Benjamin v. B&H Educ., Inc., 2017 WL 6460087 (9th Cir. 2017)

Plaintiffs in this case are students of cosmetology and hair design at the Marinello Schools of Beauty (“B&H”) in California and Nevada. Plaintiffs claim that they are employees within the meaning of the Fair Labor Standards Act (“FLSA”) and under California and Nevada state law on the ground that much of their time is spent doing menial and unsupervised work. The district court granted summary judgment in favor of B&H, holding that plaintiffs, not the schools, are the primary beneficiaries of plaintiffs’ labors because at the end of their training they qualify to practice cosmetology. The Ninth Circuit affirmed, adopting the “primary beneficiary” test under the FLSA that originated in Glatt v. Fox Searchlight Pictures, Inc., 811 F.3d 528 (2d Cir. 2016) (unpaid interns on the set of a film production who claimed to be employees under the FLSA).

As for the California state law claims, the Court held that none of the cases cited by plaintiffs arose in the educational context and, therefore, the California Supreme Court would have no reason to look to the wage order definition of employer to determine whether these plaintiffs are students or employees. The Court further predicted that the California Supreme Court would apply something like the “primary beneficiary” test instead of the more “rigid” factors adopted by the United States Department of Labor in an informal guidance on the topic issued in 2010. Finally, the Court affirmed the district court’s order striking the declarations of plaintiffs’ witnesses who had not been identified pursuant to FRCP 26. See also Douglas v. Xerox Bus. Services, 875 F.3d 884 (9th Cir. 2017) (the relevant time period for determining minimum-wage compliance under the FLSA is the workweek as a whole, rather than each individual hour within the workweek).