For the foregoing reasons, the Court grants defendant’s motion for summary

judgment. The Court hereby terminates this case. This is a final and appealable order.

SO ORDERED ENTERED: Yhf a3

HON. RONALD A. GUZMAN ©
United States Judge

13


Plaintiff, in her role as Shipping Manager, reported directly to the Plant Manager,
(id, at 58.) In her deposition, plaintiff stated that she “was the core of the apple. If I
didn’t get the steel out, they didn’t get paid.” (Jd. at 116.) Plaintiff never tumed in a slip
for alleged overtime hours at J&F Steel in 1999 or 2000; however, plaintiff asserts this is
because she was told by managers that she would not receive overtime compensation.
(Id. at 6, 16.)

Plaintiff contends that she was jin training for the position of Quality Control -

; Manager until the plant closed down. (Jd. at 57, 64-65, 70.) Plaintiff had the title of
Quality Control Manager, but still performed the Sipping Manager’s duties on a part-time
basis. (Id. at 57.) She was salaried at approximately $44,000 per year and, as Quality
Control Manager, reported directly to the plant branch manager. (Id. at 61.) Plaintiff
considered being made Quality Control Manager as a promotion. (/d.) As Quality
Control Manager, plaintiff reported to the branch manager, who in turn reported to the
J&F Steel president. (/d. at 81-82.) Quality control is part of the “core” of J&F Steel
Corporation. (Id. at 95.) Additionally, as of January 1, 1998, plaintiff was never docked
pay for taking days off due to illness or personal reasons. (Jd. at 80.)

Plaintiff had the authority to write corrective actions against other employees at
the plant. Other employees at the plant also had this authority. (Jd. at 53-56.) She wrote
corrective actions on more than one occasion. (Id. at 82-83.) The corrective actions
covered verbal/sexual abuse, negligence, or absenteeism. (id, at 103-104.) Plaintiff did
not have the ability to hire or fire another employee. (id. at 39.)

Plaintiff never belonged to a union, despite the fact that J&F Steel was a

unionized company. (Jd. at 84.) Plaintiff, in her deposition, referred to herself as a

4



(id. at 19.) It was plaintiff's job to “sometimes” help solve any problems that truckers
might encounter. (Jd. at 23-24.) Her deposition also indicated that she was responsible
for regulating dispatching. (/d. at 28.) Plaintiff helped coordinate sales functions and
dispatching for J&F Steel. (/d. at 30, 128.)

Plaintiff had the responsibility to set a revised schedule to meet a customer’s
needs when that situation arose. (/d. at 33.) “Sometimes” she also coordinated with _
truck lines to find efficient ways of moving steel in and out of the plant. (Jd. at 37-38.)
In addition, while plaintiff did not have the authority to hire or fire individuals, she did
have the ability to write corrective actions in certain circumstances. (Jd. at 49, 82-83,
103-104.)

While plaintiff denies that she exercised discretion and independent judgment, it
is clear from her deposition testimony that she did indeed exercise discretion and
independent judgment in her work environment. Several duties, such as coordinating
shipping and dealing with customer problems, clearly demonstrate plaintiff's use of
discretion and independent judgment. While it is clear from her deposition that plaintiff
had to consult with the plant manager in numerous instances, this does not necessarily
remove her from the decision making process. Piscione, 171 F.3d at 537. Thus, since
plaintiff exercised discretion and independent judgment, the second prong has been
satisfied.

Under the third prong, the employee must have primary duties that involve office
or non-manual work that is directly related to management policies or general business
operations. An employee who may spend a significant portion of his time engaged in
ministerial or routine tasks is not necessarily prevented from qualifying for the

9



any given week. 29 U.S.C. § 207(a)(1). Employees, however, that work in “a bona fide
executive, administrative, or professional capacity’ are exempt from the overtime
requirement. 29 U.S.C. § 213(a)(1). The authority to define and maintain the scope of
these exemptions has been delegated by Congress to the Secretary of Labor. Jd. The
Secretary of Labor’s regulations, then, have the “force and effect of law.” Cf. Batterton
v. Francis, 432 U.S. 416, 425 (1977). This Court may rely upon these regulations to the
extent that they enhance the assessment of a case. Shaw v. Prentice Hall Computer
Publ'g, Inc., 151 F.3d 640, 642 (7" Cir. 1998).

