Price Chopper Settles Overtime Class Action For $6.5 Million

A US District Judge in Massachusetts has granted preliminary approval to the $6.5 million overtime settlement brokered in April between Price Chopper and a group of the New England supermarket chain’s managers, the Daily Gazette reports.

Price Chopper’s “Team Leaders” Fight Back

In their class and collective action, filed back in 2014, five workers accused Price Chopper of creating sham job descriptions – “team leader” and “department manager” – to skirt the federal government’s stringent minimum wage and overtime requirements. Price Chopper denies any and all wrongdoing.

The settlement will go to resolve the claims of some 317 employees who worked at Price Chopper between July 2011 and December 2016 and filed documents consenting to participate in the class and collective action. Each of these opt-in plaintiffs will receive an average of $4,700 in back wages.

As “team leaders” and “department manager,” the employees were told they did not qualify for overtime pay. In Price Chopper’s calculus, the workers fell under an “executive” exemption of the Fair Labor Standards Act, which covers employees who make a salary over $23,660 and perform managerial duties. True executives, as federal labor law makes clear, aren’t entitled to overtime wages. Team leaders, though, aren’t true executives, according to some Price Chopper employees.

Employee Speaks Out In Collective Action

Shelly Davine, who worked at three Price Chopper stores in Massachusetts from 1983 to 2014, served as the collective action’s lead plaintiff. Whether she worked in Lenox, Lee or North Adams, Davine says that her job title remained the same. Davine was a “team leader” and, as a “team leader,” she didn’t make overtime.

But her actual job duties, whether she was “managing” workers in the bakery, deli, meat or grocery, looked a lot like the job duties performed by the people she was managing. The only difference? Her subordinates were making overtime and she wasn’t. In the end, Davine frequently worked 40+ hours in a week, but never got any overtime pay. The same thing was happening to her fellow “team leaders,” Davine says. Long hours, no overtime.

Golub Corporation is the owner and operator of both Price Chopper and Market 32 brands. The company, based in Schenectady, New York, is a major employer in the Albany region. Around 136 Price Chopper and Market 32 supermarkets are scattered throughout Connecticut, Pennsylvania, New York, Massachusetts, New Hampshire and Vermont.

The Executive Exemption

According to federal law, executive employees fall into one of the Fair Labor Standards Acts “white collar exemptions,” identifying hundreds of thousands of workers who are not entitled to overtime. These exemptions have nothing to do with an employee’s job title. Instead, the Department of Labor looks at a worker’s pay level, method of payment and job duties to determine their status under federal labor law.

• How much you make: No less than $455 per week ($23,660 per year)
• How you get paid: Salary (a fixed amount of money that doesn’t change depending on how many hours you work)

What you do at work is the real key. Here are the job duties of a true “executive”:

• manages the business or a department or subdivision of the business (either managing the entire supermarket or a specific department, like the deli, in the supermarket)
• customarily and regularly directs the work of at least two or more full-time employees or their equivalent (you could manage two full-time employees or four half-time employees)
• has the authority to hire or fire other employees or provides constructive suggestions and recommendations on personnel decisions

Without satisfying all three of these conditions, a worker can’t be considered an executive. In short, executives manage an enterprise or department, delegate work to at least two other employees and have real weight in conversations about hiring, firing and promotion. You can do other things during your hours, but the functions we just described have to be your primary duties. Being called a “manager” (or “team leader,” for that matter) doesn’t necessarily make you an “executive.” Also, remember the requirement of at least $23,660 per year in salary. That threshold is non-negotiable. A worker who performs all the right job duties, but doesn’t satisfy the salary requirement, isn’t an “executive” either.

Employers play games with these definitions all the time. It’s not hard to see why. Classified as an executive, employees aren’t entitled to overtime wages.

A Note On “Management”

As one of their primary job duties, “executive” employees manage a business enterprise or a department within a business enterprise. Management, according to federal law, is a lot more complex than it may at first appear. In a Fact Sheet intended to inform employers, the Department of Labor outlines a number of specific tasks entailed by the concept of management:

• Interviewing, selecting and training employees
• Setting and adjusting rates of pay and work hour schedules
• Planning how work will be performed
• Directing the work of employees (delegating tasks)
• Choosing materials, supplies and equipment
• Selecting merchandise to be purchased, stocked and sold
• Maintaining production or sales records
• Planning and maintaining a budget
• Evaluating employees’ productivity to recommend promotions, demotions or firings
• Handling employee complaints and grievances
• Implementing legal compliance standards
• Disciplining workers
• Maintaining the safety and security of employees and business property

That’s a really big job. You’d probably be hard-pressed to find a manager who performs all of these duties, but that’s not what we’re looking for. We’re looking for employees who work in the “spirit” of these duties, performing many, but not necessarily all, of them.