Sanchez v. Las Fiestas, Inc.
MEMORANDUM OPINION. Signed by Chief Judge Sharon Lovelace Blackburn on 8/31/2012. (KAM, )
2012 Sep-04 PM 02:37
U.S. DISTRICT COURT
N.D. OF ALABAMA
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ALABAMA
CASE NO. 3:10-CV-0614-SLB
On April 6, 2012, the Magistrate Judge filed his Report and Recommendation, (doc.
26),1 recommending plaintiff’s Motion for Partial Summary Judgment, (doc. 18), be denied.
Plaintiff filed his Objection to Magistrate’s Report and Recommendation. (Doc. 27.) Based
upon the court’s consideration of all the materials in its file, including the Report and
Recommendation, the court is of the opinion that plaintiff’s Objection is due to be sustained
and the Magistrate Judge’s Recommendation is due to be rejected in part and adopted in part.
Plaintiff’s Motion for Partial Summary Judgment will be granted in part and denied in part.
I. STANDARD OF REVIEW OF THE REPORT AND RECOMMENDATION
The district court reviews de novo those parts of the Report and Recommendation to
which a party objects. See 28 U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(b)(3)(“The district
judge must determine de novo any part of the magistrate judge's disposition that has been
Reference to a document number, [“Doc. ___”], refers to the number assigned to each
document as it is filed in the court’s record.
properly objected to.”).
The court may review the other parts of the Report and
Recommendation for plain error or manifest injustice. United States v. Slay, 714 F.2d 1093,
1095 (11th Cir. 1983)(citing Nettles v. Wainwright, 677 F.2d 404, 410 (11th Cir. 1982)).
“The district judge may accept, reject, or modify the recommended disposition; receive
further evidence; or return the matter to the magistrate judge with instructions.” Fed. R. Civ.
The plaintiff does not dispute the facts set forth in the Report and Recommendation.
Therefore, the court adopts the following:
Defendant Las Fiestas, Inc. (“Las Fiestas”) owns and operates several
Mexican restaurants in northwest Alabama. In 2004, plaintiff Abraham
Sanchez (“Abraham”) began working for Las Fiestas as a waiter at the
Cloverdale location [in Florence, Alabama]. Abraham Depo. (Doc. 23 Att. 2)
7. In 2006, Las Fiestas opened a restaurant in Regency Square Mall in
Florence, Alabama. The restaurant was located in the mall’s food court, and
provided counter service only. The restaurant operated a total of seventy hours
per week; it was open Monday through Saturday from 10:00 am to 9:00 pm,
and on Sundays from 1:00 pm to 5:00 pm.
Plaintiff began working at the mall restaurant as a manager in October
2006. Abraham Depo. (Doc.  Att. ) 8. He and all other managers
reported directly to defendant Carlos Sanchez (“Carlos”), the sole owner of
Las Fiestas. Carlos Depo. 6. Plaintiff’s job duties reportedly included
customer relations, supervising the other employees, ensuring that the
restaurant employees followed company procedures, and consistently serving
quality food to the public. Carlos Aff. (Doc. 23 Att. 1) 2[;] Abraham Depo.
30, 33. He ordered the food and other supplies for the restaurant and handled
maintenance issues. Carlos Depo. 23-24; Abraham Depo. 16–17, 27. Plaintiff
determined when employees could take breaks, determined whether additional
employees were needed, and disciplined employees for poor work. Carlos
Aff.; Abraham Depo. 29; Carlos Depo. 40–41. When employees or customers
complained, the complaints were received by plaintiff. Abraham Depo. 30,
Plaintiff shared hiring duties with Carlos. Carlos Aff.; Carlos Depo.
22–23. However, Carlos had to approve all hires at the mall location and he
was responsible for setting the pay of all employees. Carlos Depo. 23.
Employees were rarely fired from the Las Fiestas chain of restaurants, but
plaintiff had the authority to send employees back to another restaurant if he
was unhappy with their performance. Id. at 24 (“We send somebody from
another restaurant, somebody extra. Sometimes he send them back because
not working good. We never say no more job.”). For example, if plaintiff
needed extra help for the mall restaurant, he would call Carlos, who would
send an extra employee to the mall location. Id. Plaintiff could then dismiss
the extra employees back to the restaurant where they normally worked.
