Walsh v. At Home Care St. Louis, LLC

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MISSOURI

EASTERN DIVISION

JULIE SU, ACTING SECRETARY OF LABOR, )

UNITED STATES DEPARTMENT OF LABOR, )

)

Plaintiff, )

)

v. ) Case No. 4:21CV1176 HEA

)

AT HOME CARE ST LOUIS, LLC, et al., )

)

Defendants. )

OPINION, MEMORANDUM AND ORDER

This matter is before the Court on Plaintiff’s Motion for Partial Summary

Judgment, [Doc. No. 40]. Defendant opposes the Motion. For the reasons set forth

below, the Motion will be granted.

Introduction

Plaintiff brought this action alleging Defendant has violated the Fair Labor

Standards Act, (“FLSA”), 29 U.S.C. § 201, et seq. against At Home Care St. Louis,

LLC, At Home Care St. Louis CDS, LLC, and Carlita Vasser. Plaintiff moves for

summary judgment on the following issues: (1) At Home Care, CDS, and Carlita

Vasser qualify as employers under the FLSA, (2) the FLSA applies to Defendants’

employees, (3) thirty-four employees were not exempt from the FLSA overtime

provisions at relevant times during the Investigation Period, and (4) Defendants

violated the recordkeeping requirements of the FLSA.

Summary Judgment Standard

Under Rule 56 of the Federal Rules of Civil Procedure, “[a] party may move

for summary judgment, identifying each claim or defense—or the part of each

claim or defense—on which summary judgment is sought.” Fed. R. Civ. P. 56(a).

“The court shall grant summary judgment if the movant shows that there is no

genuine dispute as to any material fact and the movant is entitled to judgment as a

matter of law.” Id.

The Eighth Circuit Court of Appeals has explained,

“Summary judgment is proper if the pleadings, the discovery and disclosure

materials on file, and any affidavits show that there is no genuine issue as to any

material fact and that the movant is entitled to judgment as a matter of law.”

Torgerson v. City of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (en banc)

(quotations omitted). A fact is “material” if it may “affect the outcome of the suit.”

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “An issue is genuine if

the evidence is sufficient to persuade a reasonable jury to return a verdict for the

nonmoving party.” Schilf v. Eli Lilly & Co., 687 F.3d 947, 948 (8th Cir. 2012)

(quotations omitted).

Erickson v. Nationstar Mortg., LLC, 31 F.4th 1044, 1047–48 (8th Cir. 2022). To

put the “materiality” requirement slightly differently, “ ‘[o]nly disputes over facts

that might affect the outcome of the suit under the governing law will properly

preclude the entry of summary judgment.’ ” Rusness, 31 F.4th at 614 (quoting Doe

v. Dardanelle Sch. Dist., 928 F.3d 722, 725 (8th Cir. 2019), in turn quoting

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).

On a motion for summary judgment, “a district court should ‘not weigh the

evidence, make credibility determinations, or attempt to discern the truth of any

factual issue.’ ” Avenoso v. Reliance Standard Life Ins. Co., 19 F.4th 1020, 1024

(8th Cir. 2021) (quoting Great Plains Real Est. Dev., L.L.C. v. Union Cent. Life

Ins., 536 F.3d 939, 943-44 (8th Cir. 2008)). Instead, the court must view the

evidence in the light most favorable to the non-moving party and afford that party

all reasonable inferences supported by the evidence. Grinnell Mut. Reinsurance

Co. v. Dingmann Bros. Constr. of Richmond, Inc., 34 F.4th 649 (8th Cir. 2022);

Pearson v. Logan Univ., 937 F.3d 1119, 1124 (8th Cir. 2019).

The parties bear specific burdens on a motion for summary judgment. “The

moving party bears the burden of showing the absence of a genuine dispute.”

Glover v. Bostrom, 31 F.4th 601, 603 (8th Cir.) (citing Fed. R. Civ. P. 56(a)), reh'g

denied, No. 20-2884, 2022 WL 1564097 (8th Cir. May 18, 2022). Thus, “ ‘[t]he

movant bears the initial responsibility of informing the district court of the basis

for its motion and must identify those portions of [the record] ... which it believes

demonstrate the absence of a genuine issue of material fact.’ ” Mensie v. City of

Little Rock, 917 F.3d 685, 688 (8th Cir. 2019) (quoting Torgerson, 643 F.3d at

1042).

