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ALLEY v. COMELLA

June 3, 1965

Frank S. ALLEY, Plaintiff,
v.
James O. COMELLA, trading as J.O.C. Terminals, Defendants



The opinion of the court was delivered by: MARSH

This is an action for unpaid overtime compensation, liquidated damages and an attorney's fee, brought under § 16(b) of the Fair Labor Standards Act, as amended, 29 U.S.C. § 216(b). The defense is that the plaintiff was at all pertinent times employed in a 'bona fide executive' and/or 'administrative' capacity within the meaning of 29 U.S.C. § 213(a)(1), *fn1" wherefore the provisions of 29 U.S.C. § 207 *fn2" do not apply. At the pretrial conference, counsel stipulated that the sole issues to be tried were (1) whether the plaintiff was paid a 'salary' within the meaning of 29 C.F.R. § 541.1(f) and/or 29 C.F.R. § 541.2(e); and, if so, then (2) whether the plaintiff devoted more than 20 percent of his hours of work in the workweek to activities which were not directly and closely related to the performance of the work described in PP (a) through (d) of 29 C.F.R. § 541.1 and/or PP (a) through (c) of 29 C.F.R. § 541.2. *fn3" After non-jury trial, I hold in favor of the defendant employer and assign in support of my decision the following:

FINDINGS OF FACT

 1. Plaintiff, Frank S. Alley, a resident of Washington, Pennsylvania, was employed by the defendant at the latter's Washington, Pennsylvania, freight terminal during the period commencing October 15, 1961, and ending on May 25, 1962.

 2. The defendant conducted a single proprietorship business based at the aforesaid terminal, the primary purpose of which was the solicitation and dispatching of interstate freight to be transported by freight carriers represented by him under certificate rights granted by the Interstate Commerce Commission. Another important function of the defendant's operation was the establishment of similar terminals throughout the country, to be managed by agents recruited and selected by him.

 3. At all pertinent times, the plaintiff and the defendant were engaged in interstate commerce.

 5. The defendant paid plaintiff in all workweeks in question a guaranteed salary of $ 114 per week, plus a commission based upon volume of business. Plaintiff's total income from this employment was $ 5,324.23, averaging approximately $ 166.38 per week during the 32-week period involved.

 6. The defendant at all pertinent times was totally blind. He hired plaintiff to serve as his 'right-hand man' in directing and supervising defendant's terminal operations. Plaintiff did so. Plaintiff also played a leading role in the solicitation and promotion of additional business from shippers and in the development of prospective new freight terminal facilities outside Pennsylvania and recruitment of agents to manage same.

 7. Plaintiff did not devote more than 20 percent of his hours of work in any workweek to activities which were not directly and closely related to the performance of the work described in PP (a) through (d) of 29 C.F.R. § 541.1 and PP (a) through (c) of 29 C.F.R. § 541.2. The promotional work and solicitation of business performed by plaintiff, as well as his work in developing new terminal facilities to provide additional service to the carriers represented by the defendant and recruiting agents to manage same, were directly and closely related to the general business operations of his employer and to the other work described in the aforesaid regulations.

 DISCUSSION

 At the pretrial conference, counsel stipulated 'that the plaintiff was engaged in executive work or administrative work or both' (pretrial transcript, p. 2) and that the sole issues to be tried were (1) whether the plaintiff was paid a 'salary' within the meaning of 29 C.F.R. § 541.1(f) and/ or 29 C.F.R. § 541.2(e); and, if so, then (2) whether the plaintiff devoted more than 20 percent of his hours of work in the workweek to activities which were not directly and closely related to the performance of the work described in PP (a) through (d) of 29 C.F.R. § 541.1 and/or PP (a) through (c) of 29 C.F.R. § 541.2. At the trial, plaintiff's counsel appeared to have misgivings about having stipulated (by necessary implication) that his client's primary duty consisted 'of the performance of office or nonmanual field work directly related to management policies or general business operations of his employer or his employer's customers' (29 C.F.R. § 541.2(a)), arguing that the stipulation as to that fact might be interpreted as conflicting with plaintiff's contention that he devoted approximately 25 percent of his hours in every workweek to non-exempt activity. The concern of plaintiff's counsel in that respect was unjustified, in light of 29 C.F.R. § 541.103 and 541.206. *fn4" I hold: (a) that plaintiff is bound by his attorney's stipulation; and (b) that regardless of such stipulation, the evidence clearly reveals that 29 C.F.R. § 541.2(a) is aptly descriptive of plaintiff's work during the period in question, which I find to be the fact.

 Plaintiff was guaranteed a salary of $ 114 (gross) per week. During the period in question, it was only required that he be compensated on a salary basis of not less than $ 95 per week in order that both 29 C.F.R. § 541.1(f) and 29 C.F.R. § 541.2(e) have application. *fn6" This was the situation, as I view the evidence.

 I am also convinced that the promotional activities, solicitation of new business, and effort devoted to development of new freight terminal facilities and recruiting of managerial personnel therefor was work directly and closely related to the performance of the executive and administrative work described in PP (a) through (d) of 29 C.F.R. § 541.1 and in PP (a) through (c) of 29 C.F.R. § 541.2. A close reading of 29 C.F.R. §§ 541.108, ...


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