United States District Court, C.D. California
AMENDED FINDINGS OF FACT AND CONCLUSIONS OF
MICHAEL W. FITZGERALD United States District Judge
matter came on for trial before the Court sitting without a
jury on November 1 through November 10, 2016. Following the
presentation of evidence and the parties' closing
arguments, the matter was taken under submission.
carefully reviewed the record and the arguments of counsel,
as presented at the trial and in their written submissions,
the Court now makes the following findings of fact and
reaches the following conclusions of law under Rule 52 of the
Federal Rules of Civil Procedure. Any finding of fact that
constitutes a conclusion of law is also hereby adopted as a
conclusion of law, and any conclusion of law that constitutes
a finding of fact is also hereby adopted as a finding of
Court awards a modest verdict to Plaintiff Marine Bargas
based on certain weeks in which she was classified improperly
as an exempt employee. That sentence encompasses why this
action was unusual. The dispute was not whether overtime
hours were worked, although the Court concludes that
Plaintiff overstated her hours to a degree. Ultimately, the
dispute was not even whether the job itself could properly be
classified as exempt or not. Defendant Rite Aid Corporation
(“Rite Aid”) acknowledged that the job included a
mix of exempt and nonexempt duties, and that managers of
smaller stores are not exempt employees.
real dispute then was, week by week, whether this
Plaintiff's nonexempt work as actually performed
constituted more than 50% of her time. The Court finds that,
in general, Plaintiff did not spend most of her time on
nonexempt work. In other words, Rite Aid largely proved its
affirmative defense of the executive exemption. However, the
parties do not really dispute that Plaintiff is entitled to a
week by week determination of her correct classification. As
for those weeks in which Plaintiff was assigned to other
stores for remodeling or inventory, her work as performed was
following witnesses were called and examined by the parties
in the order recited below:
November 1, 2016, Michael Righetti appeared on behalf of
Plaintiff Marine Bargas and gave an opening statement. Elena
R. Baca and Justin M. Scott appeared on behalf of Defendant
Rite Aid Corporation (“Rite Aid”) and gave an
November 2, 2016, Mr. Righetti examined Kandice Valdivia, a
former Rite Aid store employee who worked for Plaintiff. Ms.
Baca cross-examined Ms. Valdivia; Mr. Righetti conducted a
redirect examination; and Ms. Baca conducted a recross
examination. Mr. Righetti next examined Mauricio Quintanilla,
a former Rite Aid store employee who worked for Plaintiff.
Ms. Baca cross-examined Mr. Quintanilla. Finally, Mr. Scott
examined Paul Bennie, a former Senior Director of Human
Resources for Rite Aid. Mr. Righetti cross-examined Mr.
November 3, 2016, Mr. Righetti examined Carlos Aguila, a Rite
Aid store employee who worked on a remodeling project with
the Plaintiff. Mr. Scott cross-examined Mr. Aguila; and Mr.
Righetti conducted a redirect examination. Next, Mr. Righetti
examined Marilyn Contreras, a current District Manager for
Rite Aid and Plaintiff's former District Manager, as a
hostile witness. Ms. Baca cross-examined Ms. Contreras; Mr.
Righetti conducted a redirect examination; and Ms. Baca
conducted a recross examination.
November 4, 2016, Mr. Righetti examined Rebecca Yam, a former
Store Manager for Rite Aid. Ms. Baca cross-examined Ms. Yam;
Mr. Righetti conducted a redirect examination; and Ms. Baca
conducted a recross examination. Next, Mr. Righetti examined
Plaintiff Marine Bargas. Plaintiff was not cross-examined on
November 4. Finally, Ms. Baca examined David Markley, the
current Vice President of Financial and Labor Analysis for
Rite Aid. Mr. Righetti cross-examined Mr. Markley.