The Secretary of Labor’s “short test” is the appropriate method in this case to
determine whether plaintiff was a salaried, exempt employee under the FLSA. The
“short test” for administrative employees has three main prongs: (1) the employee must
be paid on a salary basis, as defined in the regulations, (2) the employee’s work must
“include work requiring the exercise of discretion and independent judgment,” and (3)
the employee’s primary duties must involve office or non-manual work “directly related
to management policies or general business operations.” 29 C.F.R. § 514.214; see also
Haywood v. North Am. Van Lines, Inc., F.3d 1066, 1069 (7" Cir. 1997). The employer
bears the burden under this test to establish that an employee fits into this exemption.
Corning Glass Works v. Brennan, 417 U.S. 188, 196-97 (1974).

Under the first prong, an employee is paid on a ‘salary basis if “under his
employment agreement he regularly receives each pay period...a predetermined amount
constituting all or part of his compensation, which amount is not subject to reduction
because of variations in the quality or the quantity of the work performed.” 29 C.F.R. §
541.118(a). It is undisputed by both plaintiff and defendant that D’Angelo received a

6



“supervisory employee” and stated that she was regarded “as part of management.” (Id.
at 84-85.)
DISC

Pursuant to Rule 56(c) summary judgment is proper ‘sig the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any material fact and that the
moving party is entitled to a judgment as a matter of law.” To determine whether a
genuine issue of material fact exists, the court does not weigh the evidence or determine
the truth of the matters asserted. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249
(1986). Instead, the court “must view the facts, and all reasonable inferences drawn
therefrom, in a light most favorable to the nonmoving party.” Baron v. City of Highland
Park, 195 F.3d 333, 337 (7* Cir. 1999). The nonmoving party may not rest on his
pleadings however, instead he must demonstrate through specific factual allegations that
there is a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 324
(1986). Unless a reasonable jury could find for the nonmoving party, summary judgment
must be granted. Anderson, 477 US. at 249.

e Fair tand:

Plaintiff claims that J&F Steel owes her overtime wages and ‘damages under the
Fair Labor Standards Act, 29 U.S.C. § 201 et seq. In response to this claim, defendant,
J&F Steel, has asserted the affirmative defense that plaintiff was a salaried, exempt
employee who is not entitled to overtime compensation under the FLSA.

The FLSA mandates that employers must pay their employees at minimum one
and a half times their regular wages for any number of hours worked that exceed forty in

5



the FLSA. Piscione, 171 F.3d at 540, The Court of Appeals for the Seventh Circuit
reasoned that this employee evaluated possible courses of conduct for his company, and
the fact that he had to consult with his supervisors on these matters did not negate the
teality that he exercised discretion and independent judgment. Jd, at 537.

In Demos v. City of Indianapolis, the Court of Appeals for the Seventh Circuit
held that an employee who served as a go-between his supervisors and other employees,

represented the Parks Department in dealing with the public, and made recommendations

; concerning asset allocution was an exempt administrative employée under the FLSA.

Demos v. City of Indianapolis, 302 F.3d 698, 704 (7 Cir. 2002).

In the present case, plaintiff's deposition indicates that she prepared delivery
shipments and did other office work. (D'Angelo Dep., at 11-17.) She was responsible
for “getting the steel out the door to customers.” (/d.) Plaintiff made arrangements for
load pickups and stated that her responsibilities were to “prepare and get everything
ready.” (/d. at 9-14.) Plaintiff coordinated with J&F Steel’s plant manager to ensure that
stee] delivery had been accomplished. (/d. at 18.) This process involved determining
where the steel was bound for and who was receiving it, calling the truck lines or
customers in advance of shipments, and determining whether J&F trucks could be used to
make the deliveries. (/d. at 20.) It was also necessary for plaintiff to coordinate with in-
house drivers regarding the number of stops they had to make and the scheduled time for
their pickups. (Jd. at 21.) Plaintiff made calls to truck lines as part of her job as
dispatcher, (Jd. at 23.) She would also perform these duties on her own on the rare
occasions when the plant manager was absent. (/d. at 19-20.)

Plaintiff consulted with the plant manager when complaints would come to her.

