On August 7th, 2006, Beasley Allen filed a lawsuit for approximately twenty-five hundred former and current Dollar General store managers in the United States District Court for the Northern District of Alabama, alleging that the company intentionally misclassified them as executives in order to avoid paying the store managers overtime pay, a violation of the Fair Labor Standards Act (FLSA).
The firm also filed a second lawsuit in the same United States Federal Court by a single Plaintiff, Cynthia Richter, alleging the same claims but seeking certification as a collective action for all persons pursuing claims for overtime pay for Dollar General store managers.
Both of these lawsuits were filed in the Federal Court in Tuscaloosa, Alabama because the Federal Court system has established a single Multi District Litigation Court to handle all of these FLSA claims against Dollar General. The Federal Court system often establishes an MDL Court in order to efficiently manage multiple lawsuits filed against a single Defendant.
A similar lawsuit by store managers employed by Family Dollar Stores was tried to a jury verdict last April in Tuscaloosa and resulted in a 38 Million Dollar verdict for the store managers. That case is currently before the Trial Court on a Motion for New Trial filed by Family Dollar.
Recently Beasley Allen filed two very similar lawsuits against Fred’s on behalf of the assistant store managers, one in the United States District Court located in Columbus, Georgia, and a second lawsuit filed in conjunction with a Birmingham law firm in Federal Court in the Northern District of Alabama. Each of those cases seeks certification of a nationwide collective action for all assistant managers for misclassifying them under the executive exemption of the FLSA.
The executive exemption under the FLSA allows companies to pay store managers a set salary and avoid paying them overtime in the event a store manager works more than forty hours. However, the exemption also mandates that managers must actually do management duties as their primary duty as opposed to manual labor. It is very clear that store managers of the discount retail stores like Dollar General don’t qualify as executives.
All of these complaints against Family Dollar, Dollar General, and Fred’s allege that these companies forced the managers to work from sixty to eighty hours of manual labor a week as their primary duty and that they spent as little as ten percent of their actual time performing management duties, which results in free labor to the companies. Labor cost is reduced, the companies highest expense, resulting in increased profits, all on the backs of the store managers, said Dee Miles of Beasley, Allen, Crow, Methvin, Portis & Miles, P.C. The FLSA is specifically designed to prevent this very scheme where these companies are trying to cheat working folks out of a fair days pay for a fair days work, said Miles.
The companies all claim that their store managers’ primary duty is management, and they qualify as executives under the exemption. In the only case tried to a verdict thus far, which was Family Dollar, the jury rejected the companies executive defense. Miles, along with Jere Beasley and Roman Shaul of the law firm of Beasley, Allen, Crow, Methvin, Portis & Miles, P.C. in Montgomery, Alabama, represent all of the Plaintiffs in the remaining cases against Dollar General and Fred’s.