New Jersey Inadvertently Eliminates Long-Standing Exemption for Commissioned Sales People and Aligns Exemptions With Federal Law

In an effort to bring its definitions for white-collar employees exempt from the overtime pay regulations into line with the federal definitions, New Jersey inadvertently eliminated a long-standing exemption for commissioned sales people.

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Learned Professionals-Employers Take Care

The Second Circuit Court of Appeals (which covers New York, Vermont, Connecticut and Puerto Rico) recently issued a decision regarding the “professional exemption” that provides both guidance and concern to employers. Young v. Cooper Cameron Corporation considered whether an engineer with no formal education beyond high school could satisfy the “learned professional exemption.”

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Are all American Idol Workers "Creative Professionals?"

Contestants might do just about anything to get a spot on the hit show American Idol, but the show’s workers do not think they should have to give up their rights to overtime and breaks just for the privilege of working on the show. Last month, former employees filed a class-action lawsuit against FremantleMedia North America, the producer of American Idol. The lawsuit alleges that the producer failed to pay overtime, falsified time cards, and did not allow the workers to take meals and rest periods as required by law. Among other things, Idol workers allege that they were paid a flat weekly rate which, after calculations taking into account their long hours, did not equal minimum wage.

The Idol workers are being backed by the Writers Guild of America and the International Brotherhood of Teamsters, which have organized a “Truth Tour” with rallies and other events to bring attention to the claims against the successful show.

Whether or not the Idol workers’ claims have merit, it is good to keep in mind that not all workers on entertainment shows or other creative endeavors will be considered exempt from the wage and hour laws. “Creative Professionals” may be exempt from federal wage and hour laws, but only if they meet certain requirements. Specifically, an employee must be compensated on a salary or fee basis of at least $455 per week, and the primary duty of the employee must be performance of work requiring “invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.” In addition, local laws also may dictate employer obligations to people working in the creative field.

The sticking point for many employers in entertainment or other creative fields is determining whether the work performed is truly creative in nature. In the Idol case, for instance, some of the plaintiffs worked in production positions. Any position that requires intelligence, diligence and accuracy – which is often involved in production work – but does not require creativity, may not be exempt from wage and hour laws. For instance, journalists that only collect and organize information and who do not contribute a unique interpretation to the information collected would not be considered to be creative professionals who are exempt. According to the U.S. Department of Labor actors, musicians, composers, soloists, certain painters, writers, certain cartoonists, essayists, novelists and high level advertising professionals generally are considered to be creative professionals who are exempt. On the other hand, an “animator” of motion picture cartoons or a retoucher of photographs would not be considered to be performing creative work and would not be exempt. As with most issues involving application of overtime laws, each situation must be assessed on a case-by-case basis to confirm that an exemption is likely to apply.