The burden on the resisting party is as follows: The party opposing summary

judgment must “cit[e] particular materials in the record” or show that the

“materials cited do not establish the ... absence of a genuine dispute.” Fed. R. Civ.

P. 56(c)(1). “A mere ‘scintilla of evidence’ is insufficient to defeat summary

judgment, and if a nonmoving party who has the burden of persuasion at trial does

not present sufficient evidence as to any element of the cause of action, then

summary judgment is appropriate.” Wagner v. Campbell, 779 F.3d 761, 766 (8th

Cir. 2015), quoting Brunsting v. Lutsen Mountains Corp., 601 F.3d 813, 820 (8th

Cir. 2010).

Similarly, if the movant has supported its motion for summary judgment, the

party opposing summary judgment “may not simply rest on the hope of

discrediting the movant's evidence at trial.” United States v. 3234 Washington Ave.

N., 480 F.3d 841, 844 (8th Cir. 2007) (“3234 Washington”). Where the testimony

of the movant’s witnesses is critical, if the testimony is “positive, internally

consistent, unequivocal, and in full accord with the documentary exhibits,” “then

the opposing party cannot force a trial merely to cross-examine the witness or in

the hope that something might turn up at the trial.” Id. at 845 (quotations omitted);

Nationwide Prop. & Cas. Ins. Co. v. Faircloth, 845 F.3d 378, 382 (8th Cir. 2016).

But summary judgment is improper where specific facts “even partially”

undermine the witness's credibility in a material way. 3234 Washington, 480 F.3d

at 845. Erickson, 31 F.4th at 1048. Thus, “ ‘[t]o show a genuine dispute of material

fact, a party must provide more than conjecture and speculation. Rather the

nonmovant has an affirmative burden to designate specific facts creating a triable

controversy.’” Rusness, 31 F.4th at 614 (quoting McConnell v. Anixter, Inc., 944

F.3d 985, 988 (8th Cir. 2019)). The nonmoving party may not rest on mere

allegations or denials but must show, through the presentation of admissible

evidence, that specific facts exist creating a genuine issue for trial. Anderson, 477

U.S. at 256. “The mere existence of a scintilla of evidence in support of the

plaintiff's position will be insufficient; there must be evidence on which the jury

could reasonably find for the plaintiff.” Id. at 252.

Undisputed Material Facts

The Court finds the following to be the undisputed material facts, based on

Plaintiff’s Statement of Undisputed Material Facts and Defendant’s admissions

thereof:

The U.S. Department of Labor Wage and Hour Division investigated

Defendants’ pay practices for compliance with the FLSA for the period of January

1, 2019 through December 31, 2020. Investigator Lisa Gurski conducted the

investigation.

Defendant At Home Care St. Louis, LLC is a Missouri limited

liability company with a principal business office located at 11430 St. Charles

Rock Road, Bridgeton, Missouri (the Bridgeton office). At Home Care does

business from three other offices located at 2 Melgrove Lane, Suite 100 in

Hannibal, Missouri (the Hannibal office); 960 Plaza Drive in St. Clair, Missouri

(the St. Clair office); and, 3737 West Chestnut Expressway, Suite 1W in

Springfield, Missouri (the Springfield office).

Since at least January 1, 2019, At Home Care has been a home care

agency providing in-home and other community-based services to its clients. At

Home Care’s clients included disabled pediatric patients, disabled adults, and

senior citizens. The in-home services that At Home Care provided its clients

included personal care services such as cooking, cleaning, bathing, dressing,

grooming, and running errands for clients. The services provided by At Home Care

may be funded by Medicaid or private insurance companies.

Defendant At Home Care St. Louis CDS, LLC (“CDS”) is a Missouri

limited liability company and it has shared the Bridgeton office with At Home

Care.

CDS provided consumer-directed services to individuals in Missouri. CDS,

like At Home Care, is a Medicaid program. Under the consumer-directed program,

the client would hire the attendant (also referred to as a “caregiver”) directly.

On behalf of its clients, CDS would perform administrative tasks like

background checks, employment references, and other “on-boarding” tasks for

attendants. CDS would also process time clock entries and do payroll for

consumer-directed attendants on behalf of CDS clients.

The state of Missouri Department of Health and Senior Services

(“MO-DHHS”) explains the distinction between in-home and consumer-directed

services on its website as follows:

[The Division of Senior and Disability Services] administers two different

programs, available in every county: in-home services and consumer-

directed services.

