Vision Payroll

The US Department of Labor (DOL) recently issued Administrator signed Opinion Letter FLSA2009-5. Although Opinion Letters only apply to the exact set of facts and circumstances presented in each case, they are a valuable aid in understanding current interpretations of the Fair Labor Standards Act (FLSA).

In this Opinion Letter, the DOL confirmed that lifeguards employed for less than seven months of the year are exempt from the minimum wage and overtime requirements of the FLSA. The lifeguards in question were employed by a town “to protect swimmers at the local beach.”

Since employees of an “establishment that is an amusement or recreation establishment, organized camp, or religious or non-profit conference center” that is not open more than seven months in a calendar year are exempt from the FLSA, a key factor was the definition of “establishment”. The Opinion Letter also confirmed that an amusement or recreational establishment supported by tax revenues cannot qualify under a second test involving the seasonality of the revenue collected.

The Opinion Letter clarified that “the term ‘establishment’ refers to a distinct physical place of business rather than to an entire business or enterprise, which may include several separate places of business.” Also, the fact that some employees may work more than seven months in a year does not deny the exemption as long as the beach is not open for protected swimming for more than seven months.

State laws may provide rules that are more beneficial to the employee and must be followed. Contact Vision Payroll if you have questions about this Opinion Letter.

The US District Court for the District of Columbia granted summary judgment to the defendants in a lawsuit by two lifeguards seeking overtime pay. In Miroslav Ivanov, et.al., v. Sunset Pools Management, Inc., et.al., DDC, 07cv410 RJL, July 29, 2008, the two plaintiffs, Bulgarian citizens, alleged violations of the Fair Labor Standards Act (FLSA) among other complaints. Plaintiffs and defendants agreed that the Ivanov brothers worked in excess of forty hours per week and were not paid an overtime premium. Defendant Sunset Pools Management, Inc. (Sunset) argued that it was exempt from the FLSA overtime requirement under the amusement and recreational exemption. The court found conflicting opinions within the Department of Labor as to whether a pool operator qualified under the instant exception, but ruled that the “undisputed evidence in this case demonstrates that Sunset is an amusement and recreational establishment.” The court also ruled that International Training and Exchange, Incorporated, “an international staffing firm that recruits foreign citizens for ‘work-travel’ opportunities in the United States,” was not the plaintiffs’ employer and therefore not liable under the FLSA. Contact Vision Payroll if you have questions on the FLSA and the amusement and recreational exemption.