8


|
|

‘Mimate Ordee Form (06/97)

fs QyheAatts States District Court, Northern District of Minois

Vv
f Assi; Ki Si Judge if Or
wir Mapicrate Judge Ronald A. Guzman hun Anigued Judge
CASE NUMBER 01 C 6642 DATE 4/11/2003
CASE TERRY D’ANGELO vs. J & F STEEL CORPORATION
TITLE
[In the following box (a) indicate the party filing the motion, e.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature

MOTION: of the motion being presented.]
DOCKET ENTRY:

(¢)) oO Filed motion of [ use listing in “Motion” box above.)

2) Q Brief in support of motion due____.

@) Oo Answer brief to motion due. . Reply to answer briefdue__.

(4) Oo Ruling/Hearing on setfor__—_at

(5) Qa Status hearing[held/continued to] [set for/re-set for] on setfor__ saat

(CJ) im Pretrial conference[held/continued to] [set for/re-set for]on__——ssetfor_— sat
(es) 0 Trial[set for/re-set for]on__at

(8) oO [Bench/Jury trial] [Hearing] held/continued to__at

(9) ia} This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

OFRCP4(m) Local Rule 41.1 O FRCP41(a)(1) OO FRCP41(a)(2).

terminates this case. This is a final and appealable order.

Qa) [For further detail see order attached to the original minute order.)

ao ff (Other docket entry} © ENTER MEMORANDUM OPINION AND ORDER: For the forgoing
reasons, the Court grants defendant’s motion for summary judgment [27-1,2]. The Court hereby

No notices required, advised in open court.

No notices required.

Notices mailed by judge's staff.
Notified counsel by telephone,
a | Docketing to mail notices.

Mail AO 450 form,
Lyn -_

Copy to judge/magistrate judge. 99 19!Y LI sn

courtroom Co: SME es

cG deputy's ;

initials
Date/time received in
central Clerk's Office



In Haywood v. North American Van Lines, Inc., the Court of Appeals for the
Seventh Circuit held that an employee who directly related to client’s needs and
addressed their billing and delivery concerns was an exempt employee under the FLSA.
Haywood, 121 F.3d at 1072, The Haywood Court also noted that “servicing” a business
was part of the “administrative” process. Id.

In Shaw v. Prentice Hall Computer Publishing, the Court of Appeals for the
Seventh Circuit held that an employee who edited books was an exempt employee under
the FLSA because she set intermediate schedules and was ultimately responsible the
editing process, despite the fact that she had to go through her superiors on many of these
issues. Shaw, 151 F.3d at 643. The Shaw Court also noted that, “administrative
employees work in an office communicating with the customers and doing paperwork.”
Id. at 644.

In the present case, it is clear from plaintiff's deposition that she primarily
communicated with customers and did office work. Both parties agree that plaintiff
performed office* work or non-manual labor. (D'Angelo Dep., at 32.) In addition,
plaintiff stated that her responsibilities revolved around shipping. (/d. at 13.) Plaintiff
dealt with these responsibilities “all day.” (Jd. at 24.) Plaintiff stated in her deposition
that coordinating the dispatch function was the “core” of J&F Steel. (Id. at 27.) She
described this process in her deposition as the “heart of the operation.” (Jd. at 35.)
Plaintiff also stated that she “was the core of the apple. If I didn’t get the steel out, they

didn’t get paid.” (/d. at 116.) For a portion of her employment at J&F, plaintiff was

11


administrative exemption. Piscione, 171 F.3d at 540, citing York v. City of Wichita Falls,
944 F.2d 236, 242 (5" Cir. 1991). As the regulations explain, the exemption:

“is not limited to persons who participate in the
formulation of management policies or in the operation of
the business as a whole," but includes those whose
work affects policy or whose responsibility it is to execute
or carry it out ... [including] persons who either carry out
major assignments in conducting the operations of the
business, or whose work affects business operations to a
substantial degree, even though their assignments are tasks
related to the operation of a particular segment of the -
business.”

