Judge Begs Higher Courts To Clarify Exempt Status

Determining whether employees are exempt from overtime requirements under California law is more difficult than determining their status under federal law. Under federal law, exempt status depends on an employee's primary duty and the time spent performing that duty is not dispositive. But California uses a "primarily engaged" test where how the employees spend their time is entirely dispositive. So the question becomes whether the employees spend more than half their time performing duties that meet the test of the exemption like "customarily and regularly exercising discretion and independent judgment."

Hundreds of millions of dollars have been spent litigating how to apply that standard to various categories of employees. A big chunk of that has been spent litigating just whether insurance adjusters are exempt. So by this point, there must be a well-developed body of law on that issue, right? Wrong.