17‐0040‐cv Paganas v. Total Maintenance Solution, LLC, et al.

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURTʹS LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION ʺSUMMARY ORDERʺ). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 12th day of March, two thousand eighteen.

PRESENT: GUIDO CALABRESI, DENNY CHIN, SUSAN L. CARNEY, Circuit Judges.

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ANTHONY PAGANAS, Plaintiff‐Appellant,

v. 17‐0040‐cv

TOTAL MAINTENANCE SOLUTION, LLC, Defendant‐Third‐Party‐ Plaintiff‐Counter‐ Defendant‐Appellee,

ARON WEBER, REGGIE TARTAGGLIONE, Defendants‐Third‐Party‐ Plaintiffs‐Appellees,

ST. JOHNʹS UNIVERSITY, Third‐Party‐Defendant‐ Counter‐Claimant.

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FOR PLAINTIFF‐APPELLANT: ROBERT S. POWERS, Law Office of Robert S. Powers, North Babylon, New York.

FOR DEFENDANT‐THIRD‐ PERRY S. HEIDECKER, Milman Labuda Law PARTY‐PLAINTIFF‐COUNTER Group, PLLC, Lake Success, New York. ‐DEFENDANT‐APPELLEE and DEFENDANTS‐THIRD‐PARTY ‐PLAINTIFFS‐APPELLEES:

Appeal from the United States District Court for the Eastern District of

New York (Weinstein, J.).

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED,

ADJUDGED, AND DECREED that the judgment of the district court is VACATED

and the case is REMANDED for further proceedings.

Plaintiff‐appellant Anthony Paganas appeals from a judgment entered

December 6, 2016, dismissing his claims for overtime pay under the Fair Labor

Standards Act (ʺFLSAʺ),

(a)(1), and the New York Labor Law (ʺNYLLʺ),

et seq. The district court granted summary judgment in favor of

Total Management Solution, LLC (ʺTMSʺ), Aron Weber, and Reggie Tartagglione. We

assume the partiesʹ familiarity with the underlying facts, procedural history, and issues

on appeal.

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TMS employed Paganas as a building manager at St. Johnʹs University

(ʺSt. Johnʹsʺ) in Queens, New York, from July 2007 to May 2014. Paganas was

responsible for supervising the cleaning and the maintenance of several residential halls

and sports facilities at St. Johnʹs. His duties included making sure his assigned

buildings were kept clean, inspecting those buildings for deficiencies, and setting up

specific rooms for meetings or events. Each morning, Paganas attended management

meetings, which were normally led by Richard Rossi, Paganasʹs supervisor and the

director of site maintenance for TMS from December 2007 to March 2011. At these

meetings, Rossi distributed special work orders to Paganas, who then selected the

cleaners to carry out the orders.

Paganas supervised the work of somewhere between six and fifteen

cleaners. According to Rossi, Paganas was not permitted to perform cleaning duties

himself under the collective bargaining agreement between Local 32BJ and TMS.

Paganas, however, testified that he sometimes performed cleaning duties alongside the

cleaners. As building manager, Paganas also had the authority to direct the cleaners in

their work and reallocate workers in his buildings to compensate for shortages of

personnel due to sickness or vacation.

TMS paid Paganas an annual salary of $80,000. By separate agreement

between Paganas and the St. Johnʹs Athletic Department, Paganas was paid an

additional $250 per game to oversee St. Johnʹs athletic facilities during basketball games.

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In addition to his regular supervisory duties as campus building manager, Paganas

handled some off‐campus work and event set‐ups. In his off‐campus and event set‐up

duties, Paganas did not supervise any TMS employees.

On September 21, 2015, Paganas filed the complaint below alleging that

TMS violated the overtime wage provisions of the FSLA and the NYLL. Following

discovery, TMS moved for summary judgment. On October 14, 2016, the district court

gave notice of a hearing to take place prior to a decision on the summary judgment

motion, and asked the parties to provide information about whether Paganas qualified

for any exemptions to the overtime requirements of the FLSA and the NYLL. In

response, TMS asserted that Paganas qualified for both the ʺexecutiveʺ and

ʺadministrativeʺ exemptions under

(a)(1) and

(5)(c).

