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E.D.Ark.: “Payroll Manager” Demonstrated Lack Of Discretion And Independent Judgment; Defendant’s SJ Motion On Administrative Exemption Denied
Reedy v. Rock-Tenn Co. of Arkansas
Plaintiff was, at points relevant to this case, Defendant’s “payroll manager.” The case was before the Court on Defendant’s Motion for summary judgment, based on Defendant’s assertion that Plaintiff was exempt from the FLSA’s overtime provisions under the administrative exemption. Finding issues of fact as to whether Plaintiff had the requisite discretion and independent judgment, the Court denied Defendant’s Motion.
The Court recited the following relevant facts, “Dolores Reedy worked at Rock-Tenn’s folding carton plant in Conway, Arkansas, from June 1986 until March 15, 2007, when she voluntarily resigned. Reedy, who has no college degree or formal accounting training, began as a temporary employee and later worked full-time as a payroll clerk. Rock-Tenn originally treated her as an hourly employee and paid her overtime. At some point, Reedy acquired the title of “Payroll Manager,” was paid on a salary basis, and stopped receiving overtime compensation.
Reedy was responsible for Rock-Tenn’s payroll. Rock-Tenn hired several assistants to work with Reedy in the payroll department, including Linda Suggs, Carolyn Hansen, and Denise Bent. Sometimes assistants worked only as temporary employees. Reedy’s responsibilities in the payroll department included maintaining employee files; wage garnishments; referring Family and Medical Leave Act (“FMLA”) matters to her immediate supervisor, Ken Hogan, or the Benefit Services Center; completing some Employment Eligibility Verification forms based on the documents in employees’ files; and responding to requests for information from the Arkansas Employment Security Department. At some point, Reedy composed a policy reference book for the payroll department.
Reedy says that after she stopped receiving overtime pay, she continued to log her hourly time and report her time to Hogan. She says she spoke with someone in Rock-Tenn’s corporate office about whether she should be exempt from overtime compensation under FLSA. Reedy also says that she and Hogan attended a class in which the instructors conducted an exercise to determine which persons were exempt under the FLSA, and Reedy says that at the end of the exercise she was in the group of persons who were not exempt. Reedy says that she discussed the exercise with Hogan, but Rock-Tenn made no changes to her exempt status.”
After a recitation of the relevant law, the Court applied same stating, “Reedy’s job title of “payroll manager,” standing alone, is of little use in determining whether she was exempt, and the Court must examine evidence relating to the nature of Reedy’s duties. See Lentz v. Hospitality Staffing Solutions, LLC, 2008 WL 269607, at *4 (N.D.Ga. Jan. 28, 2008). A reasonable jury could conclude that Reedy did not exercise discretion and independent judgment in her job as payroll manager. Therefore, the nature of Reedy’s duties and her position relative to the payroll assistants is a disputed issue of fact.
Regarding Reedy’s investigatory duties, Rock-Tenn asserts that she investigated alleged pay discrepancies and notified management if there were any problems requiring remedial action. Rock-Tenn argues that her investigatory duties were similar to those of the postal workers in Dymond, wherein the Eighth Circuit held that postal workers exercised discretion and independent judgment inasmuch as they determined when a situation required immediate action and whether an alleged violation was minor or required reporting to the United States Attorney for prosecution. Dymond, 670 F.2d at 95. Reedy responds that her investigatory responsibilities were distinguishable from the postal workers in Dymond.Reedy says that employees came to her about payroll discrepancies because she was the one who computed payroll, that she had no authority to issue a corrective check, and that she had to receive permission from management before taking any remedial action.
Reedy’s deposition testimony does not demonstrate that her payroll duties required independent judgment or discretion. She reviewed the payroll records in response to complaints; but she was not authorized to proceed with remedial action unless approved by management. Her responsibilities were more clerical than investigatory, unlike those of the postal inspectors in Dymond.Rock-Tenn has failed to show that, as a matter of law, her authority to investigate and remedy payroll discrepancies required the exercise of discretion and independent judgment.
As to the completion of I-9s, Reedy responds that she received no special training qualifying her to recognize a fake employment form, that her job was merely to check the documents in the employee’s personnel file, and that she then signed the I-9s to indicate that Rock-Tenn did in fact have the proper documentation on a particular employee. Rock-Tenn replies that the fact that Reedy signed the I-9s under penalty of perjury-swearing that she had examined the employee’s documents-means that she had to compare and evaluate possible courses of conduct and use her common sense. Rock-Tenn cites to Haywood v. North Am. Van Lines, 121 F.3d 1066, 1073 (7th Cir.1997), for the proposition that an employee who uses common sense satisfies the discretion and independent judgment prong of the administrative employee exception. In that case, however, the Seventh Circuit mentioned “common sense” in a footnote, referencing the employer’s guidelines which informed its employees, whose job it was to negotiate with customers, that they had considerable latitude to negotiate and were to “just use [their] common sense.” Haywood, 121 F.3d at 1073 n. 8. The Seventh Circuit did not hold that every employee who exercises common sense in the performance of a job duty is exercising discretion and independent judgment, and Rock-Tenn has cited no cases holding that completing I-9s amounts to exercising discretion and independent judgment. Furthermore, other than the I-9s and Hogan’s affidavit, there is no other evidence relating to Reedy’s completion of the I-9s, and Reedy was not questioned about the I-9s in her deposition testimony.
As to Reedy’s communications with the Arkansas Employment Security Department, Reedy seemingly characterizes those communications as routine clerical work. Rock-Tenn, relying on Hogan’s affidavit, asserts that Reedy’s responses to the Department’s requests for information often triggered Rock-Tenn’s responsibility to pay unemployment benefits. However, Rock-Tenn offers no authority for the proposition that acting as a liaison between the employer and a governmental agency in and of itself rises to the level of exercising discretion and independent judgment. It is a disputed issue of fact whether Reedy’s work in this area was routine clerical work, providing information to a state department when requested, or actually involved discretion and independent judgment.
Regarding Reedy’s understanding and application of the FMLA, Reedy responds that she was merely instructed to look for certain “red flags” that could indicate that an employee might be asking for FMLA-qualifying leave. Reedy points to Hogan’s deposition, in which he stated that Reedy would bring a potential FMLA-related request to him, and he would make the final decision. Reedy also states that FMLA issues were ultimately referred to a separate entity, the Benefit Services Center. Therefore, Reedy argues, she had no authority to exercise discretion or make decisions regarding FMLA matters. Rock-Tenn replies that Reedy exercised discretion because she stated in deposition testimony that she “felt like [she] was understanding when to ask [Hogan] if [she] should offer an employee FMLA.”Because Reedy stated that she felt like she understood FMLA well enough to notify Hogan of a potential FMLA-related request, Rock-Tenn argues that she was exercising discretion and independent judgment. Reedy characterizes her testimony as showing that she merely looked for “red flags,” whereas Rock-Tenn characterizes her testimony as Reedy touting her ability to interpret and apply the FMLA. After reviewing Reedy’s deposition testimony, it is unclear that either party’s characterization is completely accurate. Thus, the degree to which Reedy actually exercised discretion and independent judgment in reviewing leave requests for FMLA issues and the nature of Reedy’s review of those requests are issues of fact best left to a jury to resolve.
