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Premick v. Dick's Sporting Goods

January 18, 2007

JAMES PREMICK, A FORMER DICK'S SPORTING GOODS, INC., EMPLOYEE, INDIVIDUALLY AND ON BEHALF OF ALL OTHER FORMER AND SALARIED DICK'S EMPLOYEES, PLAINTIFFS,
v.
DICK'S SPORTING GOODS, INC., A PENNSYLVANIA CORPORATION,*FN1 DEFENDANT.



The opinion of the court was delivered by: Terrence F. McVerry United States District Court Judge

MEMORANDUM OPINION AND ORDER OF COURT

Presently pending before the Court for disposition is the MOTION TO DISMISS AND TO STRIKE filed by Defendant, Dick's Sporting Goods, Inc. ("Dick's"), with brief in support (Document Nos. 8 and 9, respectively), the BRIEF IN OPPOSITION filed by Plaintiff, James Premick, individually and on behalf of all former and salaried Dick's employees ("Premick") (Document No. 12), and the REPLY BRIEF filed by Dick's (Document No. 17). For the reasons that follow, the Motion will be granted in its entirety.

Background

As the law requires, all disputed facts and inferences are resolved most favorable to Premick. The following background is drawn from the Complaint and the factual allegations therein are accepted as true for the purpose of this opinion.

Premick was employed at Dick's as a salaried associate classified as a Golf Professional from May 1999 until his termination in December 2005. During the period of Premick's employment, Dick's utilized an "Associate Handbook" to detail and communicate its employment practices and guidelines. (See Complaint, Exhibit A.)

According to Premick, "Dick's wrongfully used an amount equal to its salaried associates' holiday bonuses to reduce the base weekly wages of its salaried associates, including salaried Golf Professionals. Such bonus reductions from wages are illegal under the [Fair Labors Standard Act]." Complaint, at ¶ 6.

Additionally, Premick alleges that "prior to March 6, 2005, Dick's wrongfully classified Golf Professionals as exempt employees, and erroneously classified them as management (when they were not), and failed to pay them required overtime." Complaint, at ¶ 8. Apparently, after March 6, 2005, Golf Professionals were reclassified as non-exempt and "on rare occasions" received overtime when they worked and reported greater than 40 hours per week. Id. at ¶ 10.

On April 20, 2006, Premick filed a four-count Complaint against Dick's for its alleged unlawful failure to pay regular base weekly and overtime wages, in violation of the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq. ("FLSA")(Counts I and II) and the Employment Retirement Income Security Act ("ERISA"), 29 U.S.C. §§ 1059(a)(1) and 1132(a)(3) (Counts III and IV).

Dick's has filed the instant motion in which it seeks to dismiss Counts I, III, and IV of the Complaint, and to strike all portions of the Complaint which relate to Rule 23 class allegations.

STANDARD OF REVIEW

In this case, the motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) challenges the sufficiency of the Complaint filed by Premick. Accordingly, the Court must determine whether Premick would be entitled to relief under any set of facts that could be established in support of his claims. See Piecknick v. Pennsylvania, 36 F.3d 1250, 1255 (3d Cir. 1994). All allegations in the Complaint and all reasonable inferences that can be drawn therefrom must be accepted as true and viewed in the light most favorable to Premick. Pennsylvania Nurses Ass'n v. Pennsylvania State Educ. Ass'n, 90 F.3d 797, 799-800 (3d Cir. 1996), cert. denied, 519 U.S. 1110 (1997).

Generally, "to the extent that [a] court considers evidence beyond the complaint in deciding a 12(b)(6) motion, it is converted to a motion for summary judgment." Anjelino v. New York Times Co., 200 F.3d 73, 88 (3d Cir. 1999). However, in resolving a 12(b)(6) motion to dismiss, a court may look beyond the complaint to matters of public record, including court files and records, decisions of government agencies and administrative bodies, and documents referenced in the complaint or which are essential to a plaintiff's claim and are attached to either the Complaint or the defendant's motion. Pension Benefit Guar. Corp. v. White Consol. Indus., 998 F.2d 1192, 1196 (3d Cir. 1993).

Attached to Premick's Complaint is a copy of Dick's Associate Handbook and copies of two of Premick's pay stubs from Dick's. Because these documents are referenced in the Complaint and are essential to Premick's claims, the Court has considered these documents without the necessity of converting the motion to dismiss into a motion for summary judgment. Pension Benefit Guar. Corp., 998 F.2d at 1196-97.

DISCUSSION

A. Count I - Holiday Leave Claim

The FLSA requires certain employers to pay overtime wages to employees who work more than 40 hours in any given work week, absent application of one of several exemptions.

29 U.S.C. § 207(a). The FLSA contains numerous categories of employees who are exempt from the requirement of overtime pay, including "any employee employed in a bona fide executive, administrative, or professional capacity." 29 U.S.C. § 213(a)(1). The regulatory definitions of these exemptions include both a "primary duty test" and a "salary basis" test.

The parties agree that Premick's holiday leave claim involves only the "salary basis" test. 29 C.F.R. § 541.602 is the current FLSA regulation which details the salary-basis test and reads in pertinent part, as follows:

(a) General Rule. An employee will be considered to be paid on a "salary basis" within the meaning of the regulations if under his employment agreement he regularly receives each pay period on a weekly, or less frequent basis, a predetermined amount constituting all or part of his compensation, which amount is not subject to reduction because of variations in the quality or quantity of the work performed. 29 C.F.R. § 541.602 (2006). Until March 2005, the Golf Professionals employed by Dick's were considered "exempt" employees.

Premick contends that although Dick's, by virtue of its holiday leave policy as stated in its Associate Handbook, contractually offered to "pay its employees for holiday work," Dick's "did not pay its employees any monetary pay for holiday work, but only comp. time." Pl's Br. at 16-17. Plaintiff further contends that Dick's holiday leave policy violates the FLSA because it (i) constitutes an improper salary reduction for exempt employees; and (ii) improperly ...


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