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SUPREME COURT OF THE UNITED STATES
_________________
No. 15–415
_________________
ENCINO MOTORCARS, LLC, PETITIONER
v.HECTOR NAVARRO, et al.
on writ of certiorari to the united states
court of appeals for the ninth circuit
[June 20, 2016]
Justice Kennedy delivered the opinion of the
Court.
This case addresses whether a federal statute
requires payment of increased compensation to certain automobile
dealership employees for overtime work. The federal statute in
question is the Fair Labor Standards Act (FLSA), 29
U. S. C. §201 et seq., enacted in 1938 to “protect
all covered workers from substandard wages and oppressive working
hours.” Barrentine v. Arkansas-Best Freight System,
Inc., 450 U. S. 728, 739 (1981) . Among its other
provisions, the FLSA requires employers to pay overtime
compensation to covered employees who work more than 40 hours in a
given week. The rate of overtime pay must be “not less than one and
one-half times the regular rate” of the employee’s pay.
§207(a).
Five current and former service advisors brought
this suit alleging that the automobile dealership where they were
employed was required by the FLSA to pay them overtime wages. The
dealership contends that the position and duties of a service
advisor bring these employees within §213(b)(10)(A), which
establishes an exemption from the FLSA overtime provisions for
certain employees engaged in selling or servicing automobiles. The
case turns on the interpretation of this exemption.
I
A
Automobile dealerships in many communities not
only sell vehicles but also sell repair and maintenance services.
Among the employees involved in providing repair and maintenance
services are service advisors, partsmen, and mechanics. Service
advisors interact with customers and sell them services for their
vehicles. A service advisor’s duties may include meeting customers;
listening to their concerns about their cars; suggesting repair and
maintenance services; selling new accessories or replacement parts;
recording service orders; following up with customers as the
services are performed (for instance, if new problems are
discovered); and explaining the repair and maintenance work when
customers return for their vehicles. See App. 40–41; see also
Brennan v. Deel Motors, Inc., 475 F. 2d 1095,
1096 (CA5 1973); 29 CFR §779.372(c)(4) (1971). Partsmen obtain the
vehicle parts needed to perform repair and maintenance and provide
those parts to the mechanics. See §779.372(c)(2). Mechanics perform
the actual repair and maintenance work. See §779.372(c)(3).
In 1961, Congress enacted a blanket exemption
from the FLSA’s minimum wage and overtime provisions for all
automobile dealership employees. Fair Labor Standards Amendments of
1961, §9, 75Stat. 73. In 1966, Congress repealed that broad
exemption and replaced it with a narrower one. The revised statute
did not exempt dealership employees from the minimum wage
requirement. It also limited the exemption from the overtime
compensation requirement to cover only certain employees—in
particular, “any salesman, partsman, or mechanic primarily engaged
in selling or servicing automobiles, trailers, trucks, farm
implements, or aircraft” at a covered dealership. Fair Labor
Standards Amendments of 1966, §209, 80Stat. 836. Congress
authorized the Department of Labor to “promulgate necessary rules,
regulations, or orders” with respect to this new provision. §602,
id., at 844.
The Department exercised that authority in 1970
and issued a regulation that defined the statutory terms
“salesman,” “partsman,” and “mechanic.” 35 Fed. Reg. 5896 (1970)
(codified at 29 CFR §779.372(c)). The Department intended its
regulation as a mere interpretive rule explaining its own views,
rather than a legislative rule with the force and effect of law;
and so the Department did not issue the regulation through the
notice-and-comment procedures of the Administrative Procedure Act.
See 35 Fed. Reg. 5856; see also 5 U. S. C. §553(b)(A)
(exempting interpretive rules from notice and comment).
The 1970 interpretive regulation defined
“salesman” to mean “an employee who is employed for the purpose of
and is primarily engaged in making sales or obtaining orders or
contracts for sale of the vehicles or farm implements which the
establishment is primarily engaged in selling.” 29 CFR
§779.372(c)(1) (1971). By limiting the statutory term to salesmen
who sell vehicles or farm implements, the regulation excluded
service advisors from the exemption, since a service advisor sells
repair and maintenance services but not the vehicle itself. The
regulation made that exclusion explicit in a later subsection:
“Employees variously described as service manager, service writer,
service advisor, or service salesman . . . are not exempt
under [the statute]. This is true despite the fact that such an
employee’s principal function may be disagnosing [sic] the
mechanical condition of vehicles brought in for repair, writing up
work orders for repairs authorized by the customer, assigning the
work to various employees and directing and checking on the work of
mechanics.” §779.372(c)(4).
