Moon v. Virginia Oil Company

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
TERRI JONES, 
Plaintiff-Appellant,
and
BEATRICE MOON,
Plaintiff,  No. 02-1631
v.
VIRGINIA OIL COMPANY,
INCORPORATED,
Defendant-Appellee.

Appeal from the United States District Court
for the Western District of Virginia, at Charlottesville.
Norman K. Moon, District Judge.
(CA-01-88-3)
Argued: June 4, 2003
Decided: July 23, 2003
Before MICHAEL and MOTZ, Circuit Judges, and
Robert R. BEEZER, Senior Circuit Judge of the
United States Court of Appeals for the Ninth Circuit,
sitting by designation.
Affirmed by unpublished per curiam opinion.
COUNSEL
ARGUED: John Edward Davidson, DAVIDSON & KITZMANN,
Charlottesville, Virginia, Appellant. David Patrick Corrigan, HAR-
2 JONES v. VIRGINIA OIL CO.
MAN, CLAYTOR, CORRIGAN & WELLMAN, P.C., Richmond,
Virginia, for Appellee. ON BRIEF: Jeremy D. Capps, HARMAN,
CLAYTOR, CORRIGAN & WELLMAN, P.C., Richmond, Virginia,
for Appellee.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
Terri Jones and Beatrice Moon sued Virginia Oil Company, Inc.
(Virginia Oil) in the U.S. District Court for the Western District of
Virginia seeking unpaid overtime wages under the Fair Labor Stan-
dards Act, 29 U.S.C. §§ 201 et seq. (FLSA). The district court granted
Virginia Oil’s motion for summary judgment after concluding that
Jones and Moon were exempt as "bona fide executives" under the
FLSA. Jones and Moon filed this appeal. Moon’s claim has been
resolved, so only Jones’s appeal is before us for decision. For the rea-
sons that follow, we affirm the judgment of the district court in
Jones’s case.
I.
Because Jones was the nonmovant in the summary judgment pro-
ceedings, we construe the facts in the light most favorable to her and
draw all justifiable inferences in her favor. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 255 (1986). Jones is a former employee of
Virginia Oil. On December 30, 1998, Virginia Oil hired Jones as an
assistant manager at its combination Dairy Queen and convenience
store (together, "Dairy Queen") in Stanardsville, Virginia, after Vir-
ginia Oil bought the store from Jones’s prior employer. Jones’s initial
weekly salary with Virginia Oil, which she had received under the
store’s previous ownership, was $403.85. After one month, Virginia
Oil raised Jones’s salary to $495 per week. Jones was transferred
JONES v. VIRGINIA OIL CO. 3
briefly to Virginia Oil’s Dairy Queen in Ruckersville, Virginia; she
returned to the Stanardsville store in May 1999. On July 30, 1999,
Jones was promoted to manager and began receiving $550 per week.
In January 2000 she received another raise to $585 per week, and she
was paid that amount until she left her employment in February 2001.
For hourly employees, the average starting pay was $6 per hour.
Jones testified that employees often wanted $8 per hour, but she just
"couldn’t afford to pay them that." The highest paid hourly employee
at Jones’s store, a "semi in-charge person," earned $8.25 per hour. As
part of the company’s management team, Jones was eligible for, and
received, bonuses based on her store’s performance. Jones worked
approximately 60 hours per week throughout her employment with
Virginia Oil. She was never paid for her overtime.
Jones testified that even after she was promoted to a manager, she
spent approximately 75-80 percent of her time carrying out basic line-
worker tasks. These tasks included cooking burgers and other fast
food, serving ice cream, cleaning the store and its bathrooms, working
the cash register, stocking shelves, and sweeping the parking lot. At
times Jones was the only person in the store when it opened, "which
literally meant [she] would take the customer’s order up front, run to
the back, and prepare their food, and then take it up front and give
it to the customer." In addition to her line-worker tasks, Jones carried
out management-related duties. These duties included: the daily ciga-
rette count, the daily sales paperwork, the invoice paperwork, the
monthly fast food inventory, the monthly gas and lottery inventory,
the weekly schedule and payroll, the weekly truck order, the daily
drawer change, and the close out of drawers and the running of
reports. She changed gas prices on the computer, greeted vendors,
conducted convenience store inventory and ordering, and handled
customer complaints. Jones also was responsible for hiring, training,
evaluating, and firing employees. She set salaries for the hourly
employees and made recommendations to upper management about
employee raises. Jones had a key to the store; she also had access to
the safe, which was only available to persons in management. James
Miller, the director of operations, referred to Jones as a "working
manager." Jones referred to herself as the "captain of the ship" at her
store. According to Jones, she "was in charge of everything, but [she]
also was out there in the daily grind with all of the employees doing
4 JONES v. VIRGINIA OIL CO.
everything else. [She] didn’t spend too much time on paperwork, it
was mainly being out there in the field."
