The opinion of the court was delivered by: James Knoll Gardner, United States District Judge
This Memorandum pursuant to Rule 3.1 of the Third Circuit Local Appellate Rules is in response to the Notice of Appeal filed January 26, 2010 by plaintiff.*fn1
On August 28, 2009 the parties filed cross-motions for summary judgment on the issue of liability. The gravamen of the matter is whether plaintiff, as the sole site manager of a Hess gas station, was a "bona fide executive" and therefore exempt from the statutory requirement that her employer pay her employees' overtime, as set forth in the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 207-219.
On January 19, 2010 I heard oral argument on the cross-motions. By Order dictated on the record at oral argument and dated January 19, 2010, which Order was filed February 17, 2010, I granted defendant's motion for summary judgment, denied plaintiff's motion for summary judgment, entered judgment in favor of defendant and against plaintiff on the issue of liability, and dismissed plaintiff's Complaint. Specifically, I concluded that plaintiff acted in a "bona fide executive" capacity and, therefore, is properly characterized as an exempt employee under 29 U.S.C. § 213(a)(1).
After oral argument and recess for deliberations, I reopened court and dictated on the record and in the presence of counsel, my Order disposing of the cross-motions for summary judgment and an articulation of my reasons for such disposition. I incorporate those reasons here.*fn2 This Memorandum clarifies my application of the doctrine set forth in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984).*fn3
Under Chevron, when a court reviews an agency's construction of the statute which it administers, it is confronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress.... [However,], if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute.
Chevron, 467 U.S. at 842-843, 104 S.Ct. at 2781-2782, 81 L.Ed.2d at 702-703.
In this case, I concluded that pursuant to 29 U.S.C. § 213(a)(1), Congress clearly and unambiguously delegated to the United States Secretary of Labor responsibility for defining the terms "bona fide executive, administrative, or professional capacity" for purposes of exempting such employees from the overtime requirement set forth in 29 U.S.C. § 207.
Specifically, § 213(a)(1) provides that the overtime requirement does not apply to ...any employee employed in a bona fide executive, administrative, or professional capacity...(as such terms are defined and delimited from time to time by regulations of the Secretary...except that an employee of a retail or service establishment shall not be excluded from the definition of employee employed in a bona fide executive or administrative capacity because of the number of hours in his workweek which he devotes to activities not directly or closely related to the performance of executive or administrative activities, if less than 40 per centum of his hours worked in the workweek are devoted to such activities)....
29 U.S.C. § 213(a)(1).*fn4 Thus, an "employee employed in a bona fide executive, administrative, or professional capacity", as defined by the Secretary of Labor subject to the limited exception set forth in § 213(a)(1), is an "exempt" employee.
However, the precise question at issue in this matter is whether plaintiff, as an employee who spends 85 percent of her time on non-managerial duties and 15 percent of her time on managerial duties, must be paid overtime. Section 213(a)(1) does not directly speak to this question. Rather, the statute establishes an exception from the overtime requirement for employees who serve in a "bona fide executive, administrative, or professional capacity", and delegates authority to the Secretary of Labor to define those terms. Accordingly, I conclude that Congress has not directly spoken to the precise question at issue in this matter, for purposes of the first Chevron factor.
Therefore, I must consider whether the applicable regulations set forth by the agency are based on a permissible construction of the statute. Chevron, 467 U.S. at 842-843, 104 S.Ct. at 2781-2782, 81 L.Ed.2d at 703.
The court "need not conclude that the agency construction was the only one it permissibly could have adopted to uphold the construction, or even the reading the court would have reached if the question had arisen in a judicial proceeding." Chevron, 467 U.S. at 843 n.11, 104 S.Ct. at 2782 n.11, 81 L.Ed.2d at 703 n.11. Rather, where the agency has filled a gap explicitly left by Congress, "such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute." Chevron, 467 U.S. at 843, 844, 104 U.S. at 2782, 81 L.Ed.2d at 703.
The regulations at issue are as follows. According to the United States Labor Department ...