One might think that an attorney performing contract work for a law firm is indisputably engaged in the “practice of law.” But this was indeed a matter of dispute in the case of Lola v. Skadden, Arps, Slate, Meagher & Flom LLP. At stake was whether the attorney’s employer had violated the overtime provisions of the Fair Labor Standards Act (FLSA).

Reviewing documents

Regulations of the FLSA state that any “employee who is the holder of a valid license or certificate permitting the practice of law or medicine or any of their branches and is actually engaged in the practice thereof” is exempt from the requirement to receive overtime pay.

The plaintiff in this case had filed a lawsuit asserting that he should have been entitled to overtime pay under the FLSA because, even though he was an attorney, he didn’t practice law. He contended that he was a contract attorney who did document review and was paid $25 an hour and worked about 45 hours per week.

The trial court granted summary judgment in the employer’s favor, holding that the plaintiff was indeed practicing law and, as such, he was exempt from overtime as a professional. The plaintiff appealed.

Going to Carolina

The U.S. Court of Appeals for the Second Circuit vacated the trial court’s finding and remanded the case back to the lower court for further consideration. The appeals court held that the plaintiff had adequately alleged in his complaint that he didn’t engage in the practice of law.

Because federal law was silent on the definition of the “practice of law,” and the plaintiff lived and worked in North Carolina, the court looked to North Carolina state law. The state defines the “practice of law” as “performing any legal service for any other person ... or assisting by advice, counsel, or otherwise in any legal work; and to advise or give opinion upon the legal rights of any person ... .”

North Carolina law doesn’t clarify whether legal services included the performance of document review. But the appeals court stated that inherent in the definition of the “practice of law” was the exercise of independent legal judgment, and many other states also consider legal judgment an essential element of the practice of law.

Performing duties

The appeals court further stated that a fair reading of the complaint in the light most favorable to the plaintiff was that he provided services that a machine could have provided. The plaintiff alleged that his work was closely supervised by his employer and his only responsibility consisted of document review. Specifically, he would:

• Look at documents to see what search terms appeared therein,
• Mark those documents into categories set forth by his employer, and
• Redact portions of documents based on his employer’s protocols.

So the employer provided the plaintiff with the documents he reviewed, the search terms he looked for and the procedures to follow if those terms appeared. Thus, according to the court, the plaintiff didn’t actually engage in the practice of law because he didn’t use any independent legal judgment in the course of his duties.

Determining overtime

Heed the warning of this case. When determining exemption from overtime status, ensure that you’re properly classifying your employees according to actual job duties and not just title or occupation.  

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