Brian Rock v. Ray Anthony International

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
MAY 26, 2010
No. 09-16024 JOHN LEY
Non-Argument Calendar CLERK
________________________
D. C. Docket No. 08-00838-CV-T-17-EAJ
BRIAN ROCK,
Plaintiff-Appellant,
versus
RAY ANTHONY INTERNATIONAL, LLC,
Defendant,
SUNBELT CRANES, CONSTRUCTION
& HAULING, INC.,
d.b.a. Ray Anthony International,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Middle District of Florida
_________________________
(May 26, 2010)
Before BIRCH, MARTIN and ANDERSON, Circuit Judges.
PER CURIAM:
In this appeal, we consider whether a salaried dispatcher for a crane rental
company qualifies under the administrative exemption to the Fair Labor Standards
Act (“FLSA”), 29 U.S.C. § 213(a)(1). The answer to this question matters because
it determines whether the dispatcher is entitled to overtime pay under the
provisions of 29 U.S.C. § 207(a)(2). The district court’s factual findings were not
clearly erroneous, so we affirm that court’s decision exempting the dispatcher from
overtime pay.
I.
Brian Rock was employed in several different capacities by Sunbelt Cranes,
Construction, & Hauling, Inc. (“Sunbelt”) from 1999 until 2008.1 At the end of
his employment with Sunbelt, Rock was a dispatcher in the crane rental division.
He voluntarily resigned in 2008 and brought this action against Sunbelt under the
FLSA for unpaid overtime compensation and for liquidated damages. Sunbelt
responded that Rock was exempt from the FLSA and thus was not eligible for
overtime pay. Following a bench trial, the district court entered judgment in favor
of Sunbelt, finding that Rock was an administrative employee under the FLSA, and
1
Although Sunbelt was acquired by Ray Anthony International, LLC in July 2007, it
continued to operate under the Sunbelt name.
2
thus was not entitled to recover overtime pay or liquidated damages. This appeal
followed.
II.
We review de novo the district court’s conclusions of law and its factual
findings for clear error. Icicle Seafoods, Inc. v. Worthington, 475 U.S. 709, 713,
106 S. Ct. 1527, 1529 (1986); Renteria-Marin v. Ag-Mart Produce, Inc., 537 F.3d
1321, 1324 (11th Cir. 2008). Factual findings are clearly erroneous “if the record
lacks substantial evidence to support it so that our review of the entire record
leaves us with the definite and firm conviction that a mistake has been committed.”
Reich v. Dep’t of Conservation and Natural Res., 28 F.3d 1076, 1082 (11th Cir.
1994) (internal quotations omitted). This is a highly deferential standard of
review, and this Court will only disturb the district court’s factual findings where,
“after making all credibility choices in favor of the fact-finder and reviewing the
record as a whole, it is clear that a mistake has been made.” CFTC v. Gibralter
Monetary Corp., 575 F.3d 1180, 1186 (11th Cir. 2009).
Whether certain activities exclude an employee from FLSA overtime
benefits is a question of law and is reviewed de novo. Icicle Seafoods, 475 U.S. at
714, 106 S. Ct. at 1530; Bothell v. Phase Metrics, Inc., 299 F.3d 1120, 1124 (9th
Cir. 2002).
3
III.
The FLSA was enacted in 1938 to “‘aid the unprotected, unorganized, and
lowest paid of the nation’s working population; that is, those employees who
lacked sufficient bargaining power to secure for themselves a minimum
subsistence wage.’” Hogan v. Allstate Ins. Co., 361 F.3d 621, 625 (11th Cir. 2004)
(quoting Brooklyn Sav. Bank v. O’Neil, 324 U.S. 697, 707 n.18, 65 S. Ct. 895, 902
n.18 (1945)). To further the goals of protecting employees from abusive labor
practices, Congress set federal standards regarding minimum wages and child
labor, and established a forty-hour workweek.
