Misclassified to Avoid Overtime Compensation

Seattle, WAEven though Home Depot has settled overtime claims for assistant managers out of court and a class action lawsuit in 2001 alleged that it denied workers millions of dollars in overtime by misclassifying some employees as exempt, Mike S. says he was misclassified as exempt until recently: he was an assistant manager and paid a salary, yet he routinely worked more than 40 hours a week stocking shelves, pushing carts and "whatever it takes"–everything but manage.

"I usually worked about 14 to 15 hours a day but hardly any of that time was spent as an assistant manager," says Mike (not his real name). Assistant managers are supposed to manage people for a certain percentage of time each day. Instead, Mike did regular employee work—he helped customers on the floor, stocked shelves, and worked as a cashier when they were short-staffed. Many so-called assistant store managers' primary responsibilities also include mopping floors and taking out the garbage--all tasks traditionally assigned to hourly employees.

In 1994 Zaira Guerrero filed a complaint against Home Depot—she was an associate manager in Miami's Home Depot and was "in training" for 18 months, during which time she worked 70 hour weeks for a fixed annual salary of $24,000. The U.S. Department of Labor investigated Home Depot's associate manager program nationwide but it took more than two years to reach a settlement, which entitled Guerrero to $4,205.55--not even close to overtime pay she was entitled to.

Unfortunately the settlement was reached after the two year statute of limitations had run out, so Guerrero no longer had the option to sue Home Depot. The company said it "worked closely with federal officials to answer their concerns", and they make sure that "associate managers don't work more than 40 hours a week." But that is not the case for Mike: he says Home Depot counts on the statute of limitations and misclassifies assistant managers to avoid paying overtime.

"I was an assistant manager for 18 months," Mike adds, "and just about every assistant manager I know works overtime without getting paid. For the most part, the managers don't work more than 40 hours a week. We didn't complain to management because when you are hired, it is expected that you are going to work 55 hours per week—minimum. If a store is high-volume ($1 million in sales a week or more) there are more managers, but I was in a low-volume store and would maybe get a lunch break once a week; I would just work through meal periods.

Fortunately I am no longer an assistant: I got hurt on the job and I was able to get hourly pay. And I'm not involved in a lawsuit because I want to keep my job; I am afraid of repercussions. I've heard from co-workers that if you complain, management just lets you go.

Home Depot has changed. It isn't the 'mom and pop' store it used to be. Now it is big business, and they could care less about their employees."

Federal wage and hour regulations states that employees are not eligible for overtime pay when their primary duties consist of management of the company or a department, when they regularly direct two or three other employees, when they have the authority to hire or fire, and when their weekly salary is at least $400. Clearly, Mike was misclassified and is owed overtime for the 18 months he worked as assistant manager.

Home Depot operates more than 1,800 stores in the United States, Canada and Mexico, and has about 300,000 employees.