November 8, 2016, Mr. Righetti examined Roger Ceballos, a
current Senior Director of Human Resources for Rite Aid, as a
hostile witness. Mr. Scott cross-examined Mr. Ceballos; and
Mr. Righetti conducted a redirect examination. Mr. Scott next
examined Imelda Fernandez, a current Rite Aid store employee
who previously worked for Plaintiff. Mr. Righetti
cross-examined Ms. Fernandez. Ms. Baca then examined Maria
Garcia, a current Rite Aid store employee who previously
worked for Plaintiff. Mr. Righetti cross-examined Ms. Garcia;
Ms. Baca conducted a redirect examination; and Mr. Righetti
conducted a recross examination. Finally, Mr. Scott examined
Cynthia Pena, a current Rite Aid store employee who
previously worked for Plaintiff. Mr. Righetti cross-examined
Ms. Pena; Mr. Scott conducted a redirect examination.
November 9, 2016, Ms. Baca cross-examined Plaintiff. Mr.
Righetti began a redirect examination of Plaintiff.
November 10, 2016, Mr. Righetti concluded his redirect
examination of Plaintiff; Ms. Baca conducted a recross
examination. Next, Mr. Scott examined Lisa Angulo, a current
Rite Aid store employee who previously worked for Plaintiff.
Mr. Righetti cross-examined Ms. Angulo. Mr. Scott next
examined Leodoro Rodriguez and Robyn Brouillette, both
current Rite Aid store employees who previously worked for
Plaintiff. Mr. Righetti cross-examined Ms. Brouillette but
did not cross-examine Mr. Rodriguez. Mr. Scott then examined
Bonnie Reyes, a current Rite Aid store employee who
previously worked for Plaintiff. Mr. Righetti cross-examined
Ms. Reyes. Finally, Mr. Scott examined Kellie Reyes, a former
Rite Aid store employee who worked for Plaintiff. Mr.
Righetti cross-examined the second Ms. Reyes.
end of the day on November 10, Mr. Righetti made his closing
argument for Plaintiff. Ms. Baca made her closing argument
for Rite Aid.
appendix listing all exhibits admitted into evidence during
trial is attached.
FINDINGS OF FACT
Plaintiff Marine Bargas is an individual and citizen of the
State of California.
Defendant Rite Aid is a corporation duly organized and
existing under the laws of the State of Delaware with its
principal place of business in the Commonwealth of
Aid runs a national chain of drugstores. Each store is split
between the pharmacy side and the retail side. Pharmacy and
retail each have separate, independent management structures,
labor budgets, corporate mandates, and so on. Plaintiff
worked on the retail side of the business.
Corporate oversight of stores is divided by region. The
western region, encompassing all of the stores where
Plaintiff worked, includes California, Oregon, Idaho,
Washington, and Colorado. Regions are further subdivided into
states and districts within states. Each district is run by a
team of managers: a Loss Prevention Manager, a Human
Resources Manager, a District Manager for pharmacy, and a
District Manager for retail.
California, each store within a district typically is staffed
with a Store Manager, an Assistant Manager, two Shift
Supervisors (sometimes divided between a Merchandising
Supervisor and a Service Supervisor), a Price Accuracy
Coordinator (“PAC”), and regular non-management
staff, typically referred to as clerk/cashiers.
duties of clerk/cashiers include carrying out day-to-day
tasks on the sales floor. Clerk/cashiers complete
merchandising, unload stock when shipments come in (what
witnesses commonly referred to as “breaking down
truck”), price changes, keeping stock and the sales
floor clean, neat, and orderly, and ringing up customers.
training materials, Rite Aid describes the duties of the
remaining staff positions as follows (see Ex. 183):
a. Store Managers are expected to provide leadership and
development opportunities to associates (i.e., every
other store employee), to hire and train new associates
(which includes ensuring the store team is properly trained
and adheres to regulations, legislation, and Rite Aid
policies), and to implement the annual corporate plan. Store
Managers are responsible for meeting store retail sales
budgets, labor and expense budgets, and generally ensuring
that operating earnings before interest, tax, depreciation
and amortization (“EBITDA”) targets are achieved.
