United States District Court, E.D. Kentucky, Central Division, Lexington
MEMORANDUM OPINION AND ORDER
M. HOOD SENIOR U.S. DISTRICT JUDGE.
Plaintiff, Herman Henderson (“Henderson”) was an
employee of Defendant, Pieratt's, Inc.
(“Pieratt's”), from March 7, 2012 to June 26,
2017 at Pieratt's Warehouse and Delivery facility on
Palumbo Drive in Lexington, Kentucky. Henderson claims that
throughout the course of his employment, he did not receive
any additional compensation for hours he worked in excess of
forty (40) per week and further alleges that he was routinely
subjected to unlawful withholdings from his wages. Henderson
has since resigned his employment with Pieratt's.
August 25, 2017, Henderson filed this action in Fayette
Circuit Court, alleging claims that Pieratt's alleged
actions violatee the Fair Labor Standards Act of 1938
(“FLSA”), 29 U.S.C. §§ 201 et
seq., and the Kentucky Wage and Hour Act
(“KWHA”), KRS Chapter 337. [DE 1-1]. On September
18, 2017, Pieratt's removed the action to the Eastern
District of Kentucky. [DE 1].
parties have each now moved for partial summary judgment. [DE
14, 16]. Pieratt's moved for partial summary judgment on
the issue of liability on Henderson's first cause of
action under the FLSA. [DE 14]. Henderson moved for partial
summary judgment on the issue of Pieratt's alleged
liability under both the FLSA and the KWHA. [DE 16]. The
parties have responded in opposition to the applicable
motions. [DE 23, 26]. Additionally, the parties have replied
in support of their motions or the time to reply has expired.
[DE 29]. As a result, this matter is ripe for review and
consideration and all pending motions for summary judgment
will be consolidated in this memorandum opinion and order.
reasons that follow, Pieratt's motion for partial summary
judgment [DE 14] is DENIED and
Henderson's partial motion for summary judgment [DE 16]
Factual and Procedural Background
Herman Henderson, is a resident of Fayette County, Kentucky,
who was employed with Defendant, Pieratt's Inc. from
March 7, 2012 to June 26, 2017. [DE 1-1 at 2-3, PageID #5-6;
DE 5 at 2, 4, PageID #32, 34; DE 16-25 at 2-3, PageID #259;
DE 26 at 1-2, PageID #327]. Pieratt's is a Kentucky
corporation with its principal place of business in
Lexington, Kentucky. [DE 1-1 at 3, PageID #36, DE 16-25 at 1,
PageID #258, DE 26 at 1, PageID #357]. Pieratt's
maintains business operations at several locations including
(1) the Mount Tabor Showroom and Service Center in Lexington,
Kentucky, (2) the Nicholasville Road Showroom, in Lexington,
Kentucky, (3) the Richmond Center Showroom in Richmond,
Kentucky, (4), the Clearance Center Outlet, located at 2375
Palumbo Drive, Lexington, KY, and (5) the Warehouse and
Delivery facility, located at 2395 Palumbo Drive, Lexington,
Kentucky. [DE 16-3, DE 16-25 at 2, PageID #259, DE 26 at 1,
was hired to work in Pieratts Warehouse and delivery facility
on or about February 29, 2012. [DE 1-1 at 2-3, PageID #5-6;
DE 5 at 2, 4, PageID #32, 34; DE 16-4, 16-5, DE 16-25 at 2,
PageID 259, DE 26 at 1, PageID #327]. After several months,
Henderson was promoted to “delivery helper.” [DE
16-4 at 15-16, DE 16-25 at 2, PageID 259, DE 26 at 1, PageID
#327]. Until December 31, 2012, Henderson was compensated on
a straight hourly basis. [DE 16-25 at 3, PageID 260; DE 26 at
2, PageID #328]. Around December 2012, Henderson was promoted
to the position of delivery crew chief. [DE 16-25 at 3,
PageID 260; DE 26 at 2, PageID #328]. Henderson held the
position of crew chief at the Palumbo drive warehouse until
his resignation on June 26, 2017. [DE 1-1 at 3, PageID #6; DE
5 at 4, PageID #34; DE 16-13; DE 16-25 at 5, PageID #262; DE
26 at 2, PageID #328].
chief, Henderson's duties included the coordination and
execution of delivery services for Pieratt's. [DE 1-1 at
3, PageID #6; DE 5 at 4, PageID #34]. In particular,
Henderson made customer deliveries, as well as inspecting
merchandise at the Warehouse prior to making deliveries,
coordinating deliveries with customers, and driving the
delivery truck. [DE 1-1 at 3, PageID #6; DE 5 at 4, PageID
#34; DE 16-25 at 2, PageID 259; DE 26 at 2, PageID #328].
When making deliveries, Henderson and a coworker would drive
the truck to customer residences throughout Fayette County
and surrounding areas to deliver appliances and furniture.
