On March 24, 2010, the U.S. Department of Labor’s Wage and Hour Division announced that it will begin issuing “Administrator Interpretations” of the statutes and regulations administered by the division, which include the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA). According to the announcement, these Administrator Interpretations “will set forth a general interpretation of the law and regulations, applicable across-the-board to all those affected by the provision at issue,” and will clarify the law “as it relates to an entire industry, a category of employees, or to all employees.”
The Wage and Hour Division has long issued opinion letters responding to questions from individuals and organizations about how federal wage and hour law applies to specific factual situations. The Division’s announcement states that in the future, rather than providing an actual opinion regarding the specific facts referenced in an opinion letter, the Division will generally respond to such requests only by providing references to the relevant statutes, regulations, interpretations and cases. However, the Division will consider requests for opinion letters “for purposes of the Administrator’s ongoing assessment of what issues might need further interpretive guidance.”
While on its face this may appear to be a purely administrative change, the new “Administrator Interpretations” marks a clear effort to expand the Wage and Hour Division’s power to shape federal wage and hour law without the need for Congressional approval or the lengthy notice and comment process associated with formal rulemaking. Of course, like the opinion letters previously issued by the Wage and Hour Division, the new Administrative Interpretations cannot directly change existing statutes or regulations. However, they will clearly guide the Division’s enforcement activities, and will likely be treated with at least a certain level of deference by the courts, particularly as to unsettled areas of law.
In a prime example of what may be in store, the Division also issued its first Administrator Interpretation on March 24, finding that mortgage loan officers generally do not meet the requirements of the administrative exemption. This interpretation is in direct contrast to an opinion letter issued in 2006 under the prior administration, holding that mortgage loan officers were exempt administrative employees. The new Administrator Interpretation expressly withdraws that earlier opinion letter, stating that the prior opinion failed to properly construe the requirement that administrative employees perform office or non-manual work “directly related to the management or general business operations of the employer or the employer’s customers.” According to the new Interpretation, mortgage loan officers do not meet this qualification because their primary duty is selling their employer’s product – mortgage loans – rather than servicing the employer’s “management and general business operations.”
The full text of the new Administrator Interpretation, No. 2010-1, is available here.