In-home services (IHS) are designed to assist in meeting the unmet needs of

a person and provide necessary assistance for the person to remain in the

least restrictive environment.

In general, IHS consists of personal care, nursing services, housekeeping,

respite, and adult day care services.

Consumer-directed services (CDS), although similar in nature to in-home

services, are provided to persons with a physical disability and do not

include any task performed by a licensed professional. A participant of CDS

must be able to direct the care planning process and hire an attendant. In

general, CDS consists of personal care (bathing, cleaning, and meal

preparation).

At Home Care and CDS publicized their in-home and consumer-directed

services as a single homecare agency on the same website, at

https://www.athomecaremissouri.com/.

At Home Care and CDS were for-profit businesses. Since January 1, 2019,

At Home Care and CDS each have had annual gross sales of at least $500,000. At

Home Care had gross sales of $667,445 in 2019. At Home Care’s income was

$797,422.80 in 2020 and $785,488.99 in 2021.

The payroll records at Exhibit J were produced by Vasser during the

Wage and Hour Division’s investigation.

At Home Care employed the 42 employees listed in Appendix A (the

“Affected Employees”) during the Investigation Period.

Beginning around July 1, 2020, employees of At Home Care were

transferred to the CDS payroll. This included the following 15 employees: Sherlita

Brinkley (Home Care Aide), Brandy Brown (Executive Assistant), Shontelese

Brown (Home Care Aide), Ladonna Chaney (Scheduler), Raevynne Clark (HR

Director), Elishea Graves (Manager), Elizabeth King (Manager), Toni LaJoy

(Manager), Mikka McClure (Billing Supervisor), Chelsea Mitchell (HR Director),

Barbara Shaffer (Manager), Chevelle Staten (Manager), Mia Tracy

(Biller/Scheduler), Dawn White (Manager), and Pam White (Manager and Home

Care Aide).

CDS was the entity that paid the 15 employees during the times the

employees appeared on the CDS payroll. At Home Care employees continued to

appear on CDS payroll until they were switched back to At Home Care’s payroll in

January 2023.

CDS performed some pre-employment tasks for At Home Care employees;

for example, CDS performed a criminal background check for Stephanie Williams

who was employed as an LPN by At Home Care during the Investigation Period.

Employees who worked directly for At Home Care also performed services that

benefited CDS; for instance, according to an email chain, Toni LaJoy identified

herself as a “Manager” for “At Home Care and At Home Care CDS” and, in that

capacity, was involved in hiring employees.

During the relevant Investigation Period, Defendant Carlita Vasser

owned both At Home Care and CDS. Vasser was also the CEO and Director of

Nursing for At Home Care. As CEO, Vasser provided general oversight of all At

Home Care activities, oversaw the managing of supervisors and employees in all

offices, and directed, controlled, and supervised employees. As a Director of

Nursing, Vasser supervised the nurses and helped recruit home care aides. At

Home Care had an employee handbook that Vasser was personally involved in

putting together. Vasser actively managed and supervised At Home Care’s and

CDS’s operations and their employees during the Investigation Period by

recruiting and hiring employees, firing employees, setting employees’ work

schedules, and setting employees’ pay rates and salaries. At her deposition, Vasser

represented that she was the sole employee of CDS.

Defendants had written procedures that applied equally to employees

of At Home Care and CDS attendants, such as a “Payroll, Time, and Attendance”

policy and procedure. There was a single written job description for the positions

of “Home Care Aide” and “CDS Attendant.”

A “Home Care Aide” employed by Defendant At Home Care and an

“Attendant” who provided consumer-directed services under the program operated

by Defendant CDS, have the same job responsibilities, such as “planning,

preparation, and clean-up of meals,” “laundering clothes and linens,” “shopping for

essential items (e.g., groceries, cleaning supplies, etc.”

During the Investigation Period, At Home Care employed employees in the

position of Home Care Aide, including 18 of the Affected Employees. Home Care

Aides provided personal care services to At Home Care’s clients in the clients’

private homes. The personal care services that Home Care Aides provided included

cooking, cleaning, bathing, dressing, grooming, and running errands for clients.

At Home Care also employed Licensed Practical Nurses (“LPNs”),

including seven of the Affected Employees. The LPNs provided health care

services in the clients’ private homes.