Carlos visited the mall restaurant on average only twice a month. Carlos Aff.
Plaintiff typically worked from 10:00 am to 9:00 pm five days a week,
with two 30-minute breaks throughout the day. Additionally, plaintiff would
work four hours every Sunday. Abraham Depo. 21-22; Carlos Depo. 34-37.
Plaintiff arrived at the mall about fifteen-minutes early to open the restaurant
and might stay ten minutes after it closed to clean up and prepare for the next
day. Carlos Depo. 36-37; Abraham Depo. 19-20. Plaintiff received a
bi-weekly salary of $600 via check and between $500 to $600 in cash. Doc.
19 at 2; Abraham Depo. 9-12; Carlos Depo. 12. If he missed time at the mall,
his pay would be reduced accordingly. Carlos Depo. 16. On days when
plaintiff was not on duty, he could leave instructions for employees to perform
specific tasks, and upon his return, could ensure that the tasks were performed.
Carlos Aff. He had the authority to discipline employees who did not comply
with company policy during his days off. Id. Finally, he had to ensure that the
employees had the necessary supplies to operate the restaurant when he was
not working and that there were enough employees scheduled for each day.
Plaintiff typically worked with one other employee, Carlos Depo.
21-22, although as discussed above he sometimes called Carlos for extra
employees. [Defendants have] provided sheets on which plaintiff wrote down
who worked at the mall location each week. Abraham Depo. 17-18, 31-32; see
Doc. 24 Atts. 1, 2. The sheets were not necessarily a schedule, but were kept
to help ensure that the other employees were being paid for their hours.
Abraham Depo. 30-32. Plaintiff states that a man named “Jorge” worked at
the mall but did not work with plaintiff. Id. at 17. Plaintiff also worked with
two men named “Oscar” and “Josef Fidel.” Id. at 12, 17-18. Oscar typically
arrived to work earlier than Abraham, since he was the cook and needed to
prepare the food. Id. at 20, 27. When Oscar had a day off, he would prepare
the food the previous day, and another employee would come in to serve the
food to the customers. Id. at 27. Other employees from the mall location are
listed on the sheets written out by plaintiff. See Doc. 24 Atts. 1, 2. For the
most part, the sheets do not list how many hours each employee worked, but
rather just whether they worked on any particular day. . . .
Plaintiff stopped managing the mall restaurant in June or July 2009.
Abraham Depo. 34; Carlos Depo. 25. He returned to working as a waiter at
the Las Fiestas restaurant in Cloverdale and remains employed in that capacity.
On March 23, 2010, plaintiff filed this lawsuit, seeking overtime pay pursuant
to the Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq.
(Doc. 26 at 1-5 [footnotes omitted].)
The record contains a number of documents, which the Magistrate Judge called “pay
sheets,” (id. at 8), that show the days worked at the restaurant by plaintiff and other
employees, (doc. 24; doc. 24-1; doc. 24-2). Plaintiff prepared the pay sheets every week.
(Doc. 23-2 at 13, 18.) Defendant Carlos Sanchez testified that the pay sheets were “fair and
accurate representation[s] of the days that workers worked and did not work,” and that they
showed the typical staffing levels of the restaurant. (Doc. 19-1 at 20-21.)
The pay sheets are charts with the days of the week across the top and the employees’
names down the side. (Doc. 24-1; doc. 24-2.) Plaintiff prepared these documents for
purposes of paying the employees. (Doc. 23-2 at 13.) For each day – Monday through
Sunday – plaintiff has written “off” or entered a checkmark for each employee. (See doc. 241 at 1.) The Magistrate Judge assumed that a check meant that “the employee worked a full
ten-hour shift – eleven hours that the restaurant was open with two thirty-minute breaks – and
a checkmark on a Sunday meant a four-hour shift.” (Doc. 26 at 8-9 [footnotes omitted].)