29 C.E.R. § 541.205(c).
The regulations are also clear that:

A determination of whether an employee has
[administration] as his primary duty must be based on all
the facts in a particular case. The amount of time spent in
the performance of the [administrative] duties is a useful
guide in determining whether [administration] is the
primary duty of an employee. In the ordinary case it may
be taken as a good rule of thumb that primary duty means
the major part, or over 50 percent, of the employee's time.
Thus, an employee who spends over 50 percent of his time
in [administration] would have [administration] as his
primary duty. Time alone, however, is not the sole test, and
in situations where the employee does not spend over 50
percent of his time in [administrative] duties, he might

“ nevertheless have [administration] as his primary duty if
the other pertinent factors support such a conclusion. Some
of these pertinent factors are the relative importance of the
(administrative] duties as compared with other types of
duties, the frequency with which the employee exercises
discretionary powers, his relative freedom from
supervision, and the relationship between his salary and the
wages paid other employees for the kind of noriexempt
work performed by the supervisor.”

29 C.F.R. § 541.103.
10



regular salary of more than $250 per week. (Thien Dep., at 4.) Thus, the first prong has
been satisfied.

Under the second prong, the employee must exercise discretion and independent
judgment. The relevant regulations state that discretion and independent judgment
depend upon the:

“comparison and the evaluation of possible courses of
conduct and acting or making a decision after the various
possibilities have been considered....(it) implies that the -
person has the authority or power to make an independent
choice, free from immediate direction or supervision and
with respect to matters of significance.” 29 C.F.R. §
541.207. .

The discretion and independent judgment must also be “real and substantial, that
is, they must be exercised with respect to matters of consequence.” 29 C.F.R. §
541.207(d)(1). Independent judgment, however, does not need to be made in isolation.
Piscione v. Earnst and Young, LLP, 171 F.3d 527, 535 (7" Cir. 1999), quoting Dymond v.
United States Postal Serv., 670 F.2d 93, 96 (8" Cir. 1982). As was noted:

“Even though an employee’s work is subject to approval,
even to the extent that a decision may be reversed by
higher level management, it does not follow that the work
did not require the exercise of discretion and independent
judgment as the terms are defined for the administrative
employee exemption.” Jd.

In Piscione v. Earnst and Young, LLP, the Court of Appeals for the Seventh
Circuit held that an employee who worked at improving client services, communicated

with clients, attempted to solve or fix problems for clients, made recommendations to

clients, and served as a contact for clients was an exempt administrative employee under


duties on her own. (/d. at 19-20.)

Plaintiff's job included making sure truckers received proper bills of lading for
their shipping loads, and received proper directions on where to take those loads. (id. at
19.) Any complaints by truckers would first go through plaintiff, and then she would
consult with the plant manager. (id.)

It was plaintiff's job to “sometimes” help solve any problems that truckers might
encounter. (/d, at 23-24.) She was responsible for drawing up a dispatching schedule
and regulating dispatching. (dd. at 28.) Plaintiff dealt with these ‘responsibilities “alt
day.” (Id. at 24.) ,

Plaintiff stated in her deposition that coordinating the dispatch function was the
“core” of J&F Steel. (/d. at 27.) She also coordinated sales functions for the company.
(id. at 128.) Plaintiff was the only J&F Steel employee who coordinated dispatching on a
full-time basis. (Jd. at 30.) The Assistant Plant Manager had these responsibilities on a
part-time basis, when plaintiff was sick or on vacation. (Id.) At no time did plaintiff
engage in any manual or physical labor. (Id. at 32.)

It was plaintiff's responsibility to set a revised schedule to meet a customer's
needs when that situation arose. (/d. at 33.) Plaintiff described this process in her
deposition as the “heart of the operation.” (Jd. at 35.) It was also “sometimes” part of
her responsibilities to coordinate with truck lines so that trucks could be used to both
bring in and ship out material from the plant. (/d. at 37-38.) In the Plant Manager’s
absence, plaintiff would “remind” the Assistant Plant Manager of certain functions that
needed to be performed, and “sales” would contact her directly with a “hot order.” (id. at

45-46.) :


from Illinois to Delaware. (Jd.)

Plaintiff was referred to at J&F Steel as “shipping clerk” and “shipping manager.”
(@’Angelo Dep., at 12.) Plaintiff received a regular salary, at regular intervals, and was
paid more than $250 per week. (Zhien Dep., at 4.) Some of her duties at J&F Steel
included answering telephones, typing, filing, time card preparation, preparing delivery
shipments, and other office work. (D'Angelo Dep., at 11-17.) Plaintiff was responsible
for “getting the steel out the door to customers.” (/d.)

