Department Manager Sues for Unpaid Overtime

A former Urban Outfitters department manager recently filed a lawsuit against the retail clothing company for violations of the federal Fair Labor Standards Act (FLSA).  The plaintiff seeks unpaid overtime wages resulting from the store misclassifying her as “exempt” from federal overtime laws. Under the FLSA, non-exempt employees are entitled to overtime pay, while exempt employees are not. The plaintiff alleges that she regularly worked over 40 hours a week throughout her employment, but did not receive overtime compensation from Urban Outfitters as required by federal law. The lawsuit claims that the plaintiff’s treatment was part of the store’s broad, company-wide policy to minimize labor costs by classifying all department managers as “exempt” from the FLSA’s overtime provisions.

Whether an employee qualifies as exempt depends upon a variety of factors, including the job duties he or she performs—not the employee’s job title. To be exempt from receiving overtime, a manager must exercise a significant degree of independent decision-making that affects the business, direct or supervise the work of other employees, and have the authority to hire and fire employees. According to the lawsuit, the department managers at Urban Outfitters were actually non-exempt because, despite the management job title, they primarily performed manual labor and did not do any hiring, firing, disciplining, supervising, or engaging in any independent judgment and discretion.

Misclassifying employees as exempt is a common way employers can violate the FLSA. Keep in mind that a job title of “manager” or “supervisor” doesn’t necessarily mean you are exempt from receiving overtime. If you are regularly performing non-exempt work, you may be entitled to unpaid overtime wages for up to the past three years, an additional amount in liquidated damages equal to the unpaid overtime, and employment attorney’s fees and costs.

Baklava Not Creative?

A Brooklyn federal judge has ruled that baklava chefs’ jobs were not “creative” to meet the Fair Labor Standards Act’s creative professional exemption from overtime pay. The judge held that this exemption requires “innovation and imagination,” not the “consistency and precision” displayed by the Turkish baklava and baked goods chefs when making their tasty treats.

In a decision denying summary judgment to the defendants, the court held that the exemption defense failed because “although defendants adequately demonstrate that plaintiffs were experienced and talented [chefs], defendants [did] not demonstrate how plaintiffs’ experience and talent were applied to an innovative and imaginative task.”
The defendants, Gulluoglu, an entity that sells Turkish food at multiple locations, and its manager, failed to shoulder their burden of proving that its employees fell within the exemption. According to the court, “[d]efendants did not sell their baklava and other baked goods in five-star or gourmet establishments, and plaintiffs, tasked with preparing baklava and other enumerated Turkish baked goods to be sold by third parties, did not have the autonomy to design unique dishes and menu items.”

The plaintiffs, both former baked goods chefs for Gulluoglu, frequently worked 60 hour weeks, but were only paid a fixed weekly salary of $700. Although the plaintiffs’ skills and training were brought up in court, such as a plaintiff serving as an apprentice to a baklava maker in Turkey for seven years, deposition testimony showed that the baklava chef never prepared baklava from scratch. Rather, plaintiff would heat and apply a “sweet syrup” to frozen baklava imported from Turkey. Starting in 2010, however, the baklava was imported pre-cooked, with the syrup glaze already applied. Additionally, the pastry chef’s cakes were not made from scratch, but imported and defrosted.

Defendants argued that “plaintiffs’ talent alone should trigger the exemption.” Yet, the court held that “[t]he regulatory language makes clear that an employee talented at an unimaginative and unoriginal task does not fall within the exemption.”

If you feel that you are not being properly paid wages, you should call our unpaid wages lawyer for a free consultation.

The lawsuit was filed in the U.S. District Court for the Eastern District of New York, and is titled Eren v. Gulluoglu LLC, Case No. 15-CV-4083.

Overtime Exemption – Automobile Dealerships

automobile dealershipsThe Fair Labor Standards Act (“FLSA”), which governs the minimum wage and overtime pay requirements, contains specific exemptions from overtime pay.  In addition to the traditional “white collar” exemptions for certain executive, administrative, and professional employees, the FLSA has some specific, less-known industry exemptions for automobile dealerships. Here’s a quick overview of one exemption under Section 13(b)(10)(A) of the FLSA, which applies to certain service employees of nonmanufacturing establishments.

1. Which employees are covered under this exemption?

• “Salesmen” – includes those employed for the primary purpose of making sales or obtaining orders or contracts for sale. This also includes any work performed incidental to sales (deliveries or collections).

• “Partsmen” – includes those employees primarily engaged in requisitioning, stocking, and dispensing parts.

• “Mechanic” – includes those employees primarily engaged in mechanical work for the automobile’s use and operation, such as wrecker mechanics, automotive implement mechanics, and any mechanical work for safe operation.  This does not include tire changing, installing seat covers, dispatching, or any painting or polishing.

2. Are the employees “primarily engaged” in selling or servicing automobiles?

• To fall under this exemption, employees must spend at least 50% of their work hours each week selling or servicing automobiles.

3. Is the employer a “nonmanufacturing establishment” that is “primarily engaged” in selling automobiles to the ultimate purchaser?

• For the exemption to apply, over half of the establishment’s annual dollar volume must be derived from sales of the vehicles.

• This exemption applies to employees even if they work in a physically separate building from the principal establishment, so long as they are employed in a department that is “functionally operated as part of the dealership.” 29 C.F.R. 779.372.

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Raising the Salary Threshold for the “White Collar” Overtime Exemptions

The Fair Labor Standards Act (FLSA) is the federal law that establishes minimum wage and overtime pay. Under the FLSA, certain individuals who earn above a certain salary threshold are exempt from receiving minimum wage and overtime pay. Contact unpaid wages attorney now.

Under the white collar exemptions, employees must meet a salary threshold and must satisfy the “duties” portion of the exemption to be exempt from overtime. Last year, President Obama announced the need to modernize the overtime regulations as one of his top priorities for the upcoming year. Specifically, one of the goals was to raise the salary threshold for the “white collar exemptions,” which exempt certain executive, administrative, and professional employees from overtime.

What does this mean to you?

The current salary threshold—$455 a week—has been in effect since 2004 and therefore has not been subject to inflation or today’s cost of living. This means that individuals making as little as $24,000 a year can fall under the overtime exemption.  In other words, only a mere 11% of salaried workers, according to the Huffington Post, qualify for overtime pay under this “historically low” salary threshold. But the anticipated increase in the salary threshold (estimated to range from salaries of approximately $42,000 a year to $51,000 a year), however, will greatly increase the number of employees eligible for overtime pay.

Source: The Impact FLSA’s Overhaul Has on Exempt Employees, March 23, 2015

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