The district court held the evidentiary hearing on October 18, 2016, at which Paganas

and Rossi testified, and subsequently granted TMSʹs motion for summary judgment on

December 5, 2016, finding that the executive exemption applied. Paganas timely

appealed.1

This Court reviews de novo a district courtʹs grant of summary judgment,

ʺconstruing the evidence in the light most favorable to the non‐moving party and

drawing all reasonable inferences in its favor.ʺ Alibrandi v. Fin. Outsourcing Servs., Inc.,

1 The district court also dismissed TMSʹs claims against St. Johnʹs. TMS has not challenged that ruling on this appeal.

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(2d Cir. 2003) (citation omitted). ʺSummary judgment is appropriate

only if it can be established that there is no genuine issue as to any material fact and that

the moving party is entitled to a judgment as a matter of law.ʺ

(citation and internal

quotation marks omitted).

The FLSA prohibits employment for more than a specified number of

hours per week without proper overtime compensation. See

, 207, 213.

Certain employees are exempt from the FLSAʹs overtime requirements, however,

including those employed in a ʺa bona fide executive, administrative, or professional

capacity.ʺ

(a)(1). ʺʹ[B]ecause the FLSA is a remedial act, its exemptions

. . . are to be narrowly construed,ʹ and the burden rests on the employer to prove that a

particular employee is exempt from the Actʹs requirements.ʺ Havey v. Homebound

Mortg., Inc.,

(2d Cir. 2008) (quoting Martin v. Malcolm Pirnie, Inc.,

(2d Cir. 1991)). The NYLL ʺmandates overtime pay and applies the same

exemptions as the FLSA.ʺ Reiseck v. Universal Commcʹns of Miami, Inc.,

(2d Cir. 2010). Accordingly, we discuss the FLSA only and do not engage in a separate

analysis of the NYLL exemptions. See Ramos v. Baldor Specialty Foods, Inc.,

,

556 n.1 (2d Cir. 2012).

I. Executive Exemption

Although the FLSA does not define the term ʺexecutiveʺ for purposes of

the exemption, the statute directs the Department of Labor (ʺDOLʺ) to do so by

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regulation. See

(a)(1). The DOL regulations ʺhave the force of law and

are to be given controlling weight unless they are found to be arbitrary, capricious, or

manifestly contrary to the statute.ʺ Freeman v. Natʹl Broad. Co.,

(2d Cir.

1996) (citation omitted). Under a four‐factor test promulgated by the DOL, an

ʺemployee employed in a bona fide executive capacityʺ means any employee: (1)

ʺ[c]ompensated on a salary basis pursuant [above a prescribed level]ʺ; (2) ʺ[w]hose

primary duty is management of the enterprise in which the employee is employed or of

a customarily recognized department or subdivision thereofʺ; (3) ʺ[w]ho customarily

and regularly directs the work of two or more other employeesʺ; and (4) ʺ[w]ho has the

authority to hire or fire other employees or whose suggestions and recommendations as

to the hiring, firing, advancement, promotion or any other change of status of other

employees are given particular weight.ʺ

(a)(1)‐(4).

We conclude that there is no genuine issue of fact as to the first and third

factors of the executive exemption. As to the first factor, the parties do not dispute that

Paganasʹs annual salary of $80,000 exceeds the minimum salary requirements under the

FLSA and the NYLL. As to the third factor, Paganas oversaw, on average, six cleaners

in his assigned buildings, and so there is no genuine dispute that he ʺcustomarily and

regularly direct[ed] the work of two or more other employees.ʺ

(a)(3).

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We conclude, however, that there is a genuine issue of fact as to the

second and fourth factors. As to the second factor, we find a genuine dispute as to

whether Paganasʹs primary duty was management. An employeeʹs ʺprimary dutyʺ is

the ʺprincipal, main, major or most important duty that the employee performs.ʺ

(a). The relevant regulations define ʺmanagementʺ as including, but not

limited to, ʺactivities such as . . . directing the work of employees; . . . planning the

work; . . . [and] apportioning the work among the employees.ʺ

.

Merely performing some nonexempt duties, however, does not mean that an

employeeʹs primary duty was not management. See Callari v. Blackman Plumbing Supply,

Inc.,

(E.D.N.Y. 2013);

(b).

