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April 02, 2018 02:00 AM

Auto service advisers aren't covered by overtime pay laws, Supreme Court rules

Tire Business Staff
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    WASHINGTON— The U.S. Supreme Court, in a 5-4 decision, has ruled that auto service advisers aren't eligible for overtime pay under the Fair Labor Standards Act.In a 5-4 decision,

    "Because service advisers are 'salesmen primarily engaged in servicing automobiles,' they are exempt from the FLSA's overtime pay requirement," Justice Clarence Thomas wrote in the high court's April 2 decision, in which Chief Justice John Roberts and Justices Anthony Kennedy, Neil Gorsuch and Samuel Alito concurred.

    Justice Ruth Bader Ginsburg wrote the dissent, wih which Justices Elena Kagan, Sonia Sotomayor and Stephen Breyer concurred.

    In her dissent, Ms. Ginsburg said only three automotive occupations are explicitly exempted from the FLSA overtime pay rules: salesmen, partsmen and mechanics.

    "I would not enlarge the exemption to include service advisers or other occupations outside Congress' enumerations," she wrote.

    The original lawsuit was filed in 2012 by employees of Encino Motors L.L.C., a Mercedes-Benz dealership in Encino, Calif. The employees demanded back pay on the grounds that they were owed overtime pay under the FLSA.

    Encino Motors filed a motion with the district court to dismiss the case, and the court granted that motion, Justice Thomas noted in his decision. However, the Ninth Circuit Court of Appeals reversed the lower court.

    The Supreme Court heard the appeal on Jan. 17.

    Enacted in 1938, the FLSA requires employers to pay overtime to covered employees, Mr. Thomas wrote. While there has been some disagreement in the federal government and the courts over the years as to whether service advisers are covered, the Labor Department issued an opinion letter in 1978, stating that service advisers are exempt in most cases, he wrote.

    "Under the best reading of the text, service advisers are 'salesmen,' and they are 'primarily engaged in servicing automobiles,'" Mr. Thomas wrote. "The distributive canon, the practice of construing FLSA exemptions narrowly, and the legislative history do not persuade us otherwise."

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