## Landmark Ruling by U.S. Supreme Court on Employment Standards

WASHINGTON, D.C. (Jan. 16, 2025) – The National Federation of Independent Business (NFIB) has expressed its satisfaction with the recent judgment delivered by the U.S. Supreme Court in the notable case E.M.D Sales, Inc. v. Faustino Sanchez Carrera. The Court ruled that the “preponderance of the evidence” standard must be the standard applied by employers trying to prove that an employee is not eligible for minimum wage and overtime pay protections as dictated by the Fair Labor Standards Act (FLSA). This decision came after NFIB submitted an amicus brief in collaboration with the U.S. Chamber Litigation Center.

## Positive Impact on Small Businesses

“Today’s ruling is welcomed by the small business community,” remarked Beth Milito, Vice President and Executive Director of NFIB’s Small Business legal Center. “The previous standard of ‘clear and convincing evidence,’ which was implemented by the lower court, was found to be excessive and confusing. This standard could have led to negative consequences for small businesses, which often lack the resources to address complicated legal hurdles. The reinstatement of the traditionally accepted ‘preponderance of the evidence’ standard not only safeguards the interests of employers but also benefits consumers and provides employees with a fair opportunity to seek recompense. NFIB is relieved that the Court decided to restore this crucial balance by reaffirming the conventional standard.”

## Understanding the Case and Its Implications

The core of this legal case revolved around what standard of proof should be employed when evaluating whether an employee is exempt from overtime pay requirements outlined by the FLSA. In its legal brief, NFIB contended that any exceptions to the FLSA regulation concerning overtime should be governed by the customary “preponderance of the evidence” standard. The brief articulated concerns that adopting the Fourth Circuit’s alternative standard could inadvertently foster frivolous claims against employers, thereby jeopardizing the livelihoods of small business owners.

## Support for Small Business Owners

The NFIB Small Business legal Center is dedicated to defending the rights of small business operators in courts across the nation. Currently, NFIB is engaged in over 40 differing legal cases in both federal and state court systems, extending up to the U.S. Supreme Court. The organization aims to ensure that small business owners receive fair treatment under the law while navigating complex legal challenges in an ever-evolving landscape.

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