Based on his analysis of the pay sheets, the Magistrate Judge found:
There were seventy-two weeks of sheets included. . . . [P]laintiff supervised
employees for 80 or more store-hours on twenty-five of those weeks, or
thirty-five percent of the time. He supervised employees for 74 or more hours
on sixty-five of those weeks, or ninety percent of the time.
The undersigned finds that thirty-five percent of the time is not
customary or regular for the purposes of this section. See In re Family Dollar
FLSA Litigation, 637 F.3d 508 (4th Cir. 2011)(employing an eighty-percent
threshold); Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233 (11th Cir.
2008)(affirming the district court, but disagreeing with its assertion that
seventy-six percent of the time could not be found to be customary or regular).
However, there is also evidence that employees, particularly Oscar, the cook,
arrived before the start of the shift to prepare for the day. These hours are not
included in the court’s [analysis] of the chart. Furthermore, plaintiff has not
provided evidence regarding whether the employees’ breaks should be
included in the calculations. There is no testimony regarding whether the other
employees even received the two thirty-minute breaks that plaintiff did,
whether the employees are free to leave the premises during any break, or
whether plaintiff is considered to be supervising them while they are on any
break. If the court were to include just one employee’s break-time per day, or
an additional six hours per week, plaintiff would supervise employees for 80
hours or more [than] ninety percent of the time, a percentage which easily
meets the threshold of being “customar[y] and regular.” This does not
include any potential time an employee spends preparing for the day before
their shift or cleaning up after their shift. The undersigned believes a
reasonable jury could find that plaintiff customarily and regularly supervises
two or more full-time employees or their equivalent.
Generally, each schedule included on the sheets provided includes
Abraham, one full-time employee who worked six days of the week, and two
other employees who filled in. As discussed above, there is a genuine issue of
fact as to whether these subordinate employees combined to work 80 or more
hours per week. Taking the evidence in the light most favorable to defendants,
a genuine issue of material fact to exists as to this prong.
(Id. at 10-11 [footnotes omitted].)
The Magistrate Judge found a disputed issue of fact with regard to whether plaintiff
supervised two full-time employees or the equivalent, including whether he supervised
employees when he was not physically present at the restaurant.
The Report and Recommendation also states:
Plaintiff had authority to recommend potential employees for hiring to
Carlos, although Carlos had the ultimate authority to approve all hiring
decisions. Plaintiff made suggestions to Carlos about adding staff to his
location, and there is no evidence his suggestion or request for more staff was
not typically followed. Although plaintiff could not fire employees from all
Las Fiestas restaurants, he did have authority to send them back to other
restaurants if he was unhappy with their performance at work. Since the
employees who worked at the mall location were the only employees plaintiff
could customarily and regularly direct, this action could be construed as firing
them from that location. Furthermore, plaintiff allowed employees to leave
work early without any input from Carlos. Carlos would consider any
evaluations that plaintiff provided concerning the work of the employees under
his supervision. Plaintiff did not have any authority to set the pay of the
employees at the mall location, and there is no evidence regarding whether
there was any opportunity for promotion at the mall location.
(Id. at 12.) Based on this evidence the Magistrate Judge determined that an issue of fact
existed as to whether plaintiff’s suggestions were given particular weight with regard to
hiring and firing decisions. Plaintiff does not object to this finding. (See generally doc. 27.)
The Magistrate Judge found that plaintiff had not proven, as a matter of law, that
defendants could not establish an executive exemption, and, therefore, he recommended
denying plaintiff’s Motion for Partial Summary Judgment.
Plaintiff objects to the finding that substantial evidence demonstrated by the pay
sheets creates a question of fact as to whether he supervised two full-time employees or the
equivalent. He contends, “There is no evidence in the record that supports [defendants’]
assertion that the plaintiff supervised two or more full-time employees. In fact, [Carlos
Sanchez] testified that the plaintiff supervised one employee 95% of the time.” (Doc. 27 at
4.) Plaintiff takes issue with the fact that defendants did not produce records of the actual
hours worked by his subordinate employees. (See id. at 3-4.) Nevertheless, the court finds
that the pay sheets produced by defendants, which defendant Carlos Sanchez testified were
accurate, show that plaintiff did not “customarily and regularly direct[ ] the work of two or
more employees.” See 29 C.F. R. § 541.100(a).
