New Purchase/Customer Service Manager Is Exempt Administrative Employee Under FLSA

Cash v. Cycle Craft Co., ___F.3d___(1st. Cir.Nov. 20, 2007), is a well written First Circuit decision which does a nice job of summarizig the administrative exemption from the over-time requirements under the Fair Labor Standards Act.  The court held that the plaintiff, a new purchase/customer service manager was exempt from the FLSA and therefore, the employer was not responsible for over-time payments.

The court correctly summarized the law by looking to the regulations issued by the Secy. of Labor. The court described these regulations as follows:

The Secretary of Labor has issued regulations that articulate some specific parameters of the exemption. John Alden, 126 F.3d at 7; see 29 C.F.R. § 541.200 (2004). Although the regulations merely state the Secretary’s official position on how the statutes should be interpreted, a court must give them “controlling weight unless [the court finds them] to be arbitrary, capricious, or contrary to the statute.” John Alden, 126 F.3d at 8 (citing Chevron U.S.A., Inc. v. Natural Res. Def. Council, 467 U.S. 837, 843–44 (1984)).

According to the regulations, to establish that Cash as an “employee in a bona fide administrative capacity,” Boston Harley must show that he was an employee

(1)[c]ompensated on a salary or fee basis at a rate of not less than $455 per week . . ., exclusive of board, lodging or other facilities;

(2)[w]hose 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)[w]hose primary duty includes the exercise of discretion and independent judgment with respect to matters of significance. 29 C.F.R. § 541.200 (emphasis added).

Mitchell H. Rubinstein