Awan v. Durrani et al
ORDER granting in part and denying in part 18 Motion for Summary Judgment. For the reasons set forth in the attached Order, the motion is granted in part and denied in part and the parties shall appear before the undersigned on 10/6/15 at 11:30 a.m. in courtroom 820 of the Central Islip courthouse for a final pretrial conference regarding Plaintiff's remaining claims. So Ordered by Magistrate Judge Steven I. Locke on 7/1/2015. (Bagnuola, Anthony)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
CHOUDRY TAHIR AWAN, on behalf of
himself and others similarly situated,
-againstHAMID KHAN DURRANI a/k/a ZAHID
DURRANI and BAY SHORE SMOKE
LOCKE, Magistrate Judge:
Plaintiff Choudry Tahir Awan (“Plaintiff” or “Awan”) commenced this action
against his former employer Bay Shore Smoke Shop (the “Smoke Shop”) and its
principal, Hamid Khan Durrani a/k/a Zahid Durrani (“Durrani,” together with the
Smoke Shop, “Defendants”), alleging violations of the Fair Labor Standards Act
(“FLSA”) and New York Labor Law (“NYLL”), and asserting a common law breach
of contract claim.1 Presently before the Court is Plaintiff’s motion for summary
judgment on all causes of action, and related damages, DE , which Defendants
oppose. See DE [21, 22].2 For the reasons set forth herein, the motion is granted in
part and denied in part, as follows:
as to Plaintiff’s breach of contract claim,
Although the caption indicates the intent to proceed as a class or collective action, no
motion for certification was ever filed.
2 This case was previously assigned to United States District Judge Joan M. Azrack.
However, on or about March 10, 2015, the parties, pursuant to 28 U.S.C. § 636(c) and Federal Rule of
Civil Procedure 73, filed an executed Notice, Consent, and Reference of a Civil Action to a Magistrate
Judge (the “Consent Form”), DE , indicating their intention to have the undersigned “conduct all
proceedings and order the entry of a final judgment.” Judge Azrack So Ordered the Consent Form
on or about March 11, 2015, DE , and as a result, the instant dispositive motion is presently
before this Court for a final decision.
summary judgment is granted as to liability and damages; as to Plaintiff’s FLSA
and NYLL claims, summary judgment is denied.
Unless otherwise noted, the following facts are not in dispute.
Plaintiff is a resident of Suffolk County, New York. See Plaintiff’s Statement
of Undisputed Material Facts (“Pl. 56.1 Stmt.”), DE , ¶ 13; see also Compl. ¶ 6;
Ans., DE , ¶ 1.
The Smoke Shop is a domestic business corporation with a
principal place of business located at 59 Bay Shore Road in Bay Shore, New York.
See Pl. 56.1 Stmt. ¶ 2; Compl. ¶ 7; Ans. ¶ 3. Durrani is also a resident of Suffolk
County, New York, and is the president and sole shareholder of the Smoke Shop.
See Pl. 56.1 Stmt. ¶ 4; see also April 28, 2015 Affidavit of Hamid Khan Durrani in
The Court notes that both parties failed to comply with Local Civil Rule 56.1. Plaintiff’s
Rule 56.1 Statement is deficient in that its paragraphs are not “followed by citation to evidence
which would be admissible, set forth as required by Fed. R. Civ. P. 56(c).” E.D.N.Y. Local Civ.
R. 56.1(d). For their part, Defendants failed altogether to provide a “correspondingly numbered
paragraph responding to each” of Plaintiff’s factual assertions. Id. at R. 56.1(b). Defendants also
failed to provide a compliant “statement of additional material facts as to which it is contended that
there exists a genuine issue to be tried.” Id. In any event, “ ‘[a] district court . . . has broad
discretion to determine whether to overlook a party’s failure to comply with local civil rules [,] and,
thus, may in its discretion opt to conduct an assiduous review of the record[.]’ ” Bilan v. Davis, 11cv-5509, 2013 U.S. Dist. LEXIS 107619, at *4-*6 n.2 (S.D.N.Y. July 31, 2013) (Report and
Recommendation), adopted, 2013 U.S. Dist. LEXIS 118065 (S.D.N.Y. Aug. 20, 2013) (exercising
discretion to overlook the defendant’s failure to support his statement under Local Civil Rule 56.1(b)
with citations to admissible evidence in the record). In Bilan, Magistrate Judge Cott opined that
“[b]ecause of the limited record . . . and because the material facts are readily apparent from the
parties’ submissions,” the Court should exercise its discretion to review the record independently.
Id. (citations omitted). Here, the summary judgment record is extremely limited and the factual
assertions set forth in Plaintiff’s 56.1 Statements are “readily apparent” from his other submissions.
Accordingly, the Court overlooks Plaintiff’s deficient filing and independently searches the record for
such facts in order to resolve his motion.
Moreover, despite their failure to submit a
counterstatement of undisputed material facts, Defendants’ position with regard to Plaintiff’s factual
assertions is similarly apparent from their opposition papers. Thus, the Court will also overlook
their failure to comply with the Local Civil Rules and avoid deeming those facts admitted. See
E.D.N.Y. Local Civ. R. 56.1(c) (providing that each factual assertion not specifically controverted will
be deemed admitted).
Opposition to Motion for Summary Judgment (“Def. Aff.”), DE , ¶ 1; Amended
Responses to Plaintiff’s First Set of Interrogatories to Defendants (“Def. Am. Int.
Resp.”), annexed as Exhibit “D” to the Apr. 29, 2015 Declaration of Alan M. Davis,
Esq. in Opposition to Plaintiff’s Motion for Summary Judgment (“Davis Decl.”), DE
[21-3], at ¶ 30(a).
Plaintiff claims, and Defendants do not dispute, that the Smoke Shop is an
“enterprise engaged in commerce” within the meaning of the FLSA. See Pl. 56.1
Stmt. ¶ 6; Compl. ¶ 11; Ans. ¶ 7.
Plaintiff’s Employment History
Awan was employed by the Smoke Shop from December 1989 to July 1,
2014—a period of more than 25 years. See Pl. 56.1 Stmt. ¶ 7; see also March 28,
2015 Affidavit of Tahir Choudry (“Pl. Aff.”), DE [18-1], ¶ 2. Although he does not
specifically allege his job title, he states that throughout his employment, he was
“the sole operator of the store” and was “responsible for opening the shop in the
mornings and closing it in the evenings.”
Pl. Aff. ¶ 2.
This is consistent with
Defendants’ admission that Plaintiff was “a manager of” the Smoke Shop. See Def.
Am. Int. Resp. ¶ 4(1). Plaintiff claims that during this entire period he “worked
from 5 a.m. until 11 p.m. (18 hours) every day for an average work week of 126
hours.” Pl. Aff. ¶ 3. In support of this claim, Plaintiff provides four affidavits from
non-parties Jeff Jorgenson, Bertrand Demont, Thomas Russo, and Carlos Jimenez.
See March 28, 2015 Declaration of Eliot F. Bloom, Esq. in Support of Plaintiff’s
Motion for Summary Judgment (“Bloom Decl.”), DE [18-7], at Ex. “E” (Non-Party
Witness Affidavits). Each of these individuals appears to now be (or at one time
was) a customer of the Smoke Shop and attests as to his observation of Plaintiff’s
work habits. The Court notes that the affidavits are identical in content, save for
blank spaces provided for each individual witness’s name, occupation, the typical
items purchased by the witness from the Smoke Shop, and the number of years
such patronage occurred. The balance of these pro forma affidavits reads as follows:
During the past 5 years, I stopped at the Bay Shore Smoke Shop
between 5 a.m. and then until 11 p.m. every day. Whenever I was
there, TAHIR CHOUDRY was there. I observed him opening up the
store, working at the store all day, and then closing up and locking the
store at night. I observed this routine every day for the past 7 years.
