By Kayla Smernoff

Howard University News Service

The Supreme Court of the United States recently heard oral arguments for EMD Sales Inc. v. Carrera, a case that could determine if not being paid for overtime labor is illegal. The Supreme Court is expected to issue its opinion on the case during the summer.

EMD is an international food and beverage market that operates throughout the District, Maryland and Virginia area. Faustino Sanchez Carrera, Magdaleno Gervacio and Jesus David Muro, three of EMD’s sale representatives, sued the store in 2017 claiming they were denied overtime pay.

The three representatives invoked the Fair Labor Standards Act (FLSA), which requires employers to pay overtime wages.

“For over a century, this court has held that the default standard in civil cases is preponderance of the evidence,” said Lisa S. Blatt, while presenting her argument for the employer. Blatt is the chair of Williams & Connolly’s Supreme Court and Appellate practice and has argued in front of the Supreme Court 51 times.

“What evidence do you have to support a deviation from the norm?” is the question Blatt is posing to the Supreme Court.

“When [Congress] thought about the issue in the administrative context, they said it thought preponderance of the evidence was sufficiently protective of workers in the minimum-wage context, which I think is a little more sympathetic for the worker,” said Blatt.

EMD said their employees qualified for the Outside Sales Exemption, a part of FLSA that covers minimum wage and overtime pay, claiming their employees fell under the two qualifying factors.

First, “the employee’s primary duty must be obtaining orders or contracts for services for which a consideration will be paid by the customer,” according to the Outside Sales Exemption, and second, “the employee must be customarily and regularly engaged away from the employer’s place or places of business.”

In other words, the employee is specifically making sales outside of the established place of business.

In August of 2024, the Washington Legal Foundation “urged the Supreme Court to hold that employers must prove the applicability of FLSA exemptions by a preponderance of the evidence.” The foundation took the side of the employees by suggesting EMD work harder to prove their sales representatives fall under FLSA’s exemptions.

EMD argued that it provided enough evidence to prove sufficiently that their employees were eligible for exemption. The employees disagreed.

Some of the Supreme Court Justices had questions about the possible reach of this case. “Is the government taking the position that this same standard should apply to all of the exemptions?” said Associate Justice Ketanji Jackson Brown.

Aimee W. Brown, the assistant to the solicitor general in the U.S. Department of Justice, brought up the history of employment law and Occupational Safety and Health Administration regulation in the Supreme Court in response.

“If there were a different background rule in place, maybe when a different exemption was enacted, then you might think that Congress had a different rule in mind. But this has been the longstanding background presumption since 1878 in Lilienthal’s Tobacco,” Brown cited a case that centers a seller’s intent to answer Justice Brown Jackson’s inquiry.

“When there is a conventional remedy in civil litigation, the very, very strong presumption is that the preponderance of the evidence standard is going to apply,” Brown said. “And this Court has never recognized or never seen a case in which that is the lay of the land, and that would nevertheless overcome that presumption.”

EMD Sales Inc. v. Carrera will set a standard for how employers decide if their employees are exempt from certain labor laws. It will also determine how employees can retaliate.

“The outcome of this Supreme Court case will have significant practical effect in that it will determine how much evidence an employer must provide to prove an exemption,” Carrie Hoffman, a partner at Foley and Lardner LLP and a specialist in labor and employment law, said in a statement.

The volume of labor law cases being seen, processed and argued yearly makes this Supreme Court case essential, Hoffman said.

“Given the number of FLSA collective actions filed each year, this case has broad implications for employers in both deciding whether to classify an employee as exemption and in its legal strategy when defending FLSA misclassification claims.”

Kayla Smernoff is a reporter for the Howard University News Service.