Target Corporation faces a proposed collective action lawsuit that claims the retailer misclassified executive team leaders (ETLs) as “executives” in order to avoid paying time-and-a-half overtime wages.
Despite their “executive” classification, ETLs, according to the suit, were not given “significant discretion to manage” and were instead required to report to a “store team lead,” who the case contends was the “real management authority” of the store. In addition, the lawsuit claims that although ETLs were paid a flat weekly salary, the workers spent the majority of their shifts performing work typical of hourly-paid non-exempt employees, such as stocking shelves, manning cash registers and unloading trucks.
According to the complaint, Target set weekly “payroll budgets” for each store and frequently sent hourly associates home early or refrained from replacing employees who failed to show up for work. Target allegedly required ETLs to finish the tasks of workers who were dismissed early or were otherwise absent in order to meet budget requirements. Although Target typically scheduled ETLs to work 47.5 hours per week, the employees often put in between 50 and 60 hours of work as a result of the company’s staffing policies, the lawsuit claims. According to the case, ETLs did not receive overtime compensation for hours worked in excess of 40 per week.
Under the Fair Labor Standards Act (FLSA), the complaint states, retailers are required to pay overtime to “assistant managers” unless the employees’ primary duties are of an executive or managerial nature. The case includes the following section of the FLSA:
“[I]f the assistant managers spend more than 50 percent of the time performing nonexempt work such as running the cash register … are closely supervised and earn little more than the nonexempt employees, the assistant managers generally would not satisfy the primary duty requirement.”
The lawsuit seeks to represent a collective of anyone in the U.S. who worked as an executive team leader for Target at any time over the last three years. The suit requests that the court require Target to classify ETLs as non-exempt and pay back wages for unpaid overtime at the applicable rate.