As a manager, Jones generally worked an opposite shift from an
assistant manager and worked alongside four to six regular employ-
ees. Tom Singleton, the district manager, would stop by the store one
to four times a week to check on things, and he would stay anywhere
from five minutes to all day depending on the store’s needs. The Sta-
nardsville Dairy Queen was often short-staffed, and the store would
not have been able to serve its customers if Jones had not stepped in
to help the regular employees. In fact, Jones’s Dairy Queen was so
short-staffed that at times Singleton would come to the store to help
out with Jones’s paperwork. At other times, Jones called upper man-
agement to request additional help. Over the course of her employ-
ment with Virginia Oil, Jones became increasingly dissatisfied with
her position, in large part because she (and some other females in
management positions) felt that they were being paid less than men
in the same positions. For instance, one male colleague earned $650
per week as an assistant manager and then $675 per week as a man-
ager, nearly $100 more than what Jones earned in those positions.
Jones eventually gave notice and left her employment with Virginia
Oil on February 28, 2001.
Jones (and Moon) filed a complaint in the district court on August
29, 2001, seeking unpaid overtime wages under FLSA. After discov-
ery, Virginia Oil filed a motion for summary judgment, arguing that
the undisputed evidence showed that the plaintiffs were exempt exec-
utives under the Act. The district court granted Virginia Oil’s motion,
and the two plaintiffs appealed. With Moon’s case resolved and dis-
missed with prejudice, we address only Jones’s appeal.
II.
A.
We review the district court’s grant of summary judgment de novo.
Because FLSA is a remedial statute, exemptions from coverage are
construed narrowly against those asserting them. Haines v. S. Retail-
ers, Inc., 939 F. Supp. 441, 445 (E.D. Va. 1996). An employer bears
the burden of establishing by clear and convincing evidence that an
JONES v. VIRGINIA OIL CO. 5
employee qualifies for an exemption from FLSA’s requirements.
Shockley v. City of Newport News, 997 F.2d 18, 21 (4th Cir. 1993).
B.
FLSA requires employers to pay their employees time and a half
for work over forty hours a week. 29 U.S.C. § 207(a)(1). But the Act
provides exemptions from the overtime requirement for persons "em-
ployed in a bona fide executive, administrative, or professional capac-
ity." Id. § 213(a)(1). The accompanying regulations provide both a
"long test" and a "short test" for determining whether an employee
falls within the exemption. 29 C.F.R. § 541.1. The parties agree, as
do we, that the short test applies in this case. Id. § 541.1(f) (short test
used when employee is paid more than $250 per week). An employee
is exempt under the executive exemption’s short test if: (1) the
employee’s primary duty consists of the management of the enterprise
or of a customarily recognized department or subdivision thereof, and
(2) the employee customarily and regularly directs the work of two
or more other employees. Id. § 541.119(a); Smith v. First Union Nat’l
Bank, 202 F.3d 234, 250 (4th Cir. 2000).
In this case the parties agree that Jones supervised two or more
employees; the only issue on appeal is whether she meets the "pri-
mary duty" requirement. The record is clear that Jones performed
managerial duties as those duties are defined in 29 C.F.R.
§ 541.102(b) (exempt work includes interviewing, selecting, training,
disciplining, and supervising employees, and setting pay rates and
hours of work). The question is whether her primary duty as an
employee consisted of carrying out these managerial tasks. The regu-
lations accompanying FLSA set forth five factors for determining
whether management is an employee’s primary duty: (1) the amount
of time spent in the performance of managerial duties; (2) the relative
importance of the managerial duties as compared with other types of
duties; (3) the frequency with which the employee exercises discre-
tionary powers; (4) the employee’s relative freedom from supervision;
and (5) the relationship between the employee’s salary and the wages
paid other employees for non-exempt work. 29 C.F.R. § 541.103;
Shockley, 997 F.2d at 26. The district court concluded that under these
five factors, Jones was exempt as a matter of law from FLSA’s over-
time pay requirements. Our consideration of these factors in light of
6 JONES v. VIRGINIA OIL CO.
the undisputed facts leads us to agree with the district court’s conclu-
sion.