Three years later, the Court of Appeals for the
Fifth Circuit rejected the Department’s conclusion that service
advisors are not covered by the statutory exemption. Deel
Motors, supra. Certain District Courts followed that
precedent. See Yenney v. Cass County Motors, 81 CCH
LC ¶33,506 (Neb. 1977); Brennan v. North Bros. Ford,
Inc., 76 CCH LC ¶33,247 (ED Mich. 1975), aff’d sub nom.
Dunlop v. North Bros. Ford, Inc., 529 F. 2d 524
(CA6 1976) (table); Brennan v. Import Volkswagen,
Inc., 81 CCH LC ¶33,522 (Kan. 1975).
In the meantime, Congress amended the statutory
provision by enacting its present text, which now sets out the
exemption in two subsections. Fair Labor Standards Amendments of
1974, §14, 88Stat. 65. The first subsection is at issue in this
case. It exempts “any salesman, partsman, or mechanic primarily
engaged in selling or servicing automobiles, trucks, or farm
implements” at a covered dealership. 29 U. S. C.
§213(b)(10)(A). The second subsection exempts “any salesman
primarily engaged in selling trailers, boats, or aircraft” at a
covered dealership. §213(b)(10)(B). The statute thus exempts
certain employees engaged in servicing automobiles, trucks, or farm
implements, but not similar employees engaged in servicing
trailers, boats, or aircraft.
In 1978, the Department issued an opinion letter
departing from its previous position. Taking a position consistent
with the cases decided by the courts, the opinion letter stated
that service advisors could be exempt under §213(b)(10)(A). Dept.
of Labor, Wage & Hour Div., Opinion Letter No. 1520 (WH–467)
(1978), [1978–1981 Transfer Binder] CCH Wages–Hours Administrative
Rulings ¶31,207. The letter acknowledged that the Department’s new
policy “represent[ed] a change from the position set forth in
section 779.372(c)(4)” of its 1970 regulation. In 1987, the
Department confirmed its 1978 interpretation by amending its Field
Operations Handbook to clarify that service advisors should be
treated as exempt under §213(b)(10)(A). It observed that some
courts had interpreted the statutory exemption to cover service
advisors; and it stated that, as a result of those decisions, it
would “no longer deny the [overtime] exemption for such employees.”
Dept. of Labor, Wage & Hour Div., Field Operations Handbook,
Insert No. 1757, 24L04–4(k)(Oct. 20, 1987), online at
https://perma.cc/5GHD-KCJJ (all Internet materials as last visited
June 16, 2016). The Department again acknowledged that its new
position represented a change from its 1970 regulation and stated
that the regulation would “be revised as soon as is practicable.”
Ibid.
Twenty-one years later, in 2008, the Department
at last issued a notice of proposed rulemaking. 73 Fed. Reg. 43654.
The notice observed that every court that had considered the
question had held service advisors to be exempt under
§213(b)(10)(A), and that the Department itself had treated service
advisors as exempt since 1987. Id., at 43658–43659. The
Department proposed to revise its regulations to accord with
existing practice by interpreting the exemption in §213(b)(10)(A)
to cover service advisors.
In 2011, however, the Department changed course
yet again. It announced that it was “not proceeding with the
proposed rule.” 76 Fed. Reg. 18833. Instead, the Department
completed its 2008 notice-and-comment rulemaking by issuing a final
rule that took the opposite position from the proposed rule. The
new final rule followed the original 1970 regulation and
interpreted the statutory term “salesman” to mean only an employee
who sells automobiles, trucks, or farm implements. Id., at
18859 (codified at 29 CFR §779.372(c)(1)).
The Department gave little explanation for its
decision to abandon its decades-old practice of treating service
advisors as exempt under §213(b)(10)(A). It was also less than
precise when it issued its final rule. As described above, the 1970
regulation included a separate subsection stating in express terms
that service advisors “arenot exempt” under the relevant provision.
29 CFR §779.372(c)(4) (1971). In promulgating the 2011 regulation,
however, the Department eliminated that separate subsection.
According to the United States, this change appears to have been
“an inadvertent mistake in drafting.” Tr. of Oral Arg. 50.