Store Managers are also responsible for store inventory,
including ordering and loss prevention.
b. Assistant Managers are expected to assist the Store
Manager with all store operations. Assistant Managers must be
able to complete all Store Manager duties in the Store
Manager's absence, ensure Rite Aid policies and
procedures are enforced among associates, and oversee
merchandizing and stocking. Those duties include overseeing
the stocking of regular store aisles and those aisles
dedicated to seasonally-available merchandise (the
“seasonal aisles”), the stocking of aisle end
caps, and generally ensuring that all merchandise is arranged
according to the corporate plan (the
“planogram”). Like Store Managers, Assistant
Managers must interact with vendors to order seasonal and
promotional inventory, request store maintenance when
required, process returned, recalled, damaged, and outdated
merchandise, and help keep track of vendors' accounts
c. Shift Supervisors assist Store Managers and Assistant
Managers in executing corporate plans, and supervising
clerk/cashiers in their floor tasks and in the provision of
customer service. Shift Supervisors focus on working with the
front line retail cashiers and clerks on a daily basis.
d. PACs implement weekly price changes, ad sale pricing, and
generally ensure that items are priced correctly based on
corporate directives. PACs conduct audits; additionally, PACS
report the results of third party and government audits to
the proper corporate entities. The PAC role is particularly
circumscribed, as PACs are forbidden from helping with the
other day-to-day tasks of running the store.
The Store Manager Position
all the in-store employees on the retail side of the
business, only the Store Manager is classified as exempt from
California's overtime law. (The Court discusses
California's overtime law and the relevant exemptions
thereto in greater detail below.)
Store Manager job description for California lists the
following “Essential Duties and Responsibilities”
for the position (see Ex. 4), which the Court has
lightly paraphrased for readability:
a. Implement company business plans and objectives to drive
sales, be profitable and provide a superior customer and
b. Attend to opening and closing the store and maintaining
proper accountability for cash handling and company banking.
c. Manage an individual store while meeting store retail
budgeted sales, margin, labor, expenses and overall [profit
and loss] monthly results.
d. Interview, hire, train, direct, reward, and discipline
associates; evaluate associate performance; and resolve
e. Provide leadership and development opportunities for
associates by communicating career opportunities, providing
regular performance feedback, and demonstrating good customer
service behaviors to both external and internal customers and
f. Ensure the store complies with regulations, legislation,
g. Direct and assist store associates by providing a clean,
safe, and pleasing environment to customers and associates.
Follow company standards for safety regulations and overall
store appearance, including keeping the store clutter free.
h. Maintain merchandise as required by the various tools
provided by Rite Aid, including the profit planner, corporate
planograms, and other regularly updated corporate mandates.
i. Supervise store inventory, and develop plans for loss
j. Manage the store's vendor relationships.
k. Ensure price accuracy of merchandise.
However, not every store in California is staffed the same;
Rite Aid may expand or contract the management staff
depending on the sales volume of the store. (See Ex.
183). Each store always has a PAC and some number of
a. In stores with a “front end volume” (that is,
the sales volume of the retail side of the business) of $750,
000 to $1.5 million, the Store Manager position is nonexempt.
The Store Manager does not have an Assistant Manager, but is
afforded three Shift Supervisors, two full time and one part
b. In stores with a front end volume higher than $1.5
million, the Store Manager position is exempt.
c. Stores with a front end volume between $1.25 million and
$2.5 million are staffed with an Assistant Manager, and two
full-time Shift Supervisors, in addition to the Store
d. Stores with a front end volume greater than $2.5 million
are staffed with a Store Manager, an Assistant Manager, and
three full-time Shift Supervisors.
Accordingly, at least in some limited circumstances, Rite Aid
itself recognizes that the Store Manager position may
necessarily be classified as nonexempt. That is, the duties a
Store Manager must perform require a mixture of exempt and
nonexempt work; and, in some circumstances, the volume of
nonexempt duties exceeds more than half of the workload,
requiring those Store Managers to be officially classified as
its training materials, Rite Aid further recognizes that even
Store Managers who are classified as exempt may at times find
themselves performing more nonexempt duties than exempt
a. In a training program in 2005, Rite Aid handed out a
“self-audit” to Store Managers, asking them to
report whether they spent more than 50% of their time on
nonexempt, nonmanagerial tasks.
