The administrative exemption has been a hot area of litigation for a long time in California with all sorts of twists and turns in the California Supreme Court and Courts of Appeal over the last several years. Unfortunately, the courts are still struggling with this exemption and have failed to provide clear guidance or clarity in this area. As a result, plaintiffs’ lawyers continue to target the administrative exemption in individual wage hour actions as well as class actions.
So you have to ask yourself this: Are you confident that you would be able to withstand an attack as to the exempt status of your employees who are classified as administratively exempt?
Even employers who carefully designate job classifications as exempt are subject to attack. Employees may claim that, upon closer inspection, their work doesn’t meet the test for the exemption and that they are owed overtime and penalties for missed meal and rest breaks – a costly battle for employers to fight.
Employers, however, can implement some basic safeguards that will help proactively protect their exempt classifications in the event of a lawsuit. Here are a few suggested steps that employers can put in place now that may help prevent a lawsuit or provide a solid defense in the event of a lawsuit:
1. Require Self-Evaluations: During your company’s review process, solicit employees’ self-evaluations in categories related to the exemption test. Employers should consider including the following types of categories for employee self-evaluations: