marzuq v. cadete enterprises, inc., 1st cir. (2015)

7/26/2019 Marzuq v. Cadete Enterprises, Inc., 1st Cir. (2015)

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United States Court of AppealsFor the First Circuit

No. 14- 1744

GASSAN MARZUQ, et al . ,

Pl ai nt i f f s , Appel l ant s ,

v.

CADETE ENTERPRI SES, I NC. , et al . ,

Def endant s, Appel l ees.

APPEAL FROM THE UNI TED STATES DI STRI CT COURTFOR THE DI STRI CT OF MASSACHUSETTS

[ Hon. F. Denni s Sayl or , Di st r i ct J udge]

Bef ore

Howard, Chi ef J udge,Sout er , Associ at e J ust i ce, *and Li pez, Ci r cui t J udge.

Shannon Li ss- Ri ordan, wi t h whom Benj ami n J . Weber , Li cht en &Li ss- Ri or dan, P. C. , and El ayne N. Al ani s wer e on br i ef , f orappel l ant s.

Ni chol as B. Car t er , wi t h whom Mar i a T. Davi s and Todd & Wel dLLP wer e on br i ef , f or appel l ees.

Pet er Wi nebr ake, Mark J . Got t esf el d, and Wi nebr ake &

Sant i l l o, LLC on br i ef f or ami ci cur i ae Nat i onal Empl oyment LawPr oj ect , Economi c Pol i cy I nst i t ut e, and Nat i onal Empl oymentLawyer s Associ at i on; Audr ey Ri chardson and Gr eater Bost on LegalSer vi ces on br i ef f or ami cus cur i ae Massachuset t s Fai r WageCampai gn; Cather i ne Ruckel shaus, Ant hony Mi schel , Nat i onal

* Hon. Davi d H. Sout er , Associ at e J ust i ce ( Ret . ) of t heSupr eme Cour t of t he Uni t ed St at es, si t t i ng by desi gnat i on.


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Empl oyment Law Proj ect , Robert a L. St eel e, and Nat i onal Empl oymentLawyer s Associ at i on on br i ef f or ami cus cur i ae Nat i onal Empl oymentLawyer s Associ at i on; and Ross Ei senbr ey and Economi c Pol i cyI nst i t ut e on br i ef f or Economi c Pol i cy I nst i t ut e.

December 9, 2015


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LIPEZ, Circuit Judge. Two f ormer managers of Dunki n'

Donut s st or es i n Massachuset t s br ought t hi s act i on cl ai mi ng t hey

wer e i mpr oper l y deni ed over t i me pay i n vi ol at i on of t he Fai r Labor

St andar ds Act ( "FLSA") . See 29 U. S. C. 207( a) ( 1) . Based on f act s

i t deemed undi sput ed, t he di st r i ct cour t r ej ect ed t he

r ecommendat i on of t he magi st r at e j udge and gr ant ed summar y

j udgment f or t he def endant empl oyers, f i ndi ng t hat pl ai nt i f f s wer e

"bona f i de execut i ve[ s] " excl uded f r om t he st at ut e' s over t i me pay

r equi r ement . I d. 213( a) ( 1) . Our revi ew of t he l aw and t he

r ecor d per suades us t hat mat er i al f act ual di sput es r emai n

concer ni ng t he exempt i on' s appl i cabi l i t y t o pl ai nt i f f s and, hence,

we vacat e t he summar y j udgment and r emand f or f ur t her proceedi ngs.

I.

A. Factual Background

I n thi s appeal f r om a summary j udgment , we pr esent t he f act s

i n t he l i ght most f avor abl e t o t he pl ai nt i f f s, t he nonmovi ng par t y.

See Ray v. Ropes & Gr ay LLP, 799 F. 3d 99, 112 ( 1st Ci r . 2015) .

Her e we pr ovi de a br i ef r eci t al of f act s t o set t he st age f or t he

anal ysi s that f ol l ows. We pr ovi de addi t i onal det ai l l at er as par t

of t hat anal ysi s.

Pl ai nt i f f Gassan Marzuq worked as a manager at a Dunki n'

Donut s st or e i n Massachuset t s f r om 2007 unt i l hi s t er mi nat i on i n


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2012, 1 and pl ai nt i f f Li sa Chant r e was a manager at another

Massachuset t s st or e f r om2009 unt i l her t er mi nat i on i n 2010. 2 Bot h

st ores are among mul t i pl e Dunki n' Donut s f r anchi ses owned and

oper at ed by t hr ee r el at ed cor por at e ent i t i es - - Cadet e

Ent er pr i ses, I nc. , T. J . Donut s, I nc. , and Samoset St . Donut s, I nc.

- - whose common pr esi dent i s J ohn Cadete.

Pur suant t o manager agr eement s t hey si gned wi t h Cadet e

Ent erpr i ses, Marzuq and Chant r e were expect ed t o work "no less

than a si x day, 48 hour wor k week. " ( Emphasi s i n or i gi nal . )

Of t en, however , st ore manager s work more than si xt y hour s, i n part

because t hey subst i t ut e f or cr ew members who ar e out si ck or mi ss

a shi f t f or ot her r easons. Mar zuq t est i f i ed i n hi s deposi t i on

t hat hi s r egul ar schedul e added up t o si xt y- si x hour s over si x

days, but t hat he was i n f act " t her e al l t he t i me, seven days a

week. " 3 Manager s' r esponsi bi l i t i es i ncl ude cal i br at i ng t he

1 I n addi t i on t o managi ng t he r egul ar st or e, Mar zuq al somanaged f or a per i od a separat e dr i ve- up ki osk t hat opened i n 2009at a near by gas st at i on. The ki osk ser ved a l i mi t ed menu and wasopen onl y dur i ng dayt i me hour s. The r egul ar st ore i s open 24hours, seven days a week.

2 Chant r e di ed af t er t he compl ai nt was f i l ed, and t he per sonal

r epr esent at i ve of her est at e, Tani sha Rodr i guez, was subst i t ut edas a pl ai nt i f f . For conveni ence, we, l i ke t he di st r i ct cour t ,r ef er t o Chant r e as t he pl ai nt i f f r at her t han Rodr i guez.

3 For pur poses of our anal ysi s, we must r el y on Marzuq' sdescr i pt i on of hi s wor k, as t her e i s no deposi t i on i n t he r ecor df r omChant r e. She di ed f our mont hs bef ore Marzuq' s deposi t i on wast aken, i n l ate November 2012. The r ecord al so cont ai ns adeposi t i on of Marzuq t aken i n November 2011, i n a separate st ate


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equi pment t o Dunki n' Donut s speci f i cat i ons, handl i ng cash, keepi ng

t he st or e and gr ounds proper l y mai nt ai ned, t r ai ni ng and

super vi si ng the empl oyees, per i odi c count i ng of ever y non-

per i shabl e i t em i n t he st or e, and subst ant i al paper wor k.

Marzuq and Chant r e were supervi sed by a di st r i ct manager ,

Aaron Dermandy, who over saw at l east seven st ores dur i ng t he t i me

pl ai nt i f f s were managers. Among ot her dut i es, Dermandy determi ned

st af f i ng l evel s, ar r anged mai nt enance, and order ed t he baked goods

f or t he st or es. He vi si t ed each st or e ever y week, and was i nvol ved

i n bot h t he hi r i ng and f i r i ng of cr ew member s.

Mar zuq vi ewed hi msel f as " i n char ge" and "t he capt ai n" of hi s

st or e, and hi s sons, bot h of whom wor ked at Mar zuq' s st or e,

l i kewi se saw hi m t hat way. Sar mad Mar zuq t est i f i ed t hat " [ i ] t was

al ways expect ed t hat i f [ hi s f at her ] wasn' t ar ound t hat he woul d

be al ways on cal l , " and Ahmad Gassan Marzuq repor t ed t hat no one

el se was i n char ge when hi s f at her was not at t he st or e: " I f anyone

had quest i ons, we woul d j ust cal l my f ather and he usual l y woul d

come i n . . . [ a] nd sol ve t he pr obl em f or us. "

The r ecor d, however , al so cont ai ns evi dence of Mar zuq' s

di f f i cul t y i n f ul f i l l i ng hi s rol e as " l eader of t h[ e] t eam. " I n

addi t i on t o r eport i ng t hat he worked on Sundays because hi s r egul ar

si x- day schedul e was i nsuf f i ci ent t o get t he necessar y wor k done,

cour t pr oceedi ng.