Because the bulk of At Home Care’s business was to provide personal care

services, most of its employees worked in the positions of Home Care Aide and

LPN.

The supplies and materials used by At Home Care employees to

provide personal care services includes soap, water, cleaning supplies for the

home, and personal protective equipment like masks and gloves. These supplies

were provided to employees by the defendants or their clients.

At Home Care also employed office staff at its business offices as office

managers, office assistants, and to perform payroll and medical billing tasks. On

the mark-up to Appendix A, Vasser handwrote each employee’s occupation and

added asterisks to denote salaried employees. The employees without an asterisk

next to their names were paid on an hourly basis.

During the Investigation Period, 18 employees employed as Home

Care Aides and eight office staff employees were paid on an hourly basis. The

employees employed as Home Care Aides: Erica Barnard, Sherlita Brinkley,

Shontelese Brown, Latricia Darnell, Freddie Gingell, Denice Gonzalez, Gerald

Green, Richard Grisby, Michael Harmon, Anwar Hasaan, Jody Lennon, Jessie

Liggins, Whitney Meyers, Yolanda Sanderson, Gretchen Schultz, Sharon Tarwater,

Pam White, Amber Young; and, office employees: Brandy Brown (Executive

Assistant), Ladonna Chaney and Candyce Davis (Schedulers), Demi Chapman

(Assistant), Raevynne Clark (Human Resources Director), Elishea Graves

(Manager), Artis Jones IV (Billing Clerk), Mikka McClure (Billing Supervisor),

and Ki-Myra Thomas and Mia Tracey (Billers).

Hourly employees would use a telephone tracking system called

“Telephony” to track the number of hours they worked. Two office employees –

Barbara Shaffer and Dawn White, both Managers – were switched from hourly to

salaried in 2020. Barbara Shaffer was paid at the rate of $11.00 per hour for pay

periods between January 3, 2020 and July 31, 2020. Shaffer was paid a semi-

monthly salary of $1,083.33 for pay periods between August 1, 2020 and August

31, 2020. Shaffer was paid a semi-monthly salary of $1,213.33 for pay periods

between September 1, 2020 and December 24, 2020.

Dawn White was paid at the rate of $11.00 per hour for pay

periods between January 3, 2020 and June 15, 2020. White was paid a salary of

$1,250 on a semi-monthly basis (i.e., paid twice a month) for the pay periods

between July 1, 2020 and December 24, 2020.

Elizabeth King was employed as a Manager during the Investigation

Period. King was paid a biweekly salary of $1,200 for pay periods between

January 3, 2020 and April 9, 2020. King was paid a biweekly salary of $1,320 for

pay periods between April 24, 2020 and May 16, 2020. King was paid a semi-

monthly salary of $1,430 for pay periods between May 16, 2020 and December 24,

2020.

Toni LaJoy was employed as a Manager during the Investigation

Period. LaJoy was paid a biweekly salary of $1,200 for pay periods between

January 3, 2020 and May 16, 2020. LaJoy was paid a semi-monthly salary of

$1,300 for pay periods between May 15, 2020 and December 24, 2020.

Chelsea Mitchell was employed as a Human Resources (HR) Director

during the Investigation Period. Mitchell was paid a semi-monthly salary of

$1,473.33 for pay periods between November 1, 2020 and December 24, 2020.

Chevelle Staten was employed as a Manager during the Investigation

Period. Vasser testified that Staten was not employed beyond the orientation

period and Staten was not considered an FLSA-exempt employee. From September

1, 2020 to October 31, 2020, Staten was paid on a semi-monthly basis in amounts

ranging between $544.38 and $1,451.67.

In discovery, Defendants claimed certain employees were exempt from

the FLSA minimum wage or overtime requirements.

Vasser acknowledged in her deposition that Managers did not meet the

minimum salary level in 2020, but she claimed to have made additional payments

to four of the six Managers (King, Shaffer, LaJoy, and Dawn White) to

bridge the gap between the employees’ salaries and the minimum salary threshold.

Vasser did not make the additional payments until March 2021.

During the Department of Labor’s investigation, in September 2020, the

Wage and Hour Division requested from At Home Care payroll and matching time

records for the two- year period of October 14, 2018 to October 13, 2020. Vasser

provided some of the requested records, such as timesheets and payroll for the year

2020, but she did not produce any timesheets or timecards for the period January

2019 through November 2019 or payroll records for the timeframe January 2019 to

June 2019.

