Best Ohio Overtime Attorney Answer: What are the requirements for a manager to be exempt from overtime? What job duties are considered managerial? Should I get overtime if I am a manager who spends most of their time doing non-managerial work?
Our wage and hour attorneys are often asked by managers whether they are entitled to overtime pay. This situation often comes up when companies and employers attempt to simply slap the title manager on an employee in order to avoid paying overtime. Many unaware employees like the title and are simply unaware that they may still be entitled to overtime even with the fancy new title. While our overtime law lawyers have blogged on this subject before, the misclassification of employees who should receive overtime pay at time and a half is so common and widespread that it is worth talking about again. (See Should I Be Paid Overtime Even If I’m A Manger?; Are All Professionals Exempt From Overtime?; Am I Entitled To Overtime If I’m A Manager In Name Only?; and Overtime Attorney Top Answer: I’m A Manager. Can I Get Paid For Overtime Hours?).
A recent decision out of the United States District Court for the District of Colorado, Jimenez v. Denver Restaurant Venture, LLC, provides a great analysis of the executive exemption to the Fair Labor Standards Act (“FLSA“), which is the exemption employers most typically try to lump all management employees into. The employee in Jimenez was one of three Kitchen Managers, who did not receive overtime pay at time and a half for any hours he worked over 40 in a given week. Instead, the plaintiff was paid a salary of $52,000 a year.
As the court explained, the FLSA requires employers to demonstrate several factors to establish that an employee is exempt from overtime. Under the executive exemption, the employer must demonstrate that the employee (1) was paid a salary of at least $455.00 a week, (2) that the employee’s primary duty is management of the enterprise, (3) the employee customarily and regularly directs the work of two or more other employees, and (4) the employee has the authority to hire or fire other employees or their suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees are given particular weight. An employer cannot meet its burden just by demonstrating some of the prongs – it must demonstrate all of them.
In this overtime wage theft case, it was undisputed that the employees had been paid the $455.00 per week salary required by the exemption. However, the employees and the employer did not agree on any other facts.
The employer filed for summary judgment (a motion that asks the court to dismiss the lawsuit as a matter of law before it can be heard be a jury) only about two months after the case was filed – and thus, before any significant discovery could occur. As a basis for their motion, the employer argued that the employees fell “squarely” within the executive exemption. Interestingly, the employer supported their motion primarily with affidavits, rather than supporting payroll documents. As a result, the employer’s motion devolved into a he-said-she-said, with both sides providing contradicting sworn testimony regarding the employees’ duties. As a result, the court’s analysis as to each prong simply looked to the competing assertions of fact, and conclude that genuine issues of material fact existed.
The most significant dispute between the parties seemed to be over just what the employees did for the employer, and how much of their time was spent doing it. As the court explained, the FLSA contains an exhaustive list of what constitutes “managerial duties”:
the regulations classify the following activities as managerial:
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.
Yet, neither the employee or the employer could agree that plaintiff did any of these job duties:
Here, Defendants contend that H. Jimenez’s primary duty was management of Defendants’ kitchen and kitchen staff after being promoted to Kitchen Manager. Defendants explain that H. Jimenez’s managerial duties were significantly more important than his non-exempt duties. For instance, Defendants assert that while H. Jimenez spent the majority of his time engaged in management duties, the few hours a day that he spent cooking were also spent training new employees and supervising other kitchen staff. Defendants further assert that the majority of H. Jimenez’s time was spent on his duties as Kitchen Manager and that he was given the freedom and autonomy to manage the kitchen and kitchen staff. Defendants explain that H. Jimenez spent approximately 25 percent of his time cooking and training new cooks. Defendants state that the rest of H. Jimenez’s time was spent managing the kitchen and kitchen staff by scheduling, supervising and directing employees, planning and dividing work among employees, ordering food and products, training employees, interviewing and hiring new employees, and ordering food and equipment.
Defendants also contend that H. Jimenez was given complete freedom to staff, manage, and oversee the kitchen and kitchen staff, with the exception of requests to control labor and food costs. Defendants state that higher level management did not interfere with H. Jimenez’s management. Defendants also state that H. Jimenez was entrusted with the responsibility to decide and control orders, receive deliveries, and act as the decision-maker regarding products and services offered by U.S. Foods. Finally, Defendants contend that H. Jimenez’s salary and bonuses were significantly higher than the non-exempt employees that he supervised and managed.
In response, Plaintiffs assert that H. Jimenez’s primary duty was to cook and that he was not engaged in management of the kitchen. Plaintiffs explain that as a cook H. Jimenez would prepare and cook food, and clean the kitchen. Specifically, H. Jimenez states in his Second Affidavit that he spent 95 percent of his work hours cooking food, preparing food for later orders, putting food on plates, cleaning the kitchen, and washing dishes on occasion. He further states that the other five percent of his work was spent doing U.S. Foods orders when Mr. Anderson was Kitchen Manager. H. Jimenez explains that he was assigned the task of ordering from U.S. Foods during a three month period when there was no Kitchen Manager after Mr. Castillo left toward the end of 2012. H. Jimenez then explains that he retained this assignment when Mr. Anderson became Kitchen Manager until May 5, 2014. H. Jimenez states that he and Mr. Anderson would alternate ordering. When H. Jimenez did the ordering, H. Jimenez states that Mr. Terrones, Diego’s General Manager, would check the orders and often identify corrections. While Raymundo Tehuitzil was Kitchen Manager, between May 5, 2014 and October of 2014, H. Jimenez states that he did not do U.S. Food orders and spent 100 percent of his time cooking and cleaning.