As to Reedy’s job questionnaire responses indicating that she engaged in policy clarification and research, Reedy responds that Rock-Tenn has cited no authority for the proposition that doing research requires the use of discretion or independent judgment with respect to matters of significance. Reedy also states that she eventually had to suspend her research due to other obligations, and Rock-Tenn offers no evidence showing that Reedy actually engaged in research and policy clarification during the period of time relevant to her lawsuit. Furthermore, the record is inadequate to show that whatever research and policy clarification Reedy performed involved the exercise of discretion and independent judgment.
Finally, regarding Reedy’s involvement in garnishing wages, Reedy responds that her duties consisted of merely following the court orders and company procedure, and that Rock-Tenn offers no authority for the proposition that performing wage garnishments amounts to exercising discretion or independent judgment. Rock-Tenn argues that Reedy admitted in deposition testimony that she followed the applicable garnishment laws, and that following those laws required the use of discretion and independent judgment insofar as she was required to “interpret, construe, and explain the laws, policies, and regulations applicable to her work.”In her deposition testimony, however, Reedy stated only that she followed the court orders and the applicable laws regarding precedence when there were multiple garnishments. Reedy did not talk about interpreting, construing, and explaining the laws, policies, and regulations applicable to her work, as Rock-Tenn contends. Rather, it appears from her deposition testimony that, in her position as payroll manager, Reedy simply followed the court orders she received regarding garnishments and then followed the proper procedures where there were multiple garnishments. The nature of Reedy’s work with garnishments and the extent to which her garnishment work involved discretion or independent judgment are disputed issues of fact for a jury to decide.
In summary, issues of fact remain regarding the nature of Reedy’s duties and the extent to which they involved the exercise of discretion or independent judgment.”
S.D.Fla.: Airport Shuttle Operating Within A Single State Without An Arrangement With The Air Carrier(s) Is Not Engaged In Interstate Commerce; MCA Exemption Inapplicable
Gilbert v. Southern Shuttle Services Inc.
This case was before the Court upon Defendant Motion for Judgment as a Matter of Law, or in the Alternative, Motion for New Trial (DE 90). The Motion is fully briefed and ripe for review, following a verdict for Plaintiffs, drivers for Defendant, a company that primarily provides transportation services to people who are going to and from local airports. Denying Defendant’s Motion, the Court explained the “interstate” travel requirements of a Defendant seeking to claim the Motor Carrier Act (MCA) Exemption in Order to avoid FLSA liability.
Discussing the issue before the Court, the Court stated, “Defendant challenges only the portion of the instruction regarding the interstate commerce requirement. (Mot. at 4-5). The Motor Carrier Exemption, 29 U.S.C. § 213(b)(1), mandates that overtime pay is not required for any employee with respect to whom the Secretary of Transportation (“Secretary”) has power to establish “qualifications and maximum hours of service pursuant to section 21502” of the Motor Carrier Act. Thus, the question of whether a plaintiff is exempt from the overtime provisions of the FLSA under 29 U.S.C. 213(b)(1) turns on whether the Secretary had such power with respect to the plaintiff. Baez v. Wells Fargo Armored Service Corp., 938 F.2d 180, 181 (11th Cir.1991).
A requirement of the motor carrier exemption is that the carrier transports persons by motor carrier between a place in a state and a place in another state or “in the practical continuity of movement in the flow of interstate commerce.”See Powell v. Carey Intern., Inc., 483 F.Supp.2d 1168, 1179 (S.D.Fla.2007); see also29 C.F.R. § 782.2 (“The activities of drivers … in connection with transportation which is not in interstate or foreign commerce within the meaning of the Motor Carrier Act provide no basis for exemption under section 13(b)(1) of the Fair Labor Standards Act.”); see also McIntyre v. FLX of Miami, Inc., 2008 WL 4541017, *5 (S.D.Fla.2008) ( “Transportation within a single state may remain ‘interstate’ in character when it forms a part of a ‘practical continuity of movement’ across state lines from the point of origin to the point of destination.”) (citations omitted).
Even if the passengers came from or were destined to points in another state, the carrier is not engaged in interstate commerce if the carrier operates within a single state unless there is a “common arrangement” or through-ticketing between the motor carrier and the air carrier for continuous passage or interchange. See James T. Kimball-Petition for Declaratory Order, 131 M.C.C. 908, 1980 WL 14197 (1980) ((“Kimball” );Motor Transp. of Passengers Incidental to Air, 95 M.C.C. 526 (1964); see also Powell, 483 F.Supp.2d at 1179-82 (holding that plaintiffs limousine service drivers did not fall under the jurisdiction of the Department of Transportation for purposes of the Motor Carrier Exemption where there was insufficient evidence of through-ticketing arrangement between defendants and Virgin Atlantic); Rossi v. Associated Limousine Services, Inc., 438 F.Supp.2d 1354, 1362 (S.D.Fla.2006) ( “Notwithstanding, a through-ticketing arrangement must be between the motor carrier and air carrier for continuous passage in order to render the motor carrier’s operation interstate transportation. See In re Kimball, supra.Associated has no such arrangement with any air carrier.”). A common travel arrangement with a ground transportation company or a travel agency is insufficient to meet the interstate commerce requirement. See id.; Kimball, 131 M.C.C. at 918; Morrison v. Quality Transports Services, Inc., 474 F.Supp.2d 1303, 1310 (S.D.Fla.2007). The Court concludes that the instruction given was legally correct. Accordingly, the Court finds that it did not err in instructing the jury on the Motor Carrier Exemption.
Finally, the Court rejects Defendant’s claims that the evidence at trial established that it fell within the Taxicab and Motor Carrier Exemptions to the FLSA. The jury instructions were correct, both legally and in light of the evidence presented at trial, and the jury’s verdict was not against the weight of the evidence.” Accordingly, Defendant’s Motion was denied.
D.Idaho: “Sales Representative” Who Educated Retailers, But Did Not “Sell” To Customers, Not Subject To Outside Sales Exemption Under FLSA
Burling v. Real Stone Source, LLC
The case was before the Court on the parties’ respective motions for summary judgment on exemption issues. The Court agreed with Plaintiff that he was not subject to the outside sales exemption, and further held that issues of fact precluded a finding regarding the applicability of the administrative exemption. Here, we discuss only the portion of the decision pertaining to the outside sales exemption.
The Court first recited the relevant facts, “Mr. Burling, was employed as a sales representative from March 15, 2006 to November 29, 2007 by Defendant Real Stone Source, LLC, d/b/a Rox Pro. Real Stone is a distributor of Rox Pro products which is a natural modular stone system used in construction. (Dkt. No. 28,Dkt. No. 27-3, p. 37). Real Stone products are distributed exclusively through a network of local dealers from whom the ultimate consumer buys the product. (Dkt. No. 26, Ex. E). Mr. Burling was hired as a Real Stone sales representative for a seven state area comprised of Washington, Oregon, Idaho, Montana, Wyoming, Utah, and Colorado. Mr. Burling was tasked with contacting existing and potential local dealers and pitching Real Stone’s products to them. For prospective local dealers, Mr. Burling’s pitch was in an effort to get them interested in serving as a local dealer of Real Stone products. Once interested, Real Stone would determine whether the prospective dealer met its qualifications and, if so, approve them as a local dealer. For existing dealers, Mr. Burling continued to educate them on Real Stone Products and also aided them in selling Real Stone products through various efforts including promotions and outreach to consumers.”
