KPMG employs entry-level audit associates.? ?A person must have a college degree with an accounting? ?concentration? ?to? ?qualify?? for? ?this position.? ?KPMG paid its audit associates on a salary basis with no overtime. ?The plaintiff filed a class-action lawsuit asserting that unlicensed accountants were entitled not exempt professional employees and were entitled to overtime.? ?The Superior Court certified a class of 200.? ?The Superior?? Court? ?(Judge? ?Gonzalez)?? ruled? ?that whether? audit ?associates ?were? exempt professionals depended on whether they had a bachelor?s degree with a minimum number of accounting hours and 2,000 hours of work experience, what is required for certification under the ?regulations ?interpreting? the ?Public Accountancy Act (?PAA?).

The parties stipulated to certification of issues to the? ?Supreme? ?Court.?????? The? ?Supreme? ?Court transferred? ?the? ?case? ?to?? Division?? One,? ?which affirmed in part and reversed in part. ?The court of appeals looked to the Department of Labor & Industries Professional Exemption Policy for guidance on whether the employees were exempt. The policy allows accountants who do not hold a public accountancy license to qualify as exempt if they perform work that requires the consistent exercise of discretion and judgment and otherwise meet the test for professional employee.

Division I held that the trial court erred by ruling that KPMG must pay overtime to audit employees who do not meet the education and experience requirements of the PAA because that bright line rule was inconsistent with the Professional Exemption Policy. ?The court of appeals held that?the PAA was not intended as a guide to the definition of ?professional employee? under the MWA. ?The court of appeals held that the PAA lists the requirements to be a ?licensed accountant? not a ?professional accountant.? Therefore, employees who do not meet the PAA requirements may or may not be entitled to overtime, depending on what duties they actually perform.

Litchfield v. KPMG, No. 65372-5 (Div. I 9/4/12) (Leach, Lau, Schindler)