A major issue regarding exemption from overtime is what the assistant managers do in their job duties. The role of assistant manager can be complex, sometimes bridging the gap between hourly employees and management. Even with the word "manager" in the job title, there is no guarantee that all job duties will be of an administrative nature. Assistant managers are sometimes asked to step in when hourly employees do not show up for work, and pick up the slack if there is not enough staff in the store. They may also be responsible for working cash registers and cleaning the store, if necessary.
Other times, assistant store managers may be required to fulfill administrative duties, such as setting hours, ensuring the store opens and closes on time and filling in for the store manager when the store manager is away. How much discretion assistant managers have on the job is debatable, especially when you consider that they frequently have to answer not only to a store manager but also to a regional or district manager.
The issue of job duties is important because a person is exempt from overtime pay if his or her job duties consist mainly of administrative duties [among other requirements for exemption]. If the person's duties are more similar to those of an hourly employee, then he or she may still be eligible for overtime pay for hours worked above 40 per week. Non-managerial tasks include stocking or restocking shelves, working cash registers and cleaning the store.
Keep in mind, this is true even for people who are paid a salary. This means that employees who are non-exempt should receive at least 1.5 times their regular rate of pay for all hours that are worked over 40 in one workweek. Even for people on a salary, it is possible to determine an hourly rate of pay and multiply that by 1.5 to determine how much the employee should be paid for overtime hours.
Considering all the duties required of an assistant manager, it is not surprising that an assistant manager might routinely work well over 40 hours a week.
Rite Aid is certainly not the first company to face allegations that assistant managers were not properly compensated for working overtime. Earlier this year, a jury found in favor of more than 300 Staples assistant store managers in New Jersey who claimed they were illegally classified as exempt from overtime pay. The jury ordered Staples to pay $2.5 million to the plaintiffs, according to Connecticut Employee Rights Blog.
In 2008, Starbucks settled a lawsuit filed by an assistant store manager who claimed he was not paid for hours worked beyond 40 per week. The plaintiff claimed that the majority of his time at work was spent doing the work of hourly employees, including making drinks and cleaning the store. Starbucks also faced a federal suit in Florida, alleging the company misclassified its retail store managers as exempt from overtime pay.
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The truth is, to be exempt from overtime pay an assistant store manager must actually be in a position of authority and exercising managerial duties during the course of his job. That does not mean that he should be lead sales person on the floor—that alone does not exempt someone from overtime pay. Hopefully, as more of these overtime lawsuits go to court, the retail industry will realize that it cannot take advantage of its assistant store managers.