Agreeing with Plaintiff, and the cases holding that the outside sales exemption can only apply where an employee makes actual sales, the Court said, “This Court finds the cases cited by Mr. Burling to be the correct analysis to apply here. See Kuzinski v. Schering Corp., 604 F.Supp.2d 385 (D.Conn. March 30, 2009). Although the California District Court cases cited by Real Stone discuss the FLSA, they were applying California Labor Law. Notably, the Barnick court recognized that there is a distinction between the FLSA and California Labor Law. There, the court stated that the employee’s argument that he was only promoting, not selling, because he never received commitments from the physicians was “likely a correct application of the distinction between promotion and sales laid down by the Department of Labor and several federal courts with regard to the FLSA” but that it did not apply to the California Labor Law. Barnick, 522 F.Supp.2d at 1264.FN2Where, as here, the case does not raise claims of California Labor Law but, instead, the FLSA, the analysis from cases applying the FLSA are more appropriately used. As such the Court will first consider whether Mr. Burling made sales as defined by the FLSA. See Kuzinski v. Schering Corp., 604 F.Supp.2d 385 (D.Conn. March 30, 2009).”
The Court adopted the reasoning of several of the pharmaceutical sales representative cases, stating, “[t]he Court finds Real Stone has failed its burden of demonstrating that, as a matter of law, Mr. Burling was an exempt outside salesperson. The facts in the record demonstrate that Mr. Burling did not make any sales. The Court rejects Real Stone’s theory that its sales representatives were a part of every sale in their territory. (Dkt. No. 27-3, pp. 109-111), (Dkt. No. 27-4, pp. 24, 51-52), (Dkt. No. 31-2, p. 103). Mr. Burling’s job was to create a network of local dealers, educate the local dealers and contractors about the product, and bolster consumer desire to purchase the product from the local dealers who in turn bought from Real Stone. (Dkt. No. 27-3, pp. 94-96). This is consistent in the depositions of both Mr. Burling and Mr. Motarex as well as Real Stone’s “Sales Philosophy and Market Strategy” document. (Dkt. No. 26-2, Ex. E), (Dkt. No. 27-3, pp. 96-111, Motarex Depo.), (Dkt. No. 27-3, pp. 54-66, Burling Depo.). Both Mr. Burling and Mr. Motarex testified that Real Stone sales representatives were hired to establish a network of dealers in their territory, provide sales support to those dealers by promoting the products and educating the consumers, and engaging in further advanced marketing strategies to “create buzz” for the products and increase consumer purchases from the dealers. (Dkt. No. 26-2, Ex. E). In sum, to “generate” and/or “drive” sales to the local dealers. (Dkt. No. 27-3, pp. 25-28), (Dkt. No. 31-2, pp. 93, 95-96).”
Ultimately, the Court concluded, “[b]ecause the facts here do not demonstrate that Mr. Burling actually made sales, the Court finds the outside salesperson exemption does not apply. Instead the facts show that Mr. Burling’s primary duty was to promote and market the Real Stone brand in such a way so as to create a network of local dealers in his territory and to bolster a market for the products such that consumers were continually buying the products from the local dealers. Accordingly, the Court will grant Mr. Burling’s motion for partial summary judgment on this point.”
Although not discussed at length here, the Court also analyzed the applicability of the claimed administrative exemption, before ultimately deciding issues of fact precluded a finding one way or another.
D.Md.: Although Defendant Is A Motor Carrier, Factual Issues Preclude SJ On Motor Carrier Exemption, Where School Bus Drivers Drive No More Than 2 Interstate Charter Trips Per Year On Average
Hoffman v. First Student, Inc.
In this FLSA case, both the Plaintiffs, school bus drivers, and Defendant, a motor carrier, who employed them, moved for summary judgment as to whether Plaintiffs were exempt employees under the motor carrier act (MCA) exemption to the FLSA. The Court denied both motions, finding that factual issues precluded a finding one way or another.
“Under the FMCSR, First Student was a “for-hire” private motor carrier of passengers, and its school bus drivers were subject to the federal safety regulations contained in 49 C.F.R. Parts 382, 383, 387, 390-96. The FMCSR’s regulatory guidance, which can be found on the Federal Motor Carrier Safety Administration’s (“FMCSA”) website at http://www.fmcsa.dot.gov, sets forth the types of school bus services covered by the regulations. The FMCSA mandates that “anyone operating school buses under contract with a school is a for-hire motor carrier,” and when a “for-hire motor carrier transports children to school-related functions other than ‘school bus operation’ (as defined in 49 C.F.R. § 390.5), such as for “sporting events, class trips, etc., and operates across State lines,” the carrier is covered by the safety regulations. See FMCSR Regulatory Guidance Part 390.3, Question 14, available at http://www.fmcsa.dot.gov. Normal “school to home and home to school” driving activities are not covered. Id. In full accordance with this guidance, it was Defendant’s policy to pay its Baltimore bus drivers pursuant to the FLSA for “school to home and home to school” trips, but not for charter trips.
The U.S. Department of Transportation has determined that “if in the regular course of employment a driver is, or could be, called upon to transport a shipment in interstate commerce the driver would be subject” to the Department of Transportation’s jurisdiction and “even a minor involvement in interstate commerce as a regular part of an employee’s duties will subject that employee to the jurisdiction” of the Department of Transportation. See FMCSR Regulatory Guidance, Part 390.3, Question 24, at http://www.fmcsa.dot.gov. Furthermore, the U.S. Department of Labor states that:
Where safety affecting employees have not made an actual interstate trip, they may still be subject to DOT’s jurisdiction if: (1) the employer is shown to have involvement in interstate commerce; and (2) it can be established that the employee could have, in the regular course of employment, been reasonably expected to make an interstate journey. See U.S. Department of Labor, Employment Standards Administration, Wage and Hour Division, Fact Sheet # 19: The Motor Carrier Exemption Under the Fair Labor Standards Act (FLSA), available at http://www.dol.gov.
Thus, First Student posits that the drivers who volunteer to join its “charter pool” are categorically ineligible for overtime pay under the statutory and regulatory regime described above because: (1) FLSA’s overtime provisions do not apply to “any employee with respect to whom the Secretary of Transportation has power to establish qualifications and hours of service,”29 U.S.C. § 213(b) (1), and (2) the Secretary of the Department of Transportation is authorized to prescribe the “qualifications” and “hours of service” of drivers in the “charter pool.”
