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Brooks v. Tire Discounters, Inc.

United States District Court, M.D. Tennessee, Nashville Division

March 8, 2018

KEVIN BROOKS, DAVID GATER, MATTHEW WARD, CRAIG WORKMAN, DANIEL EMBRY and JOSEPH GAMMON, Plaintiffs,
v.
TIRE DISCOUNTERS, INC., Defendant.

          MEMORANDUM

          ALETA A. TRAUGER UNITED STATES DISTRICT JUDGE

         Before the court are the defendant's six separate Motions for Summary Judgment (Doc. Nos. 49-54), seeking judgment in the defendant's favor on the six plaintiffs' claims under the Fair Labor Standards Act (“FLSA”) and state law for overtime compensation and other damages. Each motion has been fully briefed and is ripe for review. For the reasons set forth herein, the motion seeking judgment in the defendant's favor on the claims brought by plaintiff David Gater (Doc. No. 49) will be granted, and the other motions (Doc. Nos. 50-54) will be denied insofar as they pertain to the FLSA claims but granted with respect to the state law claims.

         I. PROCEDURAL BACKGROUND

         Plaintiffs Kevin Brooks, Daniel Embry, Joseph Gammon, David Gater, Matthew Ward, and Craig Workman filed this lawsuit in August 2016 against their former employer, defendant Tire Discounters, Inc. (“TDI”), asserting that, while employed by TDI, they regularly performed work in excess of forty hours per week and that TDI willfully failed to pay them overtime wages as required by the FLSA. Instead, they were misclassified as employees who were “exempt” from the requirements of the FLSA pertaining to overtime pay and paid a salary that did not vary based on the number of hours worked. In addition to their FLSA claims, they assert state law claims for “Unjust Enrichment/Quantum Meruit/Breach of Contract.” (Compl., Doc. 1, at 3.) They seek a declaratory judgment that TDI violated the FLSA and that the violation was willful, an award of damages in the amount of unpaid compensation owed under the FLSA, plus interest and liquidated damages, attorneys' fees and costs. (Id. at 4.)

         TDI's Motions for Summary Judgment argue that each plaintiff was properly classified as exempt under the FLSA and, as such, was not entitled to overtime pay and that their state law claims are insufficiently pleaded and preempted by the FLSA. With respect to plaintiff Gater, TDI also argues that his claims are barred by the applicable statute of limitations.

         In their joint Response to the defendant's Motions for Summary Judgment, the plaintiffs argue that TDI has the burden of proving an exemption under the FLSA and that TDI cannot establish that any of the plaintiffs qualifies for the exemption for “executive” employees under 29 C.F.R. § 541.100(a). In particular, they argue that there is a material factual dispute as to whether the plaintiffs had the authority to hire or fire other employees and as to whether the plaintiffs' suggestions and recommendations as to hiring, firing and promotions were given “particular weight.” Id. § 541.100(a)(4). The plaintiffs argue that there is also a question of fact as to whether the defendant's violation of the FLSA was “willful” for purposes of application of the statute of limitations to Gater's claims. They do not address the defendant's argument that their state law claims are preempted by the FLSA.

         II. MATERIAL FACTS[1]

         Defendant TDI is in the business of selling tires and other car parts, servicing vehicles, and installing tires. During 2014 and 2015, the general time frame relevant to this lawsuit, TDI was rapidly expanding and opened several new stores in and around the Nashville area. The plaintiffs were hired to work in these new stores.

         Each TDI store is managed by a general manager (also called a “store manager”), who is responsible for running the entire store. Each store generally has several sales associates who work in the front of the store and are primarily responsible for selling tires and other equipment. The sales associates report directly to the general manager. The back of the store, or service center, is where service technicians and tire technicians work. Most TDI stores have a service manager who is responsible for managing the service center. The technicians report directly to the service manager, who reports to the general manager. The general manager reports to a regional manager.

         Each plaintiff in this lawsuit worked for TDI as a general manager, service manager, or both during the 2014-2016 time frame. Most of them started as manager trainees. The regional managers to whom they reported were Rafe Barber and, later, Dan Keim.

