Jottings By An Employer's Lawyer

Monday, May 31, 2004

Service Writers Covered By Auto Dealership Exemption

We have heard so much recently about the new white collar regulations it is good to remember that tucked throughout the Fair Labor Standards Act are other exemptions, usually tied to a certain business or industry. One of those is 29 U.S.C. § 213(b)(10)(A), the automobile dealership workers exemption. The position in question is that of a service writer, which as many of us had suspected from personal experience, are paid at least in part on a commission for the amount of work that they "write" to be performed on a vehicle. The question was whether or not this person fell within the exemption and the regulations promulgated by the Department of Labor. In 1973 the 5th Circuit, the only other circuit court to deal with the issue, found such service writers exempt. The 4th Circuit agreed, but on different grounds. Rather than using a "functional analysis" as did the 5th Circuit, the 4th Circuit instead struck down the DOL's interpretative regulation as contrary to the statute. Walton v. Greenbrier Ford, Inc.(4th Cir.5/28/04)[pdf]. Notwithstanding the difference in how, the bottom line in both the 4th and 5th Circuit is - service writers get no overtime. But before despairing for their lot, remember those commissions.

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