Registered nurse is not entitled to FLSA overtime

While licensed practical nurses are ordinarily exempt from overtime guarantees under the Fair Labor Standards Act, the registered nurse in this case wants overtime because she did not work in a clinical setting and was mostly handling paperwork that included approving insurance coverage. Does that mean she can recover overtime? The Second Circuit says she does not.

The case is Isett v. Aetna Life Insurance Co., issued on January 14. The FLSA is a creature of the New Deal. It provides the basis for overtime pay and other wage and hour protections. But the FLSA also has a ton of exceptions. One of those exceptions is the "professional exemption," covering anyone "whose primary job duty requires 'knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction." Under the regulations, “'[r]egistered nurses who are registered by the appropriate State examining board generally meet the duties requirements for the learned professional exemption.' By contrast, 'licensed practical nurses or other similar health care employees . . . generally do not qualify as exempt learned
professionals because possession of a specialized advanced academic degree is not a standard prerequisite for entry into such occupations." Since plaintiff is a registered nurse, this case presents a dilemma for the Second Circuit (Cabranes, Raggi and Korman [D.J.]).

In solving a case like this, the court applies a three-part test: "to qualify for the exemption, the employee must satisfy a 'primary duty test' consisting of three factors or prongs: (1) the work requires 'advanced knowledge,' (2) 'in a field of science or learning,' (3) 'customarily acquired by a prolonged course of specialized intellectual instruction.'" Under these guidelines, plaintiff is not exempt, and she therefore gets no overtime.

The Court holds that plaintiff's job duties required her to "act independent of direction, or under minimal supervision, on the basis of collected clinical data." She also acted independently (or, at a minimum, under limited supervision) on the basis of collected clinical information when she approved insurance coverage of medical services. In addition, the court rejects plaintiff's argument that she is comparable to a licensed clinical nurse (who is typically entitled to FLSA overtime) because they both acquire their skills by experience rather than specialized intellectual instruction. As the court sees it, registered nurses like plaintiff  have the ability to make a final decision about patient care with minimal supervision, which is quite unlike licensed practical nurses. The court concludes:

(1) When interpreting the scope of an FLSA exemption, courts must give the exemption a fair reading and shall not construe it narrowly against the employer seeking to assert the exemption.

(2) The first prong of the professional exemption’s primary duty test requires courts to: (A) identify what qualities or skills are characteristic of the work of the profession at issue; and (B) determine if the employee’s primary duty reflects those qualities or skills.

(3) Central to the profession of registered nursing is the ability to act independently, or under limited supervision, on the basis of collected clinical data.

(4) The District Court did not err in concluding that Isett’s job satisfies the first prong of the primary duty test. Isett’s primary duty as an appeals nurse consultant—to conduct utilization review and approve insurance coverage for medically necessary services under minimal supervision— reflects the discretion and requires the judgment characteristic of other registered nurses. Accordingly, Isett’s
job as an appeals nurse consultant required the use of advanced nursing knowledge.

(5) In cases where, as here, the employer requires the possession of an advanced academic degree, the third prong of the primary duty test for the professional exemption of the FLSA requires courts to: (A) identify the job’s primary duty which requires the use of advanced knowledge; and (B) determine if that duty is consistent with the employer’s minimum academic qualifications.

(6) The District Court did not err in concluding that Isett’s job satisfies the third prong of the primary duty test. Isett’s primary duty calls on advanced nursing knowledge that is at the core of the prolonged course of study that registered nurses receive before entering their profession.

(7) The undisputed facts demonstrate that Isett was properly classified as exempt from the FLSA’s overtime‐pay requirements because she is a professional under the statute and under the regulations adopted pursuant thereto by the Secretary of Labor.