Case about unpaid overtime to salaried employee who was performing manual work, executive exemption

Case about unpaid overtime to salaried employee who was performing manual work, executive exemption

SalEmployeearied employee working at a company that provides care for the elderly and sick worked in excess of 40 hours in a week and did not get paid overtime. Employer alleges the executive exemption under the Fair Labor Standards Act (FLSA). However, the employee worked a majority of her time doing manual work such as cooking and cleaning. Additionally, the method of calculation, such as time and a half versus half time is discussed in the brief below which gives the background of the case.

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION

TAMARA FLETCHER,

PLAINTIFF,

v. CASE NO.: 6:08-cv-01524-MSS-GJK

FRIENDS @ HOME, INC.,
CAROL MCKEE, individually, and
JOANN FARLEY, individually

DEFENDANTS.
______________________________/

PLAINTIFF’S MEMORANDUM OF LAW IN OPPOSITION TO
DEFENDANTS’ FULLY DISPOSITIVE MOTION FOR SUMMARY JUDGMENT
AND IN THE ALTERNATIVE, MOTION FOR PARTIAL SUMMARY JUDGMENT

Plaintiff, TAMARA FLETCHER, by and through her undersigned counsel and pursuant to Rule 56(c), Federal Rules of Civil Procedure, file this Memorandum of Law in Opposition to Defendants’ Fully Dispositive Motion for Summary Judgment and in the Alternative, Motion for Partial Summary Judgment, and states the following:
1. On or about November 10, 2009, Defendants, Friends@Home, Inc., Carol McKee, and JoAnn Farley, filed their fully dispositive Motion for Summary Judgment and in the Alternative, Motion for Partial Summary Judgment and Incorporated Memorandum of Law.
2. Defendants base their Motion for Summary Judgment upon the assertion that Plaintiff’s position qualifies herself as “exempt” under the executive employee exemption. Further, Defendants state that, in the alternative should their Motion for Summary Judgment fail, partial summary judgment is proper in order to establish the fluctuating workweek method of computation as the proper method to determine Plaintiff’s overtime damages.
3. Defendants’ Motion for Summary Judgment as it pertains to Plaintiff being considered as “exempt” under the executive employee exemption must fail simply because the Defendants’ cannot carry their burden of proving that Plaintiff’s primary duties were management and, in fact, not manual labor (i.e. cleaning, shopping, etc.).
4. Moreover, Defendants assertion that the fluctuating workweek method of computation in this case is misplaced. For misclassification cases, such as the instant case before this Court, it is well-established law that the fluctuating workweek method of computation cannot be used to calculate retroactive overtime pay for the purposes of determining damages under the FSLA in misclassification cases.

I. MEMORANDUM IN OPPOSITION OF FINAL SUMMARY JUDGMENT
Defendants have asked this Court to grant final summary judgment with respect to Plaintiff’s claims for overtime compensation based upon their assertion that Plaintiff can be classified as “exempt” under the executive employee exemption, as regulated by 29 C.F.R. § 54.100(a). However, Defendants’ Motion must be denied as Defendants have not satisfied their burden of proving that Plaintiff’s primary duty was management and not manual labor, as the evidence on record shows.
In order for Defendants’ Motion to prevail, the employer must establish that the employee meets every aspect of the definition for an exempt employee. Corning Glass Works v. Brennan, 417 U.S. 188, 196-97 (1974) (emphasis added). Moreover, in order to preserve the remedial nature of the FLSA, exemptions from FSLA must be narrowly construed against the employer who asserts it. Arnold v. Ben Kanowsky, Inc, 361 U.S. 388, 392 (1960). Current Eleventh Circuit case law points out that the employer asserting an exemption has the burden of proving that the employee falls “plainly and unmistakably within the terms and spirit” of the exemption. Nicholson v. World Business Network, Inc., 105 F. 3d 1361, 1364 (11th Cir. 1997) (quoting A.H. Phillips, Inc., v. Walling, 324 U.S. 490, 493 (1945)). As a result, where an employer cannot establish each element, the entire exemption defense necessarily fails, as a matter of law. See Nicholson, 105 F. 3d at 1364.
Defendants are required, under the applicable regulation, to prove that the following four (4) elements have been met when asserting the executive exemption: (1) the employee must be compensated on a salary basis, at a specified minimum or higher; (2) the employee’s “primary duty” must be “management of the enterprise in which the employee is employed or of a customarily recognized department or subdivision thereof;” (3) the employee “customarily and regularly directs the work of two or more other employees”; (4) the employee “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). Due to the fact that Plaintiff’s duties do not meet the second element of this test, the exemption must fail, as the argument below sets forth. Therefore, Defendants’ Motion for Final Summary Judgment must be denied, as Plaintiff is entitled to overtime compensation as a matter of law.

