Anani v. Cvs Rx Serv. Inc.

• Decision Date: 23 May 2011
• Docket Number: No. 09–CV–5535 (ADS)(AKT).,09–CV–5535 (ADS)(AKT).
• Citation: 788 F.Supp.2d 55,17 Wage & Hour Cas.2d (BNA) 1679
• Parties: Salah ANANI, Individually and on Behalf of All Other Persons Similarly Situated, Plaintiff,v.CVS RX SERVICES, INC., Defendant.
• Court: U.S. District Court — Eastern District of New York

788 F.Supp.2d 55

17 Wage & Hour Cas.2d (BNA) 1679

Salah ANANI, Individually and on Behalf of All Other Persons Similarly Situated, Plaintiff,

v.CVS RX SERVICES, INC., Defendant.

No. 09–CV–5535 (ADS)(AKT).

United States District Court, E.D. New York.

May 23, 2011.

Klafter Olsen & Lesser LLP by Jeffrey A. Klafter, Esq., Seth R. Lesser, Esq., Fran L. Rudich, Esq., Lana Koroleva, Esq., Of Counsel, Rye Brook, NY, Berger & Associates by Bradley I. Berger, Esq., Of Counsel, New York, NY, for Plaintiff.Jackson Lewis, LLP by Felice B. Ekelman, Esq., Of Counsel, New York, NY, Ashe Rafuse & Hill LLP by Nancy Rafuse, Esq., James J. Swartz, Esq., Kristy G. Offitt, Esq., Of Counsel, Atlanta, GA, for Defendant.

MEMORANDUM OF DECISION AND ORDER

SPATT, District Judge.

Salah Anani (“Anani” or “the Plaintiff”) commenced this action on behalf of himself and other similarly situated individuals against CVS RX Services, Inc. (“CVS” or “the Defendant”) seeking unpaid overtime compensation pursuant to the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq. (“FLSA”) and the New York Labor Law §§ 650 et seq. (“Labor Law”). Presently before the Court is the Defendant's motion for summary judgment dismissing the complaint pursuant to Federal Rule of Civil Procedure 56. For the reasons stated below, the Defendant's motion is granted.

I. BACKGROUND

Defendant CVS RX Services, Inc. is a pharmacy retail store that operates more than 5,000 stores nationwide. From November 2003 until his resignation in July 2009, Salah Anani was employed as a full-time pharmacist at CVS, where he worked at a number of different CVS locations including stores in Huntington, West Islip, East Islip, Central Islip, East Hampton, and South Hampton. As set forth in the “CVS Pharmacy Payroll Policies” packet, CVS classified its pharmacists as either “bi-weekly salaried pharmacists” or “hourly pharmacists.”

Beginning in November 2003, CVS hired Anani for a full-time position and classified him as a “bi-weekly salaried pharmacist.” In addition to a $10,000 signing bonus, CVS agreed to pay Anani an annual base salary of $100,031 predicated on a 44 hour workweek. ( See Def.'s 56.1 Stmt., Ex. C.) This agreement was memorialized in a letter from CVS to Anani informing him that he was considered a “salaried professional” and outlining the above terms of his compensation. ( See id.) Over the course of his employment at CVS, Anani's guaranteed compensation ranged from $107,536 to $145,608.32.

The payment policy for bi-weekly salaried pharmacists was set forth in the CVS Pharmacy Payroll Policies packet, which stated that the “[b]ase salary is a guaranteed minimum amount” and that “[a]ll full-time Pharmacists are paid at least their ‘base salary’ every week.” (Def.'s 56.1 Stmt., Ex. D at 2 (emphasis in original).) Although CVS classified full-time bi-weekly salaried pharmacists as “salaried professionals” who were exempt from receiving overtime compensation, it nevertheless offered “premium pay” as an “additional incentive and reward for Pharmacists who work extra shifts and help the company meet its service goals”. ( Id. at 10.) In order to calculate a pharmacist's premium pay, CVS determined the pharmacists “Compensation Rate” by dividing the annual salary by 52 weeks, and then the weekly salary by the pharmacists agreed upon number of “base hours.” The premium pay rate per hour was the “Compensation Rate” plus $6. Although Anani's base hours were set at 44, he frequently worked between 60 and 80 hours per week. As a result, Anani received a substantial amount of premium pay, often resulting in his biweekly paychecks exceeding his “base” by 70%. ( See Pl.'s Br. at 1; Pl.'s Counterstatement of Facts ¶¶ 9–12.)

Anani resigned from CVS on July 20, 2009, and commenced the instant action on December 18, 2009, alleging that CVS improperly classified him as a “salaried professional” and therefore he was entitled to overtime compensation at the full rate of time and a half under the Fair Labor Standards Act and the New York Labor Law. In opposition, CVS contends that, as a matter of law, Anani qualified as an exempt employee under the relevant statutes. Therefore CVS seeks summary judgment dismissing Anani's claims. Insofar as Anani stipulates to the dismissal of his New York Labor Law cause of action, and stipulates to a two year statute of limitations, the discussion below only addresses whether Anani was properly classified as an exempt employee under the FLSA from December 18, 2007 up to and including July 20, 2009.