Plaintiffs seek to avoid this result with two arguments. First, they point to an exception set out in the Motor Carrier Act which plausibly creates a categorical exclusion for school bus drivers from the jurisdiction of the Secretary of Transportation. Second, plaintiffs contend that even if they are not categorically excluded from coverage under the Motor Carrier Act, First Student has not established the motor carrier defense as a matter of law (and summary judgment must be denied) because defendant has failed to demonstrate that, as a matter of law, plaintiffs’ involvement with interstate commerce is other than “trivial” and de minimis, or that interstate travel was a “natural, integral and … inseparable part of the position plaintiffs held,” Dauphin v. Chestnut Ridge Transportation, Inc., 544 F.Supp.2d 266, 275 (S.D.N.Y.2008), and that proper evaluation of that defense must await trial.
As explained herein, I conclude that while defendant correctly contends that the motor carrier exemption defense is available, the record does not establish the elements of that defense as a matter of law. Accordingly, defendant’s motion for summary judgment as to the overtime claims is granted in part and denied in part 2.
The Motor Carrier Act (hereafter, “the MCA”) is found at 49 U.S .C. § 13501 et seq.Section 13501 gives the Secretary of the Department of Transportation (hereafter, “the Secretary”) jurisdiction over interstate motor carriers, and a separate section, 49 U.S.C. § 31502(b)(2), empowers the Secretary to set “qualifications” and “hours of service” for employees of interstate motor carriers. As a matter of law, First Student is a form of “motor carrier” within the jurisdiction of the MCA. However, certain types of interstate travel are not within the Secretary’s jurisdiction because they are exempted from the MCA.
One exemption excludes from the Secretary’s jurisdiction “a motor vehicle transporting only school children and teachers to or from school.”49 U.S.C. § 13506(a)(1). On its face, this exemption from the Act seems to mean that the routine carriage of students by the drivers employed by contract motor carriers such as defendant on behalf of local school districts renders the drivers eligible for overtime under the FLSA, i.e., that such employees are not within the class of employees “with respect to whom the Secretary of Transportation has power to establish qualifications and hours of service.”29 U.S.C. § 213(b)(1). And, the statutory term “to or from school” could reasonably be interpreted to include not only transportation “to or from [home to] school [and back],” but also “to or from school[, including any trips from school to other locations related to the educational mission of the school, such as school-sponsored field trips, and back to school.”] Put differently, one might justifiably infer that students on field trips and/or being transported to and from athletic contests almost always depart from and return to the school location at the beginning and end of such transportation.
Mielke v. Laidlaw Transit, Inc., 102 F.Supp.2d 988, 992 (N.D.Ill.2000), essentially adopted the above interpretation of the term “to or from school” in the MCA and reasoned that, categorically, “school bus operation” (which is the Secretary’s regulatory term, meaning “the use of a school bus to transport school children and/or school personnel from home to school and from school to home,”49 C.F.R. § 390.5), is outside of the Secretary’s jurisdiction and thus is not encompassed by the FLSA’s motor carrier exception. Specifically, the Mielke court concluded that “the phrase ‘to and from school’ includes transportation to or from school sponsored events.” 102 F.Supp.2d at 990 (citation omitted).
In reaching its conclusion that school bus drivers who drove on so-called “charter trips” were entitled to overtime notwithstanding the FLSA’s motor carrier exception, the Mielke court flatly rejected defendant’s argument that the MCA’s exception for “a motor vehicle transporting only school children and teachers to or from school” applied “only to tariff, licensing, and rate regulations” governing motor carriers, and not to the Secretary’s authority to prescribe school bus drivers’ “qualifications and maximum hours of service.”Id.
At the time the case at bar was filed in June 2006, Mielke was the sole opinion by a federal court interpreting and harmonizing the FLSA motor carrier exception with the MCA’s exclusion from the Secretary’s authority “a motor vehicle transporting only school children and teachers to or from school.”In Mielke, the former gave way to the latter and school bus drivers were deemed by the court entitled to overtime pay under the FLSA.
There is now a second case elucidating this somewhat convoluted statutory and regulatory regime treating school bus drivers’ entitlement to overpay pay under the FLSA. Dauphin v. Chestnut Ridge Transportation, Inc., 544 F.Supp.2d 266 (S.D.N.Y.2008). In Dauphin, the court declined to follow Mielke and reached a contrary conclusion, namely, that the FLSA motor carrier exception potentially applied to school bus drivers (essentially on a week-by-week, employee-by-employee basis, see 544 F.Supp.2d at 275 (“However, because this testimony fails to establish whether interstate travel was part of either plaintiff’s job duties during the entire period at issue in this litigation, the Court cannot determine whether the motor carrier exemption applies to them for all the relevant workweeks.”)). Thus, the motor carrier exception would exonerate the defendant in Dauphin provided that it could show “either that the activities of the individual plaintiffs involved interstate travel of a character that was more than de minimis or that interstate travel was a ‘natural, integral and … inseparable part’ of the position plaintiffs held.”Id.
Specifically, the Dauphin court concluded, contrary to Mielke, that the limitation on the Secretary’s jurisdiction to regulate “school bus operations” had no bearing on the Secretary’s ability to set “qualifications and maximum hours of service” for school bus drivers who operated school buses in interstate commerce. Id. at 272.That is, the court reasoned that § 13506‘s limitation on the Secretary’s jurisdiction applies only to the economic and licensing authority (found in Subtitle IV of the MCA), and not to the issue of qualifications and maximum hours of service (found in Subtitle VI of the MCA).Id. (citing Bilyou v. Dutchess Beer Distribs., Inc., 300 F.3d 217, 229 (2d Cir.2002)).
Dauphin readily acknowledged that, consistent with the statutory language in the MCA, the Federal Motor Carrier Safety Regulations except from certain regulations “[a]ll school bus operations,” pursuant to 49 C.F.R. § 390.3(f).See 544 F.Supp.2d at 274. Nevertheless, the court concluded that this regulatory exclusion is not an indication that the Secretary does not have the authority to regulate school bus transportation; rather, it concluded, the exclusion reflects the Secretary’s determination that regulating home-to school and school-to-home transportation is not necessary for public safety. Id. (citing 53 Fed.Reg. 18,043 (May 19, 1988)).
I have carefully considered the conflicting approaches of the only two federal courts to have examined this awkward statutory regime. To be sure, Mielke’s approach is fully consistent with the well-settled doctrine that FLSA exemptions and exceptions are to be construed narrowly against the employer seeking to assert them, e.g., Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392, 80 S.Ct. 453, 4 L.Ed.2d 393 (1960) (citing Mitchell v. Kentucky Fin. Co., 359 U.S. 290, 295, 79 S.Ct. 756, 3 L.Ed.2d 815 (1959)). Nonetheless, I am persuaded that some deference is owed to the Secretary’s interpretation of his authority, acquiesced in by the Department of Labor, see29 C.F.R. § 782.2(a), to regulate the qualifications and hours of service of interstate school bus drivers. Furthermore, I am persuaded by Judge Stein’s analysis in Dauphin that the broadly-worded exception set forth in the MCA does not extend to the qualifications and hours of service of interstate school bus drivers employed by motor carriers within the jurisdiction of the Secretary. Accordingly, as in Dauphin, and contrary to Mielke, I conclude that the motor carrier defense is potentially applicable here.