Paganas was responsible for several buildings on St. Johnʹs campus, and

he acknowledged that at times an average of six cleaners reported to him. Paganasʹs job

involved overseeing the cleanersʹ work, instructing cleaners to carry out work orders,

and monitoring his buildings to make sure they were clean. Paganas also had the

authority to reassign cleaners if his buildings were short‐staffed. Paganas received

compensation much greater than the cleaners he supervised. Finally, his supervisor

testified that he was not permitted to help with cleaning duties under TMSʹs agreement

with the union.

Paganas testified, however, that 90 percent of his work was non‐

supervisory physical cleaning. The district court held that this ʺtestimony is not

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creditedʺ and ʺfound [it] to be untrue,ʺ and so determined that Paganasʹs primary duty

was management. Paganas v. Total Maint. Sol., LLC,

(E.D.N.Y.

2016). The district court erred, however, because ʺa district court generally cannot grant

summary judgment based on its assessment of the credibility of the evidence

presented.ʺ Rogoz v. City of Hartford,

(2d Cir. 2015) (internal citations

and quotation marks omitted). Accordingly, viewing the evidence in the light most

favorable to Paganas, his testimony raised a genuine dispute as to whether his primary

responsibilities were management activities.

As to the fourth factor, we find that the district court also erred when it

determined that there was no genuine dispute concerning whether Paganas had

authority to change or to recommend the change of another employeeʹs status. The

district court found:

Plaintiff claims that he did not have the authority to hire and fire employees. But management testified that plaintiff had the authority to recommend discipline of employees, and in fact made recommendations of discipline in individual cases. Mr. Rossi testified that plaintiff did in fact recommend discipline of employees, and made those recommendations to upper management. Plaintiff did not contradict this testimony. He has not raised a genuine dispute as to a material fact.

Paganas,

(citations omitted). In fact, Paganas testified that: he

never recommended disciplinary actions or warning against porters; he did not have

the authority to hire or fire employees; and he never made any recommendations to

hire, promote, or fire employees. While it is correct that Paganas twice answered that

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he did not remember if he ever recommended discipline, he was less equivocal in other

testimony. Additionally, TMS identified only one purported instance in which Paganas

recommended disciplinary action. During this incident, Paganas was with the assistant

director when they saw an employee was taking an illegal break, and the assistant

director ʺdisciplined [the employee] right then and there.ʺ Appʹx at 200. Paganas

testified, ʺDid I recommend it? No, I didnʹt because the [assistant director] caught [the

employee] . . . himself.ʺ Id. at 201.

Moreover, even if Paganas had the authority to recommend a change in an

employeeʹs status, as TMS argues, TMS has not demonstrated that Paganasʹs

recommendations were ʺgiven particular weight.ʺ

(a)(4); see also

(providing factors to consider in determining if the recommendations

are given particular weight). ʺʹ[A]n occasional suggestion with regard to the change in

status of a co‐workerʹ is not sufficient to show that an employeeʹs recommendations . . .

were given a particular weight.ʺ Karropoulos v. Soup du Jour, Ltd.,

(E.D.N.Y. 2015) (quoting

).

Thus, construing the evidence in the light most favorable to Paganas, there

is a genuine dispute as to whether Paganas had authority to recommend a change in an

employeeʹs status. Accordingly, we find that the district court erred in granting

summary judgment to TMS based on the executive exemption.

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II. Administrative Exemption

The district court did not address the administrative exemption in its

decision. In its discussion of whether Paganasʹs ʺprimary dutyʺ could be classified as

ʺmanagementʺ under the executive exemption, the district court cited language from

(a)(2), which addresses the administrative exemption. The executive

and administrative exemptions should be treated separately, however, as they require

the employer to show prove different facts regarding an employeeʹs work. See, e.g.,

Reiseck,

n.7 (refusing to address the executive exemption because only

the administrative exemption was at issue). Accordingly, on remand, we instruct the

district court to consider in the first instance whether Paganas qualifies for the

administrative exemption under

.

. . .

We have considered TMSʹs remaining arguments and find them to be

without merit. Accordingly, we VACATE the judgment of the district court and

REMAND the case for further proceedings.

FOR THE COURT: Catherine OʹHagan Wolfe, Clerk

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