While Tony was working, he was the only employee in the store. He
signed for deliveries; he stocked the shelves; he tended the counter;
and he supervised every function at the store, from opening in the
morning and locking up at night. I was not the only person observing
Tony at his work. There were a number of other people there in the
early morning observing Tony unlocking the store, working throughout
the day with no break, and closing up and locking the store at
night. . . . During the times I was present, I never observed any other
person working there. There was never a female employee and there
was never a boss. . . . I am advised that Tony claim [sic] in his court
matter that he worked from 5am to 11pm seven days to week for at
least the last ten years. . . .
Bloom Decl., Ex. “E” at ¶¶ 3-5.
The Court expresses concern over the reliability of these affidavits. Initially,
they speak of an individual named “Tony,” but Plaintiff has not alleged, and there is
no evidence in the record to suggest, that Awan also went by that name.4 Thus, to
credit these accounts would be to assume a fact not in the record—i.e., that Awan
was known, at least by some of Defendants’ customers, as Tony—something the
Quite to the contrary, Defendants state that Awan had the authority to hire and fire
employees and that one of the employees he hired to assist in the Smoke Shop was named Tony. See
Def. Aff. ¶ 5.
Court is unwilling to do.
In addition, there is a material inconsistency in the
affidavits regarding the relevant time period—namely, in the span of three
paragraphs, each witness variously claims that his observations relate to the past 5
years, the past 7 years, and the past 10 years. Finally, the Court is given pause by
the fact that these affidavits are identical and purport to supply personal knowledge
of a factual scenario so expansive as to render them suspect. For instance, the
Court is skeptical that each of these affiants visited the Smoke Shop every day for
between 15 and 25 years, and that each of them witnessed the Plaintiff “opening up
the store, working at the store all day, and then closing up and locking the store at
night” 16 hours later. Bloom Decl., Ex. “E” at ¶ 3.5
Defendants materially dispute Plaintiff’s claims regarding his work
experience. First, Durrani disputes the volume of hours Awan claims he worked,
attesting that, contrary to Plaintiff’s contentions, he “actually opened the store each
day at 6:00 a.m. and then left at 8:30 a.m.” Def. Aff. ¶ 4. According to Durrani,
Plaintiff would then “return to the store at 2:00 p.m. and stay until closing time,
which was 10:00 p.m.,” and “in the final year the store was open for business,
closing time was actually 9:00 p.m.” Id.6 Defendants also dispute whether Plaintiff
The Court further notes that one affiant, Thomas Russo, also handwrote an addendum to
his affidavit that provides as follows:
I want to add that I went to Chase Bank to make deposit from Smoke Shop (for long
time) for Tony, I never see any female employee in the shop. Tony work moring [sic]
till close. Seven day’s weak [sic]. I notice his boss went to Pakistan twice a year to
drop money. Whatever he makes from two stores Smoke Shop + gas station in
Queens hide from I.R.S. Department.
Bloom Decl., Ex. “E”.
6 Though neither party explicitly states whether the Smoke Shop presently operates, the
Court finds it reasonable to conclude that it is no longer a going concern. Specifically, in his affidavit
Durrani references “the final year the store was open for business.” Def. Aff. ¶ 4. And in responses
was the “sole operator of the store,” contending instead that Durrani also “worked
at the store every day” including “many hours working with [Awan].” Def. Aff. ¶ 5.
In addition, Defendants claim that Plaintiff had authority to hire and fire
employees, and that Durrani recalls Awan hiring at least three individuals, one of
whom was named Elvis and also went by “Pablo,” and another that was named
Id.; see Def. Am. Int. Resp. ¶ 13 (stating that Durrani, Awan, “a person
named Elvis who was also known as Pablo, and a person named Tony worked at the
[Smoke Shop] during the Relevant Period”).7 In addition, Defendants claim that an
individual named Fauzia Durrani was employed by the Smoke Shop and was
identified to the New York State Insurance Fund as such.
See id. ¶¶ 15-16.
However, the dates that any of these individuals allegedly worked at the Smoke
Shop, as well as their job titles and responsibilities, are not provided, although
Defendants do state that “[t]here were no employees performing in a role similar or
identical to that of Plaintiff who worked for the Defendants during the last six (6)
years.” See id. ¶ 12. There is no supporting documentation relating to any of these
Awan’s wage and hour claims are based on his assertion that, despite
working eighteen-hour days, seven days per week, for 25 years, he was not paid for
any hours in excess of forty, instead receiving $400 per week in cash, representing a
to Plaintiff’s interrogatories, Defendants state that Durrani worked at the store until it “ceased
operations.” Def. Am. Int. Resp. ¶ 14. However, the date that the Smoke Shop allegedly closed is not
7 Plaintiff’s Document Demands define the Relevant Time Period as “the period from 1989
$10 hourly rate for only 40 hours of work. See Pl. Aff. ¶¶ 3-4. Plaintiff further
claims never to have “received an Earnings Statement or any other payroll record
from the Defendants, including a W-2 tax statement” and that “no statutory
deductions [were] withheld from him.” Pl. 56.1 Stmt. ¶ 7.
Defendants dispute Plaintiff’s claims on several bases. Initially, Defendants
contend that Awan was at all relevant times an exempt employee within the
meaning of the FLSA and NYLL because he “acted in a managerial capacity.”
Def. Aff. ¶ 9. In this regard, Durrani states that Plaintiff “ordered merchandise for
the store” and “was responsible for receiving the delivery” and “paying for the
merchandise.” Id. In addition, Awan “had the authority to hire and fire employees
and supervise these employees.” Id. In fact, Plaintiff “was very often responsible
for paying the[ ] employees” and “very often paid himself his weekly wages.” Id.
Consistent with this position, Defendants claim to have discovered a notebook
maintained by Plaintiff between November and December 2011, “detail[ing] the
store’s daily receipts and payments.” Id. ¶ 8. A sampling of pages of this notebook
is annexed to Durrani’s Affidavit as Exhibit “E”, DE [21-3]. The pages indicate that
on four occasions between November and December 2011, Plaintiff paid himself
$900. See id.
The content of these records dovetails with Defendants’ second basis for
disputing Awan’s claims regarding his compensation: the amount he claims to have
been paid varies among his other filings in this action.
For instance, in his
Complaint, DE , Awan alleges that during the course of his employment, he
“received his compensation on a salary basis, at a rate of Eight Hundred ($800.00)
Dollars per week. . . .” Compl. ¶ 16. This allegation is at variance with Awan’s
sworn affidavit in support of the instant motion.
$400.00 in cash per week”).
See Pl. Aff. ¶ 4 (“I was paid
And, both of these sums are contradicted by the
notebook, the contents of which Plaintiff does not deny appear in his handwriting.
See Def. Aff., Ex. “E” (denoting $900.00 per week as “Tahir pay”).
Finally, Awan claims, in conclusory fashion, that he “was not fully paid for
[his] last year of employment and [is therefore] owed $15,000.00 in unpaid wages.”
Pl. Aff. ¶ 5.
No further details are submitted in support of this claim and
Defendants do not directly address it.