In discovery, Defendant At Home Care acknowledged that it did not

maintain records showing the hours worked by its employees from January 1,

2019 to June 30, 2019. Vasser testified that she did not have the records for “the

first quarter and second quarter of 2019” because a payroll processing company

took the records and refused to return them. Vasser has a lawsuit pending against

the payroll company.

Discussion

An employer is defined in the FLSA as “any person acting directly or

indirectly in the interest of an employer in relation to an employee.” 29 U.S.C. §

203(d). “‘Under the FLSA, the determination of whether a party is an employer is

a question of law for the court.” Solis v. Hill Country Farms, Inc., 808 F.Supp.2d

1105, 1113 (S.D.Iowa 2011) aff'd, 469 Fed.Appx. 498 (8th Cir.2012)(citing Dole v.

Elliott Travel & Tours, Inc., 942 F.2d 962, 965 (6th Cir.1991)).” White v. 14051

Manchester Inc., 301 F.R.D. 368, 387–88 (E.D. Mo. 2014).

Under the FLSA, an employer “includes any person acting directly or

indirectly in the interest of an employer in relation to an employee and includes a

public agency.” 29 U.S.C. § 203(d); Wirtz v. Pure Ice Co., 322 F.2d 259, 262 (8th

Cir.1963)(“‘Employer’ includes any person acting directly or indirectly in the

interest of an employer in relation to an employee.”). “The Supreme Court has

indicated that courts should apply an ‘economic realities' test to determine whether

an employment relationship exists.” Baker v. Stone Cnty., Mo., 41 F.Supp.2d 965,

979 (W.D.Mo.1999). Applying the “economic realities test,” “[t]o determine

whether an individual or entity is an employer, the court considers whether the

alleged employer: ‘(1) possessed the power to hire and fire the employees, (2)

supervised and controlled employee work schedules or conditions of employment,

(3) determined the rate and method of payment, and (4) maintained employment

records.’ ” Gray v. Powers, 673 F.3d 352, 355 (5th Cir.2012)(citing Williams v.

Henagan, 595 F.3d 610, 620 (5th Cir.2010)).

“The Eighth Circuit has held that a corporate officer with operational control

of the corporation's day-to-day functions is an employer within the meaning of the

FLSA.” Simms v. Northport Health Servs. of Ark., LLC., Case No. 2:12-cv-02252,

2013 WL 2102974 (W.D. Ark. May 14, 2013) (citing Wirtz, 322 F.2d at 262–63)).

“The so-called ‘active management test’ provides that a corporate officer may be

included in the definition of ‘employer’ if he hires the supervisors and home office

workforce and if the wages of the corporation's employees are subject to his

control, if only in varying degrees.” Id. (citing Chambers Constr. Co. v. Mitchell,

233 F.2d 717, 724 (8th Cir. 1956)). Wirtz and its progeny “require ‘operational

control of significant aspects of ... day-to-day functions, including compensation of

employees or other matters in relation to an employee’ ” with the “the overarching

concern is whether the alleged employer possessed direct or indirect power to

control significant aspects of the plaintiff's employment.” White, 301 F.R.D. at 388

(quoting Hembree v. Mid-Continent Transp., Inc., Case No. 09-6094-cv-SJ-HFS,

2011 WL 5841313, at *1 (W.D. Mo. Nov. 21, 2011)); Childress, 95 F. Supp. 3d at

1139; see also Solis v. Hill Country Farms, Inc., 808 F. Supp. 2d 1105, 1115 (S.D.

Iowa 2011), aff'd, 469 F. App'x 498 (8th Cir. 2012) (citing Donovan v. Agnew, 712

F.2d 1509, 1511 (1st Cir. 1983), for the proposition that “the overwhelming weight

of authority is that a corporate officer with operational control of a corporation's

covered enterprise is an employer along with the corporation, jointly and severally

liable under the FLSA for unpaid wages.”). In short, a corporate officer must not

only have the power to exercise operational control, he or she must exercise that

power to be an employer within the meaning of the FLSA. Solis, 808 F. Supp. 2d

at 1115. The Eighth Circuit noted in Wirtz that finding an individual to be an

employer within the meaning of the FLSA would be “well supported” by showing

“a combination of stock ownership, management, direction and the right to hire

and fire employees.” Wirtz, 322 F.2d at 263. See also, Yasevich v. Heritage Co.,

Inc., No. 3:20-CV-00019 KGB, 2023 WL 5670774, at *14 (E.D. Ark. Sept. 1,

2023).

