Store managers for Family Dollar stores were awarded $35 million plus in an unpaid overtime case decided by the Eleventh Circuit Court of Appeals in Atlanta, Morgan v. Family Dollar Stores, Inc., No. 07-12398 (11th Cir. December 16, 2008). The court ruled that 1424 store managers were due $17,788.029.74 in unpaid overtime and an equal amount as unliquidated damages based on Family Dollar's willful violations of the Fair Labor Standards Act (FLSA).
The case turned on whether the store managers were exempt employees falling within the "executive exemption" to the FLSA. The court ruled that the store managers were not exempt based on the following:
- store manages spent 80-90% of their time performing manual labor tasks such as stocking shelves, running the cash registers, unloading trucks, and cleaning the parking lots, floors and bathrooms
- performing manual labor was included in the job description as "Essential Job Functions" of the store managers
- store managers rarely exercised any discretion because the operations manuals or district managers controlled virtually every aspect of a store's day-to-day operations
- store managers were closely supervised by district managers, who exercised practical managerial authority over each store
- the store managers' pay rate was only slightly higher than the hourly rate of their assistant store managers
These factors led the court to conclude that "sweeping corporate micro-management, close district manager oversight, and fixed payroll budgets left store managers little choice in how to manage their stores and with the primary duty of performing manual, not managerial, tasks." Therefore, the Family Dollar store managers did not fall within the "executive exemption" to overtime pay under the Fair Labor Standards Act.
Another class action lawsuit for overtime was recently filed by misclassified store managers in Jacksonville, Florida. See "Misclassified Managers Sue Dollar General for Overtime."
Store managers for Lush Cosmetics filed suit also in Florida claiming that they were misclassified as exempt from overtime. See "Claiming They Were Misclassified Managers Sue for Overtime."
