In two decisions issued on September 19, the Second Circuit relied on the Supreme Court’s instruction in Encino Motorcars, LLC v. Navarro, 138 S. Ct. 1134, 1140 (April 2, 2018) that FLSA exemptions are not to be construed narrowly, but fairly.

In Munoz-Gonzalez v. D.C. Limousine Service, Inc., analyzing the taxicab exemption in Section 13(b)(17) of the FLSA, the Court of Appeals noted:

[O]ur Circuit has traditionally construed FLSA exemptions narrowly and against the employers asserting them, and Munoz‐Gonzalez urges us to do the same today.  See, e.g., Fernandez v. Zoni Language Ctrs., Inc., 858 F.3d 45, 48 (2d Cir. 2017).  We cannot do so.  In Encino Motorcars, the Supreme Court made clear that we must give FLSA exemptions “a fair (rather than a ‘narrow’) interpretation.”  138 S. Ct. at 1142 (quoting Scalia & Garner, supra, at 363).  Because “the limitations expressed in statutory terms [are] often the price of passage,” id. at 9 (quoting Henson v. Santander Consumer USA, Inc., 137 S. Ct. 1718, 1725 (2017)), we must interpret each FLSA exemption the same way we would any other statutory provision—with full attention to its text.

And in Flood v. Just Energy Marketing Corp., analyzing the outside sales exemption in Section 13(a)(1) of the FLSA, the Court of Appeals noted:

Until recently, it was a rule of statutory interpretation that a court should narrowly construe an exemption to the FLSA in order to effectuate the statute’s remedial purpose.  See, e.g., Reiseck v. Universal Commc’ns of Miami, Inc., 591 F.3d 6 101, 104 (2d Cir. 2010); A.H. Phillips, Inc. v. Walling, 324 U.S. 490, 493 (1945).  But that is not the rule anymore. The Supreme Court has now “reject[ed] this principle as a useful guidepost for interpreting the FLSA.”  Encino Motorcars, LLC v. Navarro, 138 S. Ct. 1134, 1142 (2018).  According to the Supreme Court, “[t]he narrow‐construction principle relies on the flawed premise that the FLSA pursues its remedial purpose at all costs.”  Id. (internal quotation marks omitted).  Because exemptions under the FLSA are “as much a part of the FLSA’s purpose as the overtime‐pay requirement,” the Supreme Court now instructs that courts “have no license to give the exemption anything but a fair reading.”  Id.; see also Carley v. Crest Pumping Techs., L.L.C., 890 F.3d 575, 579 (5th Cir. 2018).

In both cases, the Court of Appeals affirmed district court grants of summary judgment to the employer on the ground that the plaintiffs qualified for the exemption at issue.

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Photo of Allan Bloom Allan Bloom

Allan S. Bloom is a nationally recognized trial lawyer and advisor who represents management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended a number of the world’s leading companies against claims for unpaid wages…

Allan S. Bloom is a nationally recognized trial lawyer and advisor who represents management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended a number of the world’s leading companies against claims for unpaid wages, employment discrimination, breach of contract and wrongful discharge, both at the trial and appellate court levels as well as in arbitration. He has secured complete defense verdicts for clients in front of juries, as well as injunctions to protect clients’ confidential information and assets.

As the leader of Proskauer’s Wage and Hour Practice Group, Allan has been a strategic partner to a number of Fortune 500 companies to help them avoid, minimize and manage exposure to wage and hour-related risk. Allan’s views on wage and hour issues have been featured in The New York TimesReutersBloomberg and Fortune, among other leading publications. His class-action defense work for clients has saved hundreds of millions of dollars in potential damages.

Allan is regularly called on to advise boards of directors and senior leadership on highly sensitive matters such as executive transitions, internal investigations and strategic workforce planning. He also has particular expertise in the financial services industry, where he has litigated and arbitrated cases, including at FINRA and its predecessors, for more than 20 years.
A prolific author and speaker, Allan was the Editor of the New York State Bar Association’s Labor and Employment Law Journal from 2012 to 2017. He has served as an author, editor and contributor to a number of leading treatises in the field of employment law, including ADR in Employment Law (ABA/Bloomberg BNA, Senior Editor), Employment Discrimination Law (ABA/Bloomberg BNA, Final Proof Editor), Cutting Edge Advances in Resolving Workplace Disputes (Cornell University/CPR, Editor), The Employment Law Review (Law Business Research, U.S. Chapter Author), and The Complete Compliance and Ethics Manual (SCCE, Chapter Author).

Allan is a member of the NYSBA’s House of Delegates, sits on the Executive Committee of the NYSBA’s Labor and Employment Law Section, and is a Fellow of the College of Labor and Employment Lawyers. He has been recognized as a leading practitioner by Chambers since 2011.