A zoo’s business manager wasn’t entitled to overtime pay because she was properly classified as an exempt employee under California law, a state appellate court ruled. There was enough evidence to support the trial court’s conclusion that the administrative exemption applied, the court said.

The plaintiff was the business manager for Fresno’s Chaffee Zoo Corp. from 2006 until her termination in 2012, and her annual salary was $45,000. She sued the zoo in 2013, alleging that she was misclassified as exempt under the Industrial Welfare Commission’s Wage Order 10 and was due overtime premiums.

According to the plaintiff’s job description, she was “responsible for financial management policies and procedures, including internal control and the accounting systems.” However, in her trial testimony, the plaintiff asserted that she had almost no managerial responsibilities and was “mainly an accounting clerk and/or bookkeeper.”

[SHRM members-only toolkit: Complying with California Wage Payment and Hours of Work Laws]           

Although the plaintiff directly supervised three bookkeepers, she testified that she was not treated as a real supervisor. Instead, she said, the zoo’s chief financial officer (CFO) assigned work to and managed the work of the bookkeepers.

The CFO testified that the plaintiff had a great deal of supervisory responsibility within the accounting department and that he did not supervise her work on a day-to-day basis.

He said the plaintiff spent about 70 percent to 75 percent of her time supervising employees and making decisions that involve independent judgment and discretion.

The trial court concluded that the plaintiff was properly classified as exempt under the administrative exemption, and her exempt status meant that the employer wasn’t required to pay overtime. The plaintiff appealed.

The appellate court first noted that the question before it was not whether the trial court’s ruling was right but whether a reasonable person could think it was right.  

Administrative Exemption

Under Wage Order 10’s administrative exemption, an employee must:

  • Perform office work directly related to general business operations. There is no doubt that the plaintiff’s work was office work and the accounting functions she performed (even based on her own account of them) pertained to the zoo’s administrative operations.The work she did was back-office work, and it pertained to the zoo’s business as a whole. The trial court could reasonably find that the plaintiff’s role was of substantial importance to the management or operation of the business because she oversaw most of the zoo’s accounting functions and employees under the CFO’s supervision, the appellate court noted.
  • Regularly exercise discretion and independent judgment. Under this requirement, an employee compares possible courses of conduct and makes decisions after the various possibilities have been considered. As described by her supervisor, the plaintiff’s duties required her to exercise discretion and independent judgment regularly. She oversaw the entire periodic accounting cycle—from journal entries to financial statements—and for the skilled accounting workers who provided input during the accounting cycle.The plaintiff could still regularly exercise her independent judgment if her supervisor gave direct orders or countermanded her decisions at times, the appellate court said. “The requirement of discretion and independent judgment does not necessarily imply that the decisions made by the employee must have a finality that goes with unlimited authority and a complete absence of review,” the court noted.  
  • Assist an executive or administrator or perform specialized work under general supervision. Based on the testimony of the plaintiff’s supervisor and the three bookkeepers, the trial court could reasonably find that the plaintiff’s work met both requirements, although only one is necessary for the exemption to apply. The plaintiff’s title was business manager, but she might as well have been called the assistant manager for accounting, the court said. In addition, the plaintiff performed work requiring special training in accounting and special knowledge of the zoo’s business.
  • Primarily engage in exempt duties. Under California law, an exempt employee must be “primarily engaged in duties which meet the test of the exemption.” Under state law, “primarily” means “more than one-half of the employee’s work time.” The trial court could reasonably find that the plaintiff’s job satisfied the “primarily engaged” requirement based on the CFO’s estimation that the plaintiff spent 70 percent to 75 percent of her time supervising employees and making decisions that involve independent judgment and discretion.
  • Earn a monthly salary that is double the state’s minimum hourly wage. The parties did not dispute that the plaintiff’s salary met this requirement.

The appellate court affirmed the trial court’s decision in favor of the zoo.

Pasquale v. Fresno’s Chaffee Zoo Corp., Calif. Ct. App., No. F073718 (Dec. 4, 2018).

Professional Pointer: Employees are presumed to be nonexempt and eligible for overtime pay. The employer must show that an employee falls under one of the exemptions to the overtime rule. In this case, the court found that the zoo met its burden of showing that the plaintiff was an exempt employee.

Joanne Deschenaux, J.D., is a freelance writer in Annapolis, Md. 

User Review
0 (0 votes)