Bailey v. Innovative Contracting Solutions, Inc. et al, No. 1:2013cv04114 - Document 40 (N.D. Ga. 2014)

Court Description: OPINION and ORDER denying 35 Motion to Strike or Exclude Declaration of Brian Williams and granting in part and denying in part 28 Motion for Summary Judgment. Signed by Judge Leigh Martin May on 12/4/2014. (bdb)

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Bailey v. Innovative Contracting Solutions, Inc. et al Doc. 40 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION CHRISTOPHER BAILEY, Plaintiff[s], v. INNOVATIVE CONTRACTING SOLUTIONS, INC., et al., Defendants. : : : : : : : : : : CIVIL ACTION NO. 1:13-CV-4114-LMM OPIN ION AN D ORD ER This is an action for unpaid overtim e under the Fair Labor Standards Act (the “FLSA”). It is before the Court on the Defendants’ Motion for Sum m ary J udgm ent [Doc. 28] and the Defendants’ Motion to Strike or Exclude the Declaration of Brian William s [Doc. 35]. For the reasons stated below, the Defendants’ Motion for Sum m ary J udgm ent is GRAN TED in part and D EN IED in part. The Defendants’ Motion to Strike or Exclude is D EN IED . I. Backgro u n d On J uly 11, 20 11, Defendant Innovative Contracting Solutions, Inc. (“ICS”) hired the Plaintiff, Christopher Bailey, as a project superintendent at a salary of $ 49,0 0 0 per year.1 Mr. Bailey rem ained in that position until J uly 12, 20 12.2 ICS 1 Defs.’ Statem ent 2 of Facts ¶¶ 2, 4. Id. ¶ 4. is a com mercial general contractor that renovates offices, medical facilities, industrial buildings, and restaurants throughout the southeast.3 Defendant Matthew Hubbard is the President and sole shareholder of ICS.4 The parties dispute exactly what Mr. Bailey’s duties as a project superintendent entailed. They agree that on a typical day, Mr. Bailey was the m ost senior ICS employee on the job site.5 The Plaintiff contends, however, that usually he was the only ICS employee at a given job site.6 The Defendants claim that Mr. Bailey was rarely supervised, but Mr. Bailey claim s that he reported to or checked in with his supervisor on a regular basis.7 The parties further dispute whether Mr. Bailey was responsible for hiring subcontractors. The Defendants claim that Mr. Bailey exercised “sole discretion” in selecting project labor, determ ining the am ount of labor needed, assessing the skills of laborers, and recomm ending pay rates for laborers.8 Mr. Bailey asserts that laborers were used 3 Pl.’s Statem ent of Facts ¶¶ 1-2. 4 Id. ¶ 4. 5 Pl.’s Resp. to Defs.’ Statem ent of Facts ¶ 10 . 6 Id. 7 Id. ¶ 11; Defs.’ Statem ent of Facts ¶ 11. 8 Defs.’ Statem ent of Facts ¶¶ 18-20 . 2 only ten to fifteen percent of the tim e, but adm its that on those occasions, he consulted with his supervisors to determine the am ount of labor needed and then m ade recom m endations regarding which people to hire.9 Mr. Bailey denies that he ever set the pay rate for laborers.10 He further denies that he had “sole discretion” in selecting laborers – he needed approval from his superiors.11 Mr. Bailey adm its that his recomm endations for which laborers to hire were never rejected.12 Additionally, when laborers were used, Mr. Bailey recorded and subm itted their tim e to ICS m anagem ent.13 In regard to supervision of subcontractors, Mr. Bailey adm its that he was responsible for overlooking the work of the subcontractors on site, but asserts that he had little to no control over their actions.14 Additionally, Mr. Bailey stated that the subcontractors already knew what their jobs were without any 9 Pl.’s Resp. to Defs.’ Statem ent of Facts ¶¶ 18-19. 10 Id. ¶ 19. 11 Id. ¶ 20 . 12 Id. ¶¶ 21-22. 13 Id. ¶ 30 . 14 Id. ¶¶ 23-24. 