B
Petitioner is a Mercedes-Benz automobile
dealership in the Los Angeles area. Respondents are or were
employed by petitioner as service advisors. They assert that
petitioner required them to be at work from 7 a.m. to 6 p.m. at
least five days per week, and to be available for work matters
during breaks and while on vacation. App. 39–40. Respondents were
not paid a fixed salary or an hourly wage for their work; instead,
they were paid commissions on the services they sold. Id.,
at 40–41.
Respondents sued petitioner in the United States
District Court for the Central District of California, alleging
that petitioner violated the FLSA by failing to pay them overtime
compensation when they worked more than 40 hours in a week.
Id., at 42–44. Petitioner moved to dismiss, arguing that the
FLSA overtime provisions do not apply to respondents because
service advisors are covered by the statutory exemption in
§213(b)(10)(A). The District Court agreed and granted the motion to
dismiss.
The Court of Appeals for the Ninth Circuit
reversed in relevant part. It construed the statute by deferring
under Chevron U. S. A. Inc. v. Natural
Resources Defense Council, Inc., 467 U. S. 837 (1984) , to
the interpretation set forth by the Department in its 2011
regulation. Applying that deference, the Court of Appeals held that
service advisors are not covered by the §213(b)(10)(A) exemption.
780 F. 3d 1267 (2015). The Court of Appeals recognized,
however, that its decision conflicted with cases from a number of
other courts. Id., at 1274 (citing, inter alia,
Walton v. Greenbrier Ford, Inc., 370 F. 3d 446
(CA4 2004); Deel Motors, 475 F. 2d 1095;
Thompson v. J. C. Billion, Inc., 368 Mont. 299, 294
P. 3d 397 (2013)). This Court granted certiorari to resolve
the question. 577 U. S. ___ (2016).
II
A
The full text of the statutory subsection at
issue states that the overtime provisions of the FLSA shall not
apply to:
“any salesman, partsman, or mechanic
primarily engaged in selling or servicing automobiles, trucks, or
farm implements, if he is employed by a nonmanufacturing
establishment primarily engaged in the business of selling such
vehicles or implements to ultimate purchasers.” §213(b)(10)(A).
The question presented is whether this exemption
should be interpreted to include service advisors. To resolve that
question, it is necessary to determine what deference,if any, the
courts must give to the Department’s 2011 interpretation.
In the usual course, when an agency is
authorized by Congress to issue regulations and promulgates a
regulation interpreting a statute it enforces, the interpretation
receives deference if the statute is ambiguous and if the agency’s
interpretation is reasonable. This principle is implemented by the
two-step analysis set forth in Chevron. At the first step, a
court must determine whether Congress has “directly spoken to the
precise question at issue.” 467 U. S., at 842. If so,
“that is the end of the matter; for the court, as well as the
agency, must give effect to the unambiguously expressed intent of
Congress.” Id., at 842–843. If not, then at the second step
the court must defer to the agency’s interpretation if it is
“reasonable.” Id., at 844.
A premise of Chevron is that when
Congress grants an agency the authority to administer a statute by
issuing regulations with the force of law, it presumes the agency
will use that authority to resolve ambiguities in the statutory
scheme. See id., at 843–844; United States v. Mead
Corp., 533 U. S. 218 –230 (2001). When Congress authorizes
an agency to proceed through notice-and-comment rulemaking, that
“relatively formal administrative procedure” is a “very good
indicator” that Congress intended the regulation to carry the force
of law, so Chevron should apply. Mead Corp.,
supra, at 229–230. But Chevron deference is not
warranted where the regulation is “procedurally defective”—that is,
where the agency errs by failing to follow the correct procedures
in issuing the regulation. 533 U. S., at 227; cf. Long
Island Care at Home, Ltd. v. Coke, 551 U. S. 158
–176 (2007) (rejecting challenge to procedures by which regulation
was issued and affording Chevron deference). Of course, a
party might be foreclosed in some instances from challenging the
procedures used to promulgate a given rule. Cf., e.g.,
JEM Broadcasting Co. v. FCC, 22 F. 3d 320,
324–326 (CADC 1994); cf. also Auer v. Robbins, 519
U. S. 452 –459 (1997) (party cannot challenge agency’s failure
to amend its rule in light of changed circumstances without first
seeking relief from the agency). But where a proper challenge is
raised to the agency procedures, and those procedures are
defective, a court should not accord Chevron deference to
the agency interpretation. Respondents do not contest the manner in
which petitioner has challenged the agency procedures here, and so
this opinion assumes without deciding that the challenge was
proper.
