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Novak v. Home Depot U.S.A.

August 26, 2009

EDWARD NOVAK, PLAINTIFF,
v.
HOME DEPOT U.S.A., INC., DEFENDANT.



The opinion of the court was delivered by: Sheridan, U.S.D.J.

OPINION AND ORDER

This matter comes before the Court on the plaintiff, Edward Novak's, motion for class certification. For the following reasons, this Court denies Plaintiff's motion.

I.

The named plaintiff, Edward Novak, brings this class action claim on behalf of all Merchandising Assistant Store Managers (MASMs), current and former, who were employed by Home Depot in the State of New Jersey from August 25, 2002 to the present. Novak is a New Jersey resident who previously was employed by Home Depot in the position of MASM.

Defendant, Home Depot, is a Delaware corporation with its principal offices located in Georgia. Plaintiff alleges that MASMs were mis-classified by Home Depot as exempt from state overtime pay requirements so that Defendant could save on payroll. The New Jersey Wage and Hour Law, N.J.S.A. 34:11-56a4, requires employers to pay overtime (time and a half) to employees working over 40 hours per week unless the employer establishes the right to an exemption from the overtime obligation. Workers in management positions are ordinarily exempt, and Home Depot contends that a MASM is a manager and thus qualifies for this exemption. Plaintiff counters that, in actuality, MASMs have little or no management responsibilities, and are more akin to stock clerks who are hourly employees and who are generally paid overtime.

A recent posting on Home Depot's website for the job of MASM described the position as follows:

Assistant Store Managers (ASMs) are responsible for providing Customers with a convenient and enjoyable shopping experience.

They work to create an inviting shopping environment for Customers by meeting their project needs quickly and fully. They work with the Store Manager to develop strategies and objectives to drive sales and profitability. They provide leadership to Associates so that these strategies and objectives are executed successfully. Sales ASMs must analyze trends, solve problems and develop themselves and their Associates in order to maximize contribution to store success. They must also be capable of working with Associates, the Store Manager and other ASMs to accomplish goals.*fn1 MASM is a salaried position that requires a "flexible, 55 hours per week schedule." Id. MASMs are the second highest-ranking managers in a store, subordinate to the Store Manager. The MASM job is a difficult and demanding one. The hours worked vary significantly, anywhere from 55 to 85 hours per week. Witnesses have testified about working for more than 30 hours straight without a break.

Deposition testimony establishes that MASMs' jobs include many non-managerial duties. Examples of these activities include cleaning, stocking items, customer service, packing freight, operating equipment, sweeping, mopping, mixing paint, and painting displays. On the other hand, Defendant's deposition testimony establishes that MASMs' jobs include many managerial duties as well. Examples include involvement in the hiring process, ensuring employees adhere to company policies and obey the law, analyzing how many labor hours are needed to staff each store adequately, ensuring that materials are in stock, ordering inventory, recommending employee promotions and pay raises, discipline and termination of employees, and ensuring that hourly associates complete required training.

Plaintiff argues that through common evidence he can demonstrate that each and every New Jersey MASM is and was unlawfully classified as exempt, i.e., as a management employee. Novak alleges that MASMs' non-managerial duties overwhelm any managerial or strategic duties, and the mis-classification of MASMs as exempt employees is a widespread and repeated pattern throughout the State of New Jersey. Much of this common evidence set forth by Plaintiff is derived from how Home Depot defines the MASM position. (See, e.g., Opinion at p. 2). Plaintiff argues that due to Home Depot's centralized corporate structure, MASMs' duties are identical. MASMs are, apparently, interchangeable and are frequently transferred from store to store. Additionally, all MASMs undergo a uniform nationwide training program and receive the same training materials which are centrally produced at Home Depot's headquarters in Atlanta. MASMs' job duties are further standardized through staffing graphs generated for each store from Home Depot's headquarters. It is a labor matrix that computes stores' and store departments' employee hours, company-wide Standard Operating Procedures, and a centralized system for making key decisions, regarding areas such as purchases and store performance, that applies to each store. And Plaintiff avers that a comparison of the MASM job description with the job descriptions of Home Depot non-exempt employees, such as sales associates and department supervisors, reveals that all these positions are substantially similar.