3 direction.15 Mr. Bailey did not keep track of the subcontractors’ tim e, but would report if subcontractors were absent, late, or left early.16 About ninety percent of the tim e, subcontractors were scheduled by someone other than Mr. Bailey, but on occasion, he coordinated subcontractors’ presence on job sites.17 Most significantly, the parties dispute the hierarchy of em ployees at ICS and the basic duties of project superintendents like Mr. Bailey. Mr. Bailey contends that as a project superintendent, he was supervised by project m anagers.18 ICS, on the other hand, states that project superintendents and project m anagers worked together to ensure the successful com pletion of projects.19 Mr. Bailey testified that he spent seventy-five to eighty percent of his day perform ing m anual labor, which was the m ajority of his responsibility.20 ICS stated that two-thirds of Mr. Bailey’s work was non-m anual labor, that any m anual labor perform ed was lim ited to item s after the com pletion of 15 Id. ¶ 24. 16 Pl.’s Resp. to Defs.’ Statem ent of Facts ¶ 26. 17 Id. ¶ 34. 18 Pl.’s Statem ent of Facts ¶¶ 6, 13. 19 Defs.’ Resp. to Pl.’s Statem ent of Facts ¶¶ 6, 13. 20 Pl.’s Statem ent of Facts ¶¶ 16-22, 24. 4 construction, and that tem porary laborers perform ed m anual labor.21 It is not disputed that on occasion, Mr. Bailey would purchase supplies and pick up building perm its.22 Mr. Bailey claim s that ICS failed to pay him tim e-and-a-half pay for hours over forty per week. The Defendants now m ove for sum m ary judgm ent, claim ing that Mr. Hubbard does not qualify as an em ployer, that Mr. Bailey was an exem pt em ployee, or at the very least, that som e of Mr. Bailey’s claims are barred by the statute of lim itations. II. Le gal Stan d ard Sum m ary judgm ent is appropriate only when the pleadings, depositions, and affidavits subm itted by the parties show no genuine issue of m aterial fact exists and that the m ovant is entitled to judgm ent as a m atter of law.23 The court should view the evidence and any inferences that may be drawn in the light m ost favorable to the nonm ovant.24 The party seeking sum m ary judgment must first identify grounds to show the absence of a genuine issue of material fact. 25 The 21 Defs.’ Resp. to Pl.’s Statem ent of Facts ¶¶ 16-22, 24. 22 Pl.’s Resp. to Defs.’ Statem ent of Facts ¶¶ 41, 43. 23 F ED. R. CIV. P. 56(a). 24 Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970 ). 25 Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). 5 burden then shifts to the nonm ovant, who m ust go beyond the pleadings and present affirm ative evidence to show that a genuine issue of m aterial fact does exist.26 “A m ere ‘scintilla’ of evidence supporting the opposing party’s position will not suffice; there m ust be a sufficient showing that the jury could reasonably find for that party.”27 III. D is cu s s io n A. Mo tio n to Strike o r Exclu d e In opposition to the Defendants’ Motion for Sum m ary J udgm ent, the Plaintiff offers the Declaration of Brian William s. The Defendants m ove to strike or exclude that declaration. They claim that Mr. William s was disclosed too late in the discovery process for his testim ony to be considered.28 Pursuant to the 20 10 Am endm ents to the Federal Rules of Civil Procedure, motions to strike are not a preferred m ethod for challenging the adm issibility of evidence on sum m ary judgm ent.29 The Court will therefore consider the motion only as a m otion to exclude. 26 Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986). 27 Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir. 1990 ). 28 Br. in Supp. of Defs.’ Mot. to Strike or Exclude, at 2-3. 29 F ED. R. CIV. P. 56 advisory com m ittee’s note of 20 10 subdivision (c)(2). 6 Here, the Plaintiff becam e aware of a new witness late in discovery and disclosed that witness to the Defendants.30 The Defendants claim prejudice because they were unable to depose that witness, Mr. William s, within the discovery period.31 The Plaintiff offered to consent to an extension of discovery to allow the Defendants to depose Mr. William s.32 The Defendants never responded to that offer.33 Additionally, Mr. Williams is a former em ployee of the Defendants.34 This Court refuses to exclude the declaration where the witness is a form er employee of the Defendants and the Defendants could have simply responded to the Plaintiff’s offer and then deposed Mr. William s. B. Mo tio n fo r Su m m ary Ju d gm e n t 1. H u bbard as Em p lo ye r An individual m ay only be held liable for violating the overtim e provisions of the FLSA if he qualifies as an “em ployer.”35 The term “em ployer” is broadly 30 Pl.’s Br. in Opp’n to Defs.’ Mot. to Strike or Exclude, at 4. 31 Br. in Supp. of Defs.’ Mot. to Strike or Exclude, at 3. 32 Pl.’s Br. in Opp’n to Defs.’ Mot. to Strike or Exclude, at 5. 33 Id. 34 Id. at 6. 35 29 U.S.C. § 20 7(a)(1); Alvarez Perez v. Sanford-Orlando Kennel Club, Inc., 515 F.3d 1150 , 1160 (11th Cir. 20 0 8). 7 defined as “any person acting directly or indirectly in the interest of an em ployer in relation to an em ployee.”36 Corporate officers fall within this definition if they are involved in the day-to-day operations of the business or have som e direct responsibility for supervising the em ployee.37 Here, while Mr. Hubbard did not set em ployee com pensation generally, he set the upper end of salary ranges, m ade determ inations regarding em ployee benefits, decided em ployee exem pt or non-exem pt status, and had final say over alm ost every decision.38 Given that Mr. Hubbard had significant involvem ent in the day-to-day affairs of ICS, Mr. Hubbard’s m otion for sum m ary judgm ent on the ground that he is not an em ployer should be denied. 2 . Exe m p tio n s As a general m atter, the FLSA provides that em ployees are entitled to overtim e pay for all hours worked in excess of forty hours per week.39 But, the FLSA exem pts “any em ployee em ployed in a bona fide executive, administrative, or professional capacity” from its overtime requirem ents.40 There is no dispute 36 29 U.S.C. § 20 3(d). 37 Alvarez Perez, 515 F.3d at 1160 . 38 Ford Dep. at 71, 74; Hubbard Dep. at 30 . 39 29 U.S.C. § 20 7(a)(1). 40 29 U.S.C. § 213(a)(1). 8 here that Mr. Bailey was not paid overtim e. The Defendants, however, contend that Mr. Bailey qualified as an exem pt em ployee and is therefore not entitled to overtim e pay. “The em ployer bears the burden of proving that an em ployee is exem pt from overtim e payments.”41 The em ployer “m ust prove applicability of an exemption by ‘clear and affirm ative evidence.’”42 Further, the FLSA “should be interpreted liberally in the em ployee's favor” and the Act's exem ptions “are to be narrowly construed” against the em ployer.43 a. Th e Ad m in is trative Exe m p tio n ICS contends that the Plaintiff was an exem pt employee under the adm inistrative exemption. That exem ption rem oves em ployees from the overtim e requirem ents of the FLSA if they are com pensated on a salary or fee basis at a rate of $ 455 a week or m ore, have a prim ary duty of office or non-m anual work directly related to managem ent or operations, and their prim ary duty includes the “exercise of discretion and independent judgment with respect to m atters of 41 Rock v. Ray Anthony Int'l, 380 Fed. App'x 875, 877 (11th Cir. 20 10 ) (citing Atlanta Prof ‘l Firefighters Union, Local 134 v. City of Atlanta, 920 F.2d 80 0 , 80 4 (11th Cir. 1991)). 42 Birdwell v. City of Gadsden, 970 F.2d 80 2, 80 5 (11th Cir. 1992). 43 Id. 9 significance.”44 The parties agree that Mr. Bailey received a salary of $ 49,0 0 0 per year, which satisfies the first requirement. The second two requirem ents are disputed. An em ployee’s primary duty is “the principal, m ain, m ajor or m ost im portant duty that the em ployee perform s.”45 Factors to consider in determ ining an em ployee’s prim ary duty are the importance of the exempt work relative to other work, how m uch tim e is spent perform ing exem pt work, whether the em ployee is subject to direct supervision, and the relationship between the em ployee’s salary and the wages paid to nonexem pt workers.46 The am ount of tim e spent perform ing exem pt work is a guide, but is not the sole consideration.47 Additionally, to qualify as exempt, the em ployee must perform work “directly related to assisting with the running or servicing of the business.”48 Exam ples of work that would qualify are: tax; finance; accounting; budgeting; auditing; insurance; quality control; purchasing; procurement; advertising; m arketing; research; safety and health; personnel m anagem ent; hum an resources; 44 29 C.F.R. § 541.20 0 . 45 29 C.F.R. § 541.70 0 (a). 46 Id. 47 29 C.F.R. § 541.70 0 (b). 