There are provisions for a workweek beyond the forty hours set by the
statute. If an employee works more than forty hours in a week, the employee must
be compensated at least time-and-a-half for each hour over forty. 29 U.S.C. §
207(a)(2). However, if the employee works in a “bona fide executive,
administrative, or professional capacity,” then the overtime pay requirements do
not apply. Id. § 213(a)(1). For the administrative exemption to apply, an
employee must (1) earn no less than $455 per week, (2) have primary duties that
involve “the performance of office or non-manual work directly related to the
management or general business operations of the employer or the employer’s
customers,” and (3) exercise “discretion and independent judgment with respect to
4
matters of significance” in performing his primary duties. 29 C.F.R. §
541.200(a)(1)–(3).
The employer bears the burden of proving that an employee is exempt from
overtime payments. Atlanta Prof’l Firefighters Union, Local 134 v. City of
Atlanta, 920 F.2d 800, 804 (11th Cir. 1991). FLSA provisions are to be interpreted
liberally in the employee’s favor and its exemptions construed narrowly against the
employer. See Birdwell v. City of Gadsden, 970 F.2d 802, 805 (11th Cir. 1992).
In this case, the district court determined that Rock met the three
requirements for an administrative exemption, so he was not entitled to overtime
pay under the FLSA. See Rock v. Sunbelt Cranes, Constr. & Hauling, Inc., 678 F.
Supp. 2d 1264, 1270–74 (M.D. Fla. 2009). The parties do not dispute that Rock
worked in excess of forty hours each week and that his salary exceeded $455 per
week. For that reason, we go directly to the question of whether Rock’s duties
satisfied the remaining requirements for application of the administrative
exemption.
A.
The second prong of the administrative exemption test asks whether an
employee’s primary duties directly relate to “the management or general business
operations of the employer or the employer’s customers.” 29 C.F.R. §
5
541.200(a)(2). To meet this requirement, the employee “must perform work
directly related to assisting with the running or servicing of the business, as
distinguished, for example, from working on a manufacturing production line or
selling a product in a retail or service establishment.” Id. § 541.201(a).
The district court found that Rock’s primary job duties included customer
communication, choosing the appropriate crane for specific jobs, assigning
operators to cranes, overseeing other employees, preparing and reviewing job
tickets, and maintaining the crane rental schedule. Rock, 678 F. Supp. 2d at 1266.
He was also responsible for selecting the type of materials, supplies, machinery,
equipment, and tools that were needed to meet the customers’ needs. Id. at
1268–69. In essence, the district court concluded that Rock effectively managed
Sunbelt’s crane rental department, which the district court found was “the heart of
Sunbelt’s business” and necessary to Sunbelt’s business operations.2 Id. at 1268,
1271. Because his primary duties related to servicing or running Sunbelt’s general
business operations, the district court concluded that Rock’s work qualified him for
2
We recognize that certain of these factual findings were made in discussing whether a
different exemption to the FLSA’s overtime requirements applied. Nevertheless, the district
court’s opinion makes clear that it considered the whole of Rock’s duties in concluding that the
second prong of the administrative exemption test was satisfied. See Rock, 678 F. Supp. 2d. at
1271 (explaining that “Mr. Rock’s maintenance of the schedule and Mr. Rock’s other
responsibilities combined were necessary and of the type that every crane rental business must
undertake in order to operate” and concluding that “[Sunbelt] has clearly established that
[Rock’s] primary duties were directly related to the servicing or running of Sunbelt’s business
operations”).