Nevertheless, again as in Dauphin, the motor carrier exception defense cannot be applied on this record as a matter of law. Because an employee’s exempt status is an affirmative defense to a claim for non-payment at an overtime rate, the employer bears the burden of proving the exemption by clear and convincing evidence. Stricker v. Eastern Off Road Equip., Inc., 935 F.Supp. 650, 654 (D.Md.1996). Viewed in the light most favorable to plaintiffs, the evidence in the record shows that fewer than two interstate trips per year, on average, were worked by the employees in the First Student “charter pool” during the pendency of defendant’s contracts in Maryland. Moreover, as disclosed during the hearing in this case, each such driver seems to have had the option whether to accept an assignment to operate a vehicle outside of Maryland. See Dauphin, 544 F.Supp.2d at 274-76. Thus, to paraphrase Dauphin”whether the activities of [First Student’s] [former] drivers involve[d] interstate transportation of passengers in a way that would bring them within the scope of the motor carrier exemption from the FLSA” cannot be determined as a matter of law. Id. (alterations added).
Accordingly, I conclude that, as a matter of law, although the Secretary of Transportation is authorized to regulate the qualifications and hours of service of those members of the plaintiff class who volunteered for the “charter pool,” genuine disputes of material fact preclude a determination as a matter of law whether the FLSA motor carrier exception applies to any particular member of the plaintiff class for any particular work week. Therefore, as to the motor carrier exception, plaintiffs’ motion for partial summary judgment is denied, and defendant’s motion for partial summary judgment is granted in part and denied in part.”
S.D.Ind.: Tow Truck Driver Exempt Under Motor Carrier Act (MCA), Because Might Be Called To Perform Interstate Wrecking Services
Johnson v. Hix Wrecker Service, Inc.
The case was before the Court on several motions for summary judgment. The Court granted Defendant’s motion for summary judgment, finding that the Plaintiff was exempt from the FLSA’s overtime provisions pursuant to the Motor Carrier Act (MCA) exemption. This case contrasts the proof (and result) of a similar case discussed here yesterday.
The Court explained, “Defendant Hix Wrecker Service, Inc., (“HWS”) is an Indianapolis business that, as its name suggests, performs wrecker services; the remaining Defendants are individuals who manage and operate HWS. Plaintiff Bobby J. Johnson, Jr., worked for HWS for several months in 2006 as a tow truck driver. Johnson asserts several claims in his complaint. At issue in the instant motion is his claim that HWS violated the Fair Labor Standards Act, 29 U.S.C. § 201 et seq., (“FLSA”), by failing to pay him overtime wages for occasions in which he worked more than forty hours in a given week. HWS argues that the FLSA overtime provisions were inapplicable to Johnson because the motor carrier exemption applied to him during his employment with HWS. The Court agrees.
The motor carrier exemption is found at 29 U.S.C. § 213(b)(1) and provides that “any employee with respect to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service pursuant to the provisions of section 31502 of Title 49” is exempt from the overtime provisions of the FLSA. Among other things, 49 U.S.C. § 31502 extends the Secretary of Transportation’s power to “employees of, and safety of operation and equipment of, a motor carrier” that transports property across state lines. “The Secretary has the power to set maximum hours for drivers if the company engages in more than de minimis interstate commerce, and that includes a company that holds itself out as an interstate company and solicits that business even though its prospect of obtaining much of that business is poor and some of its drivers never drive in interstate commerce.” Garcia v. Pace Suburban Bus Service, 955 F.Supp. 75, 77 (N.D.Ill.1996) (citing Morris v. McComb, 332 U.S. 422, 68 S.Ct. 131, 92 L.Ed. 44 (1947); Reich v. American Driver Service, Inc., 33 F.3d 1153 (9th Cir.1994); Marshall v. Aksland, 631 F.2d 600 (9th Cir.1980); Brennan v. Schwerman Trucking Co. of Virginia, Inc., 540 F.2d 1200 (4th Cir.1976)).”That does not mean, however, that the Secretary of Transportation has automatic jurisdiction over all drivers of an interstate carrier. Pursuant to a notice of interpretation, 46 Fed.Reg. 37,902, 37,903 (1981)… jurisdiction extends only to drivers who reasonably could be expected to make one of the carrier’s interstate runs, and that means more than a remote possibility.” Garcia, 955 F.Supp. at 77. Thus, as explained in the relevant Department of Labor regulation:
In a situation considered by the U.S. Supreme Court, approximately 4 percent of the total trips made by drivers employed by a common carrier by motor vehicle involved in the hauling of interstate freight. Since it appeared that employer, as a common carrier, was obligated to take such business, and that any driver might be called upon at any time to perform such work, which was indiscriminately distributed among the drivers, the Court considered that such trips were a natural, integral, and apparently inseparable part of the common carrier service performed by the employer and driver employees. Under these circumstances, the Court concluded that such work, which directly affected the safety of operation of the vehicles in interstate commerce, brought the entire classification of drivers employed by the carrier under the power of the Interstate Commerce Commission to establish qualifications and maximum hours of service, so that all were exempt even though the interstate driving on particular employees was sporadic and occasional, and in practice some drivers would not be called upon for long periods to perform any such work. ( Morris v. McComb, 332 U.S. 422, 68 S.Ct. 131, 92 L.Ed. 44)
29 C.F.R. § 782.2. In other words, it does not matter whether the driver in question actually has made an interstate run; as long as the driver is subject to being assigned to such a run at any time, the exemption applies to that driver.
HWS has the burden of demonstrating that the exemption applied to Johnson during the time it employed him. Klein v. Rush-Presbyterian-St. Luke’s Medical Center, 990 F.2d 279, 283 (7th Cir.1993). To demonstrate the application of the exemption to Johnson, HWS has submitted evidence, in the form of the affidavit of Defendant Gail Neal, the corporate secretary of HWS, which establishes the following:
1. HWS has at all relevant times held a common-carrier certificate of authority from the Department of Transportation that permits it to transport property for hire in interstate commerce.
2. Since 1973, HWS has provided its customers with both intrastate and interstate wrecker services.
3. HWS routinely provides interstate wrecker services for several of its customers.
4. All HWS drivers are subject to being assigned to an out-of-state run, either as a driver or as a helper, as needed.
5. Johnson was subject to being assigned to an out-of-state run at all times during his employment with HWS.
Thus, HWS has submitted evidence sufficient to establish that the motor carrier exemption to the FLSA was applicable to Johnson during his employment with HWS.” Therefore the Court granted Defendant’s motion.
N.D.Tex.: Absent Proof Of Likelihood Of Interstate Trips, Plaintiff Truckdrivers Not Subject To Motor Carrier Act (MCA) Exemption; Summary Judgment Held In Abeyance
Songer v. Dillon Resources, Inc.
Here, the parties moved by cross Motions for Summary Judgment for a determination as to whether the Plaintiff-truckdrivers were subject to the so-called Motor Carrier Exemption of the FLSA, based on the nature of their duties driving for Defendant, an interstate motor carrier. The Court held the Motions in abeyance, questioning the quality of proof offered by the Defendant.
