When the line between blue- and white-collar work is blurry, an employee’s status under the Fair Labor Standards Act (FLSA) may be hard to discern. This is especially true for construction project “supervisors” and “superintendents” that perform a variety of job duties within a single workday.
Under the FLSA, all non-exempt hourly employees are entitled to the federal minimum wage of $7.25/hour and overtime pay at a rate of one and one-half times their normal rate for all hours over 40 worked in one week. However, some positions are statutorily exempt from the FLSA’s protections.
For example, an employee falls under the “administrative exemption” if: 1) she is paid on a salary basis; 2) her primary duty is the performance of office or non-manual work directly related to the management or general business operations of the employer; and 3) she exercises discretion and independent judgment regarding matters of significance.
The courts have long debated over whether construction project supervisors fall under the administrative exemption. In an effort to help resolve the debate, the Department of Labor’s Wage & Hour Division (WHD) recently issued a pair of letters offering an opinion on whether two similar construction manager-type positions were FLSA-exempt.
In FLSA2018-4, the WHD opined that a construction company’s “project superintendents” met the administrative exemption. The superintendents exercised discretion and judgment because they had the power to hire and oversee subcontractors. Their continuous oversight of construction projects also meant that their primary duty was non-manual work directly related to the company’s business operations.
In FLSA 2018-10, the WHD concluded that a residential homebuilding company’s “project supervisors” also met the administrative exemption. The supervisors directed, managed, scheduled, and paid subcontractors, as well as reviewing new home plans and blueprints. The supervisors exercised discretion and independent judgment by adjusting the construction schedule, negotiating solutions to issues, dismissing subcontractors, and issuing payments.
It is important to note that the above two WHD opinions do not mean that all construction supervisor positions meet the administrative exemption. A different construction company’s supervisors might not meet the administrative exemption if, for example, their primary duty is blue-collar work, or if they are forbidden from making significant independent decisions.