Defendants’ Allegedly Deficient Recordkeeping
Central to Plaintiff’s motion for summary judgment is the undisputed fact
that, save for the excerpted notebook pages described above, which relate to a onemonth period in 2011, Defendants failed to maintain any records relating to the
other 25-plus years of Awan’s employment. In this regard, Defendants’ Responses
to Plaintiff’s First Request for the Production of Documents (“Pl. Doc. Demands”),
see Bloom Decl., Ex. “D”, admit that Defendants are “not in possession of any
documents referring to, relating to, or reflecting” the following as relates to the
relevant time period: “Plaintiff’s jobs/occupations with Defendants”; “the time and
day of the week when Plaintiff’s work week began for each week”; “the hours
worked each day by the Plaintiff”; “the total hours worked each week by the
Plaintiff”; “the basis on which Plaintiff’s wages were paid”; “Plaintiff’s hourly rate of
pay”; “Plaintiff’s total daily or weekly straight-time earnings for each workweek”;
any “additions to or deductions from Plaintiff’s wages”; “the total wages paid to
Plaintiff during each pay period”; and “the date of payment and the pay period
covered by the payment made to Plaintiff.” Id. ¶¶ 4-14. In addition, Defendants
concede that they possess no “journals, transcripts, diaries, transaction reports, pay
stubs, pay checks, wage papers, punch-clock records, documents, papers, job
applications, invoices, emails, memoranda, notes, or any other written or
electronically stored material referencing the Plaintiff, his wages, salaries, rates
and methods of pay, hours worked, arrivals/departures from work, breaks taken, or
any matter concerning Plaintiff’s employment with Defendants.” Id. ¶ 15.
Plaintiff’s Loan to Defendant
Plaintiff also asserts a cause of action against Durrani for common law
breach of contract arising from an alleged loan agreement between the two men. In
his complaint, Awan alleges, in relevant part, that “[o]n March 26, 2014, the
Defendants and Plaintiff entered an agreement whereby the Plaintiff would loan
the Defendants the sum of Forty Thousand ($40,000.00) Dollars which would be due
and payable on May 7, 2014.” Compl. ¶ 26. Awan alleges that he tendered the loan
amount, but Durrani breached the agreement by failing to repay it. See id. ¶¶ 2728. In his answer, Durrani expressly admits these factual allegations, stating in
relevant part that “Plaintiff loaned $40,000.00 to Defendant [Durrani]” and
“Defendant [Durrani] owes $40,000 to Plaintiff.” Ans. ¶¶ 13-16.
Awan commenced the instant action on or about July 30, 2014, seeking
damages for: unpaid wages and unpaid overtime under the FLSA and NYLL;
unpaid meal periods under the NYLL; and common law breach of contract. See
Compl. ¶¶ 30-56. Issue was joined on or about November 3, 2014, see DE , and
the parties proceeded to conduct preliminary discovery. On or about January 27,
2015, Plaintiff made a motion for sanctions against Defendants for failure to comply
with the Court-ordered discovery schedule.
See DE .
alleged that Defendants failed to respond to his first sets of document demands and
interrogatories. The Court held a hearing on the motion on February 27, 2015, see
DE , at which the Court concluded that Defendants had waived any objections
to Awan’s outstanding discovery demands and ordered Defendants to serve
responses thereto on or before March 13, 2015.8 In addition, the Court held the
remaining discovery deadlines in abeyance, pending Plaintiff’s anticipated motion
for summary judgment. See id.
As noted above, on or about March 10, 2015, the parties consented to have
the undersigned “conduct all proceedings and order the entry of a final judgment” in
As part of the instant motion, Plaintiff asserts that as of March 28, 2015, Defendants had
not yet complied with the Court’s directive. See Memorandum of Law in Support of Plaintiff’s
Motion for Summary Judgment (“Pl. Memo of Law”), DE [18-3], at 2. However, Defendants explain
that they hand-delivered the subject responses to Plaintiff’s counsel on March 13, 2015 but, due to
inadvertence, those responses were not signed as required under Federal Rule of Civil Procedure
33(b)(5). See Memorandum of Law in Opposition to Plaintiff’s Motion for Summary Judgment (“Def.
Memo of Law”), DE , at 3. Further, Defendants assert that amended responses were served
simultaneously with their opposition to the instant motion. See id. Plaintiff does not dispute this.
See May 7, 2015 Reply Declaration of Eliot F. Bloom, Esq. (“Bloom Reply”), DE , at ¶¶ 10-11
(referencing Defendants’ responses to Plaintiff’s discovery demands); see also David Decl., Ex. “C”
(Amended Response to Plaintiff’s First Request for the Production of Documents) and “D” (Amended
Response to Plaintiff’s First Set of Interrogatories to Defendants). Accordingly, the Court disregards
that portion of the instant motion relating to a purported discovery default as moot.
this matter. DE . Thereafter, on March 30, 2015, Awan filed the instant motion
seeking summary judgment on each of his claims, and related monetary damages.9
A party moving for summary judgment bears the burden of proving that
there exists no genuine issue of material fact and that the moving party is entitled
to judgment as a matter of law. See Fed. R. Civ. P. 56(a). “Material facts are those
that may affect the outcome of the case.”
Maxton v. Underwriter Labs, Inc., 4
F. Supp. 3d 534, 542 (E.D.N.Y. 2014) (citing Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248, 106 S. Ct. 2505 (1986)). “An issue of fact is considered ‘genuine’ when
a reasonable finder of fact could render a verdict in favor of the non-moving party.”
Id. “In considering a summary judgment motion, ‘the court’s responsibility is not to
resolve disputed issues of fact but to assess whether there are any factual issues to
be tried, while resolving ambiguities and drawing reasonable inferences against the
moving party.’ ” Id. (quoting Knight v. U.S. Fire Ins. Co., 804 F.2d 9, 11 (2d Cir.
Awan seeks a damages award of $1,050,340 but fails to specifically delineate how that
figure was calculated. Rather, Plaintiff claims that he is entitled to the following specified amounts,
which total $658,720: (i) $15,000 in unpaid wages from his final year of employment; (ii) $201,240 in
unpaid overtime wages under the FLSA, consisting of $15.00 per hour (time-and-a-half) for 86
overtime hours per week, over the course of three years; (iii) $402,480 in unpaid overtime wages
under the NYLL, consisting of $15.00 per hour for 86 hours per week, over the course of six years;
and (iv) $40,000 representing the unpaid loan principle. Awan does not identify the source of the
remaining $391,620 he seeks, but argues that the FLSA provides for an additional amount of
liquidated damages where an employer acts willfully in violating the statute. See id. at 5-7. While
Awan does not articulate a particular amount to which he believes he is entitled on that ground, the
Court finds it reasonable to infer that the remaining $391,620 identified in Awan’s motion papers
relates to liquidated damages. Moreover, Plaintiff claims to seek “interest and attorney fees and
costs,” id. at 8, but does not further address this portion of his claim in the instant motion papers.
Applicable Standards Under the FLSA
“Congress enacted the FLSA in 1938 to eliminate ‘labor conditions
detrimental to the maintenance of the minimum standard of living necessary for
health, efficiency, and general well-being of workers,’ 29 U.S.C. § 202(a), and to
‘guarantee [ ] compensation for all work or employment engaged in by employees
covered by the Act.’ ” D’Arpa v. Runway Towing Corp., 12-cv-1120, 2013 U.S. Dist.
LEXIS 85697, at *13-*14 (E.D.N.Y. June 18, 2013) (quoting Tennessee Coal, Iron &
Railroad Co. v. Muscoda Local No. 123, 321 U.S. 590, 602, 64 S. Ct. 698, 88 L. Ed.
949 (1944)). “As part of that effort, the Act imposes numerous ‘wage and hour’
requirements, including establishing a minimum wage and requiring overtime pay,
both of which are at issue in this case.” Id. at *14 (citing 29 U.S.C. §§ 206, 207).
Overtime and Minimum Wage Provisions
As relevant here, the FLSA provides as follows:
Every employer shall pay to each of his employees who in any
workweek is engaged in commerce or in the production of goods for
commerce, or is employed in an enterprise engaged in commerce or in
the production of goods, wages at the . . . rate [of] $7.25 an hour. . . .