Plaintiff's responsibilities revolved around shipping. (Id. at 13.) She prepared
the necessary paperwork for steel delivery, looked up directions to shipping offices, and
made arrangements for load pickups. (/d. at 9-14.) In her deposition, plaintiff stated that
her responsibilities were to “prepare and get everything ready.” (Jd. at 13.) She stated
that she was the “bottom rung” of the plant’s functioning. (a. at 130-131.) Plaintiff's
normal work hours were between six or six-thirty a.m. to four or four-thirty p.m. (dd. at .
19.) Plaintiff also asserts that she originally was paid overtime wages for these duties,
but that that practice stopped either in late 1997 or early 1998. (Id. at 8.)

Plaintiff coordinated with J&F Steel’s plant manager to ensure that steel delivery
had been accomplished. (id. at 18.) This process would involve determining where the
steel was bound for and who was receiving it, calling the truck lines or customers in
advance of shipments, and determining whether J&F trucks could be used to make the
deliveries. (Jd. at 20.) It was also Necessary to coordinate with in-house drivers
Tegarding the number of stops they had to make and the scheduled time for their pickups.
(id. at 21.) Plaintiff made calls to truck lines as part of her job as dispatcher. (/d. at 23.)
On rare occasions, when the plant manager was absent, plaintiff would perform these

2


Ne

—

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS

MEMORANDUM OPINION AND ORDER

In this suit, brought pursuant to the Fair Labor Standards Act (“FLSA”), 29
U.S.C. § 201 ef seq., and the Ilinois Minimum Wage Law, 82 ILCS 105/1 ef seq.,
plaintiff Terry D’Angelo (“D’Angelo”) has sued J&F Steel Corporation (‘J&F”), a
Delaware corporation, for alleged unpaid overtime wages. Presently before this Court is
defendant’s motion for summary judgment and/or partial summary judgment pursuant to
Federal Rule of Civil Procedure (“Rule”) 56. For the reasons stated herein, defendant’s

motion for summary judgment is granted.

FACTS

The following facts are undisputed, unless where noted. Plaintiff Terry D’ Angelo
was hired as a shipping clerk by J&F Steel in January of 1985. (Pl. ’s Ex. 1., D’Angelo
Dep., at 6.) Until January 1, 2001, J&F Steel was incorporated in Illinois. (PI. 's Ex. 2.,
Thien Dep., at 1-3.) On January 1, 2001, J&F Steel switched its state of incorporation

1

EASTERN DIVISION
TERRY D’ANGELO and LINDA )
V. PAPLAUSKI )
)
Plaintiffs, ) Judge Ronald A. Guzman
)
) 0106642
v. )
)
J&F STEEL CORPORATION, a )
_ Delaware Corporation )
) Or
Defendant. ) Goh
APp 1 77)



promoted to Quality Control Manager, even though she was still in training for this
position when the plant closed. (Id.) Quality control is also a part of the “core” of J&F
Steel Corporation. (Jd. at 95.) The plaintiff's own deposition then makes it clear that her
duties influenced J&F Steel’s business operations and policies. Her _ primary
responsibilities, involved coordinating steel delivery, without which J&F Steel would
have ceased to function. The “short test’s” third prong is thus satisfied.

It is clear that plaintiff is an exempt administrative employee under the Fair

” Labor Standards Act. Plaintiff is not entitled to overtime wages and damages from
defendant. Summary Judgment is thus appropriate for defendant J&F Steel Corporation.

Plaintiff has also raised the issue that Defendant did not plead its affirmative
defense under the FLSA prior to its Motion for Summary Judgment. However, there is
no ruling from the Seventh Circuit Court of Appeals that requires it to do so. In addition,
it is clear that plaintiff was on notice of this defense through a letter to plaintiffs counsel
prior to filing its Amended Answer to plaintiff's Complaint. Defendant is thus entitled to
assert its affirmative defense.

Defendant has also raised the issues that it is a separate corporation from its
Illinois fore bearer and that plaintiff's claim is partially barred by the statute of
limitations. Because defendant is entitled to summary judgment on the merits of its
affirmative defense, this Court declines to address those issues.

In addition, because the federal claims against defendant have been disposed, this
Court declines, pursuant to 28 U.S.C. § 1367(c)(3), to address the claims brought
pursuant to the Illinois Minimum Wage Law, 82 ILCS 105/1 et seq.

‘ON. SION

12