Stephen A. Ale v. Tennessee Valley Authority

269 F.3d 680, 7 Wage & Hour Cas.2d (BNA) 586, 2001 U.S. App. LEXIS 22393, 2001 WL 1230570
CourtCourt of Appeals for the Sixth Circuit
DecidedOctober 17, 2001
Docket99-6642
StatusPublished
Cited by75 cases

This text of 269 F.3d 680 (Stephen A. Ale v. Tennessee Valley Authority) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stephen A. Ale v. Tennessee Valley Authority, 269 F.3d 680, 7 Wage & Hour Cas.2d (BNA) 586, 2001 U.S. App. LEXIS 22393, 2001 WL 1230570 (6th Cir. 2001).

Opinion

OPINION

NATHANIEL R. JONES, Circuit Judge.

Plaintiffs, 20 former employees of the Tennessee Valley Authority (“TVA”), *683 worked in the TVA’s Site Security Organization at its Watts Bar (“WBN”) and Se-quoyah Nuclear (“SNP”) Plants. In November of 1996, plaintiffs brought a claim against the TVA charging that in June 1996, it willfully eliminated their overtime pay in violation of Section 7 of the Fair Labor Standards Act (“FLSA”). 29 U.S.C. § 207. Pursuant to 28 U.S.C. § 636(c), both parties agreed to have their case tried by a United States Magistrate Judge.

Prior to the damages phase of the trial, plaintiffs moved to amend their complaint to include all unpaid overtime compensation, including compensation owed prior to June 1996. The motion was granted. After conducting a non-jury trial on liability and damages, the magistrate judge found that TVA willfully violated the FLSA and issued an order granting damages on November 24, 1999. The TVA now appeals this order. For the reasons stated below, we AFFIRM.

I. Facts

As noted above, plaintiffs sued TVA for willfully failing to pay them time-and-a-half overtime wages in violation of section 7(a) of the FLSA. In response, TVA alleges that plaintiffs are not entitled to such compensation because they are bona fide executive and administrative employees and are exempt from the mandates of section 7(a).

A. Background

1. The Fair Labor Standards Act

Section 7(a) of the FLSA directs employers who regularly require their workers to work more than 40 hours a week to compensate those workers by paying them overtime wages at a rate of one and half times their regular rate of pay. 29 U.S.C. § 207. This law was evidently enacted to induce employers to employ more workers and/or compensate their workers for the burden of a long workweek. See Walling v. Youngerman-Reynolds Hardwood Co., 325 U.S. 419, 423-24, 65 S.Ct. 1242, 89 L.Ed. 1705 (1945).

However, not all workers are covered by this scheme. Under Section 13(a) of the FLSA, Congress exempted employees employed in a bona fide executive, administrative, or professional capacity from the requirements of section 7(a). 29 U.S.C. § 213. Athough Congress did not define these terms, it designated the Department of Labor (“DOL”) to take responsibility for implementing and clarifying the act. See 29 U.S.C. § 213(a)(1); Auer v. Robbins, 519 U.S. 452, 456, 117 S.Ct. 905, 137 L.Ed.2d 79 (1997). The DOL regulations provide guidance regarding the scope of the executive and administrative exemptions at issue in this case.

2. Department of Labor Regulations

The DOL regulations contain different definitions of bona fide executive and administrator depending on the salary of the employee. If an employee earns more than $250 per week, the employer must show that the employee meets the “short test” definition of bona fide administrator or executive in order to prove that he is exempt from section 7(a). See 29 C.F.R. §§ 541.2(e)(2), 541.1(f). If the employee earns less than $250 per week, then the employer must meet a more rigorous “long test” in order to prove that the employee is exempt from section 7(a). See 29 C.F.R. §§ 541.1(a)-(e), 541.2(a)-(e). Since it is not disputed that all of the plaintiffs earned more than $250 per week, the short test definitions of executive and administrator apply in this case.

a. Executive

The DOL “short test,” defines the term employee employed in a bona fide execu *684 tive capacity as any employee “whose primary duty consists of the management of the enterprise in which the employee is employed or of a customarily recognized department or subdivision thereof, and includes the customary and regular direction of the work of two or more other employees therein....” See 29 C.F.R. § 541.1(f).

The regulations provide guidance as to which duties are managerial in nature. According to 29 C.F.R. § 541.102(b),

[I]t is generally clear that work such as the following is exempt work when it is performed by an employee in the management of his department or the supervision of the employees under him: Interviewing, selecting and training of employees; setting and adjusting their rates of pay and hours of work; directing their work; maintaining their production or sales records for use in supervision or control; appraising their productivity and efficiency for the purpose of recommending promotions or other changes in their status; handling their complaints and grievances and disciplining them when necessary; planning the work; determining the techniques to be used; apportioning the work among the workers; determining the type of materials, supplies, machinery or tools to be used or merchandise to be bought, stocked and sold; controlling the flow and distribution of materials or merchandise and supplies; providing for the safety of the men and the property.

In addition, the regulations also indicate how to determine whether the performance of managerial duties constitutes the employee’s primary duty. 29 C.F.R. § 541.103 states,

The amount of time spent in the performance of the managerial duties is a useful guide in determining whether management is the primary duty of the employee. In the ordinary case it may be taken as a good rule of thumb that primary duty means the major part, or over 50 percent, of the employee’s time.... Time alone, however, is not the sole test, and in situations where the employee does not spend over 50 percent of his time in managerial duties, he might nevertheless have management as his primary duty if the other pertinent factors support such a conclusion. Some of these pertinent factors are the relative importance of the managerial duties as compared with other types of duties, the frequency with which the employee exercises discretionary powers, his

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Bluebook (online)
269 F.3d 680, 7 Wage & Hour Cas.2d (BNA) 586, 2001 U.S. App. LEXIS 22393, 2001 WL 1230570, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stephen-a-ale-v-tennessee-valley-authority-ca6-2001.