The FLSA provides that employees are generally entitled to receive
overtime pay at one and one-half times their regular rate for all hours worked
in excess of forty per week. See 29 U.S.C. § 207(a)(1). The FLSA exempts
from its overtime pay requirements “any employee employed in a bona fide
executive, administrative, or professional capacity.” See 29 U.S.C. § 213(a)(1);
see also Avery v. City of Talladega, 24 F.3d 1337, 1340 (11th Cir. 1994). The
employer has the burden of showing entitlement to an exemption, Jeffery v.
Sarasota White Sox, Inc., 64 F.3d 590, 594 (11th Cir. 1995), and [the Eleventh
Circuit] construe[s] overtime exemptions narrowly, against the employer.
Avery, 24 F.3d at 1340 (citing Brennan v. Sugar Cane Growers Co-Op, 486
F.2d 1006 (5th Cir. 1973)). [The Eleventh Circuit] has recognized the
“Supreme Court’s admonition that courts closely circumscribe the FLSA’s
exceptions.” Nicholson v. World Bus. Network, Inc., 105 F.3d 1361, 1364
(11th Cir. 1997). The executive exemption “is to be applied only to those
clearly and unmistakably within the terms and spirit of the exemption.”
Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233, 1269 (11th Cir. 2008).
Barreto v. Davie Marketplace, LLC, 331 Fed. Appx. 672, 673-74 (11th Cir. 2009).2 Section
541.100(a) of the Code of Federal Regulations provides:
The term “employee employed in a bona fide executive capacity” in
section 13(a)(1) of the Act shall mean any employee:
(1) Compensated on a salary basis at a rate of not less than $455
per week . . . exclusive of board, lodging or other facilities;
(2) Whose primary duty is management of the enterprise in
which the employee is employed or of a customarily recognized
department or subdivision thereof;
(3) Who customarily and regularly directs the work of two or
more other employees; and
(4) Who has the authority to hire or fire other employees or
whose suggestions and recommendations as to the hiring, firing,
advancement, promotion or any other change of status of other
employees are given particular weight.
29 C.F.R. § 541.100(a). For plaintiff to be exempt from overtime pay based on the executive
exemption, defendants must prove plaintiff satisfies “all” of the “definitive criteria” of 29
C.F. R. § 541.100(a)(1)-(4). See Wirtz v. C & P Shoe Corp., 336 F.2d 21, 27-28 (5th Cir.
1964), cited in Feldman v. Cutting, No. 09-14133-CIV, 2009 WL 4021364, 3 (S.D. Fla. Nov.
Eleventh Circuit Rule 36-2 provides, in pertinent part, “An opinion shall be
unpublished unless a majority of the panel decides to publish it. Unpublished opinions are
not considered binding precedent, but they may be cited as persuasive authority.” 11th Cir.
R. 36-2 (emphasis added).
Plaintiff moved for Partial Summary Judgment, arguing that “because he did not
regularly supervise two or more employees and because he had no real managerial authority,”
defendants cannot prove plaintiff was an executive employee exempt from the overtime pay
requirements of the FLSA. (Doc. 19 at 1-2, 10.) Plaintiff only objects to the Magistrate
Judge’s finding that he “may have directed the work of two or more employees.” (Doc. 27
In order to prove plaintiff is exempt from the overtime laws because he is employed
in a bona fide executive capacity, the defendants must prove plaintiff “has the authority to
hire or fire other employees or [his] suggestions and recommendations as to the hiring, firing,
advancement, promotion or any other change of status of other employees are given
particular weight.” 29 C.F.R. § 541.100(a)(4). The Magistrate Judge found the defendants
had “created a genuine issue of fact as to whether plaintiff’s suggestions and
recommendations regarding employees were given particular weight.” Plaintiff did not
object to this finding. After reviewing the record, the court finds that this determination is
not clearly erroneous.