After acknowledging the parties agreed Defendant was a “motor carrier” the Court examined the necessary proof the Defendant was required to come forward with in order to meet its burden of proof on the exemption, and concluded Defendant had failed to do so, “[c]oncluding that plaintiffs, as truck drivers, are subject to the Motor Carrier Act exemption, however, does not end the court’s inquiry. The court is not persuaded that the exemption bears the unlimited scope and duration defendants have suggested. In support of their respective positions, the parties argue regarding the application and authority of a number of interpretive guides, including an Interpretive Bulletin of the Department of Transportation, Federal Highway Administration, 46 Fed.Reg. 37902, 1981 WL 115508; the DOL Field Operations Handbook; and Opinion Letters of the DOL’s Wage and Hour Division. All of these sources, while not controlling or entitled to deference, are “entitled to respect” to the extent they are persuasive or offer guidance. Christensen v. Harris County, 529 U.S. 576, 587-88 (2000); Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). All of these sources lead to the same conclusion: a driver is subject to the jurisdiction of the Secretary, and thus under the Motor Carrier Act exemption, for a “4-month period from the date of the proof” that he was, or could have been, called upon to engage in interstate commerce. 46 Fed.Reg. 37902, 37903.
Although the court concludes that plaintiffs, as drivers for at least one motor carrier, are subject to the Motor Carrier Act exemption to some extent, defendants have failed to adduce summary judgment evidence of the specific application of the exemption as to each plaintiff for these defendants. The summary judgment evidence submitted by defendants sets forth generally the dates of plaintiffs’ employment and states generally the number of interstate trips made by that plaintiff. However, defendants have adduced nothing as would show, as to each plaintiff, proof of when he or she was, or could have been, called upon to transport goods in interstate commerce such that the exemption clock began ticking as to that plaintiff.
Defendants submitted summary judgment evidence that purports to be bills of lading or similar types of work tickets showing that various plaintiffs transported goods across state lines or within Texas in the intrastate flow of interstate commerce. Insofar as the court can tell, none of these items show any of the defendants as the employer or trucking company of record. For example, many of the work tickets, under the heading “Carrier,” list “Sunset Transp” or, in some cases, “Sunset Trucking.” Neither of these entities is a party to this action, nor have defendants pointed the court to any summary judgment evidence explaining the relationship, if any, between them and either of those entities.
The court also has concerns about defendants’ summary judgment evidence generally. Defendants’ appendices as assembled do not correspond to either the tables of contents or to internal citations to exhibits within affidavits. By way of example, in volume I of the appendix, the affidavit of Edward Brady refers to exhibits A, B, C, etc., attached thereto. The exhibits themselves, however, are tabbed as number 1, 2, 3, etc., making it difficult for the court to identify exactly to which exhibit the affidavit refers. This pattern is repeated as to each affidavit with exhibits. Further, the affidavits contain many conclusory assertions and do not properly authenticate the documents attached thereto as exhibits. As the court would find it helpful for the parties to provide additional briefing and evidence on the limited issues set forth below, it is expected that any additional evidence submitted will be properly assembled and identified and internally consistent. Therefore,
The court ORDERS that plaintiffs’ partial motion for summary judgment, and defendants’ motion for summary judgment, be, and are hereby, held in abeyance pending further consideration by the court of the parties’ supplemental filings ordered below.”
M.D.Fla.: Question Of Fact For Jury Whether “Field Coordinator” For Cable Company, Who Managed Subcontractors, Administratively Exempt; Summary Judgment Denied
Driggers v. Cable Television Intsallation & Service, Inc.
This case was before the Court on Defendant’s Motion seeking summary judgment finding that Plaintiff was subject to the Administrative Exemption of the FLSA. Reviewing the evidence in the light most favorable to the Plaintiff, as the non-moving party, the Court denied Defendant’s Motion.
The Court assumed the following facts, as averred by Plaintiff:
“Plaintiff was employed by CTIS, a cable and internet installation services provider. He began his employment in dispatch and then became a cable installer (“Subcontractor”) for two to three years. Subcontractors are independent contractors required to use their own equipment and tools in their installation work as well as provide their own insurance. In May 2005, Plaintiff began working as a Field Coordinator, later called a Field Advisor, and continued in this position until he was terminated in May 2008.
As Field Coordinator, Plaintiff was assigned a hub, which was a geographical area based on zip code. Each morning, he handed out work assignments to subcontractors in his hub, making the assignments based on the time of the scheduled work and, when the workload permitted, on subcontractor ability and experience. Plaintiff also reviewed and entered subcontractor paperwork, which included checking billing documents to assure they were filled out in compliance with the standards of CTIS and its customer Bright House. He adjusted billing codes to comply with the job specifications and billing rules, often seeking guidance from Bright House.
Plaintiff was responsible for informing the subcontractors in his hub of changes to job specifications put out by Bright House and CTIS. He sometimes explained what the changes meant and suggested approaches to performing the job to the new specifications. If a subcontractor had a problem with an installation, Plaintiff would try to help the subcontractor figure out how to make the job comply with specifications, and if he could not, he would contact Bright House for further instructions. Plaintiff did not have the authority to deviate from job specifications without first consulting Bright House.
In the afternoons Plaintiff performed inspections. He had the authority to inspect installations of his choice to ensure compliance with job specifications. The number of these quality control inspections varied based upon Plaintiff’s workload in the office and number of damage inspections assigned by Bright House. If his quality control inspection revealed deviations from specifications, Plaintiff would have the installation subcontractor fix the problem to meet job specifications or assign another subcontractor to do so. Occasionally Plaintiff performed the repair work himself When customers had complaints about installations, they contacted Bright House or CTIS who in turn would contact Plaintiff, instructing him to inspect the damage. Plaintiff performed these inspections to determine if the subcontractor was responsible for the damage. If the subcontractor made a mistake that caused the damage, the subcontractor and his insurance were responsible. If the damage was caused by the subcontractor following specifications, Plaintiff would contact CTIS for approval of a repair or assign another subcontractor to handle the issue. If the subcontractor was not responsible for the damage, Plaintiff would not offer repairs and the customer would have to contact CTIS to take the claim further.”
The Court noted, “[i]n their filings, both parties state that Plaintiff satisfies the first and second prongs of the administrative exemption. Defendant has described Plaintiff’s primary duty as quality assurance, including assigning work orders, communicating changes in job specifications, checking subcontractor paperwork for compliance with policy, and ensuring subcontractor installations met specifications and quality standards. For the purposes of summary judgment, Plaintiff has agreed to this description and its satisfying the second prong. Plaintiff challenges only the use of discretion and independent judgment with respect to matters of significance in the performance of Plaintiffs primary duty as required in the third prong.”
Although the Court agreed with Defendant, that a jury could find that, since 4 or the 10 tests for independent judgment and discretion laid out in the CFR were satisfied, it was a question of fact of the jury whether Plaintiff met the requisite independent judgment and discretion element of the Administrative Exemption. Thus, the Court denied summary judgment stating, “[t]he undisputed facts allow a jury to reasonably find that Plaintiff has met some or none of the factors to be considered for the applicability of the third prong of the administrative exemption. The jury could determine that Plaintiffs use of skill and experience in the performance of his primary duty and his limited leeway in decisions do not allow him to qualify under the administrative exemption. Cotton v. HFS-USA, Inc., No. 8:08-cv-251-T-33TGW, 2009 WL 1396351 (M.D.Fla. May 18, 2009) (summary judgment order) (finding an employee who performed quality control inspections through comparison to standards and who assigned subcontractor work and repairs without direct supervision did not exercise discretion and independent judgment because most of his decisions were based on experience in the industry, well-established standards, and the use of common sense, and because he sought approval for deviations from specifications and frequently spoke with his superiors). The motion for summary judgment is therefore denied.”