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Mar zuq t est i f i ed t hat he "di d not have [ ] t i me act ual l y t o be t he

manager as r equi r ed t o be a manager . " He el abor at ed as f ol l ows:

I ' mal ways on t he f l oor 90 per cent of my t i me,ser vi ng cust omer s, cl eani ng, cl eani ng t heout si de, doi ng t he l andscapi ng, cl eani ng t hepaper s out of t he bushes, cl eani ng t hebat hr oom, ser vi ng cust omer s, cover i ng shi f t s,empl oyees t hat t hey cal l i n, I have t o cover .So real l y I don' t have t i me to be 100 per centmanager . 4

He expl ai ned t hat he coul d not r out i nel y del egat e t he cl ean- up t o

cr ew member s "because you' r e al ways shor t on st af f . " When asked

about t he company pol i cy t hat empl oyees t ake a day of f , he

r esponded: "How [ ar e] you goi ng t o run . . . t he oper at i on wi t h no

management t o t ake care of t hat l ocat i on? So you have t o work. "

B. Procedural Background

Marzuq and Chant r e f i l ed t hi s act i on i n Febr uary 2011 seeki ng

over t i me compensat i on under t he FLSA, 5 and t he def endant s f i l ed a

mot i on f or summary j udgment t wo years l ater t hat r el i ed heavi l y on

t he deposi t i ons of Marzuq and Dermandy. I n r ecommendi ng t hat t he

mot i on be deni ed, t he magi st r ate j udge f ound a genui ne i ssue of

4 At another poi nt , Marzuq st ated t hat he di d not "spendenough t i me act ual l y t o be i n t he of f i ce or di r ect i ng empl oyeest he pr oper way because I ' m al ways wor ki ng on t he f l oor , i f you

want t o say t he count er , as any ot her empl oyees and I ' m put t i ng al ot of - - a l ot of hour s on t he f l oor . "

5 Mar zuq was f i r ed i n Apr i l 2012, and he subsequent l y f i l edan amended compl ai nt t hat added r etal i at i on cl ai ms under t he FLSAand st at e l aw. The di st r i ct cour t deni ed t he def endant s' mot i onf or summary j udgment on t hose cl ai ms, but t he part i es r esol vedt hem bef or e t r i al and, hence, t hey ar e not par t of t hi s appeal .


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mat er i al f act as t o whet her pl ai nt i f f s f el l wi t hi n t he FLSA' s

over t i me- pay excl usi on f or empl oyees ser vi ng i n a "bona f i de

execut i ve" capaci t y. 29 U. S. C. 213( a) ( 1) .

As descr i bed mor e f ul l y bel ow, t he di st r i ct cour t di sagr eed

t hat a j ur y coul d f i nd i n pl ai nt i f f s ' f avor . I t concl uded t hat

t he f act s i n t hi s case ar e "i n subst ance i ndi st i ngui shabl e" f r om

t hose we encount ered i n Donovan v. Burger Ki ng Corp. , 672 F. 2d 221

( 1st Ci r . 1982) ( "Bur ger Ki ng" ) , wher e we hel d t hat cer t ai n

assi st ant manager s wer e exempt f r om t he over t i me pr ovi si on. The

cour t t hus grant ed summary j udgment f or def endant s, and t hi s appeal

f ol l owed.

II.

Bef or e exami ni ng t he di st r i ct cour t ' s concl usi on t hat Bur ger

Ki ng "cont r ol s t he di sposi t i on of pl ai nt i f f s' FLSA cl ai ms, " we

r evi ew t he gover ni ng l aw and t he r easoni ng i n Bur ger Ki ng t hat l ed

us t o f i nd t he over t i me exempt i on appl i cabl e t her e.

A. The FLSA Executive Exemption

The FLSA r equi r es empl oyer s t o pay t hei r empl oyees at l east

"one and one- hal f t i mes t he regul ar r at e" f or any hour s wor ked i n

excess of a f or t y- hour wor kweek. 29 U. S. C. 207( a) ( 1) . The

over t i me r equi r ement has mul t i pl e except i ons. The one at i ssue i n

t hi s case excl udes "any empl oyee empl oyed i n a bona f i de execut i ve

. . . capaci t y. " I d. 213( a) ( 1) . Pur suant t o r egul at i ons i ssued

by t he Secr et ar y of Labor , an empl oyer seeki ng t o est abl i sh t hat


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an empl oyee i s an exempted "execut i ve" must show: ( 1) t he

empl oyee' s sal ary i s at l east $455 per week, ( 2) t he empl oyee' s

"pr i mary dut y" i s management , ( 3) t he empl oyee "cust omar i l y and

r egul ar l y di r ect s t he work of t wo or more other empl oyees, " and

( 4) t he empl oyee "has t he aut hor i t y to hi r e or f i r e ot her empl oyees

or whose suggest i ons and recommendat i ons as t o t he hi r i ng, f i r i ng,

advancement , pr omot i on or any ot her change of st at us of ot her

empl oyees ar e gi ven par t i cul ar wei ght . " 29 C. F. R. 541. 100( a)

( 2009) . 6 Each of t hese requi r ement s must be met f or t he exempt i on

t o appl y.

The r egul at i ons expl i ci t l y addr ess t he si t uat i on of an

empl oyee who concur r ent l y per f or ms exempt and nonexempt wor k - -

i . e. , one who super vi ses ot her empl oyees whi l e al so doi ng non-

super vi sor y t asks al ong wi t h t hose subor di nat es - - st at i ng t hat

such an empl oyee may f al l wi t hi n t he exempt i on so l ong as t he f our

r equi r ement s of 541. 100 l i st ed above are other wi se met . See i d.

541. 106. Whet her an empl oyee who concur r ent l y per f orms bot h

t ypes of dut i es meet s t he r equi r ement s i s det ermi ned on a case-

by- case basi s. I d. For exampl e, a manager "can super vi se

6 " Al t hough t he r egul at i ons mer el y st at e t he Secr et ar y' sof f i ci al posi t i on on how t he st at ut es shoul d be i nt er pr et ed, acour t must gi ve t hem ' cont r ol l i ng wei ght unl ess [ t he cour t f i ndst hem] t o be ar bi t r ar y, capr i ci ous, or cont r ar y t o t he st at ut e. "Cash v. Cycl e Cr af t Co. , 508 F. 3d 680, 683 ( 1st Ci r . 2007)( al t er at i on i n or i gi nal ) ( quot i ng Rei ch v. J ohn Al den Li f e I ns.Co. , 126 F. 3d 1, 8 ( 1st Ci r . 1997) ( ci t i ng Chevr on U. S. A. , I nc. v.Nat . Res. Def . Counci l , 467 U. S. 837, 843- 44 ( 1984) ) ) .


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empl oyees and ser ve cust omers at t he same t i me wi t hout l osi ng t he

exempt i on. " I d. 541. 106( b) . Hence, even a subst ant i al over l ap

i n the per f ormance of nonmanager i al and manager i al work wi l l not

di squal i f y an empl oyee f r om t he exempt i on i f t he execut i ve dut i es

ar e hi s or her "pr i mar y dut y. " I d.

The r egul at i ons pr ovi de gui dance on how t o deter mi ne an

empl oyee' s " pr i mar y dut y, " i ncl udi ng a set of non- excl usi ve

f act or s ( i n bol df ace bel ow) t o consi der . See i d. 541. 700.

Because t he pr i mar y dut y i nqui r y i s cent r al t o t hi s case, we

r epr oduce al l but t he i nt r oduct or y l i ne of t he per t i nent

r egul at i on:

( a) . . . The t er m "pr i mar y dut y" meanst he pr i nci pal , mai n, maj or or most i mpor t antdut y t hat t he empl oyee per f orms.Determi nat i on of an empl oyee' s pr i mary dut ymust be based on al l t he f act s i n a par t i cul arcase, wi t h t he maj or emphasi s on t he character

of t he empl oyee' s j ob as a whol e. Fact or s t oconsi der when det ermi ni ng t he pr i mary dut y ofan empl oyee i ncl ude, but ar e not l i mi t ed t o, 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.

( b) The amount of t i me spent per f ormi ngexempt wor k can be a usef ul gui de i ndet ermi ni ng whet her exempt work i s t he pr i marydut y of an empl oyee. Thus, empl oyees whospend more t han 50 percent of t hei r t i meper f or mi ng exempt wor k wi l l gener al l y sat i sf yt he pr i mary dut y r equi r ement . Ti me al one,however , i s not t he sol e t est , and not hi ng i n


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t hi s sect i on r equi r es t hat exempt empl oyeesspend more t han 50 percent of t hei r t i meperf or mi ng exempt wor k. Empl oyees who do notspend more t han 50 percent of t hei r t i meper f or mi ng exempt dut i es may nonet hel ess meett he pr i mar y dut y requi r ement i f t he ot herf act or s suppor t such a concl usi on.

( c) Thus, f or exampl e, assi st ant manager si n a r et ai l est abl i shment who per f or m exemptexecut i ve work such as super vi si ng anddi r ect i ng t he wor k of ot her empl oyees,order i ng merchandi se, managi ng t he budget andaut hor i zi ng payment of bi l l s may havemanagement as t hei r pr i mary dut y even i f t heassi st ant managers spend more t han 50 percentof t he t i me per f or mi ng nonexempt work such asr unni ng t he cash r egi st er . However , i f such

assi st ant manager s are cl osel y super vi sed andear n l i t t l e more than t he nonexempt empl oyees,t he assi st ant manager s general l y woul d notsat i sf y t he pr i mar y dut y r equi r ement .

