Lyles v. K-Mart Corp., 79-102-Civ-Oc.

• Court: United States District Courts. 11th Circuit. United States District Court of Middle District of Florida
• Citation: 519 F. Supp. 756
• Docket Number: No. 79-102-Civ-Oc.,79-102-Civ-Oc.
• Parties: Jeffrey LYLES and Neil Meyer, Plaintiffs, v. K-MART CORPORATION, a Michigan Corporation, Defendants.
• Decision Date: 04 August 1981

519 F. Supp. 756

Jeffrey LYLES and Neil Meyer, Plaintiffs,
v.
K-MART CORPORATION, a Michigan Corporation, Defendants.

No. 79-102-Civ-Oc.

United States District Court, M. D. Florida, Ocala Division.

August 4, 1981.

Christopher C. Ford, Ford & Minkoff, Tavares, Fla., for plaintiffs.

Thomas P. Moran, Orlando, Fla., for defendants.

OPINION

CHARLES R. SCOTT, District Judge.

This is an action brought under the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. (hereinafter `the Act'), to recover wages allegedly owed to plaintiffs for uncompensated overtime labor performed on behalf of the defendant corporation. Pursuant to Fed.R.Civ.P. 52, the Court makes the following findings of fact and conclusions of law:

FINDINGS OF FACT

1. The plaintiffs are Jeffrey Lyles and Neil Meyer.

519 F. Supp. 757

2. The defendant is K-Mart Corporation, a Michigan corporation, which operates more than 2,100 retail department stores nationwide.

3. The plaintiffs were employed as "assistant managers" at the K-Mart store in Mt. Dora, Florida. The Mt. Dora store has gross sales approximating $5 million annually and serves approximately 500 to 600 customers daily. The store has roughly 43,000 square feet of selling space and employs from 60 to 80 employees.

4. All employees of the store are compensated on the basis of an hourly wage, except for the store manager and assistant managers.

5. Jeffrey Lyles was a salaried employee who was compensated at the rate of $183.47 per week from September 22, 1977 to April 5, 1978; $192.70 from April 6, 1978 to December 13, 1978; and thereafter at the rate of $206.54 per week until his employment was terminated on February 14, 1979.

6. Neil Meyer was a salaried employee who was compensated at the rate of $263.68 per week from May 11, 1978 to September 7, 1978; $276.93 per week from September 8, 1978 to December 13, 1978; and thereafter at the rate of $288.46 per week until his employment was terminated on February 20, 1979.

7. Both plaintiffs worked a substantial number of hours in excess of 40 hours per week for which they never received compensation at the time and one-half rate. 29 U.S.C. § 207.

8. The focal point of this action is the executive exemption provision of the Act, 29 U.S.C. § 213(a)(1), as explicated by the administrative regulations, 29 C.F.R. § 541.1 et seq. The defendant raised the provision as an affirmative defense. Title 29 U.S.C. § 213(a)(1) provides that an "employee employed in a bona fide executive ... capacity" is exempt from the overtime provisions of the Act. In light of the Court's determination that plaintiffs were indeed exempt employees within the meaning of the Act, see text infra, it is unnecessary to explore plaintiffs' claims as to the actual number of overtime hours worked.

9. The Mt. Dora K-Mart store was divided into three zones and each assistant manager was in charge of one zone. Within each zone there were several departments. The assistant manager was solely responsible for the activities within his zone.

10. As with most other disputed issues in this case, the testimony regarding the number of employees supervised by each assistant manager was in conflict. Lyles, however, testified that he supervised at least 20 employees. This strikes the Court as the most reasonable testimony in light of the fact that each assistant manager supervised approximately one-third of the store and the store employed from 60 to 80 employees.

11. The assistant managers conducted initial employment interviews, made recommendations as to hiring, trained new employees, disciplined employees, and recommended the termination of employees. Their recommendations as to hiring and firing were given particular weight.

12. The assistant managers reviewed and sometimes completed numerous types of reports. These included profit reports, merchandise statements, cash reports, security activity reports, etc. The assistant managers would affix their signatures to the reports after reviewing or completing them.

13. The assistant managers met at least twice each day with the store manager to discuss store policies and strategies.

14. Each assistant manager was provided with a document bearing the heading "Areas of Responsibility for Assistant Managers." The document lists 30 duties, all of which are of a supervisory nature, that assistant managers were expected to perform. Mrs. Mary Jane Mock, a former assistant manager at the Mt. Dora K-Mart store, testified that the document accurately depicted the activities performed by an assistant manager. The Court finds Mrs. Mock to have been a credible witness.