29 U.S.C. § 206(a)(1)(C).
In addition, the FLSA requires that:
[N]o employer shall employ any of his employees who in any workweek
is engaged in commerce or in the production of goods for commerce, or
is employed in an enterprise engaged in commerce or in the production
of goods for commerce, for a workweek longer than forty hours unless
such employee receives compensation for his employment in excess of
the hours above specified at a rate not less than one and one-half times
the regular rate at which he is employed.
29 U.S.C. § 207(a)(1).
“The FLSA’s overtime and minimum wage provisions apply only to
‘employees’ who are ‘employed’ by ‘employers.’ ” D’Arpa, 2013 U.S. Dist. LEXIS
85697, at *40-*41 (citing 28 U.S.C. §§ 206(a), 207(a)(1), 203(e)(1)).
speaking, “the term ‘employee’ means any individual employed by an employer.”
29 U.S.C. § 206(e)(1).
However, “certain employees, including those who are
employed in ‘a bona fide executive, administrative, or professional capacity,’ are
exempt from” the FLSA’s minimum wage and overtime compensation requirements.
Callari v. Blackman Plumbing Supply Inc., 988 F. Supp. 2d 261, 275 (E.D.N.Y.
2013) (quoting 29 U.S.C. § 213(a)(1)).
Although “the FLSA does not define the
terms ‘executive,’ ‘administrative,’ or ‘professional’ for purposes of the exemption,”
the Department of Labor (“DOL”) has promulgated regulations to aid in the
analysis (hereinafter, the “Regulations”).
Id. at 275-76 (noting that the
“[R]egulations have the force of law, and are generally given controlling weight”
The Executive Exemption
With respect to the “executive exemption,” the Regulations provide, in
pertinent part, as follows:
The term “employee employed in a bona fide executive
capacity” . . . 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;10
Pursuant to 29 C.F.R. § 541.602(a), “[a]n employee will be considered to be paid on a
‘salary basis’ . . . if the employee regularly receives each pay period on a weekly, or less frequent
basis, a predetermined amount constituting all or part of the employee’s compensation, which
(2) Whose primary duty is management of the enterprise in which the
employee is employed or of a customarily recognized department or
(3) Who customarily and regularly directs the work of two or more
other employees; and
(4) Who has the authority to hire and 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).
According to the Regulations, “management,” as used in the foregoing
provision, includes, but is not limited to the following:
Activities such as interviewing, selecting, and training of employees;
setting and adjusting their rates of pay and hours of work; directing
the work of employees; maintaining production or sales records for use
in supervision or control; appraising employees’ productivity and
efficiency for the purpose of recommending promotions or other
changes in status; handling employee complaints and grievances;
disciplining employees; planning the work; determining the techniques
to be used; apportioning the work among the employees; determining
the type of materials, supplies, machinery, equipment 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 and security of the employees or the property;
planning and controlling the budget; and monitoring or implementing
legal compliance measures.
29 C.F.R. § 541.102. “Provided that an employee’s primary duty is management,
‘[c]oncurrent performance of exempt and nonexempt work does not disqualify an
employee from the executive exemption.’ ” Gardner v. W. Beef Props., 07-cv-2345,
2013 U.S. Dist. LEXIS 56511, at *25 (E.D.N.Y. Mar. 25, 2013) (Report and
amount is not subject to reduction because of variations in the quality or quantity of the work
11 “Under the interpretive regulations, an employee’s ‘primary duty’ is the duty that
consumes a ‘major part, or over [fifty] percent, of the employee’s time.’ ” Reiseck v. Universal
Communs. of Miami, Inc., 591 F.3d 101, 107 (2d Cir. 2010) (quoting 29 C.F.R. §§ 541.103, 541.206).
Recommendation), adopted, 2013 U.S. Dist. LEXIS 55725 (E.D.N.Y. Apr. 16, 2013)
29 C.F.R. § 541.106).
can . . . simultaneously direct the work of other employees and stock shelves
29 C.F.R. § 541.106(b)).
Additionally, the Regulations clarify that the third factor—“customarily and
regularly directing the work of two or more other employees”—contemplates
direction over “two full-time employees or their equivalent” and “[a]n employee who
merely assists the manager of a particular department and supervises two or more
employees only in the actual manager’s absence does not meet this requirement.”
29 C.F.R. § 541.104(b)-(c). In a related context, the Regulations expound upon the
phrase “customary and regularly,” indicating that it “signifies a frequency which
must be greater than occasional, but which may be less than constant.”
29 C.F.R. § 531.57 (regarding “tipped employees” under the FLSA). While “[c]ourts
have declined to set bright-line rules regarding what constitutes ‘customarily and
regularly[,]’ . . . courts have typically construed the regulation to require an
individual to supervise two or more full-time employees at least seventy-five to
eighty percent of the time.” McKinney v. United Stor-All Ctrs. LLC, 656 F. Supp. 2d
114, 131-32 (D.D.C. 2009) (citing Morgan v. Family Dollar Stores, 551 F.3d 1233,
1275 (11th Cir. 2008), cert. denied, 558 U.S. 816, 130 S. Ct. 59, 175 L. Ed. 2d 23
(2009); Jackson v. Go-Tane Servs., Inc., 56 F. App’x 267, 272 n.8 (7th Cir. 2003);
Murray v. Stuckey’s, Inc., 50 F.3d 564, 568 (8th Cir. 1995), cert. denied, 516 U.S.
863, 116 S. Ct. 174, 133 L. Ed. 2d 114 (1995); Sec’y of Labor v. Daylight Dairy
Prods., Inc., 779 F.2d 784, 788 (1st Cir. 1985); Perez v. Radioshack Corp., 522
F. Supp. 2d 731, 741-42 (N.D. Ill. 2005)); see Nicolai v. City of Whitehall, 2011 Wisc.
App. LEXIS 354, at *10 (Wisc. Ct. App. May 10, 2011) (“Federal courts have held
that an employee ‘customarily and regularly’ supervises two full-time subordinates
if he or she supervises subordinates who work a combined 80 hours per week at
least eighty percent of the time”), review denied, 337 Wis. 2d 50, 2011 Wisc. LEXIS
The Administrative Exemption
Relatedly, with respect to the “administrative exemption,” the Regulations
The term “employee employed in a bona fide administrative capacity
“ . . . shall mean any employee:
(1) Compensated on a salary or fee basis at a rate of not less than $455
per week . . . , exclusive of board, lodging or other facilities;
(2) Whose primary duty is 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) Whose primary duty includes the exercise of discretion and
independent judgment with respect to matters of significance.
29 C.F.R. § 541.200(a). In order to perform work that is “directly related to the
management or general business operations,” an 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.” 29 C.F.R. § 541.201(a). Such
work includes, but is not limited to:
work in functional areas such as tax; finance; accounting; budgeting;
auditing; insurance; quality control; purchasing; procurement;
advertising; marketing; research; safety and health; personnel
management; human resources; employee benefits; labor relations;
public relations; government relations; computer network, internet and
database administration; legal and regulatory compliance; and similar
Id. § 541.201(b).
In addition, “the exercise of discretion and independent judgment 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 term ‘matters of significance’ refers to the level of importance
or consequence of the work performed.” Id. This factor “must be applied in the
light of all the facts involved in the particular employment situation in which the
question arises.” Id. § 541.202(b).
Applicable Burden of Proof
“[B]ecause the FLSA is a remedial act, its exemptions . . . are to be narrowly
construed, and the burden rests on the employer to prove that a particular
employee is exempt from the Act’s requirements.” Callari, 988 F. Supp. 2d at 275
(internal citations and quotation marks omitted). And, whether an employee is
exempt from the FLSA’s provisions “is a mixed question of law and fact.” Ramos v.
Baldor Specialty Foods, Inc., 687 F.3d 554, 558 (2d Cir. 2012) (citation omitted). As
the Supreme Court has instructed, the question of how the employee spends his
time working is one of fact, while the question of whether those particular activities
exclude him from the FLSA’s embrace is one of law. See Icicle Seafoods, Inc. v.
