Seyfarth Shaw LLP | www.seyfarth.com Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) 11 Several federal courts have concluded that, under the FLSA, insurance adjusters qualify for the administrative exemption.47 Employers hoped that further case law would limit Bell to its facts. Their hopes were bolstered with the Ninth Circuit’s 2007 decision in Miller v. Farmers Insurance Exchange.48 Miller held that insurance adjusters, as a rule, qualify for the administrative exemption, and criticized the Bell decisions’ overbroad construction of the meaning of “production work.”49 More recently, the Court of Appeal provided more support for employers asserting the administrative exemption even where job duties do not fit neatly into the “administrative” side of the administrative/production dichotomy. Combs v. Skyriver Communications, Inc.,50 affirmed a trial court decision not to apply the administrative/production dichotomy at all in connection with evaluating the exempt status of an information technology (“IT”) professional. Combs distinguished Bell on multiple grounds. First, Combs noted that Bell was legally distinguishable because it was decided before the Wage Orders were revised to expressly incorporate relevant federal regulations.51 Combs also found Bell factually distinguishable because the insurance adjusters in Bell had job responsibilities restricted to “handling of the routine and unimportant.”52 In contrast, the plaintiff in Combs had more specialized job duties that “cannot be readily categorized in terms of the administrative/production worker dichotomy.”53 Some thought that Combs signaled a backlash against Bell, which seemed to go too far in emphasizing the administrative/production dichotomy over other aspects of the test for the administrative exemption. Although Combs has some pro-exemption language in its discussions distinguishing Bell, its application may be somewhat limited because the plaintiff held a fairly high-level, atypical IT position. That fact makes it more difficult to apply Combs to situations involving lower-level IT jobs or other sorts of mid-level administrative positions.54 coverage of claims; determining liability and total value of a claim; negotiating settlements; and making recommendations regarding litigation.” See also former 29 C.F.R. § 541.205(c)(5) (identifying insurance adjusters within the universe of employees often covered by the administrative exemption). 47 See, e.g., Bucklin v. Zurich American Ins. Co., 619 Fed. App’x 574 (9th Cir. 2015); Munizza v. State Farm Mut. Auto. Ins. Co., 103 F.3d 139 (9th Cir. 1996) (memorandum); Blinston v. Hartford Accident & Indemn. Co., 20 Wage & Hour Cas. (BNA) 6 (W.D. Mo. 1970). 48 481 F.3d 1119 (9th Cir. 2007). 49 481 F.3d at 1124, 1132. 50 159 Cal. App. 4th 1242, 1260-62 (2008), review denied (May 14, 2008). 51 Id. at 1259-60. 52 Id. at 1259. 53 Id. at 1261. 54 In Heffelfinger v. Elec. Data Sys., 580 F. Supp. 2d 933, 961-62 (C.D. Cal. 2008), affirmed in part, reversed in part, 492 Fed. App’x 710 (9th Cir. 2012), a federal district court surveyed various cases that analyzed whether IT workers were exempt, and found there to be a “clear demarcation point,” with employees who “were tasked to install, maintain, and troubleshoot software” falling on the non-exempt side, and those “charged with writing code, programming, or ‘administering’ databases or networks” falling on the exempt side.
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