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the second prong of the administrative exemption from overtime pay.3
Rock maintains that his position was more akin to sales and retail, and is
therefore outside the scope of the second prong. He relies on recent Department of
Labor guidance clarifying whether an employee’s job duties relate primarily to
production or administration for purposes of the second prong of the administrative
exemption test.4 According to this new guidance, the essence of the second prong’s
focus on “general business operations” is to separate production from
administration. See Wage and Hour Division, U.S. Dep’t of Labor, Administrator’s
Interpretation No. 2010-1, at 3 (Mar. 24, 2010), available at http://www.dol.gov/
whd/opinion/adminIntrprtn/FLSA/2010/FLSAAI2010_1.pdf. Production work
relates to the goods and services that the business contributes to the marketplace,
whereas administration relates to running the business. Id. Certain inside
3
The district court also found that Rock knew when he accepted his promotion to
dispatcher that he would be receiving a salary, that he would no longer be eligible for overtime
benefits, that he believed $55,000 was fair compensation for the work he would be doing and
that he did not try to negotiate a higher salary or better hours. See Rock, 678 F. Supp. 2d. at
1266. We agree with Rock that none of this is relevant. As Rock correctly points out, FLSA
rights cannot be waived. See Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728, 740,
101 S. Ct. 1437, 1444–45 (1981).
4
Although the guidance specifically addresses mortgage loan officers, the agency’s
interpretation of its regulation is nonetheless helpful to our review. This guidance is not binding
law, but courts owe some deference to administrative guidance document where it is consistent
with the agency’s statutory mandate. See Warshauer v. Solis, 577 F.3d 1330, 1335 (11th Cir.
2009) (“an agency’s interpretive guidance construing a statute is entitled to deference
‘proportional to its power to persuade’” (quoting United States v. Mead Corp., 533 U.S. 218,
235, 121 S. Ct. 2164, 2176 (2001)).
7
salespeople might be considered production personnel, rather than administrative
personnel, if the primary purpose of the business is to sell products. Id. at 3, 6.
Rock says his role in crane rental is akin to selling products and thus beyond the
scope of the administrative exemption.
While Rock did engage in the kind of “sales” described in the Department of
Labor’s recent guidance, the district court found that his primary duties went
beyond mere sales. Given “the amount of time Mr. Rock spent on . . . managerial
duties, it is determined that Mr. Rock’s primary duty . . . was the ‘management’ of
Sunbelt’s crane rental division.” Rock, 678 F. Supp. 2d at 1269. The district
court’s finding is consistent with our decision in Hogan, in which we concluded that
even when employees engage in sales, their duties are administrative if the majority
of their time is spent advising customers, hiring and training staff, determining staff
pay, and delegating matters to staff.5 Hogan, 361 F.3d at 627. For these reasons,
the district court properly concluded that Rock met the second prong of the
administrative exemption test.
5
The guidance document Rock relies upon was issued after the district court’s decision
and therefore was not addressed by the court below. Nevertheless, it is clear the district court
found Rock to be primarily a manager with duties that far exceeded those of a mere inside
salesperson. Even if this Court were to agree with Rock that his primary duties were more akin
to sales than to management, that is a factual determination and the district court’s contrary
conclusion was not clearly erroneous.
8
B.
The third prong of the administrative exemption test looks to whether the
employee’s primary duties involve “the exercise of discretion and independent
judgment with respect to matters of significance.” 29 C.F.R. § 541.200(a)(3).
Courts must determine whether the employee’s job “involves the comparison and
the evaluation of possible courses of conduct, and acting or making a decision after
the various possibilities have been considered.” Id. § 541.202(a). The ultimate
question is whether the employee has the ability “to make an independent choice,
free from immediate direction or supervision.” Id. § 541.202(c). Although there is
no requirement that the employee operate free from oversight, see id., the
employee’s duties must involve “more than the use of skill in applying well-
established techniques, procedures or specific standards described in manuals or
other sources.” Id. § 541.202(e).
The Department of Labor’s Field Operations Handbook offers guidance as to
whether dispatchers exercise sufficient discretion such that the administrative
exemption should apply. See Wage and Hour Division, U.S. Dep’t of Labor, Field
Operations Handbook § 22d04 (1994). Dispatchers, such as those in the bus and
trucking industry, who merely “apply their knowledge in following prescribed
procedures and techniques [do] not exercis[e] discretion and independent judgment
9
within the meaning” of the regulation. Id. § 22d04(a). However, a dispatcher may
exercise discretion and independent judgment where, for example, the dispatcher
coordinates the movement of company vehicles and equipment over non-standard
routes or handles emergency situations. See id. § 22d04(b).
