Even though Jackson, in the case Jackson v. Go-Tane, had the job title of manager, he had very few managerial responsibilities and should not be considered an exempt employee and is entitled to be paid his OT. Here’s why:
He doesn’t pass the salary test:
His wages need to be at least $455.00 a week to meet the minimum standards necessary to be considered an exempt employee and Jackson's gross pay never exceeded $360.
He also doesn’t pass the duties test:
If he were an exempt employee, his primary duty would be to manage his department. Although Jackson responded to customer complaints and performed basic administrative responsibilities, including scheduling, training and disciplining the car wash attendants, he had little or no independent authority over hiring, firing and setting pay rates. In fact, 95% of his work time was spent performing tasks that his employee’s performed.
Being an exempt employee is more than a job title, and a company needs to make the case for the exemption and it doesn’t in this case. Jackson should be considered an hourly employee. Pay the man his OT! DB
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The appeals court upheld the ruling of the district court that Jackson was not an exempt executive employee. Hence, the employer violated the FLSA by not paying him properly for overtime work performed. The case was decided under the “old” regulations, but the outcome would have been the same under the current regulations.
Under the duties portion of the short test, the employer was required to show that the employee’s primary duty is the management of the employer’s enterprise and that the employee customarily and regularly directs the work of two or more other full-time employees. The court accepted as a general guideline that a primary duty will usually consume over 50 percent of the employee’s time. In this case, the plaintiff testified that 95% of his time was spent performing janitorial and non-managerial tasks, and the employer was unable to show otherwise. In practice, Jackson operated as a “glorified Car Wash attendant,” performing the same tasks as other attendants. Additionally, he was compensated only slightly more on an hourly basis than the regular attendants and he was given little discretion or independent authority. As evidence of the latter, Jackson lacked the authority to independently decide whom to hire or fire, and how much employees should be paid. Although the finding that the employee’s primary duty did not consist of management of the employer’s enterprise was sufficient to rule against the employer, the court noted that it also agreed with the lower court that the small, part-time staff did not work enough hours under Jackson’s supervision to meet the second prong of the duties test either.
Under the current regulations, the decision that Jackson is not an exempt executive would be even more clear-cut. He would not meet the minimum salary requirement under the new regulations because he was paid a weekly salary of less than $455/wk. The new regulations also add to the duties test the requirement that the employee have the authority to hire or fire other employees, or to make recommendations on these matters that hold considerable weight. Since the court found that Jackson did not have such authority, this would further argue against exempt status. However, the current regulations place less emphasis on frequency of performance as an indicator of a “primary duty.”
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