         It is undisputed for purposes of the defendant's Motions for Summary Judgment that the positions of general manager and service manager were at all times salaried positions and that each plaintiff, at all times during his tenure with TDI, earned more than $455 per week. Generally, they earned between $600 and $750 per week and were also eligible for monthly commissions and spiffs, defined as “Bonuses based on Individual Performance.” (Doc. No. 43-3, at 1.) The plaintiffs also concede, at least for purposes of summary judgment, that, at all times during their employment, they supervised and managed at least two other employees, that the primary duty of a general manager consisted of managing or running the particular store to which he was assigned, and that the primary duty of a service manager consisted of managing or running the service center of a particular store.

         TDI expected managers to work fifty-two scheduled hours per week and understood that they generally worked more than that during the time period in question. All of the plaintiffs maintain that they worked substantially in excess of forty hours per week on a regular basis during their employment.

         Jamie Ward, TDI's Chief Operating Officer, submitted an Affidavit in which he attests that “[b]oth the general manager and the service manager have the power, and authority to, interview, hire, discipline and terminate employees.” (Doc. No. 49-1, at 3, J. Ward Aff. ¶ 22.[2]) He also attests that both general managers and service managers undergo “a full day training program” “to go over the job responsibilities and make sure there was a uniform understanding by the managers of their primary duties.” (Id. ¶ 25.) The written Job Description for general managers states broadly that the “store manager is responsible for recruiting, hiring, training, developing and evaluating the staff [of] the retail store location.” (Doc. No. 49-1, at 5.) The Service Manager Job Description states that the service manager has the authority to “[a]ssist in the hiring, discipline and termination of shop staff.” (Id. at 6.)

         A. Kevin Brooks

         Plaintiff Kevin Brooks was hired by TDI in March 2014 as a manager trainee. He became a general manager in July 2014, was put on a Performance Improvement Plan in October 2014, and was demoted to service manager in February 2015. He was eventually promoted back to the position of general manager in November 2015 but quit his job in February 2016.

         Brooks testified in his deposition that he does not specifically recall ever having seen a copy of the general manager Job Description, but he conceded that it was probably in the materials given to him when he was hired. (Doc. No. 43, Brooks Dep. 35-36.) He was sent to Cincinnati for a week of training, which consisted of being placed in stores that were short-staffed and learning while doing. He sat in on one day of training at the corporate office, but that training consisted of talk about “breaks and stuff like that.” (Id. at 34.) They did not talk about “management and things like that.” (Id.) He denies ever seeing the Service Manager Job Description prior to his deposition. (Id. at 72.)

         He denies ever interviewing any prospective employees. (Id. at 47.) Instead, he “talked to a couple employees while they were waiting to be interviewed by Dan [Keim], ” the regional manager. (Id.) Keim “sometimes” would ask Brooks what he thought about the interviewees, but Brooks himself “never hired a single soul.” (Id. at 74.) He did have occasion to recommend technicians for advancement or promotion (see Id. at 82-83), but it is unclear how much weight his recommendations carried.

         He never terminated anyone and denies that he had the authority to do so: “That was Dan's job, Dan or Rafe's job.” (Id. at 62.) But Brooks does not recall that anyone was actually terminated from his store while he was working for TDI. He remembers that he had “one tire tech” whom he “didn't want there, ” and that tech was moved to a different store. (Id. at 62-63.)

         B. Daniel Embry

         Embry started as a sales associate at TDI's Smyrna store in December 2014 and reported to Kevin Brooks. (Doc. No. 47, Embry Dep. 16.) He was sent to Cincinnati soon after he was hired, to receive training as a sales associate. (Id. at 19.) He was promoted to service manager at the Murfreesboro Medical Center store in June 2015. He was promoted to general manager in August 2015. (Id. at 27.) He left the company in January or February 2016. (Id. at 32.)

         Embry never saw a job description for general manager prior to preparing for his deposition. (Id. at 32.) He does not recall if anyone was hired at his store while he was service manager, but he did not sit in on any interviews. Likewise, he does not recall any terminations during his tenure. (Id. at 29.) When asked if he understood that his role as manager was to “manage and direct the operations of a Tire Discounters retail store, ” he agreed that that is what his job “should have been, ” but, he maintained, “Dan Keim literally told [him] everything [he] had to do as a general manager.” (Id. at 34.) He backtracked somewhat regarding the scope of that statement, explaining that, other than selling tires, “I couldn't do anything else without approval . . . . I had to get approval for anything that I needed in that store, to schedule my own guys I had to get approval.” (Id.) For example, when it came to scheduling, he was required to fill out schedules each week, but Keim invariably changed them. (Id. at 35.)