I d. ( emphasi s added) . Br i ef l y st at ed, t he r egul at i on expl ai ns

t hat an empl oyee' s "pr i mary" dut y i s not det er mi ned sol el y by t he

amount of t i me he or she devot es t o t he di f f er ent cat egor i es of

t asks - - i . e. , exempt vs. nonexempt - - but on t he over al l char act er

of hi s or her posi t i on.

B. The Burger King Decision

I n Bur ger Ki ng, t he di st r i ct cour t had f ound af t er a bench

t r i al t hat t he r est aur ant chai n' s assi st ant manager s di d not have

management as t hei r pr i mary dut y and, hence, were ent i t l ed t o

over t i me under t he FLSA. See 672 F. 2d at 224. Among ot her t asks,

t he Burger Ki ng ass i st ant managers schedul ed empl oyees, oversaw

pr oduct qual i t y, spoke wi t h cust omer s, t r ai ned empl oyees, and

"per f or m[ ed] var i ous r ecor dkeepi ng, i nvent or y, and cash


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r econci l i at i on dut i es. " I d. at 223. However , t he assi st ant

manager s al so spent a subst ant i al por t i on of t hei r t i me - - mor e

t han 40 per cent of t hei r weekl y wor k hour s, i d. at 224 - -

"per f ormi ng many of t he same tasks as hour l y empl oyees, such as

t aki ng or der s, pr epar i ng f ood, and ' expedi t i ng' or der s. " I d. at

223. The di st r i ct cour t f ound t hat , " i n t he absence of t he

manager , t he assi st ant manager on dut y was ' de f act o i n char ge of

t he st or e, ' " i d. at 225, but t he cour t nonet hel ess concl uded t hat

assi st ant manager s di d not work pr i mar i l y as manager s as r equi r ed

f or t he FLSA overt i me exempt i on.

I n r ever si ng, we stat ed t hat , "[ i ] n l i ght of t he di str i ct

cour t ' s f i ndi ng her e t hat t he assi st ant manager s wer e ' i n char ge'

of t he r est aur ant dur i ng t hei r shi f t s, i t s concl usi on t hat t hey do

not have management as t hei r pr i mary dut y cannot st and. " I d. at

227. We not ed t hat empl oyees may concur r ent l y per f orm exempt and

nonexempt t asks, and we obser ved t hat t he regul at i on "makes i t

qui t e cl ear t hat an empl oyee can manage whi l e per f ormi ng ot her

wor k, and t hat t hi s ot her wor k does not negat e the concl usi on t hat

hi s pr i mary dut y i s management . " I d. at 226. We f ound appl i cabl e

"t he pr oposi t i on t hat t he per son ' i n char ge' of a st or e has

management as hi s pr i mary dut y, even t hough he spends t he maj or i t y

of hi s t i me on nonexempt work and makes f ew si gni f i cant

deci si ons. " I d. at 227.


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Because t he i ssue of pr i mary dut y was t he onl y di sput ed f actor

f or cer t ai n of t he Bur ger Ki ng assi st ant manager s, our r ej ect i on

of t he di st r i ct cour t ' s f i ndi ng on t hat i ssue meant t hat t hose

manager s f el l wi t hi n t he FLSA' s " bona f i de execut i ve" exempt i on.

I d. at 224. 7 Accor di ngl y, we vacat ed t he di st r i ct cour t ' s j udgment

i nsof ar as i t order ed Bur ger Ki ng t o pay back over t i me wages t o

t he gr oup of assi st ant manager s ear ni ng at l east $250 per week.

I d. at 229. 8

C. The District Court's Dunkin' Donuts Decision

The r ol e pl ayed by t he Burger Ki ng assi st ant manager s, as

descr i bed i n our deci si on, appear s t o l ar gel y coi nci de wi t h t he

r esponsi bi l i t i es of Mar zuq and Chant r e as depi ct ed by t he evi dence

7 Thi s hol di ng cover ed onl y assi st ant manager s ear ni ng at

l east $250 per week. Pur suant t o t he r egul at i ons t hen i n ef f ect ,t he el i gi bi l i t y of such empl oyees f or t he exempt i on was eval uat edunder a "shor t t est " consi st i ng of onl y t wo requi r ement s: t heempl oyee' s " pr i mar y dut y" must be management , and he or she mustr egul ar l y di r ect t he wor k of at l east t wo ot her empl oyees. SeeBur ger Ki ng, 672 F. 2d at 223. The " l ong t est " appl i cabl e t oempl oyees earni ng bet ween $155 and $250 per week i ncl uded, i nteral i a, a t i me l i mi t at i on on wor k "not ' cl osel y r el at ed' t o t hei rmanagement dut i es" ( no more t han 40 percent ) . I d. at 223- 24. Asr evi sed i n 2004, and as descr i bed above, t he r egul at i ons now setout a si ngl e t est appl i cabl e t o empl oyees ear ni ng at l east $455per week. See supr a Sect i on A; see al so Morgan v. Fami l y Dol l ar

St or es, I nc. , 551 F. 3d 1233, 1265- 66 & n. 48 ( 11t h Ci r . 2008)( expl ai ni ng t he shi f t f r om t wo t est s t o one) .

8 We af f i r med t he di st r i ct cour t ' s j udgment t hat assi st antmanagers earni ng l ess t han $250 were ent i t l ed t o over t i me paybecause of t he 40 per cent l i mi t - - under t he l ong t est - - on t heamount of nonmanager i al work t hey coul d per f or m. See 672 F. 2d at228.


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r ecount ed i n Sect i on I above. Gi ven t hat f act ual si mi l ar i t y, t he

di st r i ct cour t unsur pr i si ngl y l ooked t o our anal ysi s i n Bur ger

Ki ng f or gui dance. The cour t s t at ed t hat , l i ke t he Bur ger Ki ng

assi st ant manager s, i t i s "cl ear " t hat "pl ai nt i f f s wer e at al l

t i mes ' i n char ge' of t hei r r espect i ve st or es, " i ncl udi ng whi l e

"servi ng cust omer s l i ke nor mal hour l y empl oyees. " Di st . Ct . Op.

at 9; see al so i d. at 8 ( not i ng t hat "[ t ] he Bur ger Ki ng cour t f ound

t hat an empl oyee can st i l l be ' managi ng' even whi l e physi cal l y

doi ng somet hi ng el se" ) . The di st r i ct cour t al so expr essl y i nvoked

t he FLSA r egul at i on t hat pr ovi des t hat "empl oyees who per f orm

exempt and nonexempt work concur r ent l y ar e not di squal i f i ed f r om

t he execut i ve exempt i on. " I d. at 9 ( ci t i ng 29 C. F. R.

541. 106( a) ) .

Hence, echoi ng our hol di ng i n Bur ger Ki ng, t he di st r i ct cour t

f ound i t undi sput ed t hat pl ai nt i f f s had management as t hei r pr i mar y

dut y, even t hough they spent "much of t hei r t i me" on nonexempt

wor k and "had l i t t l e di scret i on t o make si gni f i cant deci si ons. "

I d. I n addi t i on, despi t e t hei r l i mi t ed aut hor i t y over al l , t he

cour t f ound t hat pl ai nt i f f s wi el ded i nf l uence over per sonnel

deci si ons - - t he other cont est ed r equi r ement f or t he exempt i on. 9

9 The par t i es do not di sput e t hat pl ai nt i f f s sat i sf y t her emai ni ng t wo f actors f or t he execut i ve exempt i on. They earned atl east $455 per week, 29 C. F. R. 541. 100( a) ( 1) ( 2009) , and t hey"cust omar i l y and r egul ar l y di r ect [ ed] t he wor k of t wo or more ot herempl oyees, " i d. 541. 100( a) ( 3) .


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I d. at 11. Accor di ngl y, t he cour t hel d t hat "t he undi sput ed f act s

show t hat pl ai nt i f f s wer e empl oyed i n a bona f i de execut i ve

capaci t y, " and t hus not ent i t l ed t o over t i me pay. I d.

III.

On appeal , pl ai nt i f f s cont end t hat t he di st r i ct cour t f ai l ed

t o per f or m t he mul t i - f act or anal ysi s r equi r ed by t he FLSA

r egul at i ons t o det er mi ne an empl oyee' s " pr i mary dut y" and

i mpr oper l y "gl oss[ ed] over a cl ear f act ual di sput e" as t o whet her

Marzuq was abl e t o manage hi s st ore whi l e al so ser vi ng cust omers

and compl et i ng ot her nonmanager i al t asks. They f ur t her assert

t hat t he cour t ' s r el i ance on Bur ger Ki ng was mi spl aced, as t hat

case i nvol ved a ver di ct ent er ed af t er a bench t r i al r at her t han a

r ul i ng on summary j udgment f or whi ch t hey ar e ent i t l ed t o t he

benef i t of f avor abl e f act ual i nf er ences. Al l t ol d, pl ai nt i f f s

cont end t hat summar y j udgment was i mproper because t he evi dence i n

t he r ecor d woul d per mi t a r easonabl e f act f i nder t o concl ude t hat

t he over t i me exempt i on does not appl y t o them.

