Real hackers are more fearsome than this one.

Okay, okay.  I realize the headline is a bit misleading.  But it isn’t every day that you hear about a data breach at Home Depot in which 56 MILLION credit cards may have been hacked. To put that into perspective, that’s 16 million MORE than the infamous Target breach!

But this is an employment law blog, not a shopping one. So, why does this matter to human resources professionals and companies? Because if hackers can access credit card information, they are going to try to hack into your work files.

It isn’t a matter of “if”. It’s a matter of when they will attempt to do so.

Don’t take my word for it. This comes from the head of the military’s cybersecurity division.  Admiral Mike Rogers has been preaching for months of the need for companies to take data privacy and cybersecurity seriously.  A recent news post reported on the importance Rogers has placed on this area for private businesses.

Corporations must successfully deal with cybersecurity threats, because such threats can have direct impacts on business and reputation, Rogers told the business audience.“You have to consider [cybersecurity threats] every bit as foundational as we do in our ability to maneuver forces as a military construct,” he said.

I have little doubt you’ll hear a lot more about this at an upcoming Data Privacy and Cybersecurity Summit that I’ve been helping to put together here at Shipman & Goodwin, in conduction with CT SHRM.

It’s scheduled to be held on October 16, 2014 from 8a to 2p at the Crowne Plaza in Cromwell, CT.

The cost is just $75, which includes continental breakfast, coffee, buffet lunch, and the materials.  Full details as well as registration can be found here.

Speakers include myself, Shipman & Goodwin attorneys Scott Cowperthwait, Cathy Intravia and William Roberts as well as industry experts from Adnet Technologies, the Connecticut Attorney General’s office, ESPN, the FBI, FINEX North America, General Electric Company, JPD Forensic Accounting, Quinnipiac University, United Therapeutics Corporation, and United Technologies Corporation (UTC).

Hope to see you there. Register soon as spots have been filling up over the last week.

At 47 pages, U.S. District Court Judge Hall’s decision last week in Costello v. Home Depot USA (download here) denying an employer’s motion for summary judgment in an overtime case, isn’t exactly a light read. 

More Saving, More Doing? Not so with litigation

She is, of course, not to blame. The case is complicated and has a “somewhat convoluted procedural history” because it was first filed in 2004 (!) and certified (and then decertified) as a collective action that alleged that Home Depot misclassified mechandising assistant store managers as exempt.

But after nine years of litigation, the Court was finally asked to decide whether Home Depot properly classified these two of these assistant store managers as exempt from overtime pay. 

The position of “assistant store managers” has been the source of lots of litigation over the last decade.  So it’s worth taking a look at what the court did.

Procedurally, it denied the motion for summary judgment saying that there were issues of material fact that precluded the granting of the motion. In other words, the case has to be decided by a fact-finder and jury, and not by the court itself on the papers.

Substantively, the crux of the case centers on whether the employee’s “primary duty” was “management of the enterprise”. 

As to one employee, the emplioyer argued that the employee:

(1) ensured his departments were properly staffed; (2) planned the work to be done in each department; (3) delegated work to his subordinates and followed up to make sure it was done in a timely and correct manner; (4) ensured his subordinates were trained, both for their current position and so they would be ready to advance to the next level; (5) ensured proper merchandise was ordered; (6) inspected his departments for safety violations; (7) resolved employee and customer complaints; (8) made recommendations regarding annual raises for his employees; (9) counseled associates on disciplinary issues; (10) recognized his subordinates for exceptional performance; and (11) devised strategies to improved department sales.

Sounds like it should be enough to win the case, right? The employee countered by saying that “while he performed many of these tasks, in many instances — particularly related to hiring, firing, and scheduling decisions — ultimate decision-making power and discretion lay elsewhere.”  The Court actually says that these facts do indeed lean in favor of the employer, not the employee.  

So why did the court still reject the employer’s motion?

Because taking other factors like whether the employee spent a substantial amount of time performing non-exempt work, and whether the exempt duties the employee performed were of relative importance to the job, led the court to the conclusion that there were genuine disputes as to what actually occurred.

No doubt the decision is frustrating to the employer (and other employers) who laid out a number of facts that even the court — at times — found persuasive.

But ultimately, the case is an important one for all employers to understand exactly what factors a court will look at in determining whether assistant store managers are exempt, and how important it is for employers to have its rationale locked in with supporting documents and affidavits.

These types of inquiries are very fact-specific. But even here, where the employer seemed to spell out lots of details to support its argument, sometimes, a lot of evidence isn’t good enough.

Costello v. Home Depot