Employers

The undisputed material facts establish that Defendants At Home Care, At

Home Care St. Louis CDS, LLC, and Vasser were employers during the period at

issue in this case. At Home Care directly employed the 42 employees. At Home

Care St. Louis CDS directly benefited from the work done by these employees;

CDS operated a consumer-directed program wherein the client hired the attendants,

and on behalf of the clients, CDS would do background checks and employment

references for attendants yet to be hired. The paperwork was overseen by

CDSCDS paid and maintained the payroll records of fifteen At Home Care

employees for at least six months during the investigation period. CDS exercised

control over employees’ employment conditions.

Vasser was directly involved in the day-to-day operations of At Home and

At Home Care St. Louis CDS. She recruited, hired, supervised, and set pay rates.

She was involved in employee handbook preparation. She controlled the

companies as the owner, CEO, and Director of Nursing. Defendant Vasser clearly

qualifies as an “employer” under the FLSA.

Application of the FLSA to Defendants’ Employees

Under the FLSA, Defendants’ Home Care Aides and LPNs were covered by

the Act. Domestic service employees are covered under the Act because

employment of persons in domestic service in households affects commerce.” See

29 U.S.C. § 202(a); 29 C.F.R. § 552.99 (“Congress in section 2(a) of the Act

specifically found that the employment of persons in domestic service in

households affects commerce.”). The Home Care Aides performed cooking,

cleaning, bathing, dressing, grooming, and running errands for the clients in their

private homes. The LPNs were responsible for providing health care in the clients’

homes. These duties clearly fall within “domestic service employment” as set out

in the FLSA See 29 C.F.R. § 552.3. These employees fall within a single enterprise

engaged in commerce under 29 U.S.C. § 203(r). As Plaintiff thoroughly details,

the activities of At Home Care and CDS were similar in nature in that each

company provided or facilitated personal care services for their clients in Missouri,

through the Medicaid program. The personal care services were the same whether

they were provided by a Home Care Aid employed by At Home Care, or an

Attendant through CDS. At Home Care and CDS performed “related activities.”

See Brennan v. Plaza Shoe Store, Inc., 522 F.2d 843, 848 (8th Cir. 1975)(a shoe

store and dress shop engaged in related activities because, at each location, the

stores sold articles of wearing apparel to the general public entering the premises

which housed both stores).

Defendant companies’ activities were performed through a unified operation

over which Defendant Vasser exercised control. “Common control” exists where

ownership is vested in a single person. 29 C.F.R. § 779.223. “Unified operation”

entails “combining, uniting, or organizing” the performance of related activities

“so that they are in effect a single business unit or an organized business system

which is an economic unit directed to the accomplishment of a common business

purpose.” 29 C.F.R. § 779.217. Defendant Vasser owned At Home Care and CDS.

She also controlled both businesses as the CEO and Director of Nursing of At

Home Care, and as an employee of CDS. The shared website at

https://www.athomecaremissouri.com/ demonstrates Defendants held the

companies out to the public as part of a single home care agency with the “At

Home Care” designation. The companies also shared written job descriptions and

policies, including time and attendance policies. The companies conducted their

activities in such a manner as to be a unified business system. See Donovan v.

Weber, 723 F.2d 1388, 1393-94 (8th Cir. 1984).

The evidence also establishes At Home Care and CDS were for-profit

businesses in the home-care industry. By operating At Home Care and CDS,

Vasser could participate in both components of the home care industry, the in-

home and consumer-directed components. Defendants had a common business

purpose. Brennan, 522 F.2d at 848.

The evidence proves the enterprise met the $500,000 threshold during the

Investigation Period, as required under 29 U.S.C. § 203(s)(1)(A)(ii). The defendant

companies admitted their annual gross volume of sales have exceeded $500,000

since Jan. 1, 2019.