A. Plaintiff’s Primary Duty was not Management
The evidence on record shows that Plaintiff’s “primary duty” was manual labor, which included cleaning, doing laundry, cooking, and personal shopping for facility and residents. (Dkt. #18-2; Fletcher, 39:16-20). “The term ‘primary duty’ has been defined as the principle, main, major or most important duty that the employee performs.” 29 C. F. R. § 541.700. It also follows as a general rule that an “employee whose primary duty is ordinary production work or routine, recurrent or repetitive tasks cannot qualify for exemption as an executive.” 29 C. F. R. § 541.106(a); Morgan v. Family Dollar Stores, 2008 U.S. App. LEXIS 25187 at *104-105 (11th Cir. Dec. 16, 2008); Rodriguez v. Farm Stores Grocery, Inc., 518 F. 3d 1259, 1262 (11th Cir. 2008).
Further, the applicable regulations have warranted that, “a job title alone is not sufficient to establish the exempt status of an employee.” 29 C. F. R. § 541.2. Thus, Plaintiff’s “Administrator” job title is not controlling in any way. Instead, the status of any exemption “must be determined on the basis of whether the employee’s duties meet the requirements of the regulations.” Id.; Family Dollar Stores at *139.
Despite having the job title of “Administrator,” Plaintiff’s job duties were a far cry from a person holding a management position within an assisted living facility. Plaintiff would do a lot of cleaning (Dkt. #18-2; Fletcher, 41:2-3). More specifically, Plaintiff would spend her time dusting, cleaning the kitchen, and cleaning out the refrigerators (Dkt. #18-2; Fletcher, 41:5-6). The Friends@Home, Inc., facility had two refrigerators, as well as a freezer in the garage (Dkt. #18-2; Fletcher, 41: 6-7). Plaintiff would also cook meals (Dkt. #18-2; Fletcher, 75: 4-9). Plaintiff cleaned and helped to take care of the patients, since the facility had no one to come in and clean (Dkt. #18-2; Fletcher, 41:10-11).
Defendants seem to ignore Plaintiff’s own testimony that she spent “about 80 to 90 percent” of her working time cleaning, cooking, and completing other manual labor (Dkt. #18-2; Fletcher, 89:1-3). Moreover, other individuals surrounding the case proffer that same observation. Even the family of residents at the Friends@Home, Inc., facility personally witnessed Plaintiff doing laundry, cooking, washing dishes, running the vacuum, cleaning bathrooms, and other manual labor not associated with a management role (Dkt. #18-14; Farley, Exhibit 1, Statement of LaCourt). Plaintiff also took patients’ vitals and assisted them with personal hygiene care (i.e. showers and using the restroom) (Dkt. #18-14; Farley, Exhibit 1, Statement of LaCourt). Furthermore, caregivers working at the facility noticed that Plaintiff would consistently work 60-70 hours per week (Dkt. #18-15; Jordan-Wyms Affi. # 5). Plaintiff would work side-by-side with the caregivers most of the time (Dkt. #18-15: Jordan-Wyms Affi. # 7).
Contrary to Defendants’ assertions that it was not necessary for Plaintiff to work more than forty (40) hours performing the manual labor she performed, Defendants cannot provide any evidence to contradict that Plaintiff was working overtime in a non-exempt capacity. In her deposition, Friends@Home, Inc., co-owner JoAnn Farley, admitted that she did not know how many hours Plaintiff was working per week (Dkt. #18-13; Farley, 23: 9-13), nor could she dispute Plaintiff completing manual work because she (Farley) “wasn’t there” (Dkt. #18-13; Farley, 40: 5-8).
A “working supervisor whose primary duty is performing nonexempt work on the production line..does not become exempt merely because the nonexempt production line employee occasionally has some responsibility for directing the work of other nonexempt production line employees when, for example, the exempt supervisor is unavailable.” Dalheim v. KDFW-TV, 918 F. 2d 1220 (5th Cir. 1990); 29 C. F. R. § 541.106(c). In the instant action, the true exempt supervisors at the Friends@Home, Inc., facility were the co-owners, Ms. JoAnn Farley and Ms. Carol McKee, who continued to get paid and provide services to the facility (Dkt. #18-13; Farley, 8:12-17) (Dkt. #18-2; Fletcher, 89:15-19). It is simply unbelievable that a facility employing between eight (8) and ten (10) employees would use three (3) exempt supervisors. The fact is that Plaintiff was employed to work side by side with the caregivers and was engaged, the majority of her time, to manual work.
Indeed, by engaging in the manual labor activities as she did, Plaintiff’s primary duty was not management, but rather cleaning and patient care much on the same level with the staff caregivers at the facility. Moreover, Plaintiff solidifies this point further by testifying that she spent 80 to 90 percent of her time completing manual labor activities, because what little administrative paperwork she had been assigned “did not take that long” (Dkt. #18-2; Fletcher, 89:1-3).
Typically, a “good rule of thumb” in determining the exempt status of employee is that “employees who spend more than 50 percent of their time performing exempt work will generally satisfy the primary duty requirement.” This rule is based upon the fact that what employee is doing most of the time is in fact his or her primary duty.
Taking this rule into account, it is clear that Plaintiff’s “primary duty” was manual cleaning activities, and not management. Plaintiff worked underneath both of the facility’s co-owners, Ms. Farley and Ms. McKee. Clearly, cleaning and other manual labor activities along those lines are not management activity under 29 C. F. R. § 541.102.
Thus, under the 50% rule of thumb test and for the afore-stated reasons, Plaintiff’s primary duties are not exempt management activities, and Defendants cannot prove this element of the exemption set forth by the standard of review. Therefore, Defendants’ entire Motion for Summary Judgment must fail, as Plaintiff has been proven to be a misclassified employee as it relates to her non-exemption status.

