Must Ohio non-profit summer camps pay a minimum wage to camp counselors?

Non-profits have been asking the most questions about Issue 2 this week. A question from a non-profit summer camp is a good example, being whether camp counselors are covered. The short answer, it appears, is "yes." The following explains why I reach this result. I have no pride in authorship so, if you spot a flaw in the argument, please let me know in a comment or an email.

First, is there a general exclusion for non-profits? No, with the possible exception of an employee engaged as a minister for a religous entity. Even the religious exception is not at all clear under Issue 2, so do not rely on it without an opinion from employment counsel.

Second, must a summer camp pay its counselors the minimum wage? This is important because, right now, most summer camps do not have to pay the minimum wage to their counselors. Issue 2 may change that.

To reach this result we look at two main issues, being:

1. whether the camp is an "employer" covered by a minium wage law and if so,
2. whether its any of its employees in general, or camp counselors specifically, are excluded from coverage.

To answer these two questions, we must look at 3 different minimum wage laws, being:

1. Ohio's current law, which still exists;
2. Ohio's new minimum wage law (Issue 2) and
3. existing federal minimum wage law.

These three laws will exist going forward and will interact with each other. Further, if any one of them applies to the camp without an exclusion of the counselor from coverage, the camp will have to pay the minimum wage. (If any two of them require payment of different minimum wages, the employer must pay the higher wage in some, but not all, cases; more on that later).

Is the summer camp an "employer" covered by the federal minimum wage law?

The camp is an "employer" under federal minimum wage law but, because the Fair Labor Standards Act (the FLSA) does not cover all employers, most camps are not covered by the FLSA.

The FLSA defines "employer" basically to mean any person (including a non-profit company) that pays an employee. The FLSA does not, however, cover all employers. The FLSA only covers employers who are engaged in commerce or the production of goods for commerce. Therefore, if the summer camp is not engaged in commerce or the production of goods for commerce, which is usually the case, then it is not covered by the federal minimum wage law, even though it meets the definition of an "employer." Again, that is because the federal law does not cover all employers, just those engaged in commerce.

Is the summer camp an employer under Ohio law?

Assuming that the camp is not covered by federal law, Ohio minimum wage law might still apply to it. Ohio has a definition of "employer" similar to the FLSA's but Ohio law excludes an employer whose gross volume of sales is less than $150,000. Therefore, the camp could be excluded from Ohio minimum wage coverage as a small employer.

Even if the camp is not excluded as a small Ohio employer, Ohio law specifically excludes camp counselors. Thus, if the camp has revenues over $150,000, it need not pay the minimum wage to the camp counselors. This means that the camp could be covered by existing Ohio minimum wage law but, since counselors are excluded, the camp would not have to pay the minimum wage to the counselor.

Will Issue 2 cover this summer camp and counselor?

I think so.

Issue 2 will take effect on January 1, 2007. It states that

• "every employer shall pay their employees" the new minimum wage.
• "employer" and "employee" shall have "the same meanings as under the Fair Labor Standards Act," with certain exceptions and
• "only the exemptions set forth in (Issue 2) apply to (Issue 2)."

As noted above, the term "employer" under the FLSA is very broad. It basically means any person who pays an employee. The term "employee" under the FLSA does not exempt a camp counselor. Therefore, it looks like the camp is an "employer" and the counselor is an "employee" entitled to the minimum wage.

What about Issue 2's own exemptions? They do not appear to exempt the camp or its counselors. Issue 2 does not have a small employer exemption, the way current Ohio law does. Issue 2 will allow businesses with less than $250,000 in gross revenues to pay the federal minimum wage, if lower, but it does not exempt them altogether. Therefore, it appears that camp counselors will be covered by Issue 2 and entitled to at least the federal minimum wage.

This might come as a difficult surprise for previously exempted employers. If my reasoning is correct, then it could also apply to these other previously exempted Ohio employees:

• individuals engaged in the delivery of newspapers to the
  consumer;
• non-family members working on small farms;
• a member of a police or fire protection agency;
• a student employed on a part-time or seasonal basis by a political subdivision of the state; and, ironically,
• a person employed directly by the house of
  representatives or directly by the senate.

See Ohio Revised Code 4111.01(D).

Again, if I am off the mark here, please let me know. My email is Neil@fklaborlaw.com. I look forward to hearing from you.