The first factor of the "primary duty" test — the time spent on man-
agerial duties — is an important one. See Clark v. J.M. Benson Co.,
Inc., 789 F.2d 282, 286 n.2 (4th Cir. 1986). The regulations state that
as a "rule of thumb," an employee who spends over 50 percent of her
time in management has management as her primary duty. 29 C.F.R.
§ 541.103. But "[t]ime alone . . . 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 pri-
mary duty if the other pertinent factors support such a conclusion." Id.Thus, the amount of time spent on nonmanagement tasks is not dispo-
sitive, "particularly when non-management duties are performed
simultaneous to the supervision of employees or other management
tasks and other factors support a finding that the employee’s primary
duty is managerial." Horne v. Crown Central Petroleum, Inc., 775 F.
Supp. 189, 190 (D.S.C. 1991). In other words, an employee will have
management as her primary duty if while engaged in nonexempt
work, the employee also "supervises other employees, directs the
work of warehouse and delivery men, . . . handles customer com-
plaints, authorizes payment of bills, or performs other management
duties as the day-to-day operations require." 29 C.F.R. § 541.103. See
also Smith, 202 F.3d at 250-51. Indeed, "a number of federal courts
have disregarded the time factor of the short test where the manager
is in charge of a separate facility such as a convenience store or res-
taurant chain." Haines, 939 F. Supp. at 449 (internal quotation marks
and citation omitted). See, e.g., Murray v. Stuckey’s, Inc., 939 F.2d
614, 618-20 (8th Cir. 1991) (Stuckey’s manager met the "primary
duty" test even though 65-90 percent of the manager’s time was spent
on nonmanagerial duties); Donovan v. Burger King Corp., 675 F.2d
516, 521-22 (2d Cir. 1982) (relying on § 541.103 example to hold that
Burger King assistant managers had the "primary duty" of manage-
ment despite the fact that over 50 percent of their time was spent on
routine matters); Donovan v. Burger King Corp., 672 F.2d 221, 226-
27 (1st Cir. 1982) (same). But see Cowan v. Treetop Enters., Inc., 120
F. Supp. 2d 672, 690-91 (M.D. Tenn. 1999) (noting foregoing line of
cases but holding nonetheless that unit managers at franchise restau-
rant were not bona fide executives).
JONES v. VIRGINIA OIL CO. 7
Viewed in the light most favorable to Jones, the record demon-
strates that Jones spent well over half of her time performing nonman-
agerial work. In fact, she testified that she spent as much as 75-80
percent of her time performing basic line-worker tasks. However,
even assuming that Jones spent the bulk of her time performing such
line-worker tasks as cooking, cleaning the store, and manning the
cash register, the record reflects that Jones could simultaneously per-
form many of her management tasks. That is, while Jones was doing
line-worker tasks, she also engaged in the supervision of employees,
handled customer complaints, dealt with vendors, and completed
daily paperwork. Time alone then is not determinative in Jones’s case
but must be considered in light of the other factors in the "primary
duty" test. See 29 C.F.R. § 541.103.
The second factor to consider is the relative importance of an
employee’s managerial tasks to nonmanagerial work. "[C]ourts
frame[ ] this query as a measure of the significance of the managerial
tasks to the success of the facility." Haines, 939 F. Supp. at 450. In
Donovan v. Burger King the Second Circuit noted that the restaurant
in question could not have operated successfully in the absence of the
tasks carried out by the assistant managers. In that case, the manage-
ment tasks included determining the amount of food to be prepared,
running cash checks, scheduling and supervising employees, and
checking inventory. Donovan, 675 F.2d at 521. In this case Jones was
responsible for a number of managerial tasks, including hiring, sched-
uling, training, and disciplining employees, checking inventory and
ordering supplies, handling customer complaints, counting daily
receipts, and making bank deposits. See Murray, 939 F.2d at 618.
Jones acknowledged that she was "the captain of the ship" at the store,
and that she "was in charge of everything." "The [regular employees]
merely rowed the boat; [Jones] charted and steered its course." Horne,
775 F. Supp. at 191. See also, e.g., Murray, 939 F.2d at 619-20, Don-
ovan, 675 F.2d at 521; Haines, 939 F. Supp. at 450; Stricker v. E. Off
Road Equip., 935 F. Supp. 650, 654 (D. Md. 1996) ("Store managers
are frequently held to be exempt under the executive category."). The
undisputed facts in the record demonstrate that Jones’s managerial
functions were critical to the success of the Dairy Queen. That is, the
Dairy Queen could not have operated successfully unless Jones per-
formed her managerial functions, such as ordering inventory, hiring,
8 JONES v. VIRGINIA OIL CO.
training, and scheduling employees, and completing the daily paper-
work.