Worthington, 475 U.S. 709, 714, 106 S. Ct. 1527, 89 L. Ed. 2d 739 (1986); cf. Gordon
v. Rite Aid Corp., 09-cv-7665, 2012 U.S. Dist. LEXIS 54071, at *34-*35
(S.D.N.Y. Mar. 12, 2012) (“ ‘Consideration of the [above-recited] factors is a highly
fact-intensive inquiry, to be made on a case-by-case basis in light of the totality of
the circumstances.’ ” (quoting Clougher v. Home Depot U.S.A., Inc., 696 F. Supp. 2d
285, 290 (E.D.N.Y. 2010))).
Thus, summary judgment can only be appropriate
where “ ‘the parties agree on the scope of the plaintiff[’]s duties or, when such facts
are disputed, the Court accepts the plaintiff[’]s version as true, but the parties
disagree about whether those duties entitle the defendant to claim an exemption
under the FLSA.’ ” Id. at *36 (quoting Scott v. SSP Am., Inc., 09-cv-4399, 2011 U.S.
Dist. LEXIS 32819, at *20-*21 (E.D.N.Y. Mar. 29, 2011)).
Duty to Maintain Records
In addition, “[t]he FLSA requires employers to maintain accurate records of
the hours and wages of their employees.” D’Arpa, 2013 U.S. Dist. LEXIS 85697, at
*51 (citing 29 U.S.C. § 211(c)). “ ‘[A]t summary judgment, if an employer’s records
are inaccurate or inadequate, an employee need only present sufficient evidence to
show the amount of [the uncompensated work] as a matter of just and reasonable
inference.’ ” Id. (quoting Kuebel v. Black & Decker Inc., 643 F.3d 352, 362 (2d Cir.
2011)). Indeed, the Supreme Court has noted the difficulties faced by employees
who attempt to establish the hours they worked for employers who fail to maintain
When the employer has kept proper and adequate records, the
employee may easily discharge his burden by securing the production
of those records. But where an employer’s records are inaccurate or
inadequate and the employee cannot offer convincing substitutes, a
more difficult problem arises.
Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687, 66 S. Ct. 1187, 90 L. Ed.
1515 (1946), reh’g denied, 329 U.S. 822, 67 S. Ct. 25, 91 L. Ed. 699 (1946). The
Court held that in such scenarios:
the solution . . . is not to penalize the employee by denying him any
recovery on the ground that he is unable to prove the precise extent of
uncompensated work. Such a result would place a premium on an
employer’s failure to keep proper records in conformity with his
statutory duty; it would allow the employer to keep the benefits of an
employee’s labors without paying due compensation as contemplated
by the Fair Labor Standards Act. In such a situation, . . . an employee
has carried his burden if he proves that he has in fact performed work
for which he was improperly compensated and if he produces sufficient
evidence to show the amount and extent of that work as a matter of
just and reasonable inference. The burden then shifts to the employer
to come forward with evidence of the precise amount of work
performed or with evidence to negative the reasonableness of the
inference to be drawn from the employee’s evidence. If the employer
fails to produce such evidence, the court may then award damages to
the employee, even though the result be only approximate.
Id. at 687-88. Within this framework, an “employee’s burden in proving damages
under the FLSA is minimal, particularly when the employer does not keep records.”
Hosking v. New World Morg., Inc., 570 F. App’x 28, 32 (2d Cir. 2014); see D’Arpa,
2013 U.S. Dist. LEXIS 85697, at *51-*52 (“The Second Circuit has established that
‘it is possible for a plaintiff to meet this burden through estimates based on his
recollection” (quoting Kuebel, 643 F.3d at 362)).
“But the district court is not
permitted to ‘just accept [plaintiff’s] statement of the damages.’ ”
Transatl. Marine Claims Agency v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir.
Rather, the Court has discretion to weigh the testimony to determine
whether a “just and reasonable inference” regarding the amount of uncompensated
work allegedly performed by Plaintiff may be drawn therefrom. In this regard,
“there must be at least some credible evidence that [Plaintiff] performed overtime
work” as alleged in the Complaint, and testimony that is “too vague to be credible”
will not suffice. Daniels v. 1710 Realty LLC, 497 F. App’x 137, 139 (2d Cir. 2012);
see Holaway v. Stratsys, Inc., 12-cv-998, 2013 U.S. Dist. LEXIS 189434, at *7-*8
(D. Minn. Dec. 20, 2013), aff’d, 771 F.3d 1057 (8th Cir. 2014) (granting summary
judgment to employer where employee’s testimony concerning the amount of
overtime he worked was “wholly implausible”).
Applicable Standards Under the NYLL
“The New York Labor Law ‘is the state analogue to the federal FLSA.’ ”
D’Arpa, 2013 U.S. Dist. LEXIS 85697, at *65.
As Judge Gleeson explained in
D’Arpa, the NYLL:
. . . echoes the FLSA in compensation provisions regarding overtime
and minimum wage requirements. Chun Jie Yin v. Kim, 07-cv-1236,
2008 U.S. Dist. LEXIS 118533, [ ] at *4 [(E.D.N.Y. Mar. 7, 2008)
(Report and Recommendation), adopted, 2008 U.S. Dist. LEXIS 27040
(E.D.N.Y. Apr. 3, 2008)]; Jemine v. Dennis, 901 F. Supp. 2d 365, 375
(E.D.N.Y. 2012) (“The New York Labor Law mirrors the FLSA in most
aspects, including its wage and overtime compensation provisions.”);
see 12 N.Y.C.R.R. §§ 142-2.1-2.2. The NYLL, like the FLSA, requires
that employers pay one and one-half times an employee’s regular rate
of work performed in excess of forty hours a week.
Id. at *65-*66.12
In addition to seeking compensation for work performed in excess of forty hours per week,
as outlined above, Plaintiff asserts a separate claim for “unpaid overtime, unpaid wages” and related
damages arising from Defendants’ alleged “fail[ure] to provide Plaintiff with a daily thirty (30)
minute uninterrupted meal period.” Compl. ¶¶ 51-52. However, it warrants noting that under N.Y.
Lab. Law § 162 (requiring meal periods), no private statutory right of action exists to enforce it. For
And, “just as the FLSA and its [R]egulations define and exempt from its
minimum wage and overtime requirements persons employed in ‘a bona fide
executive, administrative or professional capacity,’ 29 U.S.C.A. § 213(a)(1), the
NYLL and its implementing regulations exempt from its wage and overtime
provisions individuals who work in an ‘executive, administrative or professional
capacity.’ ” Niemic v. Ann Bendick Realty, 04-cv-897, 2007 U.S. Dist. LEXIS 98840,
at *9 (E.D.N.Y. Mar. 30, 2007) (Report and Recommendation), adopted, 2007 U.S.
Dist. LEXIS 97531 (E.D.N.Y. Apr. 23, 2007) (quoting 12 N.Y.C.R.R. § 141-3.2(c)).
