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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
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No. 15-11746
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D.C. Docket No. 1:13-cv-03808-WSD
REBECCA RAMSEY,
Plaintiff-Appellant,
versus
WALLACE ELECTRIC COMPANY, LLC, et al.,
Defendants-Appellees.
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Appeal from the United States District Court
for the Northern District of Georgia
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(June 24, 2016)
Before WILLIAM PRYOR, ANDERSON and PARKER, * Circuit Judges.
PER CURIAM:
*
Honorable Barrington D. Parker, Jr., United States Circuit Judge for the Second Circuit, sitting
by designation.
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Plaintiff-Appellant Rebecca Ramsey appeals from the district court's grant
of summary judgment to Defendants-Appellees Wallace Electric Company, LLC
("Wallace") and Phillip Wallace, Sr., on Ramsey's claim for overtime pay under
the Fair Labor Standards Act ("FLSA"). 29 U.S.C. §207(a)(1). Wallace does not
dispute that Ramsey regularly worked more than forty hours a week and that
Wallace did not pay overtime wages for the hours Ramsey worked in excess of
forty hours a week. Rather, Wallace maintains that Ramsey is not entitled to
overtime pay because she was "employed in a bona fide executive, administrative,
or professional capacity" and thus exempt from the overtime pay requirements
pursuant to §213(a)(1). The district court granted summary judgment to Wallace,
holding that there was no genuine question of material fact that Ramsey was
exempt under the statute and the relevant regulations promulgated by the
Department of Labor defining and delimiting the scope of the exemption. After
reviewing the record, reading the parties' briefs, and having the benefit of oral
argument, we conclude that we must vacate the district court's order and remand
this case for further proceedings.
FLSA mandates generally that covered employees who work more than
forty hours in a week must receive overtime pay for those hours worked in excess
of forty at a rate of one and one-half times their regular wage. §207(a)(1).
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However, the overtime pay requirement does not apply to employees working in "a
bona fide executive, administrative or professional capacity." §213(a)(1).
Congress has not defined the statutory terms "executive," "administrative,"
or "professional." Rather, §213(a)(1) provides an express grant of rulemaking
authority to the Department of Labor to define and delimit the scope of the
exemptions. These regulations are given controlling weight unless they are found
to be arbitrary, capricious, or contrary to the statute. See Gregory v. First Title of
America, Inc., 555 F.3d 1300, 1302 (11th Cir. 2009).
The Department of Labor's current regulations provide that the "general
rule" is that an employee is "employed in a bona fide administrative capacity" for
the purposes of § 213(a)(1), and thus exempt from FLSA's overtime requirements,
if the employee is:
(1) Compensated on a salary or fee basis at a rate of not less than $455
per week . . . ;
(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). On appeal, the parties dispute whether Wallace is entitled
to summary judgment on the second and third prongs of this test.
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Ramsey argues that the district court erred in determining that there was no
genuine question of material fact that Ramsey's primary duty was "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." For the reasons
fully explored at oral argument, we agree with the district court with respect to this
second prong of the test.
Turning to the third prong of the test, Ramsey argues that the district court
erred in determining that there was no genuine question of material fact that
Ramsey's primary duty included "the exercise of discretion and independent
judgment with respect to matters of significance." The regulations provide several
pieces of guidance relevant to the determination of whether Ramsey exercised
discretion and independent judgment with respect to matters of significance.
First, the regulations provide a definition of the type of discretion and
judgment required:
In general, 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. The term “matters of
significance” refers to the level of importance or consequence of the
work performed.
§541.202(a) (emphasis added). According to this definition, exercising discretion
with respect to matters of significance generally requires that an employee make
consequential decisions among available options.
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Second, the regulations provide a long non-exclusive list of factors to be
considered in determining whether an employee exercises discretion and
independent judgment:
The phrase “discretion and independent judgment” must be applied in
the light of all the facts involved in the particular employment
situation in which the question arises. Factors to consider when
determining whether an employee exercises discretion and
independent judgment with respect to matters of significance include,
but are not limited to: whether the employee has authority to
formulate, affect, interpret, or implement management policies or
operating practices; whether the employee carries out major
assignments in conducting the operations of the business; whether the
employee performs work that affects business operations to a
substantial degree, even if the employee's assignments are related to
operation of a particular segment of the business; whether the
employee has authority to commit the employer in matters that have
significant financial impact; whether the employee has authority to
waive or deviate from established policies and procedures without
prior approval; whether the employee has authority to negotiate and
bind the company on significant matters; whether the employee
provides consultation or expert advice to management; whether the
employee is involved in planning long- or short-term business
objectives; whether the employee investigates and resolves matters of
significance on behalf of management; and whether the employee
represents the company in handling complaints, arbitrating disputes or
resolving grievances.
§541.202(b).
Third, the regulations provide guidance with respect to the degree of
independence an employee must possess:
The exercise of discretion and independent judgment implies that the
employee has authority to make an independent choice, free from
immediate direction or supervision. However, employees can exercise
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discretion and independent judgment even if their decisions or
recommendations are reviewed at a higher level.
§541.202(c).
Finally, the regulations provide guidance pertaining specifically to clerical
services and other mechanical or repetitive services:
The exercise of discretion and independent judgment must be more
than the use of skill in applying well-established techniques,
procedures or specific standards described in manuals or other
sources. . . . The exercise of discretion and independent judgment also
does not include clerical or secretarial work, recording or tabulating
data, or performing other mechanical, repetitive, recurrent or routine
work. An employee who simply tabulates data is not exempt, even if
labeled as a “statistician.”
§541.202(e).
With respect to this third prong of the test – i.e., the exercise of discretion
and independent judgment with respect to matters of significance – we agree with
Ramsey and hold that there are genuine issues of fact with respect to many of the
relevant factors. For example, Phillip Wallace, Sr., the proprietor of Wallace
Electric, testified that Ramsey was authorized to and frequently did negotiate
hourly rates for commercial/industrial service jobs and mark up the company’s cost
of certain materials. He indicated that Ramsey could make the "final call" before
quoting same to the customer if she was unable to reach a supervisor. However,
reasonable inferences from Ramsey's deposition and affidavit dispute that Ramsey
had such discretion or authority.
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For the foregoing reasons, and for the reasons fully explored at oral
argument, we conclude that there are genuine issues of fact which preclude
summary judgment on the third prong of the test – i.e., whether Ramsey’s primary
duty includes the exercise of discretion and independent judgment with respect to
matters of significance.
Although the district court correctly resolved the second prong of the test,
the court erred with respect to the third prong. Accordingly, the judgment of the
district court is vacated and the case is remanded for further proceedings not
inconsistent with this opinion.
VACATED and REMANDED.
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