One of the basic procedural requirements of
administrative rulemaking is that an agency must give adequate
reasons for its decisions. The agency “must examine the relevant
data and articulate a satisfactory explanation for its action
including a rational connection between the facts found and the
choice made.” Motor Vehicle Mfrs. Assn. of United States,
Inc. v. State Farm Mut. Automobile Ins. Co., 463
U. S. 29, 43 (1983) (internal quotation marks omitted). That
requirement is satisfied when the agency’s explanation is clear
enough that its “path may reasonably be discerned.” Bowman
Transp., Inc. v. Arkansas-Best Freight System, Inc., 419
U. S. 281, 286 (1974) . But where the agency has failed to
provide even that minimal level of analysis, its action is
arbitrary and capricious and so cannot carry the force of law. See
5 U. S. C. §706(2)(A); State Farm, supra,
at 42–43.
Agencies are free to change their existing
policies as long as they provide a reasoned explanation for the
change. See, e.g., National Cable &
Telecommunications Assn. v. Brand X Internet Services,
545 U. S. 967 –982 (2005); Chevron, 467 U. S., at
863–864. When an agency changes its existing position, it “need not
always provide a more detailed justification than what would
suffice for a new policy created on a blank slate.” FCC v.
Fox Television Stations, Inc., 556 U. S. 502, 515
(2009) . But the agency must at least “display awareness that it is
changing position” and “show that there are good reasons for the
new policy.” Ibid. (emphasis deleted). In explaining its
changed position, an agency must also be cognizant that
longstanding policies may have “engendered serious reliance
interests that must be taken into account.” Ibid.; see also
Smiley v. Citibank (South Dakota), N. A., 517
U. S. 735, 742 (1996) . “In such cases it is not that further
justification is demanded by the mere fact of policy change; but
that a reasoned explanation is needed for disregarding facts and
circumstances that underlay or were engendered by the prior
policy.” Fox Television Stations, supra, at 515–516.
It follows that an “[u]nexplained inconsistency” in agency policy
is “a reason for holding an interpretation to be an arbitrary and
capricious change from agency practice.” Brand X,
supra, at 981. An arbitrary and capricious regulation of
this sort is itself unlawful and receives no Chevron
deference. See Mead Corp., supra, at 227.
B
Applying those principles here, the
unavoidable conclusion is that the 2011 regulation was issued
without the reasoned explanation that was required in light of the
Department’s change in position and the significant reliance
interests involved. In promulgating the 2011 regulation, the
Department offered barely any explanation. A summary discussion may
suffice in other circumstances, but here—in particular because of
decades of industry reliance on the Department’s prior policy—the
explanation fell short of the agency’s duty to explain why it
deemed it necessary to overrule its previous position.
The retail automobile and truck dealership
industry had relied since 1978 on the Department’s position that
service advisors are exempt from the FLSA’s overtime pay
requirements. See National Automobile Dealers Association, Comment
Letter on Proposed Rule Updating Reg-ulations Issued Under the Fair
Labor Standards Act(Sept. 26, 2008), online at
https://www.regulations.gov/#!documentDetail;D=WHD-2008-0003-0038.
Dealerships and service advisors negotiated and structured their
compensation plans against this background understanding. Requiring
dealerships to adapt to the Department’s new position could
necessitate systemic, significant changes to the dealerships’
compensation arrangements. See Brief for National Automobile
Dealers Association et al. as Amici Curiae 13–14.
Dealerships whose service advisors are not compensated in
accordance with the Department’s new views could also face
substantial FLSA liability, see 29 U. S. C. §216(b), even
if this risk of liability may be diminished in some cases by the
existence of a separate FLSA exemption for certain employees paid
on a commission basis, see §207(i), and even if a dealership could
defend against retroactive liability by showing it relied in good
faith on the prior agency position, see §259(a). In light of this
background, the Department needed a more reasoned explanation for
its decision to depart from its existing enforcement policy.
The Department said that, in reaching its
decision, it had “carefully considered all of the comments,
analyses, and arguments made for and against the proposed changes.”
76 Fed. Reg. 18832. And it noted that, since 1978, ithad treated
service advisors as exempt in certain circumstances. Id., at
18838. It also noted the comment from the National Automobile
Dealers Association stating that the industry had relied on that
interpretation. Ibid.
