By a 5-4 margin, the United States Supreme Court opted to deviate from over 70 years of clearly established legal precedent to make it more difficult to hold employers accountable for wage theft. In that case, Encino Motocars, LLC v. Navarro, the 5-person majority of the Supreme Court decided that exemptions under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201, et seq., can be interpreted broadly. In other words, the majority opinion in Encino states that the right to overtime pay for overtime work under the FLSA should no longer apply to potentially millions of employees.
This radical ruling will likely have a serious impact on employment law for years to come, not only for the nature of the decision – which will limit collective actions and class actions for unpaid wages and double damages going forward – but also for how the 5-person majority reached the decision. The ruling in Encino fulfills the plan hatched by the Chamber of Commerce and other powerful corporate interests to overturn many decades of employment law. Historically, the Supreme Court has ordinarily respected and followed its earlier decisions. Not so in Encino. In fact, the 5-person majority did not even acknowledge that it was overruling prior cases. Such a cavalier approach undermines the integrity of the Supreme Court, specifically, and the rule of law, generally.