The third and fourth "primary duty" factors — discretionary pow-
ers and freedom from supervision — overlap to a certain extent and
are easily examined together. See Haines, 939 F. Supp. at 450. With
regard to these two factors, Jones makes no real argument of her own
but asserts that Virginia Oil failed to identify undisputed evidence in
the record that would establish by clear and convincing evidence that
these factors are met. The exercise of "discretionary powers" is dis-
played by "the employee who normally and recurrently is called upon
to exercise and does exercise discretionary powers in the day-to-day
performance of his duties." 29 C.F.R. § 541.107(b). Virginia Oil
points to uncontradicted evidence that Jones exercised discretionary
powers. For example, Jones had the discretion to hire, train, schedule,
discipline, and fire employees. And she had the discretion to handle
customer complaints. The record also reflects that Jones’s discretion
in running the day-to-day operations of the store was not constrained
by supervisors. The only favorable evidence cited by Jones is that
Singleton, her district manager, sometimes relieved her of paperwork
so that she could concentrate on line duties. But while Singleton
stopped by the store on a regular basis and sometimes helped Jones
out with management tasks when the store was understaffed, the
record does not reflect that upper management heavily supervised
Jones’s work. Rather, Jones was usually the senior-most person on the
job site. Thus, Jones was "vested with enough discretionary power
and freedom from supervision to qualify for the executive exception."
Haines, 939 F. Supp. at 450. See also Meyer v. Worsley Cos., Inc.,
881 F. Supp. 1014, 1020-21 (E.D.N.C. 1994); Horne, 775 F. Supp. at
191; cf. Murray, 939 F.2d at 619 ("Like other courts that have consid-
ered the question, we believe that the manager of a local store in a
modern multi-store organization has management as his or her pri-
mary duty even though the discretion usually associated with manage-
ment may be limited by the company’s desire for standardization and
uniformity.").
Finally, we look at the relationship between Jones’s salary and that
of a nonexempt worker. Jones argues on appeal that the district court
improperly looked at the $6 per hour average wage when calculating
salary differentials. But Jones herself testified that the average starting
JONES v. VIRGINIA OIL CO. 9
salary was $6 per hour and that she could not afford to pay employees
more than $8 per hour. The only employee who ever made that much
was "a semi in-charge person there for a while" who made $8.25 per
hour. Using the $6 per hour figure, if an hourly employee worked 60
hours per week (what Jones typically worked), her pay would be $420
per week; 55 hours worked would equal $375 per week. Jones earned
more than these wages throughout her employment with Virginia Oil.
In fact, she earned $585 per week — $165 more than an average
hourly employee working 20 hours of overtime — during her last
year at the Dairy Queen. Even at $8.25 per hour (the highest hourly
wage in Jones’s store), an employee working 60 hours per week
would earn $577.50, still less than what Jones was earning in the last
year of her employment. The fact that Jones made less per week than
some other managers is not relevant to the salary inquiry; the issue
is how her salary compares to that of nonexempt employees, not other
managers. See 29 C.F.R. § 541.103. The undisputed evidence shows
that Jones was making more, or at least the same, in her management
positions as nonexempt employees. See Haines, 939 F. Supp. at 451;
Horne, 775 F. Supp. at 191 ("The difference in pay brings this factor
in line with finding that [the plaintiff] is within the executive exemp-
tion.").
In sum, we conclude that when the five factors relevant to deter-
mining whether an employee’s primary duty is management are
applied to the undisputed facts in this case, it is clear that Jones’s pri-
mary duty was management. In other words, we conclude that Vir-
ginia Oil offers evidence sufficient as a matter of law to prove that
Jones was a "bona fide" executive under the FLSA. We note finally
that, contrary to her argument, Jones does not fall under the "working
foreman" exception to the bona fide executive exception. The regula-
tions "distinguish between the bona fide executive and the working
foreman or working supervisor who regularly performs production
work or other work which is unrelated or only remotely related to his
supervisory activities." 29 C.F.R. § 541.115. We have said that where
an individual’s responsibilities extend "to the evaluation of . . . subor-
dinates" and include "the exercise of considerable discretion," the
working foreman exception does not apply. Shockley, 997 F.2d at 27.
See also West v. Anne Arundel County, 137 F.3d 752, 763-64 (4th Cir.
1998). Because Jones’s responsibilities included both the evaluation
10 JONES v. VIRGINIA OIL CO.
of subordinates and the exercise of considerable discretion, the work-
ing foreman exception is inapplicable in her case.
III.
We affirm the district court’s order awarding summary judgment
to Virginia Oil on Terri Jones’s claim.
AFFIRMED