Under the FLSA, employers must pay employees a minimum wage and

overtime pay for employees who work more than 40 hours per week. 29 U.S.C. §§

206(a), 207(a)(1). Section 13(a)(1) of the FLSA exempts from the minimum wage

and overtime pay requirements ‘‘any employee employed in a bona fide executive,

administrative, or professional capacity.’’ 29 U.S.C. § 213(a)(1). The undisputed

material facts establish that twenty-eight hourly employees were nonexempt under

29 C.F.R. § 541.602(a). “An employee will be considered to be paid on a “salary

basis” within the meaning of [Part 541] if the employee regularly receives each pay

period on a weekly, or less frequent basis, a predetermined amount constituting all

or part of the employee’s 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(a). Defendants in this case have acknowledged that 28 employees

employed as Home Care Aides and office employees were paid on an hourly basis

during the entire Investigation Period. The hourly employees would use a

telephone tracking system (i.e., Telephony) to track the hours that they worked for

payroll purposes. The employees’ compensation fluctuated each pay period

depending on the number of hours they worked, and for this reason, the 28 hourly

employees were not paid on a “salary basis” within the meaning of 29 C.F.R. §

541.602(a) during the entire Investigation Period. These employees were not

exempt from the FLSA minimum wage and overtime compensation protections. 29

U.S.C. §§ 206(a), 207(a)(1), 213(a)(1); 29 C.F.R. § 541.602.

The required salary level for exempt employees has been $684 per week. 29

C.F.R. § 541.600 (2020). The required weekly salary amount is equivalent to a

biweekly salary of $1,368, a semimonthly salary of $1,482, or monthly salary of

$2,964. Id. Defendants’ payroll records show six salaried employees were paid less

than $684 a week during the second half of the Investigation Period, from January

1, 2020 through December 31, 2020. In this timeframe, the weekly salaries of these

six employees ranged from about $600 to $660. Vasser acknowledged in her

deposition that Managers did not meet the minimum salary level in 2020 but

claimed to have made additional payments in 2021 to four of the six Managers

(King, Shaffer, LaJoy, and Dawn White) to make up for the shortfall in the

employees’ salaries. However, assuming these additional payments were intended

to bring employee salaries up to the threshold level, the payments would be

immaterial because they would have been untimely under the Department of

Regulations. The deadline to make the catch-up payment is one pay period after

the end of the year. Id. Vasser testified that she did not make the additional

payments until March 2021, which was after the first pay period for these

employees who were paid on a semi-monthly basis. As a result, the six Managers

were not exempt in 2020. 29 C.F.R. § 541.600. There is no genuine dispute of

material fact that 34 of the 42 Affected Employees were not paid on a salary basis

at the required salary levels at times during the Investigation Period. Because

Defendants could not meet their burden of proving that these employees were

nonexempt during the relevant times, the Secretary is entitled to judgment as a

matter of law on this issue.

Finally, there is no genuine dispute that Defendants failed to comply with

the recordkeeping requirements of the FLSA. Under the Labor regulations, the

required records include payroll records for each employee that show the

employee’s hours worked each day and each workweek, total wages paid per pay

period, and date of payment and period covered by payment. 29 C.F.R. § 516.2(a).

All payroll records must be preserved for at least three years. 29 C.F.R. § 516.5(a).

Employers must maintain “supplementary records” on which the payroll records

are based, such as timecards or timesheets. 29 C.F.R. § 516.6(a)(1). These must be

maintained for at least two years. Id. The required records must be kept safe and

accessible, and an employer must make the records available for inspection by the

Wage and Hour Division upon request. 29 C.F.R. § 516.7. Defendants did not

maintain records of employees’ hours and wages for the period January 2019

through November 2019. Defendant Vasser produced some time and payroll

records requested by the Wage and Hour Division, but no timesheets or timecards

were produced.

Conclusion

Based upon the foregoing analysis, the motion for partial summary judgment

against Defendants is well taken as to the Secretary’s claims that: (1) At Home

Care, CDS, and Carlita Vasser qualified as employers under the FLSA, (2) the

FLSA applied to Defendants’ employees, (3) thirty-four employees were not

exempt from the FLSA overtime provisions at relevant times during the

Investigation Period, and (4) Defendants violated the recordkeeping requirements

of the FLSA.

Accordingly,

IT IS HEREBY ORDERED that Plaintiff’s Motion for Partial Summary

Judgment, [Doc. No. 40] is granted.

An appropriate judgment shall be entered upon the conclusion of the

remaining issues herein.

Dated this 218 day of November, 2023.

HENRY EDWARD a

UNITED STATES DISTRICT JUDGE