W.D.Tenn.: “Maintenance Director” Not Executive Exempt; Management Not Primary Duty; Defendant Failed To Establish Plaintiff Supervised 2 Or More Co-Employees
Jones v. FMSC Leasehold, LLC
Before the Court was Plaintiff’s Motion for Partial Summary Judgment seeking a finding that he was not executive exempt as a matter if law, because management was not his primary duty, and because he did not supervise 2 or more employees. The Court granted Plaintiff’s Motion, agreeing that neither of these required elements of the executive exemption were present here.
Plaintiff was employed at High Pointe Health and Rehabilitation Center (“the facility”) from June 19, 2005 to February 5, 2008. Starting in November 2005 and continuing until his employment ended, Plaintiff served as Maintenance Director at the facility. Plaintiff averred that he had only one assistant reporting to him during that time, and Sanford Mann, the administrator of the facility, verified that Plaintiff had only one assistant during the time Mann worked at the facility from June 2007 to January 2008. Plaintiff contended that his primary job duty as Maintenance Director was manual labor performing general maintenance tasks at the facility. Plaintiff received a salary and was not compensated by the hour. During weeks in which he worked more than forty (40) hours, Plaintiff was not paid one and one-half (1.5) times his regular rate of pay. Plaintiff argued that Defendant could demonstrate that Plaintiff was an exempt employee for purposes of overtime pay as defined under the FLSA and its regulations.
First, the Court discussed Defendant’s failure to raise an issue of triable fact regarding Plaintiff’s primary duty, stating, “[t]he Court holds that Defendant has failed to carry its burden as to the second element, whether Plaintiff’s primary duty was management. Defendant argues that Plaintiff held the title “Maintenance Director” at the facility and his primary duty was to manage the maintenance department and the assistants who reported to him. According to Defendant, Plaintiff had input on the hiring, firing, promotion and assignment of his assistants and was able to set his own work schedule. Plaintiff disputes that he ever had actual managerial duties and argues that his duties were limited to only maintenance tasks.
Rather than rely on a job description or an employee’s job title, the Court must analyze an employee’s “actual duties” in light of the factors set forth and defined in the Department of Labor regulations. With respect to this second element of the exemption, Defendant must prove that Plaintiff’s primary duty was “management of the enterprise in which the employee is employed or of a customarily recognized department or subdivision thereof.”The regulations implementing the FLSA define “management” to include activities such as interviewing, selecting, and training of employees; setting and adjusting their rates of pay and hours of work; directing the work of employees; maintaining production or sales records for use in supervision or control; appraising employees’ productivity and efficiency for the purpose of recommending promotions or other changes in status; handling employee complaints and grievances; disciplining employees; planning the work; determining the techniques to be used; apportioning the work among the employees; determining the type of materials, supplies, machinery, equipment or tools to be used or merchandise to be bought, stocked and sold; controlling the flow and distribution of materials or merchandise and supplies; providing for the safety and security of the employees or the property; planning and controlling the budget; and monitoring or implementing legal compliance measures.
The phrase “a customarily recognized department or subdivision” indicates “a unit with permanent status and … a continuing function.” Furthermore, “[c]ontinuity of the same subordinate personnel is not essential to the existence of a recognized unit with a continuing function.”
Perhaps most importantly, the Court must determine that management was the employee’s primary duty in order for the exemption to apply. A “primary duty” means “the principal, main, major or most important duty that the employee performs.”
Based on the record before the Court, Defendant has failed to adduce evidence from which a reasonable juror could conclude that Plaintiff’s primary duty was management. In his affidavit Plaintiff has stated that his primary job duties were as follows: manual labor such as replacing lights, replacing receptacles, cutting the lawn, law (sic) maintenance, cleaning and servicing heating and air units, minor plumbing, painting, carpeting, tiling floors, minor pipe replacement, some small motor repair, and other preventive maintenance including record keeping and documentation….
Defendant has not demonstrated the amount of time Plaintiff spent performing exempt work or the scope of discretion Plaintiff was granted in performing that work. Defendant has presented no evidence concerning Plaintiff’s relative freedom from direct supervision other than to state Defendant could set his own schedule. Defendant has failed to provide evidence about wages paid to other employees including employees Plaintiff allegedly supervised for the same kind of nonexempt work performed by Plaintiff. As a result, Defendant has provided very little from which a reasonable juror could find that this element is satisfied.
Defendant has proffered a job description for Plaintiff’s position. However, there is no corroborating evidence that the duties listed in the five-page job description were the actual duties carried out by Plaintiff….
Having failed to meet its burden as to this element, the Court concludes that Defendant is not entitled to the affirmative defense that Plaintiff was an exempt employee.”
The Court further held that Defendant could not satisfy the so-called 2 or more element either.
Therefore, the Court held that, as a matter of law, Plaintiff was not subject to the FLSA’s executive exemption.
11th Cir.: Issue Of Fact Precludes Finding “Manager” Subject To Executive Exemption; Summary Judgment Reversed
Barreto v. Davie Marketplace, LLC
This FLSA overtime case was before the Court on Plaintiff’s appeal from an Order awarding Defendant summary judgment based on a finding that Plaintiff, a”manager” of Defendant’s produce department, was subject to the FLSA’s executive exemption. Reviewing the evidence de novo, the Eleventh Circuit held that the Court below erred and reversed. The record, taken in the light most favorable to Plaintiff, the non-moving party, could support a finding that Plaintiff was not subject to the executive exemption.
“Barreto claims that although his title was that of “manager” and he admittedly performed some managerial-type tasks, his deposition testimony, considered in the light most favorable to him, creates a genuine dispute as to whether management was his primary duty. We agree. The parties agree that Barreto performed the managerial tasks of ordering produce, pricing produce, and scheduling and directing produce department employees; however, it is also undisputed that Barreto spent more than 50% of his time performing tasks identical to those performed by the hourly, non-exempt employees. Indeed, Barreto testified that, due to management’s under-staffing of the department, he was required to perform non-exempt work for such a large percentage of his time that he had no time to fulfill some of the managerial responsibilities he had been nominally given, i.e., to supervise other employees and to purchase the least expensive produce. He also testified that the four other non-exempt employees did not require his supervision, as they already “knew what the job was.” This evidence suggests that Barreto’s non-management responsibilities were more important to the operation of the store than his few managerial duties. Cf. Diaz v. Team Oney, Inc., 291 Fed. Appx. 947 (11th Cir.2008) (rejecting plaintiff’s claim that management was not his “prime responsibility” where the record was clear that “his managerial duties-as the highest ranking employee on duty during the majority of his shifts, in which he supervised the drivers, counterpersons, and cooks, apportioned work, made deposits, filled out required forms, interviewed prospective employees, and engaged in local restaurant marketing-were significantly more important to the operation of the restaurant than his non-managerial tasks”).