But when it came to explaining the “good reasons
for the new policy,” Fox Television Stations, supra,
at 515, the Department said almost nothing. It stated only that it
would not treat service advisors as exempt because “the statute
does not include such positions and the Department recognizes that
there are circumstances under which the requirements for the
exemption would not be met.” 76 Fed. Reg. 18838. It continued that
it “believes that this interpretation is reasonable” and “sets
forth the appropriate approach.” Ibid. Although an agency
may justify its policy choice by explaining why that policy “is
more consistent with statutory language” than alternative policies,
Long Island Care at Home, 551 U. S., at 175 (internal
quotation marks omitted), the Department did not analyze or explain
why the statute should be interpreted to exempt dealership
employees who sell vehicles but not dealership employees who sell
services (that is, service advisors). And though several public
comments supported the Department’s reading of the statute, the
Department did not explain what (if anything) it found persuasive
in those comments beyond the few statements above.
It is not the role of the courts to speculate on
reasons that might have supported an agency’s decision. “[W]e may
not supply a reasoned basis for the agency’s action that the agency
itself has not given.” State Farm, 463 U. S., at 43
(citing SEC v. Chenery Corp., 332 U. S. 194, 196
(1947) ). Whatever potential reasons the Department might have
given, the agency in fact gave almost no reasons at all. In light
of the serious reliance interests at stake, the Department’s
conclusory statements do not suffice to explain its decision. See
Fox Television Stations, 556 U. S., at 515–516. This
lack of reasoned explication for a regulation that is inconsistent
with the Department’s longstanding earlier position results in a
rule that cannot carry the force of law. See 5 U. S. C.
§706(2)(A); State Farm, supra, at 42–43. It follows
that this regulation does not receive Chevron deference in
the interpretation of the relevant statute.
* * *
For the reasons above, §213(b)(10)(A) must be
construed without placing controlling weight on the Department’s
2011 regulation. Because the decision below relied on
Chevron deference to this regulation, it is appropriate to
remand for the Court of Appeals to interpret the statute in the
first instance. Cf. Mead, 533 U. S., at 238–239. The
judgment of the Court of Appeals is vacated, and the case is
remanded for further proceedings consistent with this opinion.
It is so ordered.
SUPREME COURT OF THE UNITED STATES
_________________
No. 15–415
_________________
ENCINO MOTORCARS, LLC, PETITIONER
v.HECTOR NAVARRO, et al.
on writ of certiorari to the united states
court of appeals for the ninth circuit
[June 20, 2016]
Justice Ginsburg, with whom Justice Sotomayor
joins, concurring.
I agree in full that, in issuing its 2011 rule,
the Department of Labor did not satisfy its basic obligation to
explain “that there are good reasons for [a] new policy.”
FCC v.
Fox Television Stations, Inc., 556 U. S.
502, 515 (2009) . The Department may have adequate reasons to
construe the Fair Labor Standards Act automobile-dealership
exemption as it did. The 2011 rulemaking tells us precious little,
however, about what those reasons are.[
1]
I write separately to stress that nothing in
today’s opinion disturbs well-established law. In particular, where
an agency has departed from a prior position, there is no
“heightened standard” of arbitrary-and-capricious review.
Id., at 514. See also
ante, at 9. An agency must
“display awareness that it is changing position” and “show that
there are good reasons for the new policy.”
Fox, 556
U. S., at 515 (emphasis deleted). “But it need not demonstrate
to a court’s satisfaction that the reasons for the new policy are
better than the reasons for the old one; it suffices that
the new policy is permissible under the statute, that there are
good reasons for it, and that the agency
believes it to be
better, which the conscious change of course adequately indicates.”
Ibid.
The Court’s bottom line remains unaltered:
“ ‘[U]nexplained inconsistency’ in agency policy is ‘a reason
for holding an interpretation to be an arbitrary and capricious
change from agency practice.’ ”
Ante, at 10 (quoting
National Cable & Telecommunications Assn. v.
Brand X
Internet Services, 545 U. S. 967, 981 (2005) ). Industry
reliance may spotlight the inadequacy of an agency’s explanation.