The district court determined that Rock exercised discretion and independent
judgment, finding that he was “responsible for directing and overseeing all
operators, truck drivers, riggers, oilers, and erection crews.” Rock, 678 F. Supp. 2d
at 1272. The court further found that he exercised discretion “as to which
customers’ jobs each employee should be assigned and what equipment is required
to perform the job properly.” Id. The court found that he exercised independent
judgment in deciding “which employees to send, and where to send them, based on
the employees’ experience and reliability.” Id. The court also found that Rock had
to exercise independent judgment in the event of an emergency as he was “the first
line of communication” and had to determine how best “to resolve the conflict and
ensure that the customer’s needs were being met despite such emergency.” Id.Rock, in the district court’s view, required neither input nor approval when making
these decisions. Id. The district court further found that Rock had supervisory
authority to hire and fire employees, even though he never exercised that authority.
Id. Finally, the district court was persuaded that maintaining the schedule required
10
a level of skill that went beyond “‘applying well-established techniques,
procedures, or specific standards described in manuals or other sources.’” Id.(quoting 29 C.F.R. § 541.200(e)).
To be sure, evidence exists that Rock’s position did not require the exercise
of judgment or discretion. Rock testified that he only priced certain types of cranes
based on his own experience and the information in the load charts and that the vast
majority of his tasks simply involved the mechanical application of data from load
charts. This testimony was corroborated by his former supervisor, who testified
that the job is very simple once the dispatcher understands how to use the load
charts. For about seven out of the company’s fifty cranes, Rock could quote a price
to the customer; for all others, he had to hand the project off to a salesman. Rock
testified that he never resolved customer complaints, but rather simply forwarded
any complaints and problems to his supervisor. There is further evidence,
substantiated by his former supervisor, that Rock had little to no role in hiring,
firing, promoting, or disciplining employees.
Still, the record supports the district court’s conclusion that Rock exercised
substantial control over the day-to-day operation of Sunbelt’s crane rental business.
Patrick Gunn, a crane rental company dispatcher, testified that dispatchers ensure
that crews get to where they are going with the right equipment. Dispatchers are in
11
a superior position to crane operators and crane operators report to dispatchers.
Dispatchers find work to keep the crew busy if they are not out on a job.
Dispatchers, according to Mr. Gunn, have wide authority to resolve problems
related to accidents and breakdowns, to hire and fire employees, and to set pay.
Mr. Gunn also testified that load charts do not indicate every factor that must be
considered in selecting a crane, so a dispatcher must consider factors such as
ground conditions, curbing, and other physical conditions.
Although reasonable minds could differ about the degree of discretion Rock
exercised as a dispatcher, sufficient evidence exists in the record to support the
district court’s finding that Rock exercised discretion and independent judgment.
District courts are in a better position to judge the credibility of witnesses, and they
have more experience in making factual determinations. See Anderson v. City of
Bessemer City, 470 U.S. 564, 574–75, 105 S. Ct. 1504, 1512 (1985). And where
two plausible views of the evidence exist, we will defer to the district court unless
clear error is apparent. See Gibralter Monetary Corp., 575 F.3d at 1186. There is
no clear error here, and in view of factual findings made by the district court, it
properly concluded that Rock satisfied the third prong of the administrative
exemption test. Based on this record, the district court correctly concluded that
Rock is not entitled to overtime pay under the FLSA.
12
IV.
Rock also challenges the district court’s denial of liquidated damages.
Because we affirm the district court’s decision that Rock is not entitled to overtime
pay, he suffered no actual damages, and as such is not entitled to liquidated
damages. See Rodriguez v. Farm Stores Grocery, Inc., 518 F.3d 1259, 1272 (11th
Cir. 2008) (the FLSA authorizes an award liquidated damages that are equal in
amount to actual damages).
The judgment of the district court is AFFIRMED.
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