A. Standards of Review

We revi ew t he di st r i ct cour t ' s summary j udgment r ul i ng de

novo, assessi ng t he f act s i n t he l i ght most advant ageous t o

pl ai nt i f f s and al so dr awi ng al l r easonabl e i nf er ences i n t hei r

f avor . Ray, 799 F. 3d at 112.

The bur den i s on t he empl oyer t o prove an exempt i on f r om t he

FLSA' s r equi r ement s, Cash v. Cycl e Cr af t Co. , 508 F. 3d 680, 683


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( 1st Ci r . 2007) , and " t he r emedi al nat ur e of t he st at ut e r equi r es

t hat [ i t s] exempt i ons be ' nar r owl y const r ued agai nst t he empl oyer s

seeki ng t o asser t t hem, ' " Rei ch v. J ohn Al den Li f e I ns. Co. , 126

F. 3d 1, 7 ( 1st Ci r . 1997) ( quot i ng Ar nol d v. Ben Kanowsky, I nc. ,

361 U. S. 388, 392 ( 1960) ) ; see al so Hi nes v. St ate Room, I nc. , 665

F. 3d 235, 240 ( 1st Ci r . 2011) ( st at i ng t hat exempt i ons must be

"dr awn nar r owl y agai nst t he empl oyer " ) ; Wi r t z v. Keyst one Reader s

Ser v. , I nc. , 418 F. 2d 249, 261 ( 5t h Ci r . 1969) ( not i ng t he FLSA' s

"dual mandat es of broad cover age and nar r ow exempt i ons" ) .

B. Discussion

As not ed above, i t i s undi sput ed t hat pl ai nt i f f s meet t wo of

t he f our cr i t er i a f or t he "bona f i de execut i ve" exempt i on f r om

overt i me pay: t hey ear ned more t han $455, and t hey "cust omar i l y

and r egul ar l y di r ect [ ed] t he work of t wo or more other empl oyees. "

29 C. F. R. 541. 100( a) ( 2009) . We t hus begi n wi t h an exami nat i on

of one of t he r emai ni ng r equi r ement s: t hat management be an

exempt ed execut i ve' s pr i mary dut y.

1. Primary Duty

Appel l ant s ar gue t hat t he di st r i ct cour t i mpr oper l y f ai l ed t o

consi der t he f our non- excl usi ve f act or s l i st ed i n t he gover ni ng

r egul at i on as per t i nent t o t he pr i mar y- dut y det er mi nat i on: " t he

r el at i ve i mport ance of t he exempt dut i es as compared wi t h ot her

t ypes of dut i es; t he amount of t i me spent per f ormi ng exempt work;

t he empl oyee' s r el at i ve f r eedom f r om di r ect super vi si on; and t he


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r el at i onshi p bet ween the empl oyee' s sal ary and the wages pai d t o

ot her empl oyees f or t he ki nd of nonexempt work per f ormed by t he

empl oyee. " 29 C. F. R. 541. 700( a) ( 2009) . They f ur t her asser t t hat

t he r ecor d evi dence on t hese f act or s, vi ewed i n t hei r f avor , does

not l ead i nevi t abl y to t he concl usi on t hat management was t hei r

pr i mar y dut y - - t hus t aki ng t hi s case out si de t he scope of our

hol di ng i n Bur ger Ki ng.

As an i ni t i al mat t er , we agr ee t hat Bur ger Ki ng i s not on al l

f our s wi t h t hi s case. Our anal ysi s t her e r est ed on f i ndi ngs made

by t he di st r i ct cour t af t er a bench t r i al , whi l e on summar y

j udgment we must const r ue t he f act s i n pl ai nt i f f s' f avor .

Mor eover , t he r epor t ed f act s i n t he t wo cases ar e not i dent i cal .

I n Bur ger Ki ng, f or exampl e, t he di st r i ct cour t f ound t hat t he

assi st ant manager s "devot ed more t han 40 per cent of t hei r t i me t o

nonmanager i al dut i es, " 672 F. 2d at 224, whi l e Mar zuq t est i f i ed

t hat he was "on t he f l oor 90 per cent of [ t he] t i me" doi ng nonexempt

t asks l i ke servi ng cust omer s and cl eani ng. The di f f er ence bet ween

per f or mi ng nonexempt wor k most of t he t i me - - i . e. , 90 per cent - -

and possi bl y l ess t han hal f t he t i me - - i . e. , "mor e t han 40

per cent " - - coul d be si gni f i cant i n eval uat i ng whet her a manager

i s abl e t o per f or m super vi sor y and nonexempt t asks concur r ent l y.

At l east i n some set t i ngs, a nomi nal "manager" who spends near l y

hi s ent i r e shi f t doi ng t he same wor k as hi s subor di nat es mi ght not

be abl e t o si mul t aneousl y manage the st ore. See Morgan v. Fami l y


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Dol l ar St or es, I nc. , 551 F. 3d 1233, 1272 ( 11t h Ci r . 2008) ( not i ng,

i n a deci si on af f i r mi ng j ur y' s f i ndi ng t hat st or e manager s di d not

have management as t hei r pr i mary dut y, a di st i nct i on between

managers who spent "80 t o 90% of t he t i me per f ormi ng manual l abor "

and t hose who spent 60% or " ' mor e t han f i f t y per cent ' " of t hei r

t i me on nonexempt t asks) . As di scussed bel ow, ot her di f f er ences

al so exi st , i ncl udi ng compar at i ve pay rat es.

I mport ant l y, when an empl oyee per f or ms bot h exempt and

nonexempt work, t he quest i on of pr i mary dut y " i s det ermi ned on a

case- by- case basi s" i n l i ght of t he f act or s speci f i ed by r egul at i on

and i dent i f i ed above. 29 C. F. R. 541. 106. Appel l ant s cor r ect l y

obser ve that t he di st r i ct cour t di d not expr essl y exami ne those

f act or s. I nst ead, t he cour t t r eat ed Bur ger Ki ng as di sposi t i ve on

t he pr i mary dut y i nqui r y based on t he cour t ' s assessment t hat

pl ai nt i f f s i ndi sput abl y wer e "i n char ge" of t hei r st or es at al l

t i mes.

Not wi t hst andi ng t he pr ocedur al and f act ual di f f er ences

bet ween t he cases, Bur ger Ki ng does ar t i cul at e a pr i nci pl e t hat i s

r el evant her e: a manager who i s " i n char ge" when on t he j ob "can

st i l l be ' managi ng' . . . even whi l e physi cal l y doi ng somet hi ng

el se, " i d. at 226, and may have management as hi s pr i mary duty

"even t hough he spends t he maj or i t y of hi s t i me on nonexempt work

and makes f ew si gni f i cant deci si ons, " i d. at 227. However , Bur ger

Ki ng was anchor ed i n f act ual f i ndi ngs t hat t he assi st ant manager s


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wer e "' i n char ge' of t he r est aur ant dur i ng t hei r shi f t s, " i d. , and

t hat t hey spent subst ant i al t i me on manager i al dut i es, see i d. at

224. Hence, our anal ysi s i mpl i ci t l y assumed t hat bei ng " i n char ge"

i s not mer el y a l abel bel i ed by t he r eal i t i es of t he wor kpl ace.

We al so observed that some of t he per t i nent r egul at or y f act or s

"qui t e cl ear l y cut i n f avor of Bur ger Ki ng' s cont ent i on [ t hat t he

pl ai nt i f f s' pr i mar y dut y was management ] , especi al l y t hose rel at ed

t o f r eedom f r om super vi si on and a compar i son of wages wi t h ot her

empl oyees. " I d. at 226.

