Perform An Analysis Of The Assistant Store Manager Position

Perform an analysis of the assistant store manager position for FLSA compliance

StopNShopToday, Inc., founded in 1991, is a family-owned corporation with 15 convenience store/gas station locations and approximately 150 employees. The company employs assistant managers who perform managerial and cashier roles, working between 50 to 60 hours weekly and earning a salaried, exempt status. As a human resources generalist, you are tasked with analyzing whether this assistant manager position complies with the Fair Labor Standards Act (FLSA).

This memo aims to interpret the FLSA requirements pertinent to the assistant store manager role, evaluating whether the position's classification aligns with federal labor standards. The analysis will be organized into key bullet points to clarify compliance issues, followed by a summary and recommendations.

Analysis of FLSA Compliance for the Assistant Store Manager Position

• Exemption Classification under the Salary Basis Test: The FLSA stipulates that an exempt executive must earn a minimum salary threshold ($684 per week as of 2023) and be compensated on a salary basis, meaning a fixed salary not subject to reduction based on hours worked. The assistant manager’s salary range ($21,800 to $32,000 annually) approximates $419 to $615 weekly, which falls below the FLSA threshold, indicating potential non-compliance unless they qualify under another exemption.
• Job Duties and Responsibilities: The assistant managers perform managerial tasks such as scheduling, interviewing, and making hiring recommendations, as well as observing store activities. However, they also spend 20-30% of their time performing non-managerial cashier duties. The FLSA requires that exempt managerial employees spend a majority of their time performing managerial tasks to qualify for exemption; significant non-exempt duties could jeopardize the classification.
• Primary Duty and Clue to Non-Exemption: The extensive cashier responsibilities and the overall hours worked suggest that the assistant managers may be primarily performing non-exempt duties. This issue is critical, as a position's classification hinges on its primary duties rather than job titles alone.
• Compensation Structure and Overtime Expectations: The promoted cashier receives a $1.00 per hour increase, offsetting potential overtime pay. However, the salaried exempt status requires fulfilling salary and duty tests; the structure of pay increases tied to non-exempt duties may indicate misclassification if the role does not meet the FLSA exemption criteria.
• Work Hours and Overtime Considerations: Given that assistant managers regularly work 50-60 hours weekly, if classified as non-exempt, they would be entitled to overtime pay under the FLSA. The current exempt classification, if invalid, could expose the company to legal penalties for unpaid overtime.

Summary and Recommendations

Overall, the assistant store manager position exhibits potential issues concerning FLSA compliance. The salary level is below the federal minimum threshold for exempt employees, and the substantial amount of non-managerial duties suggests the position may not qualify for exempt status. Additionally, the working hours and job responsibilities support the conclusion that these employees could be classified as non-exempt, entitling them to overtime pay under the FLSA.

It is recommended that StopNShopToday, Inc. conduct a comprehensive job analysis to reassess the duties and compensation of assistant managers. If the role continues to involve significant non-exempt tasks, reclassification as non-exempt and adherence to overtime regulations is necessary. Conversely, if the company intends to maintain exempt status, it should ensure the role aligns strictly with FLSA criteria, including meeting salary and primary duty tests. Proper documentation and consistent application of job classifications are essential to maintain legal compliance and mitigate risk of labor disputes.

References

• U.S. Department of Labor. (2023). Fact Sheet #17A: Exemption for Executive Employees under Fair Labor Standards Act. https://www.dol.gov/agencies/whd/fact-sheets/17a-overtime
• U.S. Department of Labor. (2023). Minimum Wage and Overtime Pay. https://www.dol.gov/agencies/whd/overtime
• Fair Labor Standards Act (FLSA). (1938). United States Code, Title 29, § 201-219.
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