Supreme Court clarifies burden of proof in FLSA employer exemption cases

In a recent decision, the U.S. Supreme Court has ruled that employers asserting exemptions under the Fair Labor Standards Act (FLSA) need only meet the “preponderance of the evidence” standard rather than the more demanding “clear and convincing evidence” standard.

The Court’s decision in E.M.D. Sales, Inc. v. Cabrera provides clarity for employers navigating FLSA exemption claims and reinforces the default burden of proof in civil litigation.

The ruling

In FLSA cases, employees must establish the basic elements of their claims, such as failure to pay minimum wage or overtime. However, when an employer claims an exemption to these wage requirements, they bear the burden of proving that the exemption applies.

The Supreme Court’s decision in Cabrera addressed the level of proof required for such defenses and reaffirmed that the standard should align with the general principles of civil litigation.

The Court emphasized that the preponderance of the evidence standard — commonly understood as proving that something is more likely than not — has long been the default in civil cases. This standard allows for a fair distribution of the risk of error between both parties, the holding said.

When a heightened standard applies

The Court reaffirmed that deviations from the preponderance of the evidence standard are reserved for specific situations, including:

• Statutory requirements: When a law explicitly requires a higher standard of proof.
• Constitutional considerations: Cases involving fundamental constitutional rights.
• Extraordinary circumstances: Situations where the government’s actions involve severe consequences, such as citizenship revocation.

Since the FLSA does not contain any statutory language mandating a heightened standard, and wage-related disputes do not qualify as constitutional or extraordinary circumstances, the Court found that the preponderance standard remains appropriate for exemption defenses.

Employers defending FLSA claims

The ruling simplifies the legal landscape for employers defending FLSA exemption claims, confirming that they must show that it is more likely than not that an exemption applies, rather than meet a higher threshold of proof.

Key considerations for employers include:

• Recordkeeping and compliance: Employers should ensure that exemption classifications are well-documented and supported by clear policies to meet the preponderance standard in case of litigation.
• Training and awareness: HR professionals should educate managers and payroll teams on proper classification of exempt employees to minimize legal exposure.
• Litigation strategy: The ruling may encourage employers to assert exemption defenses with greater confidence, knowing the burden of proof aligns with typical civil standards.

By reinforcing the traditional evidentiary threshold, the Supreme Court’s decision in Cabrera provides a level of predictability and consistency in how wage-and-hour disputes will be litigated moving forward.