See
ante, at 10 (“decades of industry reliance” make
“summary discussion” inappropriate). But reliance does not
overwhelm good reasons for a policy change. Even if the
Department’s changed position would “necessitate systemic,
significant changes to the dealerships’ compensation arrangements,”
ante, at 10, the Department would not be disarmed from
determining that the benefits of overtime coverage outweigh those
costs.[
2] “If the action rests
upon . . . an exercise of judgment in an area which
Congress has entrusted to the agency[,] of course it must not be
set aside because the reviewing court might have made a different
determination were it empowered to do so.”
SEC v.
Chenery
Corp., 318 U. S. 80, 94 (1943) .
SUPREME COURT OF THE UNITED STATES
_________________
No. 15–415
_________________
ENCINO MOTORCARS, LLC, PETITIONER
v.HECTOR NAVARRO, et al.
on writ of certiorari to the united states
court of appeals for the ninth circuit
[June 20, 2016]
Justice Thomas, with whom Justice Alito joins,
dissenting.
The Court granted this case to decide whether an
exemption under the Fair Labor Standards Act (FLSA), 29
U. S. C. §201 et seq., “requires payment of
increased compensation to certain automobile dealership employees”—
known as service advisors—“for overtime work.” Ante, at 1;
see also ante, at 2, 7. The majority declines to resolve
that question. Instead, after explaining why the Court owes no
deference to the Department of Labor’s regulation purporting to
interpret this provision, see Chevron U. S. A.
Inc. v. Natural Resources Defense Council, Inc., 467
U. S. 837, 843 (1984) , the majority leaves it “for the Court
of Appeals to interpret the statute in the first instance.”
Ante, at 12.
I agree with the majority’s conclusion that we
owe no Chevron deference to the Department’s position
because “deference is not warranted where [a] regulation is
‘procedurally defective.’ ” Ante, at 8. But I disagree
with its ultimate decision to punt on the issue before it. We have
an “obligation . . . to decide the merits of the question
presented.” CBOCS West, Inc. v. Humphries, 553
U. S. 442, 472 (2008) (Thomas, J., dissenting). We need not
wade into the murky waters of Chevron deference to decide
whether the Ninth Circuit’s reading of the statute was correct. We
must instead examine the statutory text. That text reveals that
service advisors are salesmen primarily engaged in the selling of
services for automobiles. Accordingly, I would reverse the Ninth
Circuit’s judgment. Federal law requires overtime pay for certain
employees who work more than 40 hours per week. §207(a)(2)(C). But
the FLSA exempts various categories of employees from this overtime
requirement. §213. The question before the Court is whether the
following exemption encompasses service advisors:
“The provisions of section 207 of this title
shall not apply with respect to—
. . . . . “(10)(A) any salesman,
partsman, or mechanic primarily engaged in selling or servicing
automobiles, trucks, or farm implements, if he is employed by a
nonmanufacturing establishment primarily engaged in the business of
selling such vehicles or implements to ultimate purchasers.”
§213(b).
I start with the uncontroversial notion that a
service advisor is a “salesman.” The FLSA does not define the term
“salesman,” so “we give the term its ordinary meaning.”
Taniguchi v. Kan Pacific Saipan, Ltd., 566 U. S.
___, ___ (2012) (slip op., at 5). A “salesman” is someone who sells
goods or services. 14 Oxford English Dictionary 391 (2d ed. 1989)
(“[a] man whose business it is to sell goods or conduct sales”);
Random House Dictionary of the English Language 1262 (1966) (Random
House) (“a man who sells goods, services, etc.”). Service advisors,
whose role it is to “interact with customers and sell them services
for their vehicles,” ante, at 2, are plainly “salesm[e]n.”
See ibid. (cataloguing sales-related duties of service
advisors).
A service advisor, however, is not “primarily
engaged in selling . . . automobiles.” §213(b)(10)(A). On
the contrary, a service advisor is a “salesman” who sells servicing
solutions. Ante, at 2. So the exemption applies only if it
cov-ers not only those salesmen primarily engaged in selling
automobiles but also those salesmen primarily engaged in
servicing automobiles.
The exemption’s structure confirms that salesmen
could do both. The exemption contains three nouns (“salesman,
partsman, or mechanic”) and two gerunds (“selling or servicing”).
The three nouns are connected by the disjunctive “or,” as are the
gerunds. So unless context dictates otherwise, a salesman can
either be engaged in selling or servicing
automobiles. Cf. Reiter v. Sonotone Corp., 442
U. S. 330, 339 (1979) .
Context does not dictate otherwise. A salesman,
namely, one who sells servicing solutions, can be “primarily
engaged in . . . servicing automobiles.” §213(b)(10)(A).
