A recent federal court decision reiterates that an employee whose primary duties are managerial in nature who wields discretion and independent judgment to make employment and business decisions qualifies for the administrative exemption under the Fair Labor Standards Act and New York Labor Law, in addition to eligibility for the “executive” exemption commonly applied to managerial employees. Scarpinato v. East Hampton Point Mgmt. Corp., 2013 U.S. Dist. LEXIS 131338 (E.D.N.Y. Sept. 13, 2013).
Eastern District of New York Judge Joseph F. Bianco, author of a previous opinion on the exemption, adopted fully a Magistrate’s Report and Recommendation that he find the Defendant properly classified as an exempt administrative employee the General Manager of a restaurant on Long Island’s East End. The Magistrate observed that record evidence established that “plaintiff exercised considerable, often unfettered, discretion in managing the restaurant. This included single-handedly negotiating and executing contracts, disbursing funds, hiring and firing employees, etc.” Based on this evidence the Court rejected Plaintiff’s conclusory argument that her primary duty was “booking events, thereby rendering her non-exempt. Based on these findings as to duties, and the fact that Plaintiff’s $750/week base salary from the restaurant exceeded the federal and state salary basis minimum, she was properly classified.
As Scarpinato demonstrates, managerial work often implicates multiple exemptions, as well as the combination exemption regulation, 29 CFR 541.708. Businesses faced with misclassification litigation must consider all available defenses under the FLSA and state law.