Therefore, the court will adopt the Magistrate Judge’s
Recommendation that plaintiff’s Motion for Partial Summary Judgment be denied as to this
In order to prove plaintiff is exempt from overtime pay as a bona fide executive
employee, defendants must also prove that plaintiff “customarily and regularly directs the
work of two or more other employees.” 29 C.F. R. § 541.100(a)(3). The term “two or more
other employees” is defined as two full-time employees or their equivalent. One full-time
and two half-time employees, for example, are equivalent to two full-time employees. Four
half-time employees are also equivalent.” 29 C.F.R. § 541.104(a).
Citing Morgan v. Family Dollar Stores, 551 F.3d 1233, 1275 (11th Cir. 2008), the
Magistrate Judge noted that the equivalent of two full-time employees “has been held to be
subordinates working a combination of 80 hours or more per week.” (Doc. 26 at 7 [citing
Morgan v. Family Dollar Stores, Inc., 551 F.3d 1233, 1275 (11th Cir. 2008)].) In Morgan,
the Eleventh Circuit stated, “Although the preamble to the new regulations states that the
[Department of Labor] declines to clarify the meaning of ‘full-time,’ it ‘stands by its current
interpretation that an exempt supervisor generally must direct a total of 80 employee-hours
of work each week.’” Morgan, 551 F.3d at 1275 (citing Defining and Delimiting the
Exemptions for Executive, Administrative, Professional, Outside Sales and Computer
Employees, 69 Fed. Reg. 22,122, 22,135 (Apr. 23, 2004)). In a footnote, the court cited to
the Department of Labor Wage and Hour Division’s Field Operations Handbook, stating that
“[t]wo full-time employees or the equivalent within the meaning of Reg. 541.105(a) is
generally considered to mean 80 hours of work by subordinate employees.” Id. n. 65 (citing
Field Operations Handbook, § 22c00(b)).3 The Morgan court also noted that the “Field
In the current version of the Field Operations Handbook, § 22c00 is the “Criteria for
exemption of ‘administrative’ employees. Field Operations Handbook § 22c00, found at
http://www.dol.gov/whd/FOH/FOH_Ch22.pdf. Section 22b02(b) defines two or more
employees. Id. § 22b02(b).
Operations Handbook is persuasive, even though it is not entitled to Chevron deference.”
Id. (citing Klinedinst v. Swift Invs., Inc., 260 F.3d 1251, 1255 (11th Cir. 2001)).
Section 22b02(b) of the Field Operations Handbook provides:
“Two or more other employees” means two full-time
employees or the equivalent (29 CFR § 541.104). For example,
one full-time and two half-time employees are equivalent to two
full-time employees. Four half-time employees are also
equivalent to two full-time employees. Full-time generally
means someone who works 40 or more hours per week. If
occasional, temporary or part-time employees are involved when
determining if the two full-time employee equivalency is met, an
exempt executive must supervise two or more employees for a
combined total of 80 hours of work by such employees. In other
words, the total number of hours worked by subordinate
employees supervised must ordinarily total 80 within the
workweek to qualify as the equivalent of two full-time
employees. If a full-time employee works over 40 hours in the
workweek, he or she counts as the equivalent of only one
employee. For example, if a full-time employee works 60
hours per week and a part-time employee works 20 hours per
week, although the two employees together work a total of 80
hours, an equivalent of only one full-time and one part-time
employee is supervised, thereby not meeting the criteria. Only
other employees of the employer may be considered when
determining if the two full-time employee equivalency is met;
supervision of volunteers, employees of independent
contractors, or any other “non-employees” (trainees, interns) in
relation to the employer are not considered for purposes of this
Field Operations Handbook § 22b02(b) (emphasis added), found at http://www.dol.gov/
The Magistrate Judge counted the total hours worked by plaintiff’s subordinate
employees as reflected on the pay sheets. The pay sheets show that one employee regularly
worked over forty hours per week. The hours over 40 per week worked by the regular fulltime employee should not have been added to the hours worked by the part-time employees.