The FLSA does not define the term “servicing,” but its ordinary
meaning includes both “[t]he action of maintaining or repairing a
motor vehicle” and “the action of providing a service.” 15 Oxford
English Dictionary 39; see also Random House 1304 (defining
“service” to mean “the providing . . . of . . .
activities required by the public, as maintenance, repair, etc.”).
A service advisor’s selling of service solutions fits both
definitions. The service advisor is the customer’s liaison for
purposes of deciding what parts are necessary to maintain or repair
a vehicle, and therefore is primarily engaged in “the action of
maintaining or repairing a motor vehicle” or “the action of
providing a service” for an automobile.
Other features of the exemption confirm that a
service advisor is a salesman primarily engaged in servicing
automobiles. Consider the exemption’s application to a “partsman.”
Like a service advisor, a partsman neither sells vehicles nor
repairs vehicles himself. See 29 CFR §779.372(c)(2) (2015)
(defining “partsman” as “any employee employed for the purpose of
and primarily engaged in requisitioning, stocking, and dispensing
parts”). For the provision to exempt partsmen, then, the phrase
“primarily engaged in . . . servicing” must cover some employees
who do not themselves perform repair or maintenance. So “servicing”
refers not only to the physical act of repairing or maintaining a
vehicle but also to acts integral to the servicing process more
generally.
Respondents’ contrary contentions are
unavailing. They first invoke the distributive canon: “Where a
sentence contains several antecedents and several consequents,” the
distributive canon instructs courts to “read [those several terms]
distributively and apply the words to the subjects which, by
context, they seem most properly to relate.” 2A N. Singer & S.
Singer, Sutherland on Statu-tory Construction §47.26, on p. 448
(rev. 7th ed. 2014). Respondents accordingly maintain that 29
U. S. C. §213(b)(10)(A) exempts only salesmen
primarily engaged in selling automobiles. Brief for Respondents
20–26. But the distributive canon is less helpful in cases such as
this because the antecedents and consequents cannot be read-ily
matched on a one-to-one basis. Here, there are three nouns to be
matched with only two gerunds, so the canon does not overcome the
exemption’s plain meaning. Perhaps respondents might have a better
argument if the statute exempted “salesman or mechanics who
primarily engage in selling or servicing automobiles.” In such a
case, one might assume that Congress meant the nouns and gerunds to
match on a one-to-one basis, and the distributive canon could be
utilized to determine how the matching should occur. But that is
not the statute before us. For the reasons explained, supra,
at 3–4, the plain meaning of the various terms in the exemption
establish that the term “salesman” is not limited to only those who
sell automobiles. It also extends to those “primarily engaged in
. . . servicing automobiles.” §213(b)(10)(A).
Respondents also resist this natural reading of
the exemption by invoking the made-up canon that courts must
narrowly construe the FLSA exemptions. Brief for Respondents 41–42.
The Ninth Circuit agreed with respondents on this score. 780
F. 3d 1267, 1271–1272, n. 3 (2015). The court should not
do so again on remand. We have declined to apply that canon on two
recent occasions, one of which also required the Court to parse the
meaning of an exemption in §213. Christopher v.
SmithKline Beecham Corp., 567 U.S. ___, ___–___, n. 21
(2012) (slip op., at 19–20, n. 21); see also Sandifer v.
United States Steel Corp., 571 U.S. ___, ___, n. 7 (2014)
(slip op., at 11, n. 7). There is no basis to infer that
Congress means anything beyond what a statute plainly says simply
because the legislation in question could be classified as
“remedial.” See Scalia, Assorted Canards of Contemporary Legal
Analysis, 40 Case W. Res. L. Rev. 581, 581–586 (1990). Indeed,
this canon appears to “res[t] on an elemental misunderstanding of
the legislative process,” viz., “that Congress intend[s] statutes
to extend as far as possible in service of a singular objective.”
Brief for Chamber of Commerce of the United States of America
et al. as Amici Curiae 7.
* * *
For the foregoing reasons, I would hold that the
FLSA exemption set out in §213(b)(10)(A) covers the service
advisors in this case. Service advisors are “primarily engaged in
. . . servicing automobiles,” given their integral role
in selling and providing vehicle services. Accordingly, I would
reverse the judgment of the Ninth Circuit.