b. In 2006, Rite Aid distributed a “Front End Manager
Audit” to California Store Managers via Rite Aid's
electronic communications system. Store Managers were again
asked to evaluate how much time they spent each day
performing managerial and nonmanagerial tasks.
c. Rite Aid stopped asking Store Managers to report how they
divided their time between managerial and nonmanagerial tasks
Paul Bennie, former Senior Director of Human Resources for
Rite Aid, testified that Store Managers are informed, via
computer based training modules, of Rite Aid's
expectations that Store Managers will spend more than 50% of
their time on managerial tasks. Rite Aid presented evidence
that Plaintiff completed these computer based trainings.
However, Plaintiff testified that it was easy for Store
Managers to skip through the computer based training without
paying close attention. Indeed, to some extent it was
incentivized: the trainings themselves were two, sometimes
three hours long, and employees could access them from cash
registers. Many Store Managers and other Rite Aid associates
completed their computer based trainings while checking out
Plaintiff explained that, while clicking through the slides,
“I'm going back and forth. I'm not really
paying attention. We're just trying to get [the computer
based trainings (“CBT”)] done because we have a
lot of work to do. And that takes - some of these take two
hours, three hours.” Later, Plaintiff testified
“I don't remember really going through them.
I'm just trying to get them out of the way to get back to
what I'm supposed to be doing in the store.” And
later still, Plaintiff illustrated:
[S]ay, for instance, if I'm in the register and I'm
doing my CBT, I could be helping a customer here, and then
over here, I'm doing my CBT training. And I let it run so
I could go faster. And then I come back again, take care of
[a] customer. I would just skip to the next page. And then
come back to my-to my customer. And then I'll go back.
And I'm looking at it. I'm just trying to skip, next,
next. Because I'm just trying to get it out of the way
because we already have so many things to do. We didn't
care-not that we didn't care. But everybody just wanted
to get the CBTs out of the way.
Marine Bargas' Employment with Rite Aid
about June 2001, Plaintiff Marine Bargas applied for a
cashier/clerk position at Rite Aid. She was hired to work at
a store located in downtown Los Angeles. Plaintiff worked at
that store for about three years. During that time, Plaintiff
was promoted from cashier/clerk to PAC.
After about three years, Plaintiff's husband (then, her
boyfriend), with whom she had been working, received a
promotion. As a result, Plaintiff was transferred to a
different downtown store. In about 2003 or 2004, after a few
months working in the new downtown location, Plaintiff
received a promotion to Shift Supervisor. This promotion
elevated Plaintiff to the management team for the first time.
a Shift Supervisor, Plaintiff received a set of keys to the
store and the office, and access to the safe. Plaintiff was
authorized to open and close the store, and to do most other
tasks associated with management outside of hiring, firing,
and scheduling store associates.
After about six or seven months, Plaintiff was transferred to
another Rite Aid store in downtown Los Angeles. Soon after
the transfer, Plaintiff was promoted to Assistant Manager.
Plaintiff worked as an Assistant Manager at the third
downtown store for about two to three years.
After about three years, Plaintiff's District Manager
asked to her to take on a new role traveling between stores
in southern California to help Store Managers stay caught up
with their obligations. Often, Plaintiff was asked to help
with some of the physical labor in the stores in order to
free up trainee Store Managers to focus on learning their
Plaintiff estimated that, in her new role, she worked at a
new store about every three months. Plaintiff worked at
stores in Alhambra, Rosemead, Pico Rivera, Compton, Commerce,
Eventually, Plaintiff was promoted to Store Manager. Rite Aid
employed Plaintiff as a Store Manager from June 14, 2009 to
April 5, 2013. The whole time Rite Aid employed Plaintiff as
a Store Manager, it classified her as an exempt employee
under California's labor laws.
June 2009, Plaintiff was assigned to a store in the city of
Downey, California. Plaintiff worked at the Downey store for
about a year.
Near the end of June 2010, Plaintiff went on maternity leave.
