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June 17, 2022

Overtime Obligations: Why You Should Pay Attention to S.B. 47

by Thomas Spyker, Esq., Reminger Co., LPA

On July 6, 2022, Ohio’s overtime laws are changing as Senate Bill 47 takes effect. Signed into law earlier this year, S.B. 47 attempts to better define employers’ overtime obligations.

The largest changes are familiar, as S.B. 47 expressly incorporates several provisions of the federal Fair Labor Standards Act into Ohio law. However, the text goes beyond what is provided by federal law, leaving some ambiguities. Below is a brief breakdown of the significant changes.

Incorporating the Portal-to-Portal Exemptions:

S.B. 47 enacts the new R.C. § 4111.031, which largely echoes Sections 2 and 4 of the Portal-to-Portal Act, a 1947 amendment to the FLSA. This clarifies that under state law, employers are not required to pay overtime for normal to-and-from work commutes. Assuming this law is interpreted as its federal counterpart has been, this would make routine commutes, however long, non-compensable.

Additionally, the new Ohio code section also incorporates the de minimums exemption, making “activities requiring insubstantial or insignificant periods of time beyond the employee’s scheduled working hours” non-compensable. (e.g., reading an email at home between shifts).

Further, R.C. § 4111.031 codifies additional exemptions, clarifying that employers do not need to pay overtime for “[p]erforming activities that are preliminary to or postliminary to the principal activity or activities” (e.g., waiting in line to check in, changing out of a uniform and showering before coming home, etc.).

Limitations on the Exemptions:

R.C. § 411.031 builds in some express limitations to these exemptions, the language deviating from its federal counterpart. First, the “preliminary and postliminary” exemption does not apply if the task is done during the course of the normal workday, or at the specific direction of the employer.[1] Initially, it is unclear what the scope of “specific direction” actually is here. Again, this is a deviation from the FLSA, whose version of the same exemption was recently determined to apply even if the act is something required by the employer, depending on circumstances.[2]

Further, none of the exemptions described above apply if (1) the activity is performed “pursuant to an express provision of a written or unwritten contract…” or (2) the activity is performed pursuant to an established “custom or practice.”[3] While the first contractual provision is fairly straightforward, the latter provision relating to customs and practices leaves significant room for ambiguity.

Procedural Changes to Class Actions:

In addition to the substantive changes, S.B. 47 introduces R.C. § 4111.10(C) to reform class procedures. This section mirrors the federal procedure established in FLSA § 216(b). Prior to the bill, class suits seeking unpaid wages could proceed under Civil Rule 23, where members would be required to affirmatively “opt-out” of the lawsuit. Now, under the new provision, prospective plaintiffs must affirmatively “opt-in” to the lawsuit.

Advice for Incorporating the Changes:

Although many of the changes are familiar and well-interpreted by federal case law, others present uncharted territory. Employers and employees should seek the advice of professional legal counsel before acting on any of the changes described in this article.

 

[1] R.C. 4111.031(B)

[2] See Integrity Staffing Solutions v. Busk, 135 S. Ct. 513 (2014).

[3] R.C. 4111.031(B)

Although many of the changes are familiar and well-interpreted by federal case law, others present uncharted territory. Employers and employees should seek the advice of professional legal counsel before acting on any of the changes described in this article.