Barreto also presented evidence that his discretion in performing his managerial tasks was limited and his work was subject to supervision. Specifically, Barreto testified that he was required to order the cheapest produce available from a list of vendors pre-selected by management, to fix the pricing of the produce by increasing the wholesale prices according to a set scale given to him by management, and to order produce only as needed to restock preexisting supplies. He testified that he was told at the managers’ meeting how many employees he needed to schedule for each shift and how many hours the employees would work. Barreto also testified that when he asked management to hire one or two more employees for his understaffed department, management denied his request and instructed him to cut the hours of the remaining hourly employees from 40 to 30 hours per week. This testimony, considered in the light most favorable to Barreto, contradicts Dhawan’s conclusory affidavit statements that Barreto was given “wide latitude” in managing his department and that he was responsible for using “his judgment” to accomplish certain business goals. As such, Barreto’s testimony creates a genuine issue of fact regarding the extent of Barreto’s discretionary powers and relative freedom from direct supervision while performing his identified managerial tasks, i.e., ordering produce, setting prices, and setting the work schedule for non-exempt employees.
In summary, Barreto’s sworn testimony suggests that Barreto spent the majority of his time performing non-management duties; the management duties he did perform were less important to his position than the other types of duties he performed; and Barreto infrequently exercised his discretion and was subject to direct supervision. Accordingly, even though the evidence suggests that Barreto’s wages were significantly greater than the wages paid to the non-exempt employees in the produce department, we conclude that a reasonable factfinder could find that Barreto’s managerial tasks did not constitute his “primary duties” under the balancing test set forth in the Regulations. See Morgan, 551 F.3d at 1280-81 (holding that store managers were not exempt executives where evidence showed that they “spent most of their time performing manual, not managerial, tasks, that corporate manuals micro-managed store managers’ performance of those tasks, that the 380 district managers closely supervised their store managers, and that store managers had little discretion or freedom from supervision”).
Based solely on Barreto’s deposition, the district court also found that the evidence established that Barreto “customarily and regularly directed the work of two or more employees” and that his recommendations in hiring, firing or the advancement of employees were given “particular weight.” Accordingly, the court found Davie Marketplace met the third and fourth prongs of the executive exemption test as a matter of law. Specifically, the district court noted that Barreto admitted that “he told employees who worked in the produce department their schedules and place[d] them on either the morning shift or afternoon shift,” that “he would assign jobs to the employees to take merchandise outside, and had them rotate bad produce and refill missing produce,” and that “none of [the other employees] were experienced.” The district court also noted that Barreto admitted that he had recommended that an employee be terminated for eating “very expensive fruit” and that the employee had subsequently been fired. Furthermore, although Barreto made no recommendations regarding hiring or advancement of employees, the district court found that “it is unlikely that evaluations and recommendations of advancement of employees would be made” in the five months Barreto worked for Davie Marketplace. Therefore, although Dhawan’s affidavit did not comment upon Barreto’s authority to direct other employees or upon the weight given to his hiring or firing recommendations, the district court found that Barreto’s deposition testimony alone established that the third and fourth prongs of the executive exemption had been met as a matter of law.
We conclude, however, that Barreto’s deposition testimony, when read in its entirety, does not support the district court’s conclusion. First, regarding the third prong, the Regulations define “two or more other employees” as either two full-time workers or their equivalent. 29 C.F.R. § 541.104(a). As to equivalency, “[o]ne full-time and two half-time employees, for example, are equivalent to two full-time employees. Four half-time employees are also equivalent.” Id.; Morgan, 551 F.3d at 1274. In his deposition, Barreto testified that the produce department consisted of five employees, including himself, during his first week of employment, but that after the first week, “two of them were reduced” and that ultimately, there were “three less” employees in the department. Barreto also testified that after the first week, there were “three [employees in the produce department] in the morning and one in the afternoon.” Considering this testimony in the light most favorable to Barreto, after his first week on the job, Barreto supervised two half-time employees in the morning and was by himself in the department in the afternoon. Davie Marketplace offers no evidence refuting this testimony. Accordingly, we conclude that Davie Marketplace has not satisfied its burden of proving that Barreto regularly directed the work of two or more full-time employees.
Regarding the fourth prong, we disagree that evidence of one employment recommendation that was followed is sufficient to establish as a matter of law that Barreto’s recommendations regarding hiring and firing were given a “particular weight.” The Regulations explain that “[t]o determine whether an employee’s suggestions and recommendations are given ‘particular weight,’ factors to be considered include, but are not limited to, whether it is part of the employee’s job duties to make such suggestions and recommendations; the frequency with which such suggestions and recommendations are made or requested; and the frequency with which the employee’s suggestions and recommendations are relied upon.” 29 C.F.R. § 541.105. Here, Barreto’s testimony established that, in one instance, his recommendation to fire an employee for a serious infraction-stealing-was followed; however, his testimony also showed that in another instance, he recommended hiring additional employees and this advice was not heeded. Indeed, after he recommended that additional employees be hired, Barreto was directed instead to cut the hours of his remaining employees. Furthermore, Barreto stated that he did not evaluate the employees in his department and it is uncontested that he did not interview candidates or make any decisions regarding the hiring or advancement of other employees. As such, the evidence in the record creates a genuine issue of fact as to whether Barreto’s employment recommendations were given “particular weight.”
Viewing the evidence in the light most favorable to Barreto, there are questions of fact as to whether his “primary duty” consisted of management, whether he regularly directed the work of two or more full-time employees, and whether his recommendations in hiring, firing, or advancement of employees were given particular weight. Summary judgment based on the executive exemption is appropriate only where the four prongs of the “executive exemption” test are met as a matter of law; it is not the appropriate disposition where, as here, there remain issues of fact regarding three of the four elements. Accordingly, we vacate the entry of summary judgment and remand this matter to the district court.”
15 Senators Urge Fair Wages For Home Care Workers
According to a press release, Senator Tom Harkin and 14 other U.S. senators have sent a letter to the DOL urging the Secretary of Labor, Hilda Solis, to “use its broad authority to interpret the Fair Labor Standards Act (FLSA) to extend wage and hour laws to home health care workers.
Though most domestic workers are covered under FLSA, an exemption to that law has been interpreted by the DOL to exclude home care workers. Today marks the two-year anniversary of a Supreme Court ruling that upheld the Department’s interpretation, making clear that the Department has broad authority to interpret FLSA.
In the three decades since the exemption was created, the numbers of home care workers and their responsibilities have expanded dramatically as the population has aged and more and more people are choosing long-term care services in their homes rather than in institutions. Home care, increasingly, has become not casual work performed by a friend or family member but a full-time regular type of employment,” wrote the lawmakers. “It is critical that these professional workers, who provide essential services to our nation’s elderly and disabled, have the same right to minimum wage and overtime pay as enjoyed by other workers.”
To read the full text of the letter from the senators, go to IOWAPOLITICS.com.
Overtime Law Blog 