Unlicensed Accountants Are Not Categorically Excluded From Potential Exempt Status


On June 15, 2011, the Ninth Circuit issued its long-awaited decision in Campbell v. PricewaterhouseCoopers, LLP, No. 09-16370 (June 15, 2011). In its ruling, the Ninth Circuit reversed the district court’s holding that unlicensed junior accountants could never meet the professional or administrative exemptions under California law, concluding that there is a triable issue of fact as to both exemptions.

In Campbell, over two thousand unlicensed junior accountants brought suit against their employer, arguing that they were misclassified as exempt and owed additional compensation for their overtime hours worked. The district court agreed, and held that unlicensed accountants could categorically never qualify for the Industrial Welfare Commission’s (“IWC”) professional or administrative exemptions. Analyzing the professional exemption first, the district court held that these PwC employees were ineligible for the exemption as a matter of law, because they were not licensed Certified Public Accountants. As to the administrative exemption, the district court held that, because the unlicensed accountants were required by law to work under the supervision of a licensed accountant, they could never meet the requirement that they work under only “general supervision” to be classified as an exempt administrative employee.

The Ninth Circuit disagreed. Warning of the potentially extreme implications of categorically excluding entire classes of employees from the exemption analyses, the Court instead held that each employee’s duties and responsibilities must be measured against the exemptions’ requirements to determine whether each exemption applies.

Please see full article below for more information.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Sheppard Mullin Richter & Hampton LLP | Attorney Advertising

Written by:


Sheppard Mullin Richter & Hampton LLP on:

JD Supra Readers' Choice 2016 Awards
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.

Already signed up? Log in here

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.