[Id]. While Pieratt's does not concede that Henderson
“regularly” worked in excess of forty (40) hours
per week, it does acknowledges that Henderson “did work
more than 40 hours per week on occasion.” [DE 1-1 at
4-5, PageID #7-8; DE 5 at 5, PageID #35].
the time of his promotion to crew chief in December 2012,
Pieratt's implemented a new compensation scheme for
delivery personnel which utilized hourly rates, commission
payments, and bonus wages, which are reflected in
Pieratt's Compensation Program Overview. [[DE 1-1 at 5,
PageID 35; DE 16-9; DE 16-25 at 3, PageID 260; DE 26 at 2,
PageID #328]. Pieratt's calculates employee earnings
within two timeframes: (1) a regular pay period consisting of
two workweeks; and (2) a bonus period that measures employee
production over a four-week period - i.e., two consecutive
regular pay periods.
crew chief's regular wages, Pieratt's pays the
greater of the employee's calculated hourly wages or
calculated commissions. [DE 16-9; DE 16-25 at 3, PageID 260;
DE 26 at 2, PageID #328]. Pieratt's calculates a crew
chief's hourly wages by multiplying the employee's
hourly rate by the total hours worked in every fourteen (14)
day period. [DE 16-9; DE 16-25 at 3, PageID 260; DE 26 at 2,
delivery employee is assigned a designated hourly rate and
Pieratt's tracks the amount of hours worked by an
employee each work week. [Id.]. For example, during
the pay period covering January 25, 2016 to February 6, 2016,
Henderson was recorded as working a total of 99.37 hours for
the entire period: 56:94 for the first week, and 42.43 hours
for the second. Henderson's designated hourly rate during
this period $13.63 per hour. [DE 1-1 at 5-6, PageID #8-9; DE
5 at 5, PageID #35].
Pieratt's delivery operations employee's daily
commission is made up by combining, among other things, the
volume and mileage accrued by an employee. [DE 1-1 at 6,
PageID #9; DE 5 at 5, PageID #35]. In particular,
Pieratt's calculates commissions according to (a) the
total volume of merchandise delivered multiplied by a factor
of 0.0095; (b) the total mileage driven multiplied by a
factor of 0.12; (c) a predetermined flat rate for exchanges
and services pickups based on distance travelled; and (d) any
holiday or sick pay calculated at a full day of hourly wages.
[DE 16-9, 16-25 at 3, PageID #260, DE 26 at 8, PageID #328].
Pieratt's totals each employee's commission at that
end of each two week pay period. [DE 1-1 at 6, PageID #9; DE
5 at 5, PageID #35].
compensation scheme also included a “Performance and
Safety Bonus” to be paid every two pay periods (every
four weeks), consisting of 10% of the employee's total
commissions during the four-week period. [DE 1-1 at 7, PageID
#10; DE 5 at 6, PageID #36; 16-8, 16-9, 16-25 at 3, PageID
260; DE 26 at 2, PageID #328].
in its description of delivery bonuses, Pieratt's states
that such compensation “may be reduced by 50% if the
associate is required to be paid hourly versus commission.
This will be at the sole discretion of the general manager
who will take into account both levels of business and
performance levels of the other delivery teams.” [DE
16-8]. Pieratt's policy also states that such bonuses may
be reduced for:
(a) Return trips caused by crew errors;
(b) Damages to merchandise, customer property, or company
(c) Customer complaints or driving complaints;
(d) Failures to conduct proper truck maintenance;
(e) Service calls;
(f) Safety violations; and
(g) Disciplinary action.
respect to overtime, Pieratt's compensation scheme does
not mention calculation or payment of overtime compensation
to employees holding the crew chief position. [DE 16-8; DE
16-9; DE 16-25 at 4, PageID #261; DE 26 at 2, PageID #328].
However, the Pieratt's employee handbooks provide that
associates compensated on an hourly basis will be paid
time-and-a-half for hours worked over 40 in a week. [DE
16-10; DE 16-11; DE 16-25 at 4, PageID # 261, DE 26 at 2,
PageID #328]. Pieratt's Handbook also states that
commissioned associates are not compensated with overtime
pay. [DE 16-10; DE 16-11; DE 16-25 at 4, PageID #261; DE 26
at 2, PageID # 328].
does not dispute that Henderson was compensated according to
these policies from December 31, 2012 until his resignation
on June 30, 2017. [DE 16-12; DE 16-13; DE 16-25 at 5, PageID
#262; DE 26 at 2, PageID #328]. Nor does Pieratt's
dispute that from December 31, 2012 to June 30, 2017 that
Henderson's hourly rate was $12.99 and that his hourly
rate thereafter increased to $13.63. [DE 14; DE 15; DE 16-25
at 5, PageID# 262; DE 26 at 2, PageID #328].
complains that “[t]hroughout the entire course of [his]
employment, from about March 7, 2012 to about June 26, 2017,
[he] did not receive any additional compensation for hours he
worked in excess of forty (40) per week, and was routinely
subjected to prohibited withholdings of his wages.” [DE
1-1 at 9, PageID #12]. Pieratt's does not dispute that
Henderson never received overtime pay at one-and-a-half times
his regular rate for any hours worked in excess of 40 per
week. [DE 16-25 at 5, PageID #262; DE 26-2, PageID #328].
Henderson resigned on June 26, 2017. [DE 1-1 at 3, PageID #6;
DE 5 at 4, PageID #34; DE 16-13; DE 16-25 at 5, PageID #262;
DE 26 at 2, PageID #328].
August 25, 2017, Henderson filed his Complaint [DE 1-1] in
Fayette Circuit Court and Pieratt's subsequently removed
this action to federal court pursuant to 28 U.S.C.
§§ 1441 and 1446. [DE 1]. Henderson alleges that
Pieratt's violated the 29 U.S.C. § 207 of the Fair
Labor Standards Act of 1938(“FLSA”), 29 U.S.C.
§§ 201 et seq., as well as KRS 337.060 and
377.285 of the Kentucky Wage and Hour Act
(“KWHA”), KRS Chapter 337, by ...