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Smith v. Brennan

United States District Court, E.D. Virginia, Alexandria Division

July 13, 2015

DONALD W. BRENNAN, et al., Defendants

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[Copyrighted Material Omitted]

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For Willard L. Smith, III, Plaintiff: Andrew Steven Cabana, LEAD ATTORNEY, Law Office of Andrew Cabana PC, Alexandria, VA.

For Donald W. Brennan, Michael W. Brennan, Brennan's Heating & Air Conditioning Service, Inc., Defendants: Lori Hunt Turner, Isler Dare Ray Radcliffe & Connolly PC, Vienna, VA.

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Liam O'Grady, United States District Judge.

This Memorandum Opinion constitutes the Court's findings of fact and conclusions of law, pursuant to Federal Rule of Civil Procedure 52(a), following a bench trial. For the reasons set forth below, judgment will be entered in favor of Defendants.

I. Background

This suit arises out of an employment relationship between Plaintiff Willard Smith, III and Defendants Donald Brennan, Michael Brennan, and their company, Brennan's Heating and Air Conditioning Service, Inc. (" Brennan's HAC" ). On June 20, 2014, Smith filed a one count complaint alleging violations of the minimum wage and overtime provisions of the Fair Labor Standards Act (" FLSA" ). In the Complaint, Smith alleged he was entitled to recover $55,282.50 in compensatory damages for unpaid wages[1] as well as an equivalent amount in liquidated damages. Defendants answered, and a brief discovery period ensued.

At the bench trial, held on March 24, 2015, Smith presented his own testimony as well as that of Defendant Michael Brennan and the manager of Brennan's HAC's Service Department, Joseph English. After Smith rested, Defendants again called Michael Brennan and Joseph English. Defendant Donald Brennan also testified. Finally, Defendants called Brennan's HAC

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employee Christopher Fox and former employee Jonathan Tinker. Although the Court found Smith for the most part credible, it found the defense witnesses' recollection of the events to be more consistent and reliable. In light of these credibility determinations, the Court makes the following factual findings.

II. Findings of Fact

Defendant Brennan's HAC is a heating, ventilation, and air conditioning contractor incorporated and based in Virginia. At all relevant times, Brennan's HAC was subject to the overtime provisions of the Fair Labor Standards Act of 1938 (" FLSA" ), as amended. Defendant Donald Brennan established Brennan's HAC in 1979 and is its sole shareholder. He also serves as the company's President and CEO. His son, Defendant Michael Brennan, is the Vice President of the company and serves as its on-site manager. Donald Brennan regularly consults with Michael Brennan on company matters.

Plaintiff Willard Smith, III had been a service mechanic with the company for approximately 13 years. In this position, he was paid hourly. Prior to April 2012, Michael Brennan was the manager of Brennan's HAC's Service Department, Joseph English was the manager of the Installation Department, and Nancy Dempsey was the manager of the Administrative Department. The parties have stipulated that the Installation Department at Brennan's HAC was a " recognized department" within the meaning of the applicable Department of Labor (" DOL" ) regulation, 29 C.F.R. § 541.100(a).

On April 1, 2012, Smith was promoted to the position of Installation Supervisor with an annual salary of $65,000.00. This salary was calculated from the average of his salaries in the previous three years, including overtime pay and bonuses. Following Smith's promotion, Michael Brennan became Vice President in charge of sales and Joseph English became the manager of the Service Department. In his new position, Smith would arrive between 6:30 and 6:45 A.M., and typically left between five and six o'clock on average. Thus, he routinely worked over forty hours per week. At no point was he paid overtime, also known as " time and a half," for the hours that he worked over forty during his eighteen months as Installation Supervisor.

In his position as Installation Supervisor, Smith " customarily and regularly directed the work of two or more other employees." Stipulated Uncontested Facts (" Stip." ) ¶ 4. Specifically, there were between nine and twelve lead installers and helpers under Smith's supervision during the pertinent time period. In addition to supervisory duties, Smith scheduled the installation jobs (" installs" ), assigned all of the installers their work, ordered all equipment parts and metal needed, made sure items were ready for the next day's installs, entered the installs into the computer, prepared the paperwork and checklist for the installation jobs, processed the paperwork necessary to obtain county permits, secured safety equipment for the employees, and answered customers' calls concerning installation of equipment and accessory items. Installation Department employees reported to Smith when they called in sick, needed to leave work early, or needed parts or equipment for an install. He also handled their requests to change their schedules. The installers occasionally called English, the former head of the Installation Department, for troubleshooting advice, but this occurred only when Smith could not answer their questions. Notably, despite calling on English for help, the Installation Department employees viewed Smith, not English, as their boss. For all intents and purposes, Smith was the manager of these employees.

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Smith had no role in the following activities: procuring new vehicles, pricing the equipment sold by Brennan's HAC, determining which financing options would be offered to customers, establishing offers on coupons, having Brennan's HAC designated as an authorized dealer by certain vendors, managing the budget, deciding which insurance to use for company vehicles, advertising and marketing Brennan's HAC products, human resources tasks, or establishing an employee handbook. Nor was Smith consulted " regarding the strategic decisions of the company," including " business, advertising, which way we were going in the future, purchasing of new trucks." Trial Tr. 113:22-114:5.

Smith denies having provided training for the installers. Michael Brennan testified, however, that Smith trained the new hires " about all the paperwork that they would have to complete, the parts list, how we fill out our service tickets, our certificate of inspections with our customers, [and] show[ed] them were to load the equipment." Id. at 162:14-163:2. Although it is possible that the lead installers trained the new hires rather than Smith, there is no testimony to that effect. The Court will therefore accept Brennan's testimony on the issue, as it is the most credible.

Smith did not have a role in hiring new employees. He was not permitted to sit in on interviews. He did not review resumes or applications. Instead, he was merely informed when interviews were taking place. Similarly, Smith was " just informed" as to employees' wage rates and " had no input" on them. Id. at 93:23-94:5. During a meeting with English and Donald and Michael Brennan, however, Smith told them that the installers " want raises too." Id. at 51:14-16. Due to the wage freeze in place at the time, the request " was not acted upon." Id. at 97:3-10.

Smith did, however, have the authority during a new hire's 90 day probationary period to recommend termination or continued employment with the company. Based on his evaluations, which he communicated to Michael Brennan orally, certain probationary employees were retained, resulting in modest wage increases for them. Smith had occasion to observe and evaluate the installers' performance when he conducted " quality checks." Id. at 65:3-16. He could also gauge the installers' performance based on whether " the work was getting done." Id. at 68:19-25. Due to the wage freeze, Smith never filled out any written performance review forms, which had previously been utilized at Brennan's HAC to evaluate employees for raises. Nonetheless, Michael Brennan would regularly ask for his input regarding the performance of the installers, as he was " the only person that could report on them." Id. at 86:22-87:6. Indeed, Smith admitted that, with respect to new hires, " someone might ask how they are doing" after a week or two on the job. Id. at 23:21-24. According to Brennan, Smith would say the employee was " doing fine," or " would work well out here." Id. at 163:14-18; 165:12-19. Based on Smith's positive verbal performance evaluations, Christopher Fox, Michael Stinson, Tyler Ahern, and Tyler Knight were all retained beyond their 90 day probationary periods and given raises.

With respect to Smith's influence on termination decisions, the parties dispute whether he recommended that two new hires, Richard Shaw and Luke Danison, be terminated at the end of their probationary periods. Luke Danison was fired for snorting an unknown substance at work. Smith testified that one of the service technicians who had been working with Danison called English, and ...

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