Department of Labor Issues Fact Sheet Discussing Applicability of the Fair Labor Standards Act Exemptions Specific to Higher Education Employees

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The Department of Labor issued a fact sheet discussing the applicability of Fair Labor Standards Act exemptions to certain higher education jobs, including online instructors.

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The Department of Labor's (DOL) Wage and Hour Division (WHD) recently released Fact Sheet #17S: Higher Education Institutions and Overtime Pay Under the Fair Labor Standards Act (FLSA). While the FLSA requires that non-exempt employees be paid overtime wages when working in excess of 40 hours per week, the law exempts employees who qualify for certain "white collar exemptions" from this requirement. The Fact Sheet provides clarification on the applicability of various white collar exemptions for jobs specific to higher education and notably with respect to online instructors.

An employee must typically satisfy three tests in order to qualify for a white collar exemption: (1) They must be paid on a salary basis (the salary basis test); (2) they must receive a salary at a rate not less than $455 per week (the salary level test); and (3) their primary duty must involve work associated with the exemption, such as executive, administrative, or professional work (the duties test). However, regulation (29 CFR § 541.303) exempts teachers from the overtime requirements if their primary duty is "teaching, tutoring, instructing or lecturing in the activity of imparting knowledge and who is employed and engaged in this activity as a teacher in an educational establishment by which the employee is employed." They need not satisfy the salary level and salary basis tests if they meet the aforementioned duties test.

Despite the regulation governing the teacher exemption, questions persisted within the higher education community about the applicability of the exemption for some employees in the field. EDUCAUSE joined CUPA-HR and 19 other higher education associations in submitting comments to a 2017 Request for Information that DOL issued to initiate the process of writing a new overtime rule. DOL took this regulatory step after the 2016 final rule updating the salary threshold in the salary level test was struck down in federal court.

Included in those comments was the question of whether employees, such as online instructors, who have a primary duty of teaching but do not necessarily instruct people enrolled in degree-seeking programs, qualify for the teaching exemption. Since regulations governing the teacher exemption are unclear in this area, guidance was requested.

Specific to the teacher exemption, the new fact sheet states that:

"A faculty member who teaches online or remotely also may qualify for this exemption. The regulations do not restrict where bona fide teaching may take place, to whom the knowledge can be imparted, or how many hours a teacher must work per week to qualify for the exemption. The exemption would therefore ordinarily apply, for example, to a part-time faculty member of an educational establishment whose primary duty is to provide instruction through online courses to remote non-credit learners."

The administration's Spring 2018 Unified Regulatory Agenda identifies January 2019 as the release date for a new proposed overtime rule. EDUCAUSE is actively monitoring the regulatory action and will keep members apprised of developments as they occur.

Kathryn Branson is an associate with Ulman Public Policy.

© 2018 Kathryn Branson. The text of this work is licensed under a Creative Commons BY-NC-ND 4.0 International License.