As relevant here, the NYCRR defines an employee working in a bona fide
executive capacity as an individual:
(a) whose primary duty consists of the management of the enterprise
in which such individual is employed or of a customarily recognized
department or subdivision thereof; and
(b) who customarily and regularly directs the work of two or more
other employees therein; and
(c) who has the authority to hire and fire employees or whose
suggestions and recommendations as to the hiring or firing and as to
the advancement and promotion or any other change of status of other
employees will be given particular weight; and
(d) who customarily and regularly exercises discretionary powers; and
instance, in Browne v. IHOP, 05-cv-2005, 2005 U.S. Dist. LEXIS 48129, at *2-*3 (E.D.N.Y. Aug. 8,
2005), Judge Trager dismissed the claims of a pro se plaintiff-employee who alleged that she had
been denied half-hour lunch breaks over a four-year period, concluding that “[w]hile Article 5 of the
New York Labor Law, section 162, affords an unpaid meal period, there is no private right of action
to enforce this provision” (collecting cases). New York courts are in accord. See McElroy v. New
York, 50 Misc. 2d 223, 225, 270 N.Y.S.2d 113, 115 (Sup. Ct. Special Term Kings Cnty. 1966), aff’d, 29
A.D.2d 737, 287 N.Y.S.2d 352 (App. Div. 2d Dep’t 1968) (holding that “there [wa]s no question that
the defendant illegally denied [the plaintiffs] 15 minutes of lunchtime which they were entitled to,”
but that the plaintiffs “[could] not recover the value thereof since under the statute they are given no
right of action for any violation thereof”). Thus, to the degree Awan seeks compensation for allegedly
having been denied meal periods during his employment, no cause of action for such relief exists and
Plaintiff may instead “consider presenting [such a] claim to the New York Commissioner of Labor
who is charged with regulating and enforcing New York’s labor laws.” Browne, 2005 U.S. Dist.
LEXIS 48129, at *4 (citation omitted). However, to the extent Awan is alleging that he worked
through his statutory lunch breaks without pay, his claims may be cognizable under the overtime
and minimum wage provisions of the NYLL discussed hereinabove.
(e) who is paid for his services a salary of not less than . . . $626.25 per
week. . . .
12 N.Y.C.R.R. § 141-3.2(c)(1).
Similarly, the NYCRR defines an employee working in a bona fide
administrative capacity as an individual:
(a) whose primary duty consists of the performance of office or
nonmanual field work directly related to management policies or
general operations of such individual’s employer;
(b) who customarily and regularly exercises discretion and
(c) who regularly and directly assists an employer, or an employee
employed in a bona fide executive or administrative capacity . . . or
who performs, under only general supervision, work along specialized
or technical lines requiring special training, experience or knowledge;
(d) who is paid for his services a salary of not less than . . . $626.25 per
week. . . .
12 N.Y.C.R.R. § 140-2.14(c)(4)(ii). In this regard, “New York law follows the FLSA
on the standards that govern the executive [and administrative] exemption[s].”
Gardner v. W. Beef Props., 07-cv-2345, 2013 U.S. Dist. LEXIS 56511, at *9 n.2
(E.D.N.Y. Mar. 25, 2013) (Report and Recommendation), adopted, 2013 U.S. Dist.
LEXIS 55725 (E.D.N.Y. Apr. 16, 2013) (citations omitted); see Jackson v. Bloomberg,
L.P., 298 F.R.D. 152, 160 (S.D.N.Y. 2014) (“FLSA’s exemptions are incorporated into
the NYLL”); Sethi v. Narod, 974 F. Supp. 2d 162, 183 (E.D.N.Y. 2013) (“The NYLL
also provides exemptions for some employees similar to the FLSA”); Harper v.
GEICO, 980 F. Supp. 2d 378, 384 (E.D.N.Y. 2013), vacated and remanded on other
grounds, 586 F. App’x 772 (2d Cir. 2014) (“The FLSA statutory exemptions from the
overtime payment requirement are incorporated into New York State’s parallel
overtime provision” (citation omitted)).
Finally, “New York law also requires that employers keep various, detailed
Like the FLSA, the NYLL requires that employers keep
employment records in their course of business relating to employees’ rates of pay,
hours, dates of work, and payroll, among other information.”
Dominguez v. BS
Supermarket, Inc., 13-cv-7247, 2015 U.S. Dist. LEXIS 39670, at *20 (E.D.N.Y. Mar.
5, 2015) (Report and Recommendation), adopted, 2015 U.S. Dist. LEXIS 39512
(E.D.N.Y. Mar. 27, 2015) (citing N.Y. Lab. Law § 195). “Thus, where the defendant
has failed to maintain proper records, the burden of proving that plaintiff was paid
properly falls on the defendant.” Id. at *21 (citing Marin v. JMP Restoration Corp.,
09-cv-1384, 2012 U.S. Dist. LEXIS 136498 (E.D.N.Y. Aug. 24, 2012) (Report and
Recommendation), adopted, 2012 U.S. Dist. LEXIS 136490 (E.D.N.Y. Sept. 24,
2012) (“To determine NYLL overtime damages, courts use the same burden-shifting
scheme employed in FLSA actions”).
Plaintiff’s Breach of Contract Claim
Awan is entitled to summary judgment on his breach of contract cause of
action. In New York, “[t]o establish a claim of breach of contract . . . , a plaintiff
must demonstrate ‘(i) the formation of a contract between the parties; (ii)
performance by the plaintiff; (iii) failure of defendant to perform; and
(iv) damages.’ ” Zorbas v. U.S. Trust Co., N.A., 11-cv-2318, 2014 U.S. Dist. LEXIS
137756, at *23 (E.D.N.Y. Sept. 29, 2014) (quoting Johnson v. Nextel Commc’ns, Inc.,
660 F.3d 131, 142 (2d Cir. 2011)). The parties do not dispute the material facts
underpinning Plaintiff’s breach of contract claim—namely, that the parties entered
into a loan agreement pursuant to which Plaintiff loaned Defendants $40,000,
Defendants did not repay any part of the loan principle, and Defendants currently
owe the loan principle to Plaintiff. Accordingly, summary judgment on this claim is
granted and damages should be awarded to Plaintiff in accordance with Section VI,
Plaintiff’s Claims Under the FLSA and NYLL
Plaintiff also seeks damages for Defendants’ alleged violations of the
overtime and minimum wage provisions of the FLSA and NYLL. However, before
addressing the merits of those claims, the Court considers a threshold issue raised
by Defendants: whether Plaintiff is exempt from the statutes’ requirements as an
executive or administrative employee. See Def. Memo of Law at 2,4.
The Executive Exemption
Applying the standards outlined above, and weighing the appropriate
regulatory factors, the Court concludes that material questions of fact exist
sufficient to warrant a trial on the issue of whether Awan is an “employee engaged
in a bona fide executive capacity” within the meaning of the FLSA and NYLL, and
therefore exempt from those statutes’ protections.13
Although the Court’s analysis follows the framework established under the federal
Regulations, its analysis applies with equal force to the parallel exemptions established under New
York law. See Gardner, 2013 U.S. Dist. LEXIS 56511, at *9 n.2 (“New York law follows the FLSA on
the standards that govern the executive exemption”); Jackson, 298 F.R.D. at 160 (“FLSA’s
First Factor—Compensated on a Salary Basis
There is no dispute that Awan was “compensated on a salary basis,” although
the parties disagree on whether such compensation exceeded $455 per week. In
fact, the Court notes that Plaintiff’s own statements on the subject are inconsistent,
raising an issue of fact in this regard. Specifically, while attesting in support of
summary judgment that he was paid $400 per week, Awan alleged in his Complaint
that he received $800 per week.
And, Defendants proffered evidence, which
Plaintiff did not materially dispute, demonstrating that for at least a brief period in
2011, he received $900 per week. Accordingly, the Court finds that a question of
material fact exists regarding the first factor as to whether the executive exemption
Second Factor—Primary Duty of Managing the Enterprise
As made clear by the interpretive Regulations, the operative question
regarding the next factor is whether “a major part, or over fifty [ ] percent, of
[Awan]’s time” at work was spent in management. See Reiseck, 591 F.3d at 107
(quoting 29 C.F.R. §§ 541.103, 541.206). And in this regard, the record contains
material factual inconsistencies that are sufficient to preclude summary judgment
on this issue.
exemptions are incorporated into the NYLL”); Sethi, 974 F. Supp. 2d at 183 (“The NYLL also
provides exemptions for some employees similar to the FLSA”); Harper, 980 F. Supp. 2d at 384 (“The
FLSA statutory exemptions from the overtime payment requirement are incorporated into New York
State’s parallel overtime provision”).