15. While employed by K-Mart, both plaintiffs completed forms bearing the

519 F. Supp. 758

heading "Tests to Qualify As An Executive." Lyles' form reflects that his work time was apportioned among his various job duties as follows

Supervision: ---------------------------- 60 percent
                Store Planning: ------------------------- 10 percent
                Control: -------------------------------- 5 percent
                Personnel Development and Training: ----- 15 percent
                Miscellaneous-Exempt Responsibilities: -- 2 percent
                GRAND TOTAL EXEMPT DUTIES: -------------- 92 percent
                NON-EXEMPT DUTIES: ---------------------- 8 Percent1
                

Lyles' signature followed the statement: "I hereby certify that the above is an accurate breakdown of my duties as an assistant manager at the K-Mart Corporation."

Meyer's form reflects that his work time was apportioned among his various work duties as follows:

Supervision: ---------------------------- 25 percent
                Store Planning: ------------------------- 30 percent
                Control: -------------------------------- 4 percent
                Personnel Development and Training: ----- 10 percent
                Miscellaneous-Exempt Responsibilities: -- 1 percent
                GRAND TOTAL EXEMPT DUTIES: -------------- 70 percent
                NON-EXEMPT DUTIES: ---------------------- 30 Percent
                

Meyer's signature followed the statement quoted above certifying that the form accurately depicted the breakdown of his duties.

It is evident from Meyer's form that an alteration was made after it was initially completed. Originally, Meyer had filled in the form to show a 50-50 breakdown between exempt and non-exempt duties. At trial, Meyer testified that the store manager, Roger Hamilton, would not accept the form unless Meyer changed the figures. Hamilton testified that he did not coerce Meyer to change the figures. Rather, Hamilton testified that he merely discussed the breakdown of duties with Meyer and that Meyer voluntarily decided that he was spending more than ten percent of his time in Store Planning.

Mrs. Mock testified that she spent approximately 15 percent of her work time engaging in non-exempt duties while employed by K-Mart as an assistant manager.

16. At trial, plaintiffs claimed they spent 80 to 90 percent of their time performing non-exempt work. The Court finds that this testimony lacked credibility, particularly in light of the "Executive Test" forms the plaintiffs completed. Plaintiffs testified that they spent most of their time moving stock, waiting on customers, unloading trucks, sweeping floors and engaging in other similar menial labor. All of the evidence on this matter, with the exception of the testimony of plaintiffs and Janet Wall, established that this was inaccurate.

Hamilton, the store manager, estimated that Lyles spent roughly 20 to 30 percent of his time performing menial labor and that Meyer spent less than five percent of his time performing such labor. Mrs. Mock, a former assistant manager, placed this figure at ten percent for Meyer and "less than that" for Lyles. Josephine Peebles, former personnel manager at the Mt. Dora store, testified that plaintiffs engaged in menial tasks on an infrequent and irregular basis. Other employees testified that they saw the plaintiffs stocking shelves or waiting on customers only occasionally.

519 F. Supp. 759

Janet Wall testified for plaintiffs. She estimated that both Meyer and Lyles spent roughly 50 percent of their time engaging in activities such as unloading trucks, moving stock, stocking shelves, assisting customers, etc. At her deposition, however, Wall was unable to offer any type of percentage breakdown.² Moreover, it is difficult to comprehend how Wall could have observed the daily activities of plaintiffs when she was generally confined to the camera and jewelry department, which occupies only a small portion of the store's 43,000 square feet of selling space.

The Court finds that Wall's testimony lacked credibility. She appeared to be an extremely disgruntled former employee. Her testimony established that she had "more than a mild dislike" for Hamilton, the store manager, and had "a few private names" reserved for him. Motivation for her bias might stem from the fact that she was formally reprimanded three times within the last two months of her employment.

The Court finds that both Lyles and Meyer spent a minimum of 70 percent of their time engaged in managerial or supervisory duties.

17. The plaintiffs routinely performed several discretionary functions. Each had several departments under his control, e. g., Meyer testified that he was responsible for at least 15 departments. All the employees within the assistant manager's zone were under his direct supervision and he was responsible for instructing them on how to perform their job duties. The plaintiffs conducted pre-employment interviews and made recommendations as to hiring. They had the authority to discipline employees, which...