48 29 C.F.R. § 541.20 1(a). 10 em ployee benefits; labor relations; public relations; government relations; com puter network, internet and database adm inistration; legal and regulatory com pliance; and sim ilar activities.49 Mr. Bailey contends that his prim ary duty was perform ing m anual labor. Specifically, he claim s that he was often the only person perform ing labor at a job site. ICS claim s that Mr. Bailey’s prim ary duty was supervising job sites and subcontractors. While there is certainly evidence in the record that Mr. Bailey perform ed som e exem pt duties, such as reporting laborers’ tim e and m aking purchases, there is also evidence that he spent a significant am ount of tim e perform ing m anual labor. The Defendants dispute the am ount of time Mr. Bailey spent perform ing manual labor – specifically, they claim only one-third of Mr. Bailey’s tim e was spent on incidental m anual tasks, while Mr. Bailey claim s he spent over three-quarters of his tim e on essential m anual labor. Taking the facts in the light m ost favorable to Mr. Bailey, it cannot be said that any adm inistrative tasks were the m ost im portant part of his work. Determ ining Mr. Bailey’s actual prim ary duty will therefore require resolving factual disputes between the parties and assessing the credibility of the witnesses, m aking resolution of this issue inappropriate for sum m ary judgment. Even if Mr. Bailey’s duties could be classified as adm inistrative as a m atter of law, the evidence is not sufficient to say that he exercised discretion and independent judgment with regard to matters of significance. Where discretion is 49 29 C.F.R. § 541.20 1(b). 11 lim ited and does not have a profound effect on the em ployer’s business, the exemption is not satisfied.50 Here, the parties dispute the facts regarding Mr. Bailey’s exercise of discretion. Under the Defendants’ version of the facts, Mr. Bailey hired em ployees, set their pay, supervised them on site, and kept track of their tim e on a regular basis. Under Mr. Bailey’s version of the facts, he m ade recom m endations about who to hire, but m ost tim es he was sim ply perform ing labor and had no authority to m ake decisions or even talk to clients. It is a jury question as to who is the m ost credible. b. Exe cu tive Exe m p tio n The Defendants also claim that Mr. Bailey fell under the executive exemption. That exem ption excludes from the overtim e requirem ent em ployees who are paid not less than $ 455 per week, have a prim ary duty of m anagem ent of the enterprise in which they are em ployed, customarily and regularly direct the work of two or m ore em ployees, and have the authority to hire or fire other em ployees or can give suggestions regarding hiring, firing, or em ployee change of status that are given particular weight.51 Again, the parties agree that Mr. Bailey satisfied the salary requirem ents for the executive exemption. The parties disagree on the other three requirem ents. 50 Allem ani v. Pratt (Corrugated Logistics) LLC, 1:12-cv-0 0 10 0 -RWS, 20 14 WL 2574536, at *11 (N.D. Ga. J une 6, 20 14). 51 29 C.F.R. § 541.10 0 (a). 12 The Eleventh Circuit has found a genuine dispute of m aterial fact regarding the m anagem ent duties prong of the test where the em ployee perform ed som e m anagerial tasks, but spent greater than fifty percent of his tim e perform ing tasks identical to those of hourly em ployees.52 In Baretto, the em ployee did not have tim e to perform his m anagerial duties because he spent so m uch tim e perform ing non-exem pt work.53 Additionally, the hourly employees there did not need supervision because they already understood their jobs.54 Conversely, the Eleventh Circuit has held that the assistant m anager of a pizza restaurant m et the m anagerial duties requirement despite m aking pizzas and interacting with custom ers, where his m anagerial tasks, such as supervising delivery drivers, apportioning work, and m arketing the restaurant, were m ore im portant to operation of the enterprise.55 Here, Mr. Bailey perform ed som e m anagerial tasks, such as m aking purchases and reporting day laborers’ tim e to hum an resources. But, taking the facts in the light m ost favorable to Mr. Bailey, he also perform ed a substantial am ount of m anual labor that was necessary to the com pletion of the jobs. 52 Barreto v. Davie Marketplace, LLC, 331 F. App’x 672, 675 (11th Cir. 20 0 9). 