14 The Court notes that although the monetary threshold applicable to the first factor of the
executive exemption analysis under the FLSA ($455.00) is different than its NYLL counterpart
($626.25), the Court’s conclusion in this regard remains the same. Indeed, Plaintiff’s most recent
assertions on the issue (i.e., that he received $400 per week), if true, would render him non-exempt
for purposes of this factor under both statutes, and Defendants’ assertions (i.e., that he in fact
received $800-$900 per week), if true, would render him exempt.
Initially, Awan’s own contentions are again inconsistent with his stated
despite resisting classification as an “executive employee,” he readily
concedes that he was “the sole operator of the” Smoke Shop and “worked
independently” without “any other person” during the relevant time period. Pl.
Memo of Law at 1; Pl. Aff. ¶ 2. Further, he claims that throughout the course of his
employment he performed work that was “directly essential to the business
operated by Defendants.”
Pl. 56.1 Stmt. ¶ 8.
Similarly, the non-party witness
affidavits he submits state that Plaintiff “supervised every function of the store.”
See Bloom Decl., Ex. “E” at ¶ 3. Defendants’ statements on this subject are also
self-contradictory—on the one hand they argue that Awan is an executive employee,
responsible for ordering merchandise for the store, receiving deliveries, paying for
merchandise, and hiring and firing employees, while on the other hand disputing
that Awan operated the store on his own, asserting that Durrani, the store’s owner,
worked at the Smoke Shop “every day” with him. Def. Aff. ¶¶ 5, 9.
These factual inconsistencies prevent a meaningful examination of whether
Awan’s job responsibilities rise to the level of executive management within the
meaning of the FLSA and NYLL. Specifically, though not dispositive, neither party
has submitted evidence sufficient to demonstrate whether Awan set the rates of pay
and hours of work for other employees or even for himself; whether he regularly
maintained production of sales records for use in supervision or control; whether he
planned the work of the store or determined techniques to be used in its operation;
whether he planned or controlled the budget; or whether he monitored or
implemented legal compliance measures. See 29 C.F.R. § 541.102.
Further, and perhaps most glaringly, the parties hotly dispute the existence
and roles of other employees at the store, another critical component of the second
factor. For his part, Plaintiff insists that he “solely” and “independently” operated
the Smoke Shop, opening every morning and closing every evening. He relies on
affidavits from customers to demonstrate that that he “was the only employee in the
store” and that customers “never observed any other person working there.” See
Bloom Decl., Ex. “E”.
Defendants take an utterly conflicting position—namely, that Awan was
empowered to hire and fire employees; that he hired three such employees; and that
he was responsible for supervising and paying them. See Def. Aff. ¶¶ 5, 9. There is
nothing in the record to demonstrate whether Awan interviewed, selected, and
trained employees; whether he appraised other employees’ productivity and
efficiency; whether he handled complaints and grievances; whether he disciplined
any employees; whether he apportioned work among them; or whether he provided
for employees’ safety and security. See 29 C.F.R. § 541.102. Based on this record,
scant as it is, the Court concludes that a genuine issue of material fact exists with
regard to the second factor.
Third Factor—Customarily and Regularly Directing Two or
The parties’ conflicting factual assertions regarding the Smoke Shop’s
employees also raise a question of fact concerning the third factor, concerning
supervision of employees.
Initially, the Regulations make clear that this factor contemplates an
employee exercising direction over “two full-time employees.”
In this regard,
Defendants assert that Awan hired and supervised three employees, but they
neither allege nor provide evidence relating to the workers’ dates of employment,
typical work hours, or whether they contributed a combined 80 hours per week to
the Smoke Shop. As Awan flatly denies even the basic existence of these employees,
a trial is required on the issue of whether, and in what capacity, the Smoke Shop
employed other individuals.
Further, assuming arguendo that there were other employees, questions of
fact abound concerning the degree to which Awan supervised them. In this regard,
Awan states that he was the “sole operator” of the store. If true, this fact suggests
that he was responsible for overseeing any other staff. Similarly, Defendants state
that “[t]here were no employees performing in a role similar or identical to that of
Plaintiff who worked for the Defendants during the last six (6) years.” Def. Am. Int.
Resp. ¶ 12. Thus, if none of the other alleged employees hired by Awan performed
in a role similar to him, it stands to reason that Plaintiff functioned as their
supervisor, which is directly relevant to the executive exemption analysis.
emphasizing that there is no evidence regarding the dates that the alleged other
employees began and ended their employment; the amount of days or hours they
worked; their job responsibilities generally or specifically vis-à-vis Awan; or the
conditions of their employment over which Plaintiff exercised supervisory authority.
Remarkably, Durrani, who claims to have worked at the store with Awan every day,
cannot even recall one of the three employees’ names. Based on these alleged facts,
there is insufficient evidence in the record to permit this Court to determine the
third factor as a matter of law.
Similarly, a genuine question of material fact exists with regard to the fourth
and final factor, concerning hiring and firing employees. Specifically, Defendant
explicitly states that Plaintiff “had the authority to hire and fire employees” and did
so on at least three occasions. Def. Aff. ¶ 5. Awan does not deny this, but instead
focuses on Defendants’ failure to maintain business records as a basis for granting
summary judgment on the issue.
In addition, Durrani recalls that one of the
employees hired by Plaintiff was named Tony, which is the same name referenced
throughout the customer affidavits relied upon by Awan. See id. ¶ 5; see also Bloom
Decl., Ex. “E” (“While Tony was working, he was the only employee in the store”).
On this record, there is insufficient evidence to determine the scope of Awan’s
decision-making authority, if any, with respect to any other Smoke Shop employees
as a matter of law and summary judgment on this issue is inappropriate.
Accordingly, material issues of fact exist as to each of the foregoing factors sufficient
to warrant a trial as to whether the executive exemption applies.
The Administrative Exemption
The Court reaches a contrary result with respect to the administrative
exemption. In this regard, Defendants have not met their burden of establishing
that Awan is an “employee engaged in a bona fide administrative capacity” within
the meaning of the FLSA and NYLL as matter of law.
First Factor—Compensated on a Salary Basis
This factor mirrors the first factor of the executive exemption analysis. The
Court accordingly adopts its prior reasoning, and concludes that a question of
material fact exists regarding the first factor for whether the administrative
exemption should apply.
Second Factor—Primary Duty of Performing Office/NonManual Work Directly Related to Management
Defendants, however, have failed to submit any evidence that Plaintiff’s
primary duties were administrative in nature. An examination of the interpretive
Regulations makes clear that the nature of Awan’s work in the Smoke Shop was not
of the kind contemplated as “directly related to the management or general
In this regard, the Regulations explicitly state that
administrative work is to be “distinguished . . . from . . . selling a product in a retail
or service establishment,” which was Awan’s essential function in the store.
29 C.F.R. § 541.201(a). And even assuming that Plaintiff was, as Defendants claim,
tasked with the ancillary duties of opening and closing the store, ordering and
paying for merchandise, and making certain personnel decisions, such activities do
not bring Plaintiff within the realm of those employees who “perform work directly
related to assisting with the running or servicing of the business” such as
accountants, auditors, insurance specialists and risk managers, human resource
professionals, public relations specialists, advertising professionals, and attorneys.
See 29 C.F.R. § 541.201(b). Thus, Defendants fail to establish a material issue of
fact as to the second factor for whether the administrative exemption should apply.