         He testified unequivocally that he was not allowed to hire or fire employees and “wasn't allowed to really even interview.” (Id. at 43-45.) He wanted to fire a particular employee after the employee cursed at him and walked out of the store, but Keim did not allow it. (Id. at 45.) He testified that Keim told him specifically that he was not “allowed to even hire a tire tech.” (Id.) He also tried to get a sales associate promoted to service manager, but his recommendation “fell on deaf ears.” (Id.) With respect to technicians, if they did their training, they generally got promoted as a matter of course, once he “sent the training up to corporate.” (Id. at 45-46.) He did not believe that his recommendation for their promotion entered into the picture.

         C. Joseph Gammon

         Plaintiff Joe Gammon began working for TDI in January 2015 and left in March 2016. He was hired as a manager trainee and was sent for two weeks of training in Cincinnati, which he found very helpful. (Doc. No. 48, Gammon Dep. at 42.) However, he denied ever seeing the written Job Description for the general manager or service manager position prior to his deposition. (Id. at 104.)

         A month after his hire, he was promoted to service manager. He worked as service manager for three months before becoming general manager in June 2015. He was moved to a different store that was chronically understaffed, but he was not allowed to hire more staff to meet the store's needs. Keim kept telling him, “it's a new store and we're trying to find the right people, ” but “it was always the roundabout.” (Id. at 69.) He testified that he trained at least two employees whom he hoped he would be allowed to keep as employees at his store, but it was not his “call.” (Id. at 70.) They were sent to other stores instead. (Id. at 86.) He never had a service manager the entire time he was employed as general manager and was not given the option of hiring one. (Id. at 91, 146.) Moreover, while he would prepare weekly schedules for his employees, Keim invariably changed them and, not infrequently, pulled employees from Gammon's store to place them at different stores, requiring Gammon to cover as best as he could. Gammon did not have authority to give an employee a day off-Keim had to approve it.

         As an example, Gammon relayed an instance when he had two employees who needed days off back to back, so the schedule Gammon prepared reflected their requests. The schedule Keim sent back disregarded the employees' requests and gave each employee the day off the other had requested:

One guy had to have a Tuesday off, the other guy had to have a Wednesday off. And so when I submitted the schedule to Dan [Keim], it was like that. He didn't like that. He swapped it, for whatever reason. He swapped it back. So that would have meant both guys were going to miss whatever appointment they were going to have.

Id. at 92-93. Gammon had no authority to give the men the days off that they had requested, but the two employees more or less took matters into their own hands:

And so when the schedule came back, . . . I told the guys, . . . he swapped it back.
I said, I think that he's going to expect you guys to work like this. And . . . what ended up happening was, I believe the first employee on the Tuesday, he just ended up calling out.
So, therefore, it just meant by default now I had to call the other guy and see if he could come in and cover it. And so he did. And then the other one . . ., they had . . . figured out that they could do this and get around it. And so that's what they ended up doing.

Id. at 93. Keim was not pleased by the work-around and implicitly threatened Gammon's job over the matter:

Well, when Dan found out that they did not follow the schedule that he had set forth, he told me that, you know, it's a condition of employment. They're going to follow the schedule that I submit to you, not the one you submit to me.

(Id. at 93-94.)

         Gammon denies ever sitting in on, or participating in, interviews of prospective employees. (Id. at 107.) He also denies that he had the ability or discretion to fire employees. He provided an example of an employee who performed poorly and whom he wanted to fire. He brought the issue to Keim's attention, but Keim told him “it wasn't up to [him] to make that decision.” (Id. at 129.) He agrees that he could make the recommendation but maintains that he could not make the decision and that his recommendation was disregarded in that instance. Later, in the case of two employees who committed a similar but less egregious mistake, Gammon wanted to give them a written warning instead of firing them. Keim overrode that decision as well and forced him to fire them:

They're going to be terminated. You don't have a choice in this matter. He let me know that I didn't have a choice in that matter. . . .
When I asked him, I said . . ., well, what if I say no, I don't agree with that and I'm not going to present this [termination notice]? He told me my job would be in jeopardy. It was a condition of employment. That was-that ...

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