Elevance Nurses Sue for Unpaid Wages

Landis was brought as a collective action lawsuit (very similar to a class action suit) under the FLSA. The nurses now seek to expand the class of plaintiffs to include workers with titles that did not exist when the lawsuit was first filed. Elevance argues that their move is simply too late, after years of preliminary practice.

But, when lawyers find themselves arguing about timelines and procedure rather than substance, the real issue can get hidden.
Who is entitled to overtime pay under law? (And why are nurses so badly paid?)

Is “managed care” like “conditional love”?

Elevance is an insurance company, formerly known as The Anthem Companies, Inc.. Amerigroup Corporation, the other named defendant, is a subsidiary of Elevance.

Elevance focuses on managed care programs and related services. In the 1980s, the philosophy of “managed care” shifted the focus of the American healthcare system away from the patient-provider relationship to a cost/benefit analysis. The new managed care guidelines are about money.

Proponents claim cost savings. Critics highlight the plight of people seeking care. Landis focuses on the peculiar dilemma of workers who now find that they may also have become victims of this money-centered focus.

Sort, evaluate and often deny

Kathy Landis was not a bedside nurse. From 2021 to 2022, when she worked for Elevance, she performed utilization reviews for enrollees in North Carolina’s Medicaid program. She used software tools and other resources to evaluate insurance claims in accordance with a strict set of guidelines and subject to the review of her managers. In a typical week, Landis estimates that she worked for 46 hours. Many other workers, with many different job titles, did the same task under similar circumstances. Elevance also employed licensed practical or licensed vocational nurses to do similar medical necessity reviews.

But, unlike Landis, the LPNs and vocational nurses were paid on an hourly basis and classified as eligible for overtime pay. Why?

Consistency across job titles or an arbitrary classification of a job as salaried or hourly-paid may be useful shorthand for understanding the law, but FLSA rules are far more nuanced.

Counting hours

The FLSA requires employers to pay covered, nonexempt employees at least 1.5 times their regular rate of pay for all hours worked over 40 in a single 168-hour workweek. The hours that must be counted include all hours during which the worker is “suffered or permitted” to work. Importantly, hours that an employee chooses to work to complete unfinished tasks must be included, unless the employer specifically objects at the time.

Most employees are covered by FLSA minimum wage and overtime protections. Some, however, are excluded because of the amount they make and the duties they perform.

Salary test

Excluded employees must make at least $684 per week and total compensation of $107,432 per year. A worker who makes less than that amount is entitled to overtime pay, regardless of how the employer labels the payment.

Duties test

Certain employees are also excluded from overtime protection because of the duties they perform. The three most common exclusions are for executive, administrative, and professional workers.

To fall under the executive exemption, an employee’s primary duty must be to manage an enterprise, or a recognized subdivision. An executive ordinarily directs two or more employees and has authority to hire and fire.

An administrator generally does office or non-manual work directly related to management or general business operations. An administrator usually has the power to exercise discretion and independent judgment on significant matters.

The professional exemption generally requires advanced knowledge in a field of science or learning (customarily requiring a degree) or work as a teacher, artist, or in a creative field.

The salary and duties tests are cumulative, so that someone who does the work outlined for the administrator or professional categories, for example, must also make at least $107,432 per year.

The Landis plaintiffs might plausibly base their overtime claim on either the total amount of annual salary or their apparent inability to exercise discretion and independent judgment.

Long hours, low pay

Here’s the hard question – what can be done about the long hours and inadequate pay that Kathy Landis and the other utilization review nurses describe in their Complaint?

The FLSA was enacted in 1938 in response to labor unrest triggered by the Great Depression. The law was designed to prevent the kind of worker exploitation the nurses describe. Unpaid wages lawsuits, like Landis, are clearly part of the solution. The recent nurses strikes in New York and California suggest that collective political action may also play a role.