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

© 2022 Seyfarth Shaw LLP Massachusetts Wage & Hour Peculiarities, 2022 ed. | 101 • Has authority to commit the employer in matters that have significant financial impact • Has authority to waive or deviate from established policies and procedures without prior approval • Has authority to negotiate and bind the company on significant matters • Provides consultation or expert advice to management • Is involved in planning long-term or short-term business objectives • Investigates and resolves matters of significance on behalf of management • Represents the company in handling complaints, arbitrating disputes, or resolving grievances 555 Federal courts generally find that employees who engage in two or three of the above activities qualify for the administrative exemption. 556 In general, an employee who exercises discretion and independent judgment has the authority to make independent choices without immediate direction or supervision. 557 However, this does not mean that to qualify for the exemption, the decisions made by an employee must be final or that the employee has unlimited authority. Employees can exercise discretion and independent judgment even if their decisions or recommendations are reviewed and revised at a higher level. 558 The federal regulations provide the following specific examples illustrating when an employee will qualify for the administrative exemption even though his or her decision is not final: • A credit manager of a large corporation formulates policies that are subject to review by higher company officials who may then approve or disapprove these policies. • A management consultant who makes a study of the operations of a business and draws up a plan for proposed change in an organization may then have the plan reviewed or revised by superiors before it is submitted to the client. 559 555 29 C.F.R. § 541.202(b) . 556 Bondy v. City of Dallas , 77 F. App’x 731, 732-33, 2003 WL 22316855, at *1 (5th Cir. Oct . 9, 2003); Robinson-Smith v. Gov’t Emps. Ins. Co., 590 F.3d 886 (D.C. Cir. 2010); Napert v. Gov’t Emps. Ins. Co., 36 F. Supp. 3d 237 (D. Mass. 2014). 557 29 C.F.R. § 541.202(c). 558 Id . 559 Id . While administ rat ive employees’ decisions may be reviewed at higher levels, the law is unset t led with respect to the effect on exercise of independent judgment and discret ion of workplace rules and legal requirement s that limit what employees may say or do. Some court s have held that it remains possible to exercise discret ion in heavily regulated indust ries. See Renfro v. Indiana Michigan Power Co ., 370 F.3d 512 (6th Cir. 2004) (interpreting a 1988 regulat ion that specifically addressed nonmanual work, which was removed in 2005).