H. Jimenez further states in his Second Affidavit that the Kitchen Manager would apportion work among employees and that the more experienced employees were asked to assist in training new employees. H. Jimenez contends that because he spent so much time in the kitchen, Kitchen Managers would sometimes ask him which employee was best at certain kitchen tasks. H. Jimenez states that the Kitchen Manager would then assign employees to various posts. Additionally, H. Jimenez states that he was only assigned to interview prospective employees when Mr. Anderson was Kitchen Manager because Mr. Anderson did not speak Spanish. Otherwise, H. Jimenez asserts that Mr. Tehuitzil and Mr. Anderson conducted interviews. H. Jimenez also asserts that he had nothing to do with setting or adjusting the hours or pay rates of employees; did not maintain production or sales records for use in supervision or control, did not plan the work that needed to be done; did not monitor or implement legal compliance measures, or provide safety and security for employees on the property; and did not have the authority discipline employees. Finally, Plaintiffs contend that H. Jimenez’s wages were commensurate with the wages of other non-exempt employees.
Lacking any evidence other than the competing testimony of the employees and the employers, the court concluded that genuine issues of fact existed, and that summary judgment was inappropriate.
The he-said-she said dispute continued through the remaining elements, with the court again concluding that mere contradictory testimony was not enough to entitle the employer to summary judgment:
Defendants assert that H. Jimenez customarily and regularly managed and directed the work of 12 to 14 employees. Defendants explain that the affidavits of five employees that worked with or were supervised by H. Jimenez attest to the fact that H. Jimenez managed and directed their work. These employees explain that H. Jimenez set their schedules, assigned them tasks, provided them training, and supervised their work on a daily basis. In response, Plaintiffs state that H. Jimenez only supervised one other cook and a dishwasher in isolated instances. Plaintiffs further state that H. Jimenez did not set employee work schedules, assign work to employees, or determine the techniques used in the kitchen. Specifically, H. Jimenez states in his Second Affidavit that he had nothing to do with setting or adjusting the hours of employees, did not assign tasks or apportion work, and assisted with training when asked by the Kitchen Manager. H. Jimenez also states that he occasionally supervised one other cook and a dishwasher, but only when Mr. Anderson left early. H. Jimenez further states that he did not supervise anyone when Mr. Tehuitzil was Kitchen Manager because Mr. Tehuitzil did not leave before he did. …
Defendants assert that H. Jimenez, as Kitchen Manager, was given full authority to hire, fire, and set salaries of the kitchen staff. Mr. Terrones states that all hiring and firing of kitchen staff was performed by the Kitchen Managers, including H. Jimenez. Moreover, Defendants assert that employees Juan Castillo, Hugo Armendariz, Maria Sanchez, and Sally Pineda all state that they were interviewed and hired by H. Jimenez while he was employed as Kitchen Manager.
In response, Plaintiffs assert that H. Jimenez did not hire new kitchen employees or set employee wage rates. Plaintiffs also assert that H. Jimenez did not have or exercise the authority to discipline employees. Specifically, J. Jimenez states in his Second Affidavit that he only interviewed and translated for Spanish speaking prospective kitchen employees because Kitchen Manager William Anderson did not speak Spanish. Otherwise, H. Jimenez asserts that Mr. Tehuitzil and Mr. Anderson conducted interviews. H. Jimenez further states that he had nothing to do with setting or adjusting pay rates of employees. Moreover, according to Raymundo Tehuitzil, H. Jimenez did not have anything to do with hiring while Mr. Tehuitzil was employed as Kitchen Manager between May 5, 2014 and October 30, 2014. …
Having determined that genuine issues of material fact exist as aforementioned, I find it appropriate to deny Defendants’ Motion for Summary Judgment.
The takeaway here is twofold. First, it is more difficult for an employee to qualify as exempt under the executive exemption than many employees realize. Just being paid a salary is not enough, and even being able to hire and fire is not dispositive. If a manager or asupervisor spends a significant amount of time on non-managerial task, they are likely to be non-exempt under the FLSA. Secondly, it is a bad idea to file for summary judgment with nothing but affidavits. All the employees have to do is produce an affidavit contradicting your facts, and you lose.
If you believe that your employer is not paying you all of your wages for all of your lawfully earned overtime compensation at a rate of one and half times your normal wages as requires under the Federal Fair Labor Standards Act or Ohio Minimum Fair Wage Standards laws or you are an nonexempt employee that has been misclassified as exempt or independent contractor, contact the attorneys at The Spitz Law Firm today for a free and confidential initial consultation. The wage and hour lawyers at The Spitz Law Firm will provide you with the best options for your overtime pay dispute situation. If you even think that you may be entitled to overtime pay that you are not being paid, call 866-797-6040.
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