Al t hough t hi s case r esembl es Bur ger Ki ng i n cer t ai n r espect s,

t he pr i mary dut y quest i on cannot be answered wi t hout t he case-

speci f i c i nqui r y cont empl at ed by r egul at i on. Whet her pl ai nt i f f s

ar e si mi l ar l y si t uat ed t o t he Bur ger Ki ng assi st ant manager s

depends both on whet her t hey wer e i n f act " i n charge" whi l e at

t hei r st or es and whet her , i n t he par t i cul ar ci r cumst ances of t hi s

case, t hei r bei ng " i n char ge" compel s t he concl usi on t hat

management was t hei r pr i mary dut y. To f ul l y engage t hose i ssues,

i t i s necessar y t o cl osel y exami ne t he recor d evi dence on t he

f act or s speci f i ed i n 541. 700( a) as per t i nent t o t he pr i mar y dut y

det er mi nat i on. We t hus consi der each f act or i n t ur n.

a. Relative importance of plaintiffs' exempt and other

duties

The r ecor d cont ai ns evi dence t hat pl ai nt i f f s' manager i al and

nonmanager i al dut i es wer e bot h essent i al f or t he smoot h


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f unct i oni ng of t hei r r est aur ant s. Mar zuq t est i f i ed t o mul t i pl e

t asks t hat onl y he per f or med, i ncl udi ng r ecor dkeepi ng, deposi t i ng

cash, cal i br at i ng equi pment , and set t i ng schedul es. I n hi s

super vi sor y r ol e, he al so i nt er vi ewed pot ent i al empl oyees, t r ai ned

new hi r es, and gener al l y over saw t he day- t o- day oper at i on of t he

st or es. These r esponsi bi l i t i es r ef l ect ed t he expect at i ons set i n

Cadet e' s f ormal empl oyment document s, whi ch por t r ay the manager ' s

dut i es as al most excl usi vel y super vi sor y. The "Cadet e Ent er pr i ses

Posi t i on Pr of i l e" l i st s mor e t han t wo dozen manager i al t asks

expect ed of a r est aur ant manager , onl y one of whi ch di r ect l y

ant i ci pat es a manager ' s assi st ance wi t h nonexempt t asks

( "Super vi se & assi st i n qual i t y Cust omer Ser vi ce" ) . 10 Si mi l ar l y,

t he "Rest aur ant Manager Posi t i on Agr eement " st at es t hat " [ t ] he

Rest aur ant Manager ' s maj or i t y of t i me i s spent l eadi ng t he t eam t o

meet Guest expect at i ons, r ecr ui t i ng, hi r i ng, and t r ai ni ng new cr ew

member s as r equi r ed. "

10 The posi t i on pr of i l e st at es t hat t he pur pose of t her est aur ant manager posi t i on i s t o " [ i ] ncr ease Franchi se sal es andpr of i t abi l i t y t hr ough pr oper i mpl ement at i on of Cadet e Ent er pr i ses

and Dunki n Br ands pol i ci es & pr ocedur es. " The document provi dest hat t he "Pri mar y Cont r i but i ons" of a manager i ncl ude: " I ncr easeFranchi se sal es" ; " I mpr ove Franchi se oper at i ng st andar ds" ;"Del egat e t asks and ensur e Rest aur ant Empl oyees r emai n engaged";"Ensure pr oper i mpl ement at i on of Rest aur ant Sani t at i on pr ogr am";"Pr oper l y depl oy st af f dur i ng peak and non- peak hour s ofoper at i on" ; and "Moni t or and pr oper l y handl e al l cust omercompl ai nt s & concer ns. "


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Despi t e t he cor porate emphasi s on super vi sor y

r esponsi bi l i t i es, Mar zuq' s t est i mony per mi t s t he concl usi on t hat ,

as a f act ual mat t er , hi s nonmanager i al wor k al so was "cr i t i cal t o

t he success of t he r est aur ant . " Donovan v. Bur ger Ki ng Cor p. , 675

F. 2d 516, 521 ( 2d Ci r . 1982) . The bul k of Mar zuq' s wor kweek was

spent per f ormi ng nonexempt work, i ncl udi ng ser vi ng cust omers and

cl eani ng. As r ecount ed above, he r epor t ed r out i nel y subst i t ut i ng

f or hour l y empl oyees who wer e si ck or absent f or other r easons,

expl ai ni ng t hat "ever y day i t ' s a chal l enge. " He had par t i cul ar

di f f i cul t y f i ndi ng r epl acement s f or cer t ai n shi f t s - - "especi al l y

t he mi dni ght shi f t and t he ni ght shi f t on t he weekend" - - and woul d

f i l l t hose s l ot s hi msel f . 11 He needed t o do t hat nonexempt wor k,

he expl ai ned, because he r ar el y was f ul l y st af f ed wi t h hour l y

empl oyees - - " [ o] nce ever y f i ve, si x mont hs. " I ndeed, he st at ed

11 Mar zuq t est i f i ed t hat he r egul ar l y cover ed shi f t s whenempl oyees "cal l [ ed] i n":

[ I ] f t her e' s a cal l i n, somebody cal l s i n, f orexampl e, t he mi dni ght t o si x i n the mor ni ng,I ' m t her e. I f somebody cal l s i n si x t o

mi dni ght shi f t , I ' m t her e. I f somebody cal l si n i n t he af t er noon shi f t , I ' mt her e. And, ofcour se, when t hey cal l i n t he mor ni ng, I ' mt her e anyhow, so - -

Marzuq st ated t hat he al so cal l ed Der mandy f or assi st ance i nf i ndi ng subst i t ut es, and Dermandy somet i mes pr ovi ded an empl oyeef r om anot her st or e.


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t hat he had no choi ce but t o come i n on Sundays - - t he sevent h day

of hi s workweek - - t o compl et e t he paperwork requi r ed of hi m. 12

I f , cont r ar y t o t hei r j ob descr i pt i ons, manager s coul d not

pr i or i t i ze t hei r super vi sor y dut i es because "qual i t y Cust omer

Ser vi ce" demanded t hat t hey regul ar l y per f or m t asks or di nar i l y

assi gned t o hour l y empl oyees, a f act f i nder coul d r easonabl y

concl ude t hat pl ai nt i f f s' exempt and nonexempt dut i es wer e equal l y

i mpor t ant t o t he successf ul oper at i on of t hei r r est aur ant s. See,

e. g. , Mor gan, 551 F. 3d at 1270 ( uphol di ng j ur y' s ver di ct t hat st or e

managers ar e not exempt execut i ves wher e "ampl e evi dence suppor t ed

a f i ndi ng t hat t he nonmanager i al t asks not onl y consumed 90% of

a st ore manager ' s t i me but were of equal or gr eat er i mport ance t o

a st or e' s f unct i oni ng and success" ) . Hence, whet her t he " r el at i ve

i mport ance" of dut i es f actor support s t he over t i me exempt i on

cannot be det er mi ned wi t hout a f act f i nder ' s j udgment on t he i mpact

of t he pl ai nt i f f s' var i ed under t aki ngs. See i d. ( "The j ur y was

f r ee t o wei gh t he r el at i ve i mpor t ance of t he st or e manager s'

manager i al and nonmanager i al dut i es . . . . ") .

b. Amount of time spent on exempt work

Mar zuq r epor t ed t hat hi s dai l y manager i al act i vi t y i ncl uded

checki ng cal i br at i on on t he equi pment f or about t hi r t y mi nut es

12 Mar zuq' s son, Sar mad, t est i f i ed t hat he " r ar el y" saw hi sf ather i n hi s of f i ce or doi ng paper work "because he was al wayson t he f l oor wi t h us, " i ncl udi ng af t er noons and Sundays.


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ever y morni ng, count i ng t he cash at t he end of t he morni ng shi f t

( bet ween 11 AM and noon) , 13 ent er i ng sal es and cash dat a i nt o the

comput er , and deposi t i ng money at t he bank. Once a week, he al so

prepar ed empl oyee schedul es, 14 and twi ce a week he spent f i ve or

t en mi nut es pl aci ng an order f or dr y goods and f r ozen f ood i t ems.

I n addi t i on, he spent bet ween ni net y mi nut es and thr ee hour s on

t r ai ni ng when new empl oyees were hi r ed. More general l y, he

r epor t ed t hat he di d hi s " of f i ce wor k" - - t he money count i ng and

deposi t , schedul es, payr ol l , i nvent or i es, or der i ng, cust omer count

- - between 1 and 3 PM on weekdays, and f r om about noon t o 1 or 2

PM on Sat urdays, and he compl et ed paper wor k on Sunday mor ni ngs and

eveni ngs.

For Marzuq, however , t hose admi ni st r at i ve t asks added up

t o a r el at i vel y smal l por t i on of hi s wor kweek because he est i mat ed

t hat he was " on the f l oor , " suppl ement i ng t he cr ew, f or 90 per cent

of hi s wor k hour s. Of cour se, wor ki ng al ongsi de t he hour l y

empl oyees " on t he f l oor " does not necessar i l y si gni f y t hat Mar zuq

was engaged onl y i n nonmanager i al act i vi t y dur i ng t hose t i mes.

As expl ai ned above, t he r egul at i ons cont empl ate t he concur r ent

13 The r egul ar st or e shi f t s wer e f r om 6 AM t o noon, noon t o3 PM, 3 PM t o 6 PM, 6 PM t o mi dni ght , and mi dni ght t o 6 AM.

14 Al t hough t he schedul es were supposed t o remai n l argel y t hesame f r om week t o week, Marzuq t est i f i ed t hat cr eat i ng a schedul ecoul d "t ake[ ] a whi l e" because of empl oyee absences and aper si st ent st af f shor t age.