II. DISCUSSION

A. Legal Standard on Summary Judgment

It is well-settled that summary judgment under Fed.R.Civ.P. 56(c) is proper only “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). A fact is “material” within the meaning of Fed.R.Civ.P. 56 when its resolution “might affect the outcome of the suit under the governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). An issue is “genuine” when “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. In determining whether an issue is genuine, “[t]he inferences to be drawn from the underlying affidavits, exhibits, interrogatory answers, and depositions must be viewed in the light most favorable to the party opposing the motion.” Cronin v. Aetna Life Ins. Co., 46 F.3d 196, 202 (2d Cir.1995) (citing United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962) (per curiam), and Ramseur v. Chase Manhattan Bank, 865 F.2d 460, 465 (2d Cir.1989)).

Once the moving party has met its burden, “the nonmoving party must come forward with ‘specific facts showing that there is a genuine issue for trial.’ ” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (quoting Fed.R.Civ.P. 56(e)). However, the nonmoving party cannot survive summary judgment by casting mere “metaphysical doubt” upon the evidence produced by the moving party. Matsushita, 475 U.S. at 586, 106 S.Ct. 1348. Summary judgment is appropriate when the moving party can show that “little or no evidence may be found in support of the nonmoving party's case.” Gallo v. Prudential Residential Servs., 22 F.3d 1219, 1223–24 (2d Cir.1994) (citations omitted).

B. As to the Relevant Exemptions from the FLSA

The FLSA sets minimum requirements for wage and overtime payments and prohibits employment for more than a specified number of hours per week without proper overtime compensation. 29 U.S.C. §§ 201–13. In particular, an employee who works in excess of forty hours a week must be compensated for each hour worked in excess of forty hours “at a rate not less than one and one-half times the regular rate at which he is employed.” Id. at § 207(a)(1). However, certain employees, including those who are employed in “a bona fide executive, administrative, or professional capacity”, are exempt from this overtime compensation requirement. Id. at § 213(a)(1). “ ‘[B]ecause the FLSA is a remedial act, its exemptions ... are to be narrowly construed,’ and the burden rests on the employer to prove that a particular employee is exempt from the Act's requirements.” Havey v. Homebound Mortgage, Inc., 547 F.3d 158, 163 (2d Cir.2008) (quoting Martin v. Malcolm Pirnie, Inc., 949 F.2d 611, 614 (2d Cir.1991)).

The FLSA does not define the terms “executive,” “administrative,” or “professional” for purposes of the exemption, but directs the Secretary of Labor to do so by regulation. 29 U.S.C. § 213(a)(1). The Secretary's regulations have the force of law, and are generally given controlling weight. See Auer v. Robbins, 519 U.S. 452, 461, 117 S.Ct. 905, 137 L.Ed.2d 79 (1997) (“Because the salary-basis test is a creature of the Secretary's own regulations, his interpretation of it is ... controlling unless ‘plainly erroneous or inconsistent with the regulation.’ ”) (quoting Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 359, 109 S.Ct. 1835, 104 L.Ed.2d 351 (1989)).

On March 31, 2003, the United States Department of Labor (“DOL”) published a notice with regard to a proposed set of new FLSA regulations. See Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees, 68 Fed.Reg. 15,560, 2003 WL 1617356 (Mar. 31, 2003) (“DOL Proposal”). After a 90–day comment period, the DOL revised and released its final regulations, defining the exemptions under the FLSA. See Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees, 69 Fed.Reg. 22,122, 2004 WL 865626 (Apr. 23, 2004) (“DOL Final Rules”). The new regulations became effective on August 23, 2004 (the “2004 Amendments”), and are applicable to the instant case, insofar as Anani asserts entitlement to overtime for pay periods from December 18, 2007, through and including July 20, 2009. The guidance contained in the DOL Proposal and the DOL Final Rules, as well as the guidance contained in DOL Wage & Hour Opinion Letters, “are ‘entitled to respect’ ... to the extent that they are persuasive ...” Christensen v. Harris County, 529 U.S. 576, 578, 120 S.Ct. 1655, 1657, 146 L.Ed.2d 621 (2000) (quoting Skidmore v. Swift & Co., 323 U.S. 134, 65 S.Ct. 161, 164, 89 L.Ed. 124 (1944)).

Here, CVS contends that Anani was not subject to the FLSA overtime requirements because he was properly classified and treated both as an exempt “professional employee”, see 29 C.F.R. § 541.300, and as an exempt “highly compensated employee”, see 29 C.F.R. § 541.601. In order to meet the criteria for the “professional” exemption, an employee must satisfy both a “salary basis test” and a “duties test.” See 29 C.F.R. § 541.2; Auer, 519 U.S. at 455, 117...