Under the FLSA (Fair Labor Standards Act) a salaried, registered nurse consultant, exempt professional, not owed overtime. The nurse has no final decision authority over coverage denials, works from home, rarely interacts with supervisors, applies clinical guidelines, analyzes medical services for medical necessity, but remains exempt under the FLSA’s professional exemption, even for working more than 40 hours a week.
The case is Isett v. Aetna Life Insurance Company, 18-3271-cv. It was decided January 14, 2020 here in New York.
A salaried nurse is deemed an exempt professional not owed overtime pay under the FLSA. The professional exemption applies even for work beyond 40 hours per week. Aetna Life Insurance Company successfully argues that its nurse consultants are not owed overtime pay. The nurse’s lack of apparent authority or little discretion on the job does not matter. The nurses’ lack of independent judgment is also not critical. The nurses are all licensed and registered. Their decisions may be routine. But they are required to use advanced knowledge in a field of science to do their jobs. Therefore, they are not entitled to overtime pay.
Similarly, physician medical directors are also exempt from overtime pay. But licensed practical nurses, LPNs, are not. Registered nurses argue that they are not clinicians. As remote workers they do not see patients. They believe that the FLSA exemption from overtime pay should apply only to RNs within clinical settings. Their primary duties as non-clinicians should entitle overtime pay. The Court disagrees. It examines the RNs’ primary duties, key for most employment law disputes.
Under the FLSA a “professional” is an employee whose primary job duty requires “knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction.” Registered nurses are so qualified.
SCOTUS dissects the legal authority of its lower courts reminding them that they “have no license to give the [professional] exemption anything but a fair reading” Encino Motorcars, LLC v. Navarro, 138 S. Ct. 1134, 1142 (2018). The Secretary of Labor clarifies exemptions thru rule-making under the CFR [Code of Federal Regulations]. “Discretion and independent judgment” are explained in relation to an administrative exemption. Courts neither draft nor do they choose employers’ exemptions.
Aetna chooses to defend under the professional exemption as opposed to the administrative exemption. Under the professional exemption much less discretion and independent judgment are required of registered nurses for them to remain exempt from overtime pay. Under the administrative exemption, nurses might exercise no “authority to commit the employer in matters that have significant financial impact …. to waive or deviate from established policies and procedures without prior approval,” or “to negotiate and bind the company on significant matters” Pippins v. KPMG, LLP, 759 F.3d 235, 238 (2nd Cir. 2014). But this was not the exemption under which Aetna defends itself so their argument fails.
Registered nurses are not bound to work in clinical settings. Nothing prevents registered nurses from remote work. Under the professional exemption they may perform their primary duties from almost anywhere. The decisions they make do not change depending on situs of their jobs. Employers choose their defenses. The professional exemption exempts Aetna from overtime pay to registered nurses.
The “discretion and judgment” needed under the professional exemption is less stringent than under the administrative exemption. The registered nurses are using their advanced knowledge or education in a field of science. Aetna requires such knowledge of the consultants hired to perform those duties. Regardless of nurses’ beliefs, they exercise some degree of discretion or judgment in the duties required by their jobs. Actual or perceived authority appears irrelevant under a legitimate professional exemption.