53 Id. 54 Id. 55 Diaz v. Team Oney, Inc., 291 F. App’x 947, 949 (11th Cir. 20 0 8). 13 Additionally, like in Barreto, the laborers knew what their jobs were and perform ed them without supervision. A reasonable jury could find that Mr. Bailey’s prim ary duty was not m anagerial, but rather identical to that of a nonexempt em ployee. As to the requirem ent that the em ployee regularly and custom arily supervise two or m ore em ployees, the facts again do not support application of this exemption. The regulations require the em ployee to supervise two or m ore full-tim e em ployees or their equivalent.56 There is no evidence here that Mr. Bailey supervised any full-tim e em ployees. In fact, Mr. Bailey claim s that he was only supervising day laborers about ten to fifteen percent of the tim e. Those laborers were not even considered em ployees of ICS. The Defendants cite Arm itage v. Dolphin Plum bing & Mechanical, LLC,57 for the proposition that supervising piece workers and day laborers satisfies the requirem ent. The Defendants m isstate the holding of Arm itage. The em ployee there admitted that he regularly supervised at least two hourly em ployees in addition to piece workers and day laborers.58 Here, there is no indication that Mr. Bailey supervised ICS employees. 56 29 C.F.R. § 541.10 4(a). 57 510 F. Supp. 2d 763, 771 (M.D. Fla. 20 0 7). 58 Id. 14 The facts do indicate that Mr. Bailey m ade recomm endations on which laborers to hire and that those recomm endations were given deference. The fourth requirem ent is therefore arguably satisfied. Regardless, because the Defendants have not m et their burden to prove that Mr. Bailey’s prim ary duty was m anagerial and that he supervised two or m ore em ployees, the executive exemption cannot apply at this point. 3 . Statu te o f Lim itatio n s The statute of limitations under the FLSA is two years, unless there is proof of a willful violation of the statute.59 If a willful violation is shown, the statute of lim itations extends to three years.60 To show a willful violation, a plaintiff m ust present evidence “that the em ployer either knew or showed reckless disregard for the m atter of whether its conduct was prohibited by the statute.”61 Merely negligent conduct does not rise to the level required to show willfulness.62 A willful violation would exist where an em ployer ignores advice from a responsible official that its conduct is not lawful.63 The Eleventh Circuit has held that an issue 59 29 U.S.C. § 255(a). 60 Id. 61 McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133 (1988). 62 Id. 63 Davila v. Menendez, 717 F.3d 1179, 1185 (11th Cir. 20 13). 15 of fact as to willfulness exists where there was evidence that the em ployer knew of the hourly wage laws, but failed to investigate whether they had com plied with them .64 Here, the Plaintiff has not produced evidence to show a willful violation of the FLSA. To the contrary, the evidence shows that the Defendants consulted an attorney and complied with industry standards regarding classification of superintendents.65 Although the Plaintiff contends that the Defendants relied on potentially outdated legal advice, that fact would not indicate a willful violation of the FLSA. The Court therefore finds that the two-year statute of limitations applies. This lawsuit was filed on December 12, 20 13. Any claim s for overtim e worked prior to Decem ber 12, 20 11, should therefore be dismissed. IV. Co n clu s io n For the reasons stated above, the Defendants’ Motion to Strike or Exclude the Declaration of Brian William s [Doc. 35] is D EN IED , and the Defendants’ Motion for Sum m ary J udgm ent [Doc. 28] is GRAN TED in part and D EN IED in part. IT IS SO ORD ERED this 4 th day of Decem ber, 20 14. 64 Id. 65 Hubbard Dep. at 30 , 32; Ford Dep. at 77, 80 -81. 16

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