On January 15, 2025, the Supreme Court of the United States issued a unanimous decision in E.M.D. Sales, Inc. v. Carrera, finally clarifying the standard of proof for employers to demonstrate an employee is properly exempt from minimum-wage and overtime-compensation requirements under the Fair Labor Standards Act of 1938 (“FLSA”). Long story short, the Supreme Court has made it crystal clear that FLSA exemptions are subject to the default “preponderance of the evidence” standard, akin to other employment law claims under Title VII. The Court explained that this decision was made, in large part, because: (1) the FLSA does not specify an evidentiary standard (which generally indicates a default preponderance standard); and (2) it does not involve the limited types of claims (e.g., constitutional claims or citizenship removal proceedings) in which the heightened “clear and convincing evidence” standard is warranted.
Until the Carrera decision, the Fourth Circuit stood alone as the sole circuit embracing the “clear and convincing” standard of proof for FLSA exemptions. The Carrera decision rectified this discrepancy, making every circuit uniform in this respect. Ultimately, this decision is a win for employers in the Fourth Circuit, because it lowers their evidentiary burden to successfully argue their workers fall within an FLSA exemption. Employers elsewhere should continue doing business as usual.
