In these times of short staffing, it is important to remember that when exempt employees perform non-exempt duties, they may lose their exempt status if the employee spends too much time performing non-exempt work. The District of Minnesota recently examined the primary duty test under the Fair Labor Standards Act (“FLSA”) in Babbitt v. Target Corp., 2022 WL 313887 (D. Minn. Feb. 2, 2022). The Court’s ruling serves as a stark reminder that exempt employees may perform non-exempt work but only if their primary duty remains exempt.
Ms. Babbit was employed as Executive Team Leader (“ETL”) for Food & Beverage Sales in Target’s South Rochester, Minnesota store in 2019. Target classified her as an exempt employee under the FLSA. In her position, she oversaw 75 employees and allegedly worked 60-70 hours a week. Ms. Babbit brought an FLSA lawsuit against Target seeking overtime wages in which she claimed that her main duty was not management, but hourly work.
Target argued Ms. Babbit was exempt under the FLSA’s executive exemption. The Department of Labor’s regulations set forth a four-prong definition of the work of an executive employee who is exempt from overtime. The rule states – among other things – that an executive is one whose “primary duty” is management of the enterprise or a customarily recognized department thereof.” The term “primary duty” means the “principal, main, major, or most important duty that the employee performs.” 29 C.F.R. § 541.700(a).
In Babbitt, the court reviewed whether the employee’s primary duty was the performance of exempt management work or hourly, non-exempt work. Target argued Ms. Babbitt’s primary duty was the management of the Food Department, and her managerial activities included directing the work of Team Leads and ensuring that Team Leads were accountable for their subareas, executing weekly sales plans and staffing plans, leading the completion of hourly tasks delegated by the Store Team Leader, helping prepare for executive and regulatory visits, overseeing compliance with wage-and-hour requirements, and opening the store.
Ms. Babbitt countered that her most important duty was the performance of non-managerial (in other words, non-exempt) work, including stocking shelves, working the cash register, placing newly received merchandise, setting up displays, cleaning the store, folding clothes, unloading trucks, assisting customers, and filling internet orders. Ms. Babbitt contended she spent 80-90% of her workday performing these tasks.
The Court denied Target’s motion for summary judgment concluding that there was a factual dispute regarding whether Ms. Babbitt’s primary duty was exempt managerial work. Stated differently, Ms. Babbitt created a genuine issue of material fact by introducing evidence that she performed hourly work the majority of the time.
Bottom Line
This case provides an example of how important it is for employers to constantly guard against allowing exempt employees to perform too much non-exempt work. Can exempt employees perform some non-exempt work? Certainly. However, an exempt employee’s primary duty (whether measured on a daily, weekly, monthly, or yearly basis) must be the performance of exempt work or they may be able to make a claim for overtime wages because the employee will not be considered to be exempt.