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per f ormance of exempt and nonexempt t asks. See, e. g. , I n r e Fami l y

Dol l ar FLSA Li t i g. , 637 F. 3d 508, 516 ( 4t h Ci r . 2011) ( "Fami l y

Dol l ar ") ( "Thus, whi l e [ pl ai nt i f f ] unl oaded f r ei ght or swept t he

f l oor s, she was al so t he manager , and no one el se was di r ect l y

super vi si ng her wor k. " ) . I ndeed, cer t ai n of Mar zuq' s manager i al

r esponsi bi l i t i es woul d appear t o be advanced by hi s wor ki ng si de-

by- si de wi t h hi s subor di nat es, i ncl udi ng coachi ng t hem and

cor r ect i ng t hei r mi st akes.

Nonet hel ess, t he recor d cont ai ns evi dence i ndi cat i ng

t hat Mar zuq' s super vi sory rol e was, at l east at t i mes, over whel med

by hi s nonmanager i al t asks. Mor e t han once, he cl ar i f i ed t hat he

"t r i ed" t o exer ci se hi s manager i al dut i es, 15 and he repor t ed

needi ng t o do var i ous t asks t hat woul d t ake hi m away f r om t he

cust omer servi ce area of t he st or e ( cl eani ng t he bat hr oom, cl eani ng

up out si de the st or e, l andscapi ng) and, hence, appear i nconsi st ent

wi t h empl oyee super vi si on. By cont r ast , i n Fami l y Dol l ar , wher e

t he appel l at e panel af f i r med summary j udgment f or t he empl oyer on

an FLSA over t i me cl ai m, t he pl ai nt i f f acknowl edged t hat , "whi l e

[ she] per f ormed nonmanager i al t asks ar ound t he st ore as she

determi ned necessary, she concurr ent l y per f ormed t he manager i al

15 For exampl e, Marzuq was asked, " [ W] hi l e you were i n t hest or e hel pi ng t o serve cust omer s, you cont i nued t o act i n yourmanager i al capaci t y, r i ght ?" He r esponded: " I t r i ed, yes. "Si mi l ar l y, hei mmedi at el y f ol l owed up hi s acknowl edgement t hat hewas " t he capt ai n" of hi s st or e by not i ng t hat he " t r i ed t o be" t hecapt ai n.


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dut i es of r unni ng t he st or e. " 637 F. 3d at 515- 16 ( emphasi s

omi t t ed) . 16

The t i me f act or i s par t i cul ar l y compl ex i n t hi s case because

Mar zuq r out i nel y wor ked f ar i n excess of t he f or t y- ei ght - hour

t hr eshol d r equi r ed by t he Cadete manager agr eement . Hi s regul ar

schedul e cal l ed f or si xt y- si x hour s over seven days, 17 but because

he subst i t ut ed f or absent empl oyees, hi s aver age workweek was

sevent y t o ei ght y hour s. I n addi t i on, he act ed as "capt ai n" of

t he st or e even when he was of f dut y, f i el di ng phone cal l s f r om

16 The Four t h Ci r cui t el abor at ed on t he pl ai nt i f f ' s mul t i -t aski ng:

As she expl ai ned, "whet her or not [ she]happened t o be put t i ng up st ock at a gi venmoment or r unni ng a regi st er or t al ki ng t o acust omer , at t he same t i me [ she was]r esponsi bl e f or maki ng sur e t he whol e st or e

r an successf ul l y. " Si mi l ar l y, she st at ed,"When [ she was] r unni ng a cash regi st er , [ shewas] at t he same t i me l ooki ng at t he condi t i onof t he f r ont end and keep [ si c] an eye out f ort hef t , et c. " She expl ai ned, "When [ she was]doi ng [ her ] paper wor k f or [ her ] cash r egi st er sand [ her] money, [ she was] t hi nki ng about whathad t o be done l at er wi t h r egard t o t hat moneyand al l t hat paper wor k f or t hat and st or edel i ver i es. "

637 F. 3d at 516 ( al t er at i ons i n or i gi nal ) ; see al so i d. at 517

( not i ng t hat "she t est i f i ed pl ai nl y, ' I r an t he st or e when I wasi n t he bui l di ng, ' and, accor di ng t o her , she was i n t he bui l di ngmost of t he t i me, as she spent bet ween 50 and 65 hours per weekat t he st or e") .

17 He was schedul ed Monday t hrough Sat urday f r om 4 AM t o 2: 30PM, and Sunday f r om5 AM t o 8 AM. He al so r epor t ed wor ki ng Sundayeveni ngs t o f i ni sh hi s paper wor k.


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empl oyees and goi ng i nt o work i f necessary t o resol ve pr obl ems.

Yet , gi ven t he compet i ng demands r out i nel y pl aced on Mar zuq, a

f actual di sput e exi st s as t o how much of hi s workweek he actual l y

was "i n char ge" of t he st or e. Al l ocat i ng per cent ages of Mar zuq' s

work hours t o exempt and nonexempt dut i es i s t hus not a

st r ai ght f or war d cal cul at i on.

Hence, t he second f act or - - l i ke t he f i r st - - does not poi nt

deci si vel y i n ei t her di r ect i on. Cf . Donovan, 675 F. 2d at 522

( af f i r mi ng di str i ct cour t ' s f i ndi ng, af t er a bench t r i al , t hat

Bur ger Ki ng ass i st ant managers were exempt f r om overt i me where

"[ t ] he r ecor d [ ] shows t hat f or t he gr eat bul k of t hei r wor ki ng

t i me, Assi st ant Manager s ar e sol el y i n char ge of t hei r r est aur ant s

and ar e t he ' boss' i n t i t l e and i n f act " ( emphasi s added) ) .

c. Freedom from direct supervision

Test i mony f r om bot h Mar zuq and hi s di st r i ct manager ,

Der mandy, suggest s t hat Dunki n' Donut s manager s have some autonomy

over t he day- t o- day oper at i on of t hei r st or es, t hough - - l i ke t he

Bur ger Ki ng assi st ant managers - - t hey are "unabl e t o make any

si gni f i cant or subst ant i al deci si ons on [ t hei r ] own. " Bur ger Ki ng,

672 F. 2d at 227. Managers cr eat e weekl y schedul es and deci de how

many hour s t o assi gn part i cul ar empl oyees, but company di r ect ors

( r anked above Dermandy i n t he Cadet e hi erarchy) set t he st ore

budget sand Der mandy det er mi nes t he over al l st af f i ng l evel s f or

hi s di s t r i ct ' s s tores . Manager s i n al l Cadet e st ores ar e expect ed


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t o f ol l ow uni f or mpr ocedur es. Der mandy t est i f i ed t hat t he pr i mar y

t ool s used t o i nst r uct new manager s i n hi s di st r i ct ar e an onl i ne

t r ai ni ng cour se pr ovi ded by Dunki n' Br ands and two t o ei ght weeks

of "hands- on, " i n- st or e t r ai ni ng, somet i mes super vi sed by hi m and

somet i mes conduct ed at a Cadet e " t r ai ni ng st or e. " That t r ai ni ng

cover s, i nt er al i a, cust omer ser vi ce ski l l s, l eader shi p, equi pment

cal i br at i on, schedul i ng, and paper wor k.

Regul ar super vi si on cont i nues t hr oughout a manager ' s t enur e.

Dermandy spends bet ween f i f t een mi nut es and f our hours at each

st or e i n hi s di st r i ct each week. He expl ai ned t hat hi s weekl y

agenda depends on "whet her I have new managers t hat . . . need

more at t ent i on, more of my hel p, whet her or not cer t ai n st ores are

up or down i n sal es, whet her or not t hey have budget concer ns and

about 10 mi l l i on ot her t hi ngs. " Marzuq agr eed t hat Dermandy was

at hi s s t ore at l east once a week, and somet i mes more f r equent l y. 18

St or e manager s' aut hor i t y t o pr obl em sol ve i s l i mi t ed.

Der mandy' s manager s ar e r equi r ed t o cal l hi m i f t hey need

mai nt enance work t hey are unabl e t o per f orm t hemsel ves, and he

wi l l t hen pl ace t he r epor t ed mal f unct i on on a r epai r l i st f or an

out si de mai nt enance per son. Manager s appear t o have l i t t l e

f l exi bi l i t y i n r esol vi ng cust omer compl ai nt s. I n r esponse t o "my

18 Marzuq r epor t ed Dermandy' s vi si t s as f ol l ows: "Some weeksevery day, some weeks every ot her day, some weeks once. I t al ldepends on hi s own schedul e, and al l depends on what ki nd ofpr obl ems t hat I have at t he st or e. "


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cof f ee was col d yest erday, " f or exampl e, a manager may "buy" t he

cust omer a new cup of cof f ee, but t he manager may not i ssue a gi f t

card wi t hout Der mandy' s appr oval .

The r ecor d cont ai ns i nconsi st ent evi dence on personnel

deci si ons. For exampl e, Dermandy st at ed t hat a st ore manager has

aut hor i t y t o t ermi nat e a cr ew member f or some reasons - - such as

t ar di ness - - whi l e t he di st r i ct manager needs t o be i nvol ved f or

"bi g" i ssues, such as t hef t or verbal abuse bet ween empl oyees.