However, according to the testimony of many MASMs, the actual day-to-day duties of a MASM are not nearly as uniform as their job description. During the relevant period, Home Depot has operated between 56 and 67 retail stores in New Jersey. These stores have significant differences among them which impact MASMs' day-to-day responsibilities and duties. For instance, within New Jersey, some stores are in high-volume urban areas, while others are in less densely populated rural locations. Stores in New Jersey differ in size from approximately 46,000 to 236,000 square feet (generally, the larger the store, the larger that store's sales volume). The stores also contain a varied assortment of Home Depot's eleven core merchandising departments: Lumber, Building Materials, Flooring, Paint, Hardware, Plumbing, Electrical, Garden, Kitchen & Bath, Millwork, and Decor. These departments are each generally assigned at least one department supervisor who reports directly to the MASM managing that department. At each store, the number of MASMs varies from one to seven. According to testimony, a MASM could manage anywhere from one to eleven merchandising departments. The depositions state:

MASMNumber of Departments ManagedTranscript Citation Cassi2Cassi T 5:18-22 McGeachy5McGeachy T 20:9-12 Thurman6Thurman T 6:20-7:1 Riviera2Riviera T 27:13-23.

Obviously, the number of departments assigned will alter the number of employees supervised, if any. In addition, the duties of a MASM who manages the same department at different stores vary, due to differences among stores. For example, the number of hourly workers in a single department may range from three to twenty.

Many MASMs testified that their job responsibilities change considerably depending upon the circumstances. In fact, the testimony of the MASMs was widely diverse. The Court cites to five separate examples presented below.

Example 1 - Supervisory Responsibilities

Most MASMs discussed their supervisor responsibilities. MASM Michael McGeachy spent about 40 hours per week "apportioning, planning and directing the work" of others. He stated:

Q: How much time do you spend apportioning, planning and directing the work by other employees?

A: Most of my day.

Q: Is it difficult to actually give a specific number?

A: Eight to nine hours. (McGeachy T 34:13-22). Unlike McGeachy, MASM Stephen Payne spends "two hours a day" supervising others. (Payne T 49:5-7). He stated:

Q: Home much time did you spend planning and directing work among Home Depot employees on a given week?

A: It would vary. I mean, it could be - - because I was on the floor all the time so it could be two hours a day.

Q: How did you come up with that number?

A: Just trying to figure out how much time I actually spend.

Q: I'm trying to understand what actual acts constitute planning and directing the work among associates.

Q: So can you explain what were the actual acts that you were doing in planning and directing the work among associates?

A: Basically, I would turn around and see the work list, see what had to be done. Direct the associates what to be done. Always on the floor with the associates. (Payne T 49:2-22).

Another MASM, Stephen Riviera, spent 27 hours per week supervising, which is in the middle range of the two previous MASMS. He testified:

Q: Look at paragraph 25, please. You say, "A large aspect of my job duties is planning and directing the work among employees in my department. Do you see that?

A: Yes.

Q: You say you spend, "Approximately 27 hours apportioning, planning and directing the employees in my department as to work that must be completed. How do you estimate it was 27 hours week?

A: At the time I tried to break things down and give it a lot more thought than I could do off the cuff now. I would have to do the time study all over again to answer that. (Riviera T 102:19-103:11).

Example 2 - Non-Exempt Work

As with the differences in supervisory time, if one looks to hourly work, MASMs also spend unequal time in labor intensive jobs. Some of the MASMs expended long hours unloading freight while others spent little time. MASM Hector DeLeon spent about two hours a day stocking shelves. He stated:

Q: How often would you stock shelves?

A: That's an everyday thing.

Q: How long would it take?

A: Depending on the case or what I was working on or how bad the aisle was, I should say, or that one section, it could take a couple of hours a day. (DeLeon T 34:12-33-14).

MASM Payne spent approximately the same time as DeLeon stocking shelves, but according to him "it depends on the day." He testified:

Q: How often would you be stocking shelves?

A: Depends on the day.

Q: On an average day?

A: Couple hours.

Q: Would you be at least spending some time stocking shelves every day?

A: Depends on the duties that have to be done throughout the day. It would vary.

Q: What circumstances would vary?

A: It depends on the day. What really has to be done. I mean, it's make sure stuff's coming in the building. Make sure it's getting put away. Make sure associates are working. Make sure the customers are being taken care of. (Payne T 74:8-23).

Unlike Payne and DeLeon, MASM David Decher rarely stocks ...


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