DOL: Opinion Letters Are Back!

On June 27, 2017, the U.S. Department of Labor (“DOL”) announced that it has reinstated the issuance of Opinion Letters by its Wage & Hour Division and unveiled a new website to guide employers and employees in requesting an Opinion Letter.  The agency also redesigned the website housing its Opinion Letters and other sub-regulatory guidance.

DOL stopped issuing Opinion Letters answering questions from the regulated community in 2010, replacing them with the more general “Administrator Interpretations” (“Interpretations”).   Interpretations were intended to set forth a general interpretation of the law and regulations as they related to an entire industry, a category of employees, or to all employees. An Opinion Letter, in contrast, is an official, written opinion by the Wage and Hour Division of how a particular law applies in specific circumstances presented by an employer, employee or other entity requesting the opinion.

DOL issued only eleven Interpretations between 2010 and 2016; and two of those – on independent contracting and joint employment – were withdrawn on June 7, 2017.  Prior to 2010, DOL would often issue dozens of Opinion Letters each year.

With the return of Opinion Letters, DOL provides employers with another tool to ensure compliance with the Fair Labor Standards Act (“FLSA”) and establish a good faith defense against FLSA liability.  Section 10 of the Portal-to-Portal Act provides a complete affirmative defense to all monetary liability if an employer can plead and prove it acted “in good faith in conformity with and in reliance on any written administrative regulation, order, ruling, approval, or interpretation” of the Administrator of the Wage and Hour Division.  29 U.S.C. § 259; see also 29 C.F.R. Part 790.  Reliance on an Opinion Letter can also form the basis of a good faith defense against the double liquidated damages available under the FLSA, 29 U.S.C. § 260, and the third-year of damages for willful violations.  The best option for establishing these FLSA defenses is to request and obtain an Opinion Letter that addresses your company’s specific practice and factual situation, although employers can also rely on any guidance addressing similar circumstances.

Employers should welcome the return of Opinion Letters as it signals that DOL intends to provide employers with more guidance on how to meet their statutory obligations.  The Wage and Hour Division has two important functions:  enforcement and compliance assistance.  Because DOL can never have enough resources to investigate every workplace, the only path for increasing compliance in all workplaces is to answer employer questions and assist them in complying.  DOL’s recently announced FY 2018 budget plan includes a $3 million budget increase for additional compliance assistance for employers. 

If you are interested in obtaining an Opinion Letter from DOL, please contact your Littler attorney.  The decision to request an Opinion Letter is a careful calculus:  There is always a risk that DOL may not approve your company’s practice, requiring that changes be made.  But, the reward of a complete affirmative defense to FLSA liability is also great.

DOL’s press release on opinion letters is available at: https://www.dol.gov/newsroom/releases/whd/whd20170627

Opinion Letters and AIs issued from 2001 to the present are posted here: https://www.dol.gov/whd/opinion/guidance.htm

Guidance on how to request an Opinion Letter can be found here: https://www.dol.gov/whd/opinion/opinion-request-1.htm

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.