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Visner v. Michigan Steel Industries, Inc.

United States District Court, E.D. Michigan, Southern Division

July 23, 2015

DAVID VISNER, Plaintiff,
v.
MICHIGAN STEEL INDUSTRIES, INC., d/b/a MICHIGAN STEEL STRAPPING and SEQUOIA STRAPPING, and GARY GALLIERS, Defendants.

OPINION AND ORDER GRANTING PLAINTIFF'S MOTION FOR PARTIAL SUMMARY JUDGMENT

PATRICK J. DUGGAN, District Judge.

Plaintiff David Visner instituted this lawsuit claiming that his former employer, Defendants Michigan Steel Industries, Inc., d/b/a Michigan Steel Strapping and Sequoia Strapping, and the owner thereof, Gary Galliers, violated the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-219, by failing to pay him time-and-a-half for hours worked in a given week in excess of forty hours (Count I) and for unlawful retaliation (Count II).

Presently before the Court is Plaintiff's Motion for Partial Summary Judgment, filed pursuant to Federal Rule of Civil Procedure 56. In this motion, Plaintiff seeks summary judgment on the issue of liability with respect to his claim for overtime wages, as well as on the issues of his entitlement to liquidated damages and whether Defendants should be jointly and severally liable to Plaintiff as "joint employers" under the FLSA. The motion has been fully briefed. Having determined that oral argument would not significantly aid the decisional process, the Court dispensed with oral argument pursuant to Eastern District of Michigan Local Rule 7.1(f)(2). For the reasons set forth herein, the Court will grant Plaintiff's Motion.

I. BACKGROUND

A. Factual

Defendant Michigan Steel Industries, Inc. ("Michigan Steel") was founded in 1977 by Defendant Gary Galliers, the sole owner of the entity at all times since. (Galliers Dep. 7-8.) Although Michigan Steel began as a steel broker in the automotive sector, over time, the business evolved into a manufacturing company, machining and bending steel parts such as steel strapping, seals, and bucklers, as ordered by customers. ( Id. at 10.) When operating in the automotive sector, Michigan Steel paid its employees overtime at one-and-a-half times their hourly rate. ( Id. at 28.) However, since becoming a steel manufacturing operation, employees of Michigan Steel rarely work overtime and, if they do, they are not paid for that overtime at one-and-a-half times their hourly rate. ( Id.; Dodge Dep. 60-61.)

Michigan Steel has thirteen employees, but does not maintain written employment policies. (Galliers Dep. 11.) When Michigan Steel has a hiring need, it will typically place an advertisement in a newspaper or on the internet. ( Id. at 11-12.) The individual conducting the initial interview is dependent upon which position is being filled; however, Galliers, as the owner, reserves the right to "put [his] two cents in[, ]" and "generally will do a follow-up interview before [an individual is hired]." ( Id. at 12-13.)

In June of 2013, Plaintiff David Visner responded to a Michigan Steel job posting for a toolmaker, machinery builder position. (Visner Dep. 37-39.) Within a few days of submitting his resume, Michigan Steel tool room supervisor Steve Dodge called Plaintiff to schedule an interview. ( Id. at 38.) During this interview, Dodge learned how much Plaintiff was making at his previous job - $12.50 an hour for the first forty hours per workweek, and then time-and-a-half for any overtime, which Plaintiff indicated was at least an additional twenty hours per week. ( Id. at 40-41.) Although the base amount offered by Michigan Steel was similar, employees at Michigan Steel worked forty-hour weeks, and were, therefore, ineligible for overtime. ( Id. at 41.) Based on this reduction in overall earnings, neither Plaintiff nor Dodge left the interview with an impression that Plaintiff would ultimately end up there. ( Id. at 42.)

Shortly after the interview, Dodge discussed Plaintiff's interview with Galliers. (Galliers Dep. 14; Dodge Dep. 42-43.) Although Dodge liked Plaintiff's technical abilities and was excited about the prospect of hiring someone who would not need training, he did not believe that Galliers would be interested in spending in excess of $13.00 per hour to hire someone for the available position. (Galliers Dep. 14, 16; Dodge Dep. 42-43.) To Dodge's surprise, however, Galliers appeared amenable, and spoke with Plaintiff on two separate occasions to determine if they could reach a deal. (Galliers Dep. 16.) Ultimately, Galliers determined that he could offer Plaintiff $15.00 per hour, a $0.50 raise every six months for two years, and up to fifty-six hours of work per workweek at the fixed hourly wage. ( Id. at 15-16; Visner Dep. 44.) When Galliers called Plaintiff to make him this offer, there was no discussion of overtime or time-and-a-half. (Galliers Dep. 16.) Plaintiff accepted Galliers's offer and Galliers informed Dodge that he had struck a deal with Plaintiff to work up to fifty-six hours per week at his straight hourly rate and instructed Dodge to make accommodations for Plaintiff to work up to sixteen additional hours per week. (Dodge Dep. 45-46.)

