U.S. Department of Labor Issues New Opinion Letters: Part Two – Paralegals

By Courtney Amelung - Shawe Rosenthal LLP

July 10, 2019

In our last blog post, we revealed a three-part series intended to address the new opinion letters issued by the U.S. Department of Labor on July 1, 2019.  The second of these opinion letters, FLSA2019-8, addresses whether paralegals employed by a trade organization are exempt from minimum wage and overtime requirements under Section 13(a)(1) of the FLSA – an issue of admittedly more limited interest, except as to employers of such individuals.

Scenario: A trade organization employs paralegals that engage in non-manual work and receive an annual salary of at least $100,000.  Among other duties, the paralegals: keep and maintain records; prepare and distribute notices and reports; assist with bank account, trademark, and real estate matters; maintain the legal department’s budget and assist with annual audits; assist with the formation of new entities; and prepare training seminars.

DOL Opinion: The DOL concluded that the paralegals qualify for the highly compensated exemption from minimum wage and overtime pay requirements which applies when: (1) the employee’s primary duty includes performing office or non-manual work; (2) the employee receives total annual compensation of at least $100,000; and (3) the employee customarily and regularly performs any one or more of the exempt duties or responsibilities of an executive, administrative, or professional employee.  29 C.F.R. § 541.601.  In so concluding, the DOL noted that all of the paralegals’ duties are non-manual and the paralegals receive total annual compensation of at least $100,000.  Moreover, the paralegals perform one or more duties of an exempt administrative employee, which must be directly related to the management or general business operations of the employer or the employer’s customers.  29 C.F.R. § 541.200(a)(2).  These duties are also performed by the paralegals on a customary and regular basis.  Accordingly, the paralegals at issue are qualified as highly compensated employees.

Tip for Employers: If you are an employer that employs paralegals, consider whether those paralegals are eligible for the highly compensated exemption from the FLSA’s minimum wage and overtime requirements.  If so, take the opportunity to re-classify those employees from non-exempt to exempt and avoid the onerous and complicated obligations imposed by the FLSA! Other employers can use this opinion letter as a reminder that the highly-compensated exemption may be an option for those office employees making over $100,000 and performing at least one exempt duty.