For example, assuming – as the Magistrate Judge did4 – that a shift on Monday through
Saturday was 10 hours and a shift on Sunday was four hours, typically one subordinate
employee worked 54 hours per week and either 2 employees worked 20 hours or three
employees worked 30 hours. According to the Field Operations Handbook, the total hours
of the full-time employee and the part-time employees are not added together. Rather, all
the hours worked by the full-time employee are counted as one full-time employee, and the
hours worked by the part-time employees are added together to determine if they equal the
hours of a full-time employee, which is a combined 40 hours or more. See Field Operations
Handbook § 22b02(b).
Of the 72 weeks covered by the pay sheets, 2 employees worked more than 40 hours
each, the equivalent of 2 full-time employees, 3 times. (See doc. 24-1 at 4, 17; doc. 24-2 at
13.) For 5 weeks, plaintiff supervised the equivalent of 2 full-time employees – 1 employee
worked 40 hours or more and two or more part-time employees worked 40 hours or more,
the equivalent of a full-time employee. (See doc. 24-1 at 4, 8; doc. 24-2 at 7.) Thus, plaintiff
supervised 2 or more full-time employees, or the equivalent of 2 full-time employees, for 7
out of 72 weeks, or 9.7% of the time.
(See doc. 26 at 8-9.)
As to the remaining weeks represented by the pay sheets, for 5 weeks, no single
employee worked over 40 hours and the total of the hours worked by all part-time employees
was less than 80. (See doc. 24-1 at 3, 7, 10, 16; doc. 24-2 at 17.) For 60 weeks, plaintiff
supervised 1 full-time employee and 1 or more part-time employees working less than 40
hours, (see doc. 24-1 at 1, 3, 5-20; doc. 24-2 at 1-6, 8-9, 12-17). Therefore, approximately
90% of the time, plaintiff did not supervise two or more employees.5
The court finds that the Magistrate Judge erred in counting the total hours worked by
the full-time employee instead of counting him as one full-time employee. When the fulltime employee is properly counted, the evidence shows that plaintiff did not “customarily and
regularly direct the work of two or more other employees.”
Because defendants cannot prove that plaintiff meets each and every requirement for
the executive exemption, plaintiff’s Motion for Partial Summary Judgment is due to be
granted. See Wirtz, 336 F.2d at 27-28.
Plaintiff also moved for summary judgment on his claim for attorney’s fees.6
Recently, the Eleventh Circuit held –
This result is not significantly different if the court assumes that employees worked
eleven hours without a break on the Monday-Saturday shifts. Using this assumption, plaintiff
supervised two or more full-time employees, or the equivalent of two full-time employees
10 weeks out of the 72 weeks, which is almost 14%.
The Magistrate Judge made no finding as to plaintiff’s claim for attorney’s fees in
his Motion for Partial Summary Judgment because he had found a genuine issue of material
of fact as to defendants’ claimed executive exemption. (Doc. 26 at 13 n.15.)
Congress has provided that the court in an FLSA action “shall, in addition to
any judgment awarded to the plaintiff or plaintiffs, allow a reasonable
attorney’s fee to be paid by the defendant, and costs of the action.” 29 U.S.C.
§ 216(b)(emphasis added). The FLSA plainly requires that the plaintiff
receive a judgment in his favor to be entitled to attorney’s fees and costs.”
Dionne v. Floormasters Enterprises, Inc., 667 F.3d 1199, 1205 (11th Cir. 2012). Plaintiff’s
Motion for Partial Summary Judgment as to his attorney’s fees is premature and will be
denied without prejudice to plaintiff to seek an award of attorney’s fees as part of a judgment
in his favor if any.
Based on the foregoing, plaintiff’s Objection to the Magistrate Judge’s Report and
Recommendation, (doc. 27), will be sustained. For the foregoing reasons, the court is of the
opinion that there are no material facts in dispute and plaintiff is entitled to judgment as a
matter of law as to defendants’ affirmative defense based on the executive exemption. An
Order rejecting the Magistrate Judge’s Recommendation and granting plaintiff’s Motion for
Partial Summary Judgment,(doc. 18), as to the executive exemption and denying the Motion
as to plaintiff’s claim for attorney’s fees will be entered contemporaneously with this
DONE, this 31st day of August, 2012.
SHARON LOVELACE BLACKBURN
CHIEF UNITED STATES DISTRICT JUDGE
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