October 3, 2016 / 1:51 PM / a year ago

UPDATE 1-U.S. top court declines GEICO appeal on overtime pay

(Added case background, paragraphs 3-5)

By Robert Iafolla

WASHINGTON, Oct 3 (Reuters) - The U.S. Supreme Court on Monday declined to hear GEICO General Insurance Co's appeal of a ruling that the No. 2 auto insurer in the United States must pay overtime wages to its claims investigators after the company had sought to exempt them.

GEICO had challenged a 2015 decision by the Richmond, Virginia-based 4th U.S. Circuit Court of Appeals that its investigators are eligible for overtime under federal wage laws. GEICO, headquartered in Chevy Chase, Maryland, is a subsidiary of Berkshire Hathaway Inc.

The 4th Circuit found that GEICO's claims investigators were too removed from management or general business operations to qualify for an exemption from federal overtime requirements.

In 2012, a federal judge in Maryland ruled that GEICO owed claims investigators who joined a class action for unpaid overtime. The judge limited the damages that GEICO owed to about $3 million because it had acted in good faith, citing the company's efforts to keep up with legal developments about overtime eligibility.

Florida-based claims investigator Samuel Calderon sued GEICO on behalf of other investigators in 2010. GEICO argued that it did not need to pay them overtime because they fell under the "administrative function" exemption of the Fair Labor Standards Act.

Reporting by Robert Iafolla; Editing by Will Dunham

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