Marzuq, however , sai d t hat Dermandy had t o appr ove any t ermi nat i on,

addi ng: "He ha[ s] t o know ever yt hi ng t hat ' s goi ng on. " Manager s

al so need permi ss i on t o hi r e addi t i onal cr ew members when t hey are

shor t st af f ed, as wel l as t o add an assi st ant manager posi t i on.

FromMar zuq' s per spect i ve, manager s have l i t t l e i ndependence.

When asked how Dermandy supervi sed hi s wor k, he st at ed: "Fr omever y

way, f r om t he r ecor ds t hat I send hi m weekl y, f r om comi ng down

[ t o] t he st or e or f r om t he of f i ce i f he hear d anyt hi ng, f r om phone

cal l s, f r om e- mai l s, or f r om showi ng up di f f er ent t i mes. . . . I

. . . have t o go thr ough my bosses f or anythi ng t hat I have t o

do. "

I n sum, t he r ecor d depi ct s a dynami c t hat , at l east i n br oad

st r okes, appear s t ypi cal f or a f ast - f ood f r anchi se manager :

l i mi t ed deci si on- maki ng aut hor i t y, par t i cul ar l y when a mat t er

i nvol ves spendi ng money; cl ose moni t or i ng by an of f - si t e super i or

t o ensur e compl i ance wi t h t he company' s pol i ci es, pr act i ces, and


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expect at i ons; and ever yday r esponsi bi l i t y f or t he smoot h oper at i on

of a cl ean, adequat el y st af f ed r est aur ant . Thi s scenar i o i s

si mi l ar t o our descr i pt i on of t he ci r cumst ances i n Bur ger Ki ng,

where t he assi st ant managers' equi val ent t asks were "governed by

hi ghl y det ai l ed, st ep- by- st ep i nst r uct i ons cont ai ned i n Bur ger

Ki ng' s ' Manual of Oper at i ng Dat a, ' and admi t of l i t t l e or no

var i at i on. " 672 F. 2d at 223; see al so Morgan, 551 F. 3d at 1271

( concl udi ng t hat "[ s] t or e manager s had l i t t l e f r eedom f r om di r ect

super vi si on, " wher e, i nt er al i a, di st r i ct manager s "wer e

r esponsi bl e f or enf or ci ng t he det ai l ed st or e oper at i ng pol i ci es; "

cl osel y r evi ewed each st or e' s i nvent or y, or der s, and net sal es

f i gur es; moni t or ed weekl y payrol l ; cont r ol l ed empl oyee pay r at es

and r ai ses; and "r out i nel y sent t o- do l i st s and emai l s wi t h

i nst r uct i ons t o st or e manager s") .

The r ecor d t hus shows t hat Der mandy cl osel y super vi sed

pl ai nt i f f s . On i t s own, t hi s f act or t ends t o f avor pl ai nt i f f s .

Bur ger Ki ng, however , accept ed a conf i ned l evel of aut hor i t y as

consi st ent wi t h a concl usi on t hat t he assi st ant manager s had

management as t hei r pr i mar y dut y. Hence, t hi s f act or , l i ke t he

t wo f act or s al r eady di scussed, does not deci si vel y poi nt one way

or t he ot her on t he pr i mar y dut y quest i on.


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d. The relationship between plaintiffs' salaries and the

wages paid hourly employees for similar nonexempt work

The par t i es' combi ned st at ement of undi sput ed f act s gi ves

Marzuq' s weekl y sal ary as $825 and Chant r e' s as $600, and r epor t s

t hat cr ew member s ar e pai d $8 per hour . I f , on an hour l y basi s,

a manager ' s sal ary f or per f ormi ng a hi gh percent age of nonexempt

wor k i s about t he same as t he wages of cr ew member s f or such wor k,

t he j ust i f i cat i on f or exempt i ng t he manager f r om over t i me pay i s

weakened. See general l y, e. g. , Donovan, 675 F. 2d at 520 ( "Where

sal ar y i s l ow and a subst ant i al amount of t i me i s spent on non-

exempt work, t he i nf erence that t he empl oyee i s not an execut i ve

i s qui t e st r ong . . . . ") ; Mar shal l v. W. Uni on Tel . Co. , 621 F. 2d

1246, 1251 ( 3d Ci r . 1980) ( not i ng t hat "gr ant i ng manager i al

empl oyees exempt st at us must have been a recogni t i on t hat t hey ar e

sel dom t he vi ct i ms of subst andar d wor ki ng condi t i ons and l ow

wages" ) . An accur at e compar i son of weekl y and hour l y wages

necessar i l y depends on t he number of hour s at t r i but ed t o t he

sal ar i ed empl oyees, yet - - as descri bed above - - i t i s di f f i cul t

on t hi s r ecor d t o f i x a number of hour s worked by t he managers.

Taki ng t he f act s i n t he l i ght most f avor abl e t o pl ai nt i f f s,

however , we at a mi ni mummust presume t hat Mar zuq regul ar l y wor ked

si xt y- si x hour s per week. Based on t hei r sal ar i es, t hat woul d be

an hour l y rate of $12. 50 f or Marzuq and r oughl y $9 f or Chant r e.


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Two ot her f act or s al so must be consi dered. Fi r st , t he hour l y

empl oyees al so recei ved t i p i ncome, i ncr easi ng t hei r ear ni ngs by

some mar gi n. We thus must deter mi ne how much t i p i ncome to add t o

t he cr ew member s' $8- per - hour base r at e t o make a f ai r compar i son

wi t h pl ai nt i f f s' sal ar i es. The r ecor d cont ai ns evi dence

i ndi cat i ng t hat t i ps may have been as l ow as f i f t y cent s per hour

or as much as $2. 70 per hour . 19 I n t hei r br i ef , appel l ant s pr opose

a $2- per - hour t i p est i mat e, whi ch we concl ude i s adequat el y

suppor t ed by t he r ecord f or pur poses of summary j udgment .

Second, a f ai r compar i son of wages al so needs t o t ake i nt o

account t hat , i f managers were compensat ed l i ke hour l y empl oyees,

hour s worked over f or t y woul d be pai d at t he over t i me rat e of t i me-

and- a- hal f . Hence, t aki ng a si xty- si x- hour wor kweek, compensat ed

at $8 per hour f or t he f i r st f or t y hour s ( $320) and $12 per hour

f or t he r emai ni ng t went y- si x hour s ( $312) , suppl ement ed by $2- per -

hour i n t i ps ( $132) , a nonmanager i al cr ew member woul d earn $764

- - si gni f i cant l y mor e t han Chant r e and i nsi gni f i cant l y l ess t han

Marzuq. See, e. g. , Morgan, 551 F. 3d at 1271 ( descr i bi ng as

"r el at i vel y smal l " a two- or t hr ee- dol l ar di f f er ence bet ween

19 Cadete assumed empl oyees ear ned f i f t y cent s per hour i n t i pi ncome, but Mar zuq t est i f i ed t hat , when he shar ed i n t i ps, her ecei ved r oughl y $180 per week i n such i ncome. Based on a si xt y-si x- hour week, $180 woul d amount t o about $2. 70 per hour . At somepoi nt dur i ng Marzuq' s t enur e wi t h Cadete, t he company changed i t spol i cy t o pr ohi bi t manager s f r om r ecei vi ng t i ps.


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hour l y rat es of sal ar i ed st or e manager s and hour l y assi st ant

managers) .

At l east at t hi s j unct ur e, t he equi val ence i n pay shown

by thi s cal cul at i on means t hat t he sal ar y vs. hour l y wages f act or

i s squarel y i n pl ai nt i f f s ' f avor .

e. The primary duty inquiry as a whole

As our di scussi on of t he f act or s l i st ed i n 541. 700( a)

demonst r ates, t he evi dence i n t he r ecor d does not l ead i nevi t abl y

t o a concl usi on t hat , i n pr act i ce, Mar zuq and Chant r e' s pri mar y

dut y was management . To eval uate at l east t wo of t he f act ors - -

t he t i me spent on exempt wor k and t he wage compar i son - - a

f act f i nder woul d need t o det er mi ne t he number of hour s pl ai nt i f f s

r egul ar l y worked, t he percent age of t i me t hey were engaged i n

nonexempt work, and the por t i on of t hat nonexempt t i me i n whi ch

t hey wer e concur r ent l y per f or mi ng manager i al dut i es. See, e. g. ,

Rei ch v. St ewart , 121 F. 3d 400, 404 ( 8t h Ci r . 1997) ( " [ T]he amount

of t i me an empl oyee works and t he dut i es he or she per f orms pr esent

f act ual quest i ons[. ] ") .