When she returned to Rite Aid in October 2010, she was
assigned to a different store in the city of Commerce,
California. Plaintiff managed the Commerce store for a little
over two years.
September 2012, Plaintiff was transferred to a store in the
city of Maywood, California. Plaintiff remained a Store
Manager at the Maywood store until she left Rite Aid in April
the pay periods between June 14, 2009 and April 24, 2010,
Plaintiff's weekly salary as a Rite Aid Store Manager was
$1, 038.46. For the pay periods between April 24, 2010 and
April 24, 2011, Plaintiff's weekly salary was $1, 064.42.
For the pay periods between April 24, 2011 and May 5, 2012,
Plaintiff's weekly salary was $1, 080.38. For the pay
periods between May 5, 2012 and April 5, 2013,
Plaintiff's weekly salary was $1, 107.39. Plaintiff's
salary as a Store Manager was at least twice the state
minimum wage for full time employment.
Rite Aid required that a member of the management team with
keys (that is, a Store Manager, an Assistant Manager, or a
Shift Supervisor) be present in the store at all times during
open business hours.
During her employment as a Store Manager, Rite Aid did not
pay Plaintiff premium overtime wages when Plaintiff worked
more than 40 hours per week. Rite Aid also did not pay
Plaintiff premium overtime wages when she worked more than
eight hours per day.
Rite Aid did not keep records of the actual hours Plaintiff
Rite Aid did not keep records of when Plaintiff's meal
periods began and ended, or whether Plaintiff was afforded
a Store Manager, Plaintiff never received an additional hour
of pay on days when she did not receive an uninterrupted,
off-duty meal period lasting at least 30 minutes before the
end of the fifth hour of work (i.e. meal period
a Store Manager, Plaintiff never received an additional hour
of pay on days when she did not receive an uninterrupted,
off-duty rest break lasting at least ten minutes for every
four hours of work (i.e. rest break premium wages).
Marine Bargas' Schedule
DOWNEY: Plaintiff testified that she worked 12 hour days five
days per week for the first three months she managed the
Downey store. Plaintiff testified that she worked 10-12 hour
days about three days per week thereafter, until she went on
maternity leave. Plaintiff testified that she worked a sixth
day per week about twice per month and said that she worked a
24 hour shift between four and seven times while managing the
COMMERCE: Plaintiff testified that for about the first three
months she managed the Commerce store, she worked 12 hour
days five days per week. Plaintiff did not testify to her
typical schedule thereafter at Commerce.
MAYWOOD: Plaintiff testified that she worked 12 hour days six
days per week for about the first six months that she worked
there. She estimated that there was only about one week per
month during that time that she did not work six days per
week. Plaintiff did not testify to her typical schedule
thereafter at Maywood.
Rite Aid kept a record of the times that Plaintiff was
scheduled to work between December 2009 (about six months
after Plaintiff became a store manager at Downey) and March
2013 (about a month before Plaintiff left Rite Aid, on April
4, 2013). These records were admitted into evidence as a
Microsoft Excel file. (See Exhibit 185A). In total,
Exhibit 185A includes 741 time entries for Plaintiff.
Plaintiff testified that a typical shift lasted nine hours,
comprised of an eight hour workday plus one hour for lunch.
Of the 741 entries, 205 (or about 28%) recorded a scheduled
shift of greater than nine hours. Eighty six entries (or
about 12%) recorded a scheduled shift of less than nine
hours. Plaintiff was thus scheduled to work a regular nine
hour shift about 60% of the time.
Exhibit 185A also records that Plaintiff was scheduled to
work six days per week for 20 out of 144 total weeks. She was
scheduled to work seven days per week for three weeks. In
sum, Plaintiff was scheduled to work more than five days per
week about 16% of the time.
the Downey store, Plaintiff was typically scheduled to work a
9:00 a.m. to 6:00 p.m. shift, although she was not
infrequently scheduled to work 9:00 a.m. to 7:00 p.m. or 8:00
a.m. to 5:00 p.m.
the Commerce store, Plaintiff was typically scheduled to work
from 7:00 or 8:00 a.m. to 5:00 p.m. Near the end of her time
at Commerce, Plaintiff typically was scheduled to work from
7:30 a.m. to 4:30 p.m.
the Maywood store, Plaintiff was typically scheduled to work
either 6:00 a.m. to 3:00 p.m. or 7:00 a.m. to 4:00 p.m.
