Judge Virginia Emerson Hopkins recently certified a potential class action by store managers seeking overtime compensation from Cato women’s clothing stores. See Prince v. Cato Corp., No. 1:14-CV-1708-VEH, 2016 WL 2997217 (N.D. Ala. May 25, 2016). Cato contends that its store managers are “bona fide executive, administrative or professional” employees who are exempt from overtime requirements.
The request for a class action was made by Virginia Prince, a store manager at Cato’s Anniston, Alabama store. Ms. Prince claims that she was required to work at least 45 hours per week, but that the overwhelming majority of her time was spent performing manual labor instead of bona fide managerial work. A special provision of the Fair Labor Standards Act regulations permits an executive or administrative employee in the retail sector to spend up to 40% of their time on non-administrative duties without loss of the overtime exemption.
Ms. Prince asked Judge Hopkins to certify a nationwide class of Cato store managers, but Judge Hopkins declined. Instead, she certified a class solely within the Northern District of Alabama consisting of current and former store managers from September 17, 2011 to the present.
Judge Hopkins’s certification is merely the first step in the process for a potential class action. Cato obviously denies that its managers are entitled to overtime and will have the opportunity to de-certify the class at a later dater. Nevertheless, Prince provides a cautionary tale for employers. Large employers with employees performing the same duties in similar locations are potentially subject to class actions for overtime compensation under the FLSA.