In the case of Taylor v. HD and Associates, LLC., Byron Taylor, a cable technician who worked for HD and Associates (HDA), alleged that he and other similarly situated employees did not receive overtime pay as required by the FLSA. HDA is a subcontractor of Cox Communications (Cox) and provides cable and telephone equipment installation and repair services for Cox’s residential customers in Louisiana.
The HDA cable technicians receive work orders directly from Cox based on customer service requests. Cox and HDA use a digital platform to manage work orders, track technician locations, and update routes and assignments. The court uses the bona fide exemption to determine the cable technicians’ qualification for overtime exemption. Since HDA was considered a service establishment and met the regular rate of pay requirement, the key question is whether HDA paid technicians a commission.
The court determined that HDA provided commissions to their technicians because their payment was a percentage of the price passed on to customers, tied to the customer’s demands, and incentivized faster work rather than longer hours.
The district court affirms that the cable technicians were considered exempt and were not entitled to overtime pay.
Key lessons from this case:
- The bona fide exemption is when an employer is a retail or service provider, the regular rate of pay exceeds 1.5 times the minimum hourly rate, and more than half of the compensation is commissions on goods or services.
- An employer’s business operations, payment structure, and the nature of the employees’ work play a significant role in determining exemption eligibility.
- If employees receive commissions as a percentage of the price passed on to customers, it can be a factor supporting exemption eligibility.
If you want to know more about overtime regulations, read our guide on Louisiana Overtime Laws.