Plaintiff was also occasionally scheduled to work from 5:00
a.m. to 2:00 p.m. or 6:30 a.m. to 3:30 p.m.
Testimony re Actual Hours Worked
Plaintiff testified that the schedule was not an accurate
representation of the amount of time she actually worked.
Plaintiff testified that she occasionally arrived to work
later than she was scheduled or left earlier than she was
scheduled to leave. Plaintiff testified that on other
occasions, she would arrive to work one or two hours earlier
than she was scheduled and often stayed several hours later
than she was scheduled. Plaintiff further testified that she
often was asked to attend meetings or take part in
inventories on days when she was scheduled to be off.
Mauricio Quintanilla, who was a shift supervisor with
Plaintiff at the Downey store, testified that his shift
overlapped with Plaintiff's about four out of five days
per week. Quintanilla typically worked from 3:00 p.m. until
11:00 p.m. Quintanilla testified that he believed Plaintiff
usually started work at 7:00 a.m. He typically saw Plaintiff
leave work at 6:30 or 7:00 p.m.
Bonnie Ray Reyes, who was a cashier/clerk for Plaintiff in
the Downey Store, testified that Plaintiff typically left
work at 6:00 or 7:00 p.m.
Kandice Valdivia, who was first a shift supervisor and later
an assistant manager with Plaintiff at the Commerce store,
testified that on days when the store received stock
(“load days”), Valdivia would arrive at 5:00 a.m.
to unload the truck. Load days occurred about once per week.
On those days, Plaintiff would arrive at 7:00 a.m. to open
the store. Sometimes, this pattern was reversed: Plaintiff
would arrive at 5:00 a.m. to help with the load, while
Valdivia would arrive at 7:00 a.m. to open the store.
Valdivia testified that on load days Plaintiff would
typically leave around 6:00 or 7:00 p.m.
Valdivia testified that she typically observed Plaintiff
leave work at 5:00 or 6:00 p.m., but also remembered seeing
Plaintiff stay until the store closed at 9:00 or 10:00 p.m. a
few times per month.
Imelda Fernandez, who occasionally worked the opening shift
at the Commerce store with Plaintiff, testified that she
would sometimes arrive half an hour to an hour later than she
was scheduled. Fernandez testified that when she worked the
closing shift she would typically arrive at 3:30 or 4:30
p.m., at which time Plaintiff typically would have already
left for the day. Fernandez testified that she never saw
Plaintiff stay for a full eight hour shift.
Maria Garcia, who regularly worked the opening shift at the
Commerce store with Plaintiff, testified that Plaintiff would
arrive half an hour later than she was scheduled about 80% of
the time. Garcia further testified that it was her
understanding that Store Managers were expected by their
District Managers to work ten hours per day, at least five
days per week, and that Store Managers were expected to be in
the store until at least 5:00 p.m.
Cynthia Pena, who often worked the opening shift at the
Commerce store with Plaintiff, testified that Plaintiff would
usually arrive between ten minutes and half an hour later
than she was scheduled.
Carlos Aguila was an assistant store manager at the Maywood
store with Plaintiff starting in October of 2012. He
testified that Plaintiff typically worked the morning shift,
whereas he typically worked either the mid or closing shift.
Aguila testified that his shift would overlap with
Plaintiff's about three or four times per week.
Aguila testified that he typically saw Plaintiff leave work
at 6:00 or 7:00 p.m. He remembered that she would stay late
stocking, building displays, and so on. Aguila never saw
Plaintiff leave earlier than 5:00 p.m.
Aguila testified that Plaintiff frequently came in to work on
her day off; that is, he frequently saw her working a sixth,
Lisa Angulo, who was an assistant manager for Plaintiff for
three months at the Maywood store, testified that she
sometimes observed Plaintiff leave early; typically,
Plaintiff would explain ...