Mass-Peculiarities: An Employers Guide to Wage & Hour Law in the Bay State 2022 Edition

100 | Massachusetts Wage & Hour Peculiarities, 2022 ed. © 2022 Seyfarth Shaw LLP Under certain circumstances, however, an employee may meet the “directly related to management or general business operations” prong of the duties test even if some of his or her job functions would be considered production duties. 549 For example, an employee may qualify for the administrative exemption if his or her primary duty is the performance of office or non- manual work directly related to the management or business operations of the employer’s customers . 550 Thus, employees acting as advisors or consultants to the employer’s customers— such as tax experts or financial consultants—may be exempt, even though their employer’s main business is the sale of such services. 551 (2) Exercise of Discretion and Independent Judgment To qualify for the administrative exemption, an employee’s primary duty must include the exercise of “discretion and independent judgment” with respect to matters of significance. 552 The exercise of discretion and independent judgment generally involves comparing and evaluating several possible courses of conduct and making a decision after the various possibilities have been considered. 553 The regulations specify that determining whether an employee meets this requirement is fact-specific and must be examined on a case-by-case basis. 554 Factors to consider in making this determination include whether the employee: • Has authority to formulate, affect, interpret, or implement management policies or operating practices • Carries out major assignments in conducting the operations of the business • Performs work that affects business operations to a substantial degree, even if the employee’s assignments are related to operation of a particular segment of the business management or general business operat ions of the employer. See DOL WHD Administ rator’s Interpretat ion FLSA No. 2010-1, Applicat ion of the Administ rat ive ExemptionUnder Sect ion 13(A)(1) of the Fair Labor Standards Act , 29 U.S.C. § 213(a)(1), to EmployeesWho Perform the Typical JobDut ies of a Mortgage Loan Officer (Mar. 24, 2010), available at ht tps://www.dol.gov/sites/dolgov/files/WHD/legacy/files/FLSAAI2010_1.pdf ( last visited Sept . 18, 2021). The U.S. Supreme Court held that the DOL’s interpretation did not violate the notice-and-comment procedures of the Administ rat ive Procedures Act . Perez v. Mortg. Bankers Ass’n, 575 U.S. 92, 135 S. Ct . 1199 (2015). 549 See , e.g. , Roe-Midgett v. CC Servs., Inc. , 512 F.3d 865, 872-73 (7thCir. 2008). 550 29 C.F.R. § 541.201(c). 551 Id. See also Roe-Midgett, 512 F.3d at 872 (holding that employees of company that specialized in processing insurance claims on behalf of insurance companies were exempt because they “serviced” client s’ businesses, even though their own employer’s primary business was to sell the claim processing services they performed). 552 29 C.F.R. § 541.202(a); Cash , 508 F.3d at 686. 553 Id. ; Crowe , 136 F. Supp. 3d at 42 (posit ion required independent discret ion and judgment because clinical quality assurance coordinators could independent ly determine whether a reviewing physicians rat ionale was well-supported and recommend alternat ive determinations). 554 29 C.F.R. § 541.202(b). The Dist rict of Massachuset t s granted a mot ion for summary judgment in favor of the employer because the employee’s poor performance was the reason she did not exercise the judgment and discret ion that the posit ion required. DiBlasi v. Liberty Mut. Grp Inc. , 2014 U.S. Dist . LEXIS 45898, at *27 (D. Mass. Apr. 3, 2014).