MANY immigrants who come to America have professional degrees or licenses from their home country. They usually are not ‘licensed or certified by the State of California’ and yet still are working in some capacity within their professions here in California.
These include accountants, engineers, lawyers, doctors, dentists, optometrists, architects, and teachers. These workers normally work more than 8 hours per day and are paid a monthly salary.
Are these professionals entitled to additional wages by way of overtime pay?
Under California law, licensed professionals are automatically exempt from overtime. But what about those professionals who, though unlicensed in California, have been trained in their respective professions and whose work require some exercise of these professions? For example, are unlicensed accountants who perform accounting work for an accounting company entitled to overtime?
These are the questions that the federal appellate court recently grappled with in a case involving accountants from California working as associate accountants for PricewaterhouseCoopers (PwC), one of the world’s biggest accounting firms. These associate accountants were not licensed as certified public accountants but were treated as exempt employees anyway and were not paid overtime. They sued their employer for unpaid overtime. The court ruled for the employees and the employer appealed.
The accountants said they perform primarily routine and menial tasks with strict instructions from managers, using company auditing software, and with an extensive work-review system that preclude them from exercising any significant discretionary judgment or analytical thinking.
On the other hand, PwC says that the accountants perform analytical work “integral” to PwC’s services. If the accountants do not exercise discretion and independent judgment during audit work, they fail to meet the firm’s expectations. The accountants also perform a variety of duties, which when performed inadequately, will result in “significant consequences” for PwC’s clients.
The US Court of Appeals considered the consequences of its decision not only in the case of accountants but on other professions requiring a license or certification by the state. The court said that the lack of a license does not automatically entitle the employees to overtime pay. For unlicensed professionals to be exempt, they must either meet the requirements for administrative exemption, or be found to be primarily engaged in an occupation commonly recognized as a learned or artistic profession.
To fall under the administrative exemption, an employee must:
(1) perform work directly related to management policies or general business operations;
(2) customarily and regularly exercise discretionary and independent judgment;
(3) work under only general supervision while either performing specialized or technical work requiring special training, experience or knowledge; or executing special assignments and tasks.
(4) primarily engage in exempt work meeting the above requirements; and
(5) meet a minimum salary requirement.
Someone is engaged in a learned or artistic profession if they are professionals engaged in work that is “predominately intellectual and varied in character.” This means that their duties and qualifications must be examined to determine their exempt status. Hence, each case requires a fact-specific inquiry.
Based on this most recent development in the law, employers and unlicensed professionals should re-examine the latter’s actual responsibilities in the workplace. If they primarily work on clerical, routine, and manual tasks, they may not be exempt and may be entitled to additional wages.
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C. Joe Sayas, Jr., Esq. is an experienced trial attorney who has successfully obtained significant results, including several million dollar recoveries for consumers against insurance companies and big business. He is a member of the Million Dollar-Advocates Forum—a prestigious group of trial lawyers whose membership is limited to those who have demonstrated exceptional skill, experience and excellence in advocacy. He has been featured in the cover of Los Angeles Daily Journal’s Verdicts and Settlements for his professional accomplishments and recipient of numerous awards from community and media organizations. His litigation practice concentrates in the following areas: serious personal injuries, wrongful death, insurance claims, unfair business practices, wage and hour (overtime) litigation. You can visit his website at www.joesayas law.com or contact his office by telephone at (818) 291-0088.
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