vacate a Ninth Circuit ruling stating that auto service advisers should be eligible to receive overtime compensation. The Supreme Court has ordered the matter to be reconsidered without taking into account U.S. Labor Department regulations.
In response to the order Harriet said, “The Supreme Court is chastising the DOL for issuing regulations that reversed the DOL’s decades-old interpretation of the auto dealer exemption to include service advisers, without providing a coherent explanation or analysis for this significant change. When an administrative agency does a complete about-face, as the DOL has done here, which will dramatically impact the way in which an industry compensates certain employees, the Supreme Court is saying to the lower courts that they should not defer to the agency’s new regulation unless it provides a reasoned and thoughtful justification for the change and is procedurally compliant. The DOL has repeatedly said that it is seeking to expand the coverage of the FLSA to more employees by restricting the scope of FLSA exemptions. The Supreme Court’s decision sends a warning to the DOL that if it chooses to issue regulations changing established interpretations, it must provide ‘a reasoned explanation for its decision to depart from the existing enforcement policy’ or risk losing judicial deference of its interpretation.”
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