II. MEMORANDUM IN OPPOSITION OF PARTIAL SUMMARY JUDGMENT
REGARDING COMPUTATION OF OVERTIME

Being that Plaintiff must be found as non-exempt in relation to her FLSA overtime claim, Defendants’ assertion that partial summary judgment is proper regarding the computation of overtime damages is also misguided. Defendants allege that the proper method for computing retroactive overtime damages to an employee who has been misclassified as exempt is the fluctuating workweek method. However, based upon a proper analysis of the current case law, which follows here, the fluctuating workweek method cannot be used to calculate Plaintiff’s retroactive overtime pay in a misclassification case such as this instant action before the Court.
Defendants’ counsel is correct is citing the basic framework for the fluctuating workweek method as 29 C.F.R. § 778.114(a). However, Defendants’ Motion for Summary Judgment makes no mention of 29 C.F.R. § 778.114(c), which effectively outlines the “legal prerequisites”, needed to be satisfied by the employer. If such prerequisites have not been met, the fluctuating workweek method cannot be applied, per the rule.
Section 29 C.F.R. § 778.114(c) provides,
“The “fluctuating workweek’’ method of overtime payment may not
be used unless the salary is sufficiently large to assure that no
workweek will be worked in which the employee’s average hourly earnings
from the salary fall below the minimum hourly wage rate applicable under
the Act, and unless the employee clearly understands that the salary
covers whatever hours the job may demand in a particular workweek and
the employer pays the salary even though the workweek is one in which a
full schedule of hours is not worked. Typically, such salaries are paid
to employees who do not customarily work a regular schedule of hours and
are in amounts agreed on by the parties as adequate straight-time
compensation for long workweeks as well as short ones, under the
circumstances of the employment as a whole. Where all the legal
prerequisites for use of the “fluctuating workweek’’ method of overtime
payment are present, the Act, in requiring that “not less than’’ the
prescribed premium of 50 percent for overtime hours worked be paid, does
not prohibit paying more. On the other hand, where all the facts
indicate that an employee is being paid for his overtime hours at a rate
no greater than that which he receives for non-overtime hours, compliance
with the Act cannot be rested on any application of the fluctuating
workweek overtime formula.”

