Insurance Agents Dispute Exempt Classification, Claim Unpaid OT

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Two individuals have filed a proposed collective action against their former employer, Selective Healthcare, LLC, and two owners. They claim the healthcare company misclassified them as exempt employees and failed to pay them proper overtime wages, as required under the Fair Labor Standards Act (FLSA). According to the complaint, health insurance agents like the plaintiffs were paid based on a standard commission structure and did not have any control over most aspects of their jobs, indicating that they cannot qualify as overtime-exempt under the FLSA. From the complaint:

“The Code of Federal Regulations, at 29 C.F.R. §779.317, identifies certain occupations that do not qualify for the exemption found at 29 U.S.C. §207(i), including those engaged in the business of ‘Insurance; mutual, stock and fraternal benefit, including insurance brokers, agents, and claims adjustment offices.’”

“Defendants nonetheless failed and refused to pay Plaintiffs and the class of similarly situated commissioned health insurance agent employees at the rate of time and one half of their regular rate(s) of pay (including non-discretionary commissions earned) for all hours worked over 40 hours in a workweek.”