Third Factor—Exercise of Discretion and Independent
Judgment on Matters of Significance
Considered “in the light of all the facts involved,” there is insufficient
evidence submitted to determine the amount of discretion and judgment Plaintiff
exercised concerning matters of significance. Neither party directly addresses this
point, and the record contains conflicting statements as to the level of discretion or
decision-making authority Awan possessed.
To note but one example, Durrani
claims that Awan had discretion to make personnel decisions and order
merchandise, while on the other hand disputing that Plaintiff operated the store on
his own, contending instead that he (Durrani) also worked at the store every day.
Under these circumstances, there is simply no basis to conclude whether Awan’s
responsibilities, whatever they were, constituted matters of relative significance to
the operation of the business or that they comprised Awan’s “primary duties”—i.e.,
that they occupied fifty percent or more of his work time. As a result, the Court
concludes that summary judgment is inappropriate on the third factor of the
administrative exemption analysis. Nevertheless, because Defendants fail to meet
their burden on the second relevant factor, summary judgment on this issue is
required in Plaintiff’s favor and the administrative exemption does not apply.
Plaintiff Would Not Be Entitled to Summary Judgment as
to Damages under the FLSA and NYLL Even if the
Executive Exemption Does Not Apply
Even if Awan is not covered by the executive exemption and submitted
sufficient evidence that he was not properly paid time-and-a-half for hours worked
in excess of forty per week, however, summary judgment would still be
inappropriate as to the issue of damages based on Plaintiff’s FLSA and NYLL wageand-hour claims because the evidence does not support a “just and reasonable
inference” of those damages. Although an “employee’s burden in proving damages
under the FLSA is minimal, particularly when the employer does not keep records,”
Hosking, 570 F. App’x at 32, “there must [still] be at least some credible evidence
that [Plaintiff] performed overtime work” as alleged in the Complaint. Daniels, 497
F. App’x at 139. Here, Awan’s unsupported affidavit—the only competent evidence
in the record relating to damages—is untenable and, without more, is insufficient to
justify judgment with a reasonable degree of certainty.
Defendants’ conceded failure to keep records regarding Plaintiff’s employment,
Awan’s conclusory allegations that he worked 18 hours per day, every single day of
the week, without so much as a thirty-minute lunch break, for more than 25 years
are implausible and insufficient to form the basis of a reasonable inference or
approximation of compensatory damages (which Plaintiff alleges exceed one million
dollars in this case as a matter of law).
Cf. Holaway, 2013 U.S. Dist. LEXIS
189434, at *7-*8. Similarly, for the reasons set forth above, the Court finds the pro
forma affidavits of various customers of the Smoke Shop insufficient to establish the
days and hours Plaintiff worked as a matter of law.
In this regard, the Court recognizes that Defendants inarguably violated the
FLSA and NYLL by failing to maintain the required business records. However,
contrary to Awan’s contentions, that fact alone does not automatically entitle him to
a specific amount of damages.
Rather, Plaintiff must still present “sufficient
evidence” to show the amount of the allegedly uncompensated work, albeit as a
matter of reasonable inference. See D’Arpa, 2013 U.S. Dist. LEXIS 85697, at *51.
Awan’s supporting affidavit, without more, is insufficient for this purpose.
In addition, the Court finds Defendants’ testimonial evidence sufficient to
raise an issue of fact as to the amount of uncompensated work Awan actually
As noted above, Defendants do not materially dispute the fact that
Plaintiff performed work in excess of forty hours per week for which he did not
receive overtime pay, but they do contend that the actual number of hours is
substantially less than what Awan alleges. Thus, Durrani’s affidavit, when viewed
in the light most favorable to Defendants, would be sufficient under the
circumstances to raise a genuine fact issue regarding Plaintiff’s estimation of
Finally, Plaintiff advances no substantive argument, and submits no
supporting evidence, regarding his claims for additional measures of damages,
including liquidated damages, attorneys’ fees, and costs of the action. As a result,
even assuming that the executive exemption does not apply, with regard to Awan’s
wage-and-hour claims, summary judgment as to the issue of damages would be
As set forth herein, at this stage, Plaintiff is entitled to damages only on his
breach of contract claim. In this regard, Plaintiff is entitled to the principal amount
plus prejudgment interest. See Graham v. James, 144 F.3d 229, 239 (2d Cir. 1998)
(“Under New York law, ‘prejudgment interest is normally recoverable as a matter of
right in an action at law for breach of contract’ ”) (quoting Adams v. Lindblad
Travel, Inc., 730 F.2d 89, 93 (2d Cir. 1984)); see also Fed. Ins. Co. v. CAC of NY, Inc.,
14-cv-4132, 2015 U.S. Dist. LEXIS 32098, at *18-*19 (E.D.N.Y. Feb. 5, 2015)
(Report and Recommendation) (collecting cases for the proposition that prejudgment
interest in breach of contract cases is “mandatory” under New York law), adopted,
2015 U.S. Dist. LEXIS 31923 (E.D.N.Y. Mar. 16, 2015).15 New York Civil Practice
Law and Rules (“CPLR”) § 5001 provides that “[i]nterest shall be recovered upon a
sum awarded because of a breach of performance of a contract” and “shall be
computed from the earliest ascertainable date the cause of action existed, except
that interest upon damages incurred thereafter shall be computed from the date
incurred.” Such interest “shall be at the rate of nine per cent per annum, except
where otherwise provided by statute.” CPLR § 5004. Accordingly, the Court finds
The Court notes that Plaintiff’s breach of contract claim is in federal court because of
supplemental jurisdiction and “state law governs stand-alone pendent claims in federal question
cases.” Liberty Media Corp. v. Vivendi Universal, S.A., 03-cv-2175, 2013 U.S. Dist. LEXIS 3521, at
*6-*7 & n.13 (S.D.N.Y. Jan. 9, 2013).
that Awan may recover interest at the annual statutory rate of 9% on the principal
amount of $40,000 due under the parties’ loan agreement.
As noted above, prejudgment interest is calculated from “the earliest
ascertainable date the cause of action existed.” “Under New York law, a cause of
action for breach of contract accrues at the time of the breach.” Fed. Ins. Co., 2015
U.S. Dist. LEXIS 32098, at *19 (collecting cases). Here, the breach occurred on May
7, 2014, when Defendants’ repayment of the loan amount came due and they failed
to make the requirement payment.
See Compl. ¶¶ 53-55.
Thus, the Court
calculated prejudgment interest on the principal loan amount through the date of
this Order as $4,141.20.16 And, since the principal amount remains outstanding,
daily interest shall continue to accrue at the rate of $9.86 per day for each day until
judgment is entered.
Based on the foregoing, Plaintiff’s motion for summary judgment on his
breach of contract claim is granted as to the issues of liability and damages. In
addition, summary judgment as to Plaintiff’s FLSA and NYLL claims is denied.
The parties shall appear before the undersigned on October 6, 2015 at 11:30
a.m. in courtroom 820 of the Central Islip courthouse for the purpose of conducting
a final pretrial conference. A joint proposed pretrial order shall be electronically
This figure was reached by taking the number of days between the date of the breach, May
7, 2014, and the date of this Order, July 1, 2015 (420 days) and multiplying it by the daily interest
rate of $9.86 ($40,000 (principal loan amount) x 0.09 (yearly interest) = $3,600 (yearly interest) / 365
days = $9.86 per day interest). Cf. Daniello v. PML Furniture Group of NJ, Ltd., 06-cv-5261, 2009
U.S. Dist. LEXIS 131676, at *7-*8 n.5 (E.D.N.Y. May 6, 2009) (Report and Recommendation),
adopted, 2009 U.S. Dist. LEXIS 114931 (E.D.N.Y. Dec. 2009).
filed in accordance with this Court’s Individual Rules at least three days prior to the
Central Islip, New York
July 1, 2015
s/ Steven I. Locke
STEVEN I. LOCKE
United States Magistrate Judge
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