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September 19, 1986

William E. Brock, Secretary of Labor, United States Department of Labor, Plaintiffs,
The Claridge Hotel And Casino, Defendant

The opinion of the court was delivered by: COHEN

 Plaintiff, William E. Brock, the Secretary of the United States Department of Labor, filed a complaint in this action on October 17, 1984 alleging that the defendant, The Claridge Hotel and Casino, violated the overtime provisions of the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. ("FLSA or Act") by failing to pay proper overtime compensation to three classes of its supervisory employees -- Boxpersons, Floorpersons, and Pit Bosses to be defined infra. Plaintiff seeks a permanent injunction against defendant's alleged violations of the FLSA's overtime provisions, the payment of monies representing overtime compensation due to defendant's supervisory employees, and liquidated damages in an amount equal to the back pay allegedly owing. The case was tried before this Court on August 5, 6, and 7, 1986. After considering all the evidence, arguments of counsel, and submissions, the following shall constitute our findings of fact and conclusions of law pursuant to Fed. R. Civ. P. 52.


 Plaintiff, William E. Brock, is the current duly appointed Secretary of Labor, United States Department of Labor, and is charged with the duties, responsibilities, and authority vested in him by the provisions of the FLSA.

 Defendant, the Claridge Hotel and Casino, is a limited partnership, organized under the laws of the State of New Jersey, with its principal place of business in Atlantic City, New Jersey. Defendant operates a hotel and gaming casino licensed by The New Jersey Casino Control Commission, at which the public engages in a variety of games of chance. Such games include blackjack, roulette, baccarat, slot machines and craps. The dealer, the generic term for the employee who operates these games, is a non-supervisory employee who has the most direct contact with the gambling public. He accepts the bets, conducts the game, and enforces its rules.

 From October 1, 1981 to the present, when a Boxperson, Floorperson, or Pit Boss, is scheduled for a tour of duty, he is required to report to his station approximately fifteen minutes prior to the start of the scheduled shift for the purpose of preparing for the commencement of the "action." His time in attendance is recorded using two different measures. Each of the above-mentioned supervisory personnel is required, upon arrival and departure, to sign a sheet at his work station, recording thereon his time of arrival and departure. In addition thereto, Boxpersons and Floorpersons are required to punch a computerized clock when they start and finish their tours of duty. The employee inserts his identification card into a computer when he begins and ends a shift, and the computer automatically reads and records his working hours. This procedure is known as "badging in" and "badging out." Defendant, during slow work periods, employs a procedure entitled the "Early Out" program which is designed to reduce its scheduled supervisory work force. Prior to or during their tour of duty, the supervisory employees are invited to sign an "early out" sheet, thereby requesting to leave work early if business should slow down. If defendant does become overstaffed at some point during a shift, the signatories to the "early out" list are asked, in the order in which they signed the list, whether they would like to leave early. If they answer in the affirmative, they are permitted to leave before the scheduled end of the shift. Should defendant seek to reduce its supervisory staff, but there are insufficient names on the "early out" list for a given shift, the non-signatories are asked whether they would like to leave early. If defendant does not enlist a sufficient number of "volunteers," some of the supervisory employees are assigned to different tasks for the remainder of the shift.

 The defendant established a so-called "two-tiered" compensation plan for its Boxpersons, Floorpersons, and Pit Bosses. According to defendant, the supervisory employee under this plan is guaranteed a base salary of $ 250.00 for any week in which he performed any service, plus potential earnings in excess of that amount depending on the number of hours worked. At the time an individual is hired as a Boxperson, Floorperson, or Pit Boss he is required to sign a form entitled "Weekly Salary Guarantee." It provides as follows:

In consideration of the fact that you are employed in a supervisory capacity, you will be guaranteed a weekly salary of $ 250.00 for any week in which you perform any service. Absence from work due to jury duty, court appearance or military leave will not affect this guarantee.
If your absence is due to an accident or illness, you will be covered under our sick leave and disability plans, and therefore this guarantee does not apply.
Please indicate your receipt of this memorandum by signing in the space provided.

 By design, the $ 250.00 guarantee comes into play only in the rare instance where an employee is not scheduled for a sufficient number of shifts, or is not permitted by defendant to work a sufficient number of hours, to earn $ 250.00. If an employee in a given week is scheduled for enough shifts to earn $ 250.00, but voluntarily absents himself from work, the guarantee does not come into effect. Where a supervisor is scheduled for at least $ 250.00 of work hours, but is absent for either a full day or a partial day because of an accident, illness, personal reason, or otherwise voluntarily, the guarantee does not apply. Absenting oneself pursuant to the "Early Out" program, is considered by defendant to be a voluntary absence. *fn1" If a supervisory employee does choose to leave early pursuant to the "Early Out" program, or leaves a shift early for illness or a personal reason, he signs his departure time on the sign-in sheet and, except for Pit Bosses, "badges out".

 The rate of pay for a supervisory employee is designated by defendant as an X amount per eight-hour day. It is neither overtly designated as an hourly rate, nor a weekly rate. If an individual works more than eight hours in a given day, he is paid the daily rate plus a pro rata share of the additional time. If an individual works less than eight hours in a given day, he is paid a pro rata share less than the daily rate. *fn2"

 The payroll department regularly received reports on the hours worked by the aforesaid supervisory employees. It calculates their earnings by multiplying the number of hours of actual work by an hourly amount derived from dividing the applicable daily rate by eight. Earnings are calculated for periods as small as one-half hour. The Boxpersons, Floorpersons, and Pit Bosses regularly work over 40 hours in a given week, but never receive time and one-half pay for the hours in excess of 40. These ...

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