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Retail ‘managers’: Exempt or not? Look at duties, not time spent on them

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in Firing,Hiring,Human Resources,Leaders & Managers,Management Training

Retail managers are generally responsible for everything that happens in their stores—from hiring, firing and training employees to meeting profit goals. But they often spend most of their time doing the same work that hourly employees do, such as running cash registers. Even so, they may qualify as exempt employees under the Fair Labor Standards Act.

Why? It’s the quality of the management work they do that counts, not the number of hours they spend doing it.

Recent case: Nancy Soehnle, a site manager for a Hess convenience store, supervised the other employees and handled scheduling. She also recruited, hired and trained employees, plus was responsible for the store’s maintenance and safety.

However, the reality was that Soehnle spent about 85% of her time running the register. She spent only about an hour a day on management duties.

Soehnle worked about 70 hours per week and earned a $34,000 annual salary. That was about twice as much as other employees. And because Hess classified her as an exempt employee, she received no overtime pay.

Soehnle sued, alleging she should have been paid overtime. She claimed that, because she spent so much time on the register, she wasn’t really a manager.

The court disagreed. It said that what counts is not the amount of time spent on management, but the quality of that time. In this case, her most critical duties were managerial, and she alone was responsible for them. (Soehnle v. Hess Corporation, No. 10-1344, 3rd Cir., 2010)

Final note: The outcome might have been different if Soehnle had fewer management duties or there were several other managers working with her.

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