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NADA Hails Supreme Court Decision on Encino Overtime Pay Case

Published April 2, 2018


Today the Supreme Court issued a 5-4 decision in Encino Motorcars, LLC v. Navarro, concluding that dealership service advisors fall within the “salesmen, partsmen, and mechanics” overtime pay exemption under the federal Fair Labor Standards Act. In doing so, it reversed a January 2017 decision by the Ninth Circuit Court of Appeals that held — in direct conflict with several other federal and state decisions – that the exemption did not apply.

National Automobile Dealers Association (NADA) Chairman Wes Lutz released the following statement in response to the Supreme Court’s decision:

“NADA is extremely pleased with the Court’s decision that dealership service advisors clearly fall within the salesmen, partsmen, and mechanics overtime pay exemption under the federal Fair Labor Standards Act. This decision upholds more than 40 years of consistent interpretation by the courts and the executive branch, and will allow the auto retail industry to continue structuring employment relationships that are efficient and beneficial to dealerships, their employees, and their customers.”

NADA provided extensive support to the dealers litigating the case and worked with the state dealer associations in the Ninth Circuit to file several “friend of the court” briefs on behalf of all dealers.