I ndeed, i f a f act f i nder det er mi ned t hat pl ai nt i f f s' nonexempt

dut i es r egul ar l y consumed more t han f or t y hour s per week, 20 and

t hat pl ai nt i f f s di d not , i n f act, si mul t aneousl y per f or m

20 Ni net y per cent of hi s schedul ed si xt y- si x hour s - - t heamount of t i me Marzuq sai d he was "on t he f l oor " - - woul d beabout 59 hour s.


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manager i al dut i es dur i ng a subst ant i al por t i on of t hat t i me, a

concl usi on t hat management was pl ai nt i f f s' pr i mary dut y seems

unl i kel y - - even i f , as Mar zuq t est i f i ed, he spent at l east anot her

t went y t o t hi r t y hour s each week on exempt work. Taken as t r ue,

t he f act t hat Marzuq wor ked seven days a week, l oggi ng a mi ni mum

of si xt y- si x hour s and of t en mor e, t oget her wi t h a f i ndi ng t hat

most of t hose hour s were excl usi vel y devot ed t o nonexempt work,

woul d suggest t hat he ef f ect i vel y was doi ng t wo j obs, f or one

sal ary: a f ul l t i me nonexempt posi t i on and a part - t i me exempt one.

I n t hat scenar i o, a r easonabl e f act f i nder mi ght be r el uct ant t o

char act er i ze t he "par t - t i me" manager i al posi t i on as hi s pr i mar y

dut y f or t he company.

Moreover , such a scenar i o woul d appear t o conf l i ct wi t h one

of t he pr i nci pal goal s of t he FLSA' s over t i me pr ovi si on: "t o spr ead

empl oyment more wi del y t hrough t he work f or ce by di scour agi ng

empl oyer s f r om r equi r i ng more t han f or t y hour s per week f r om each

empl oyee. " Mar shal l v. Chal a Ent er s. , I nc. , 645 F. 2d 799, 803

( 9t h Ci r . 1981) ; see al so Over ni ght Mot or Tr ansp. Co. v. Mi ssel ,

316 U. S. 572, 578 ( 1942) ( " I n a per i od of wi despr ead unempl oyment

and smal l pr of i t s, t he economy i nher ent i n avoi di ng ext r a pay was

expect ed t o have an appr eci abl e ef f ect i n t he di st r i but i on of

avai l abl e work. Reduct i on of hour s was a par t of t he pl an f r om

t he begi nni ng. " ) , super seded on ot her gr ounds by st at ut e, Por t al -

t o- Por t al Pay Act , 61 St at . 84, 86- 87 ( 1947) , as st at ed i n Tr ans


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Wor l d Ai r l i nes, I nc. v. Thur st on, 469 U. S. 111, 128 n. 22 ( 1985) ;

Mechmet v. Four Seasons Hot el s, Lt d. , 825 F. 2d 1173, 1176 ( 7t h

Ci r . 1987) ( not i ng t hat one pur pose of t he FLSA over t i me

r equi r ement was " t o spr ead wor k and ther eby r educe unempl oyment ,

by requi r i ng an empl oyer t o pay a penal t y f or usi ng f ewer worker s

t o do t he same amount of wor k as woul d be necessar y i f each wor ker

worked a short er week") ; "Def i ni ng and Del i mi t i ng t he Exempt i ons

f or Execut i ve, Admi ni st r at i ve, Pr of essi onal , Out si de Sal es and

Comput er Empl oyees, " 69 Fed. Reg. 22, 122, 22, 124, 2004 WL 865626

( Apr . 23, 2004) ( her eaf t er "Def i ni ng and Del i mi t i ng t he Exempt i ons

2004") ( not i ng " t he pot ent i al j ob expansi on i nt ended by the FLSA' s

t i me- and- a- hal f over t i me pr emi um") .

Manager s, of cour se, t ypi cal l y wor k mor e t han a f or t y- hour

week wi t hout ent i t l ement t o overt i me compensat i on under t he FLSA, 21

21 The r egul at i ons do not addr ess execut i ve empl oyees whosemanager i al r esponsi bi l i t i es r equi r e an ext r aor di nar y number ofwor k hour s, appar ent l y ref l ect i ng an assumpt i on t hat suchempl oyees are adequat el y compensat ed i n ot her ways. See "Def i ni ngand Del i mi t i ng t he Exempt i ons 2004, " 69 Fed. Reg. at 22, 123- 24( st at i ng t hat "[ t ] he l egi sl at i ve hi st or y i ndi cat es t hat t he. . . exempt i ons wer e pr emi sed on t he bel i ef t hat t he wor ker sexempt ed typi cal l y earned sal ar i es wel l above the mi ni mum wage,and t hey were pr esumed t o enj oy ot her compensat ory pr i vi l eges suchas above aver age f r i nge benef i t s and bet t er oppor t uni t i es f or

advancement " ) ; Dep' t of Labor , Wage and Hour Di vi si on, "Def i ni ngand Del i mi t i ng t he Ter ms ' Any Empl oyee Empl oyed i n a Bona Fi deExecut i ve, Admi ni st r at i ve, or Pr of essi onal Capaci t y . . . or i nt he Capaci t y of Out si de Sal esman, ' " 46 Fed. Reg. 3010, 3016 ( 1981)( st at i ng t hat t he execut i ve exempt i on "st emmed f r om t her ecogni t i on t hat such per sonnel have speci al wor kr esponsi bi l i t i es, compensat or y pr i vi l eges and benef i t s whi ch ar esuper i or t o t hose of ot her empl oyees" ) .


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and t he Secr et ar y' s r egul at i ons expr essl y rej ect a per cent age

t hr eshol d f or t r i gger i ng over t i me pay. See 29 C. F. R. 541. 700( b)

( " [ N] ot hi ng i n t hi s sect i on r equi r es t hat exempt empl oyees spend

more t han 50 percent of t hei r t i me per f ormi ng exempt work. " ) ; 22see

al so Fami l y Dol l ar , 637 F. 3d at 515 ( "Ther e i s no per se r ul e t hat

once t he amount of t i me spent on manual l abor approaches a cer t ai n

per cent age, sat i sf act i on of [ t he t i me] f act or i s pr ecl uded as a

mat t er of l aw. " ) . Yet , t he percent ages may have an i mpact when

combi ned wi t h other f actors. Under t he r egul at i ons, manager s who

"spend mor e t han 50 per cent of t he t i me per f or mi ng nonexempt wor k

such as r unni ng t he cash r egi st er " woul d gener al l y not f ul f i l l t he

pr i mar y dut y requi r ement i f t hey ar e "cl osel y super vi sed and ear n

l i t t l e more t han t he nonexempt empl oyees. " 29 C. F. R. 541. 700( c) .

I n shor t , as expl ai ned above, t he evi dence i s i nconcl usi ve on

mul t i pl e f act or s i n t he pr i mar y- dut y i nqui r y. Hence, t he

pl ai nt i f f s' pr i mar y dut y cannot be det er mi ned as a mat t er of l aw

at t hi s st age of t he case.

22 The FLSA "Exempt i ons" pr ovi si on ant i ci pat es t hat amanager i al empl oyee i n "a r et ai l or ser vi ce est abl i shment " wi l lspend some t i me on nonexempt dut i es, and thus pr ovi des t hat exempt

st at us shoul d not be deni ed based on " t he number of hour s i n hi swor kweek whi ch he devot es t o act i vi t i es not di r ect l y or cl osel yr el at ed t o t he per f or mance of execut i ve or admi ni st r at i veact i vi t i es, i f l ess t han 40 per cent um of hi s hour s wor ked i n t hewor kweek ar e devot ed t o such act i vi t i es. " 29 U. S. C. 213( a) ( 1) .Under t he r egul at i ons, t he number of nonexempt hours can exceed 40per cent so l ong as t he empl oyee other wi se sat i sf i es t he exempt i onr equi r ement s.


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2. Authority or Influence on Personnel Decisions

The open quest i on of pr i mar y dut y means t hat i t i s unnecessar y

f or us t o addr ess t he r emai ni ng el ement of t he "bona f i de

execut i ve" i nqui r y: pl ai nt i f f s' r ol e i n changi ng t he st at us of

ot her empl oyees, i ncl udi ng hi r i ng, f i r i ng, and pr omot i on. The

f act ual di sput e concer ni ng pr i mar y dut y suf f i ces t o f or ecl ose

summar y j udgment .

IV.

Vi ewi ng t he r ecor d i n t he l i ght most f avor abl e t o pl ai nt i f f s,

a r easonabl e f act f i nder coul d concl ude t hat def endant s have f ai l ed

t o meet t hei r bur den of showi ng t hat Marzuq and Chant r e f el l wi t hi n

t he "bona f i de execut i ve" except i on t o t he FLSA' s over t i me pay

r equi r ement . Hence, we vacat e t he summary j udgment f or def endants

and r emand t he case f or f ur t her pr oceedi ngs.

So or der ed. Cost s t o appel l ant s.

marzuq v. cadete enterprises, inc., 1st cir. (2015)

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