new dol opinion letters provide useful guidance

Lessons in Overtime Pay for Higher Ed Institutions

Overtime pay under the FLSA frequently causes confusion among higher education institutions due to the unique application of the FLSA’s “white collar” exemptions to these institutions.  Thankfully, the Department of Labor (“DOL”) issued a fact sheet last week clarifying the FLSA’s application to many common higher education jobs.  Think of it like a cheat sheet.

Pay attention.  There may be a pop quiz.

Here are the highlights from the DOL’s fact sheet:

  • Teachers – Teachers are unique under the FLSA in that the general duties + salary test is truncated. A teacher may be exempt from the overtime requirement of the FLSA so long as he or she meets the duties prong of the test, i.e. his or her primary duty is teaching, tutoring, instructing, or lecturing to impart knowledge, and if he or she is performing that duty as an employee of an educational establishment.  So long as the duty requirement is met, the salary prong does not apply.  Following that logic, with the rise of distance learning, the DOL clarifies that a faculty member that teaches online or remotely may also qualify for the exemption, regardless of hours and the audience.
  • Coaches – Similarly, a coach may qualify under the teacher exemption so long as his or her primary duties include instructing student-athletes regarding how to play a particular sport. However, a coach who focuses primarily on recruiting students for the school would not qualify.
  • Student-Employees – With student-workers, institutions must first consider whether or not an employment relationship exists. If the student receives compensation and his or her duties are not part of the educational program, the DOL with likely find an employment relationship exists.  Therefore the minimum wage and overtime requirements of the FLSA would apply.  Typically, student workers are non-exempt hourly employees.  However, there are exceptions:
    • Graduate teaching assistants whose primary duty is teaching are exempt under the above “teacher” exemption.
    • Research assistants are typically in an educational relationship with the school as opposed to an employment relationship. If so, the higher education institution is not bound by the FLSA.
    • Student residential assistants who are enrolled at the school and receive a reduced rate for housing and/or tuition in exchange for being a resident assistant are not generally considered employees of the school. Therefore, the FLSA’s minimum wage and overtime requirements would not apply.

Due to the unique application of the FLSA’s “white collar” exemptions to these and other common higher education jobs, administrators are encouraged to review workers’ (including student workers’) classifications to ensure the classifications are in line with the DOL’s recent guidance.