Thus, according to the rule, in order for the fluctuating workweek method to be the prevailing method of computation, two (2) requirements must be met. One requirement is a “clear mutual understanding of the parties that the fixed salary is compensation (apart from overtime premiums) for the hours worked each workweek, whatever their number, rather than for working 40 hours or some other fixed weekly work period.” 29 C.F. R. § 778.114(a). The second requirement involves the contemporaneous provision of overtime pay. 29 C.F. R. § 778.114(c) (“Where all the facts indicate that an employee is being paid for his overtime hours at a rate no greater than that which he receives for non-overtime hours, compliance with the Act cannot be rested on any application of the fluctuating workweek overtime formula.”).
In their Motion, Defendants proffer numerous cases under the law of the Eleventh Circuit, which state that the fluctuating workweek method of computation is appropriate when there has been a misclassification and it has been established that the employee understood he/she would be paid the same amount each week regardless of hours worked apart from overtime premiums. Yet, Defendants do not, and cannot, offer any evidence on record that Plaintiff ever had a clear understanding of such an arrangement. When an employee has been classified as exempt in terms of being paid overtime by his or her employer, neither the “clear mutual understanding” between parties exists, nor is there a contemporaneous payment of overtime made. Therefore, when an employee has been classified as exempt in error, such as Plaintiff has in this instant action, and illegally not paid his or her overtime hours due, neither one of the legal prerequisites outlined in 29 C.F.R. § 778.114(a) & (c) has been met and the fluctuating workweek method of computation is improper.
Foremost, it is clear that in a misclassification case such as the instant case before this Court, the “clear mutual understanding” prerequisite cannot be reached. If this conclusion were not the case, the argument would essentially boil down to an employer arguing that misclassified employees have implicitly agreed to not receive their FLSA entitlement to overtime pay when they state that an understanding exists between employer and employees who will be paid a flat weekly rate for fluctuating hours, including those over forty (40) hours and not be paid overtime. That argument would be based upon illegal principles. Employees cannot agree to waive their right to overtime pay. Barrentine v. Arkansas- Best Freight Systems, Inc., 450 U.S. 728, 739-740 (1981).
Moreover, in FLSA misclassification cases, overtime was not provided contemporaneously. Therefore this second branch of the two-pronged legal prerequisite under 29 C.F. R. § 778.114(a) & (c) cannot be reached. Once an employer has been found to be in violation of 29 U.S.C. § 207(a), they cannot reach this requirement simply by claiming that they had intended to, in fact, pay the overtime monies due to the employee. A similarly-stated argument was rejected by the Supreme Court in its analysis of the case, Overnight Motor Transportation Company v. Missel, 316 U.S. 572, 581 (1942) (rejecting the employer’s attempt to use the fluctuating workweek method of computation where there was “no provision for additional pay in the event the hours worked required minimum compensation greater than the fixed wage”).
After a thorough review of the current case law, it appears that other district courts have also held that the fluctuating workweek method is not appropriate in FLSA misclassification cases. Specifically, in Rainey v. American Forest & Paper Association, the Court thoroughly examined the provision of 29 C.F.R. § 778.114 and found that its requirements do in fact call for a “clear mutual understanding” that the employee is entitled to overtime compensation and a contemporaneous payment of overtime premiums to the employee. 26 F. Supp. 2d 82, 99-102 (D.D.C. 1998); see also Hunter v. Sprint Corporation, 453 F. Supp. 2d 44, 58-62 (D.D.C 2006) (discusses the fluctuating workweek method and its application to a misclassification case). Additionally other district courts have rejected the fluctuating workweek method of computation in relation to its applicability to misclassification cases due to the fact that each lacked a contemporaneous payment of overtime compensation. See e.g., Cowan v. Treetop Enterprises, 163 F. Supp. 2d 930, 941 (M.D. Tenn. 2001) (citing Rainey); Scott v. OTS Inc., 2006 WL 870369, *12 (N.D. Ga.) (citing Rainey).
Therefore, utilizing the afore-stated line of reasoning, Defendants’ alternative motion for partial summary judgment with regard to the computation of Plaintiff’s overtime damages, must be denied. The traditional award of overtime damages at a rate not less than one and one-half times Plaintiff’s regular rate.

III. CONCLUSION
WHEREFORE, Plaintiff respectfully requests that this Court reject Defendants’ assertion that Plaintiff is exempt from receiving overtime as an executive employee and deny Defendants’ Motion for Summary Judgment. Further, it is also respectfully requested that Defendants’ Motion for Partial Summary Judgment with respect to the fluctuating workweek method of computation for Plaintiff’s overtime damages also be rejected.

Respectfully submitted,
_________________________
Maurice Arcadier, Esquire
Attorney for Plaintiff

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that the original of the foregoing was filed with the Court by using the CM/ECF system, which will send a Notice of Electronic Filing to Counsel for Defendants, on this _____ day of December, 2009.

ARCADIER & ASSOCIATES, P.A.

____________________________
Maurice Arcadier, Esquire
Florida Bar No.: 131180
2815 W. New Haven, Ave., Ste. 304
Melbourne, Florida 32904
Phone: 321-953-5998
Fax: 321- 953-6075
Attorney for Plaintiff