U.S. Supreme Court Holds Service Advisors Exempt Under FLSA

The Fair Labor Standards Act (FLSA) includes a requirement that employers must pay overtime to what are considered nonexempt employees. In Encino Motorcars, LLC v. Navarro, the Supreme Court now has held that automobile service advisors are exempt. But just as if not more importantly for future issues about classification of employees as exempt or nonexempt, the Supreme Court rejected the long-accepted notion that exemptions should be construed narrowly, saying “[w]e reject this principle as a useful guidepost for interpreting the FLSA.” Instead, the Court majority concluded that “exemptions are as much a part of the FLSA’s purpose as the overtime-pay requirement” and that it “ha[s] no license to give the exemption anything but a fair reading.” The Court reversed the lower court decision of the Ninth Circuit Court of Appeals, a regional federal appeals court sometimes known for being not infrequently reversed.

Here’s the Court’s slip opinion: https://www.supremecourt.gov/opinions/17pdf/16-1362_gfbh.pdf