Shabazz v. Burlington Coat Factory Warehouse Corp., et al
Am I entitled to overtime if I’m a manager?
In Shabazz v. Burlington Coat Factory Warehouse Corp., et al., the plaintiff began work for the defendants in 1992 and worked in various positions, culminating in the role entitled “Customer Service Logistics Manager.” In November 2011, the employer terminated Ms. Shabazz for insubordination, and in February 2012, she filed suit against the defendants based upon her assertion that she was denied payment for overtime for hours she worked in excess of 40 each week. After conducting discovery, the defendants moved for summary judgment. The main issue presented in this case was whether the plaintiff’s primary duty was management, rendering her an exempt executive employee pursuant to the Fair Labor Standards Act.
In a review of the employee’s duties, the Court relied almost exclusively upon the plaintiff’s deposition testimony. Therein, the plaintiff testified that she supervised receiving, front-end and accounting, assisted the store manager in hiring, coaching and teaching, counseled and disciplined employees, assisted the store manager with scheduling and issued directives to employees reporting to her. The plaintiff had 18-19 direct reports, including the receiving supervisor and associates, cashiers, customer service supervisor and, until the position’s elimination, the customer service manager. Although the store manager was responsible for final hiring decisions, Ms. Shabazz made hiring recommendations and testified that she could not recall any occasion in which her recommendations were not followed. She likewise made promotion recommendations on three occasions, and these recommendations were also followed.
Ms. Shabazz also testified that she monitored payroll and made sure the store stayed within budget by reporting to the store manager, and in the store manager’s absence, she would make recommendations involving cutting employees’ hours in an effort to curtail costs. Furthermore, the plaintiff edited timesheets, a job that hourly employees were forbidden from performing, as well as completed workers’ compensation reports. She likewise was privy to confidential information, such as rates of pay. Notably, the plaintiff also conveyed through her testimony that she performed managerial and non-managerial (i.e. working at a cash register and unloading freight) tasks at the same time.
In moving for summary judgment, the employers claimed that based upon the enumerated tasks, the plaintiff’s performance of management activities was her primary duty. The defendants likewise stated that she worked with relatively little supervision and exercised discretion, she earned significantly more than hourly employees, that she made hiring/firing/promotion recommendations that were given particular weight, and that she trained and monitored payroll and budget data.
In response, the plaintiff contended that management was not her primary duty. Instead, she asserted that she likewise performed the work of hourly associates, including operating the cash register and unloading freight. Furthermore, the plaintiff stressed that this nonexempt work comprised more than 50% of her time. Finally, she argued that she exercised little discretion in completing her tasks.
In an opinion by Judge Forrester, the Court cited the Regulations promulgated by the Department of Labor that define the executive exemption, which requires that the employee be
(1) compensated on a salary basis at a rate of not less than $455 per week;
(2) whose primary duty is management of the enterprise in which the employee is employed or of a customarily recognized department or subdivision thereof;
(3) who customarily and regularly directs the work of two or more other employees; and
(4) who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees are given particular weight.
29 C.F.R. § 541.100(a).
Focusing upon the “primary duty” requirement, the Court reviewed the factors in the Regulations applicable to this inquiry, including an analysis of the relative importance of the exempt duties as compared with other types of duties; the amount of time spent performing exempt work; the employee’s relative freedom from direct supervision; and the relationship between the employee’s salary and the wages paid to other employees for the kind of nonexempt work performed by the employee.
29 C.F.R. § 541.700(a).
In response to the plaintiff’s contention that more than half of her time was spent on nonexempt labor, the Court indicated that although time spent on exempt work is a useful guide in the primary duty analysis, it is not the sole test. Indeed, the Court found that it is the work performed of “principal value” to the employer that is the “primary duty,” not collateral activities, even where these collateral tasks take more than half of the employee’s time. Although the plaintiff had testified that she performed nonexempt activities, she likewise indicated in her deposition that she still had managerial responsibility while completing nonexempt tasks.
Accordingly, the Court stated that the plaintiff “concurrently” performed both types of activities, and concurrent completion of exempt and nonexempt work does not preclude application of the exemption. Indeed, the Court found that this case differed significantly from instances in which employees deemed “managers” spent the majority of the time performing manual tasks that were essential to the business, had no discretion and who were forced to perform nonexempt work to keep the business running. By contrast, the Court found that the plaintiff’s management duties were necessary to the store’s operation and were far more significant to the employer than her nonexempt tasks, rendering management her “primary duty.”
Having found all the elements of the executive exemption fulfilled, the Court granted the defendants’ motion for summary judgment. The disposition resulted in dismissal of the plaintiff’s case.
Author: Tanya McAdams, Esq.