After accepting the position, Plaintiff met with Defendants' office staff in order to sign the necessary employment documents, including a written employment agreement for fifty-six hours per week without an overtime premium. (Visner Dep. 52-23, 105-06; Galliers Dep. 17-18, 24-25.) Defendants' then finance manager, Hollie Rybicki, memorialized this agreement in a document entitled "Employee Notes" and placed it in Plaintiff's personnel file. (Galliers Dep. 12, 17-18; see also Employee Notes, Pl.'s Mot. Ex. A ("allowed to work up to 16 extra hours per week, not overtime, extra hours.").)

Pursuant to the above-referenced agreement, Plaintiff commenced employment with Michigan Steel as a toolmaker at their Detroit location in July of 2013, and worked there until June 26, 2014. (Visner Dep. 46, 65; Dodge Dep. 52.) Plaintiff's job duties included working as a machinist to perform repairs and maintenance on Defendants' dies and machines as needed. (Dodge Dep. 52-53.) During his tenure at Michigan Steel, Plaintiff regularly worked in excess of forty-hours per week, [1] but never received overtime compensation.

B. Procedural

Plaintiff instituted the present civil action by filing a two-count complaint on July 16, 2014. (ECF No. 1.) Both counts implicate the FLSA: in Count I, Plaintiff complains of overtime wage violations committed by Michigan Steel and its owner Galliers, and in Count II, Plaintiff alleges that Defendants retaliated against Plaintiff for exercising his rights under the FLSA. Defendants answered the complaint and filed affirmative defenses on July 29, 2014. (ECF No. 4.) On January 15, 2015, after the conclusion of discovery, Plaintiff filed a Motion for Partial Summary Judgment pursuant to Federal Rule of Civil Procedure 56. In this motion, Plaintiff seeks summary judgment on Count I, and only on the issue of liability. Indeed, Plaintiff indicates in a footnote that "[s]hould the Court grant this Motion, Plaintiff will submit a separate motion for final judgment to include an assessment of total damages, attorneys' fees, and costs." (Pl.'s Br. 1 n.1.) Defendants responded to Plaintiff's Motion on January 29, 2015, (ECF No. 19), and Plaintiff replied on February 6, 2015, (ECF No. 20).

II. GOVERNING LEGAL STANDARD

Federal Rule of Civil Procedure 56 instructs courts to "grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a) (2012). A court assessing the appropriateness of summary judgment asks "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Amway Distribs. Benefits Ass'n v. Northfield Ins. Co., 323 F.3d 386, 390 (6th Cir. 2003) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52, 106 S.Ct. 2505, 2512 (1986)). In making this assessment, a court "must view the evidence and draw all reasonable inferences in the light most favorable to the nonmoving party[.]" Arnett v. Myers, 281 F.3d 552, 561 (6th Cir. 2002).

III. ANALYSIS

A. Defendants Violated the FLSA's Overtime Compensation Provision

The FLSA requires employers to pay their employees time-and-a-half ("one and one-half times the regular rate") for work performed in excess of forty hours per week. 29 U.S.C. § 207(a)(1).[2] An employee's "regular rate" of pay is defined as "all remuneration for employment paid to, or on behalf of, the employee." Id. § 207(e). Where an employee is paid by the hour, the hourly wage is the regular rate. 29 C.F.R. § 778.110.

By employing Plaintiff in excess of forty hours per week without compensating Plaintiff for the excess hours at a rate of one-and-one-half of his usual pay, Defendants violated the FLSA. Indeed, Defendants concede as much in their brief. (Defs.' Br. 14 ("Because Defendants concede that they were mistaken in their understanding of the FLSA as it pertains to optional extra hours beyond the forty-hour work week..., the only issues presently before the Court are the ...


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