Head Chef Not Entitled to Overtime Pay Because Executive Exemption Applied

​There was enough evidence to support a jury verdict in favor of a restaurant in a chef's lawsuit for overtime pay, a California appellate court ruled. The jury had concluded that the restaurant was not required to pay him overtime because the executive exemption to California's wage and hour laws applied.

The California Labor Code requires overtime pay for employees who work more than eight hours in any one day and more than 40 hours in any one week, unless an exemption applies. One exemption for the "public housekeeping industry," which includes restaurants, exempts those employed in "executive capacities."

Workers employed in an executive capacity are those who:

• Have duties and responsibilities that involve management of the business or a department or subdivision of the business.
• Customarily and regularly direct the work of two or more other employees.
• Have the authority to hire or fire other employees.
• Customarily and regularly exercise discretion and independent judgment.
• Are primarily engaged in duties that meet the test of the exemption.
• Earn a monthly salary not less than two times the state minimum wage.

The chef undisputedly met most of the requirements of the exemption. At issue, however, was whether the chef was "primarily" engaged in executive duties. The term "primarily" is defined by state regulations as "more than one-half of the employee's work time." The regulations, the court noted, take a purely quantitative approach, focusing exclusively on the percentage of time an employee spends performing exempt duties.

The appropriateness of any employee's classification as exempt must be based on a review of the actual job duties performed by that employee, the court continued, noting that no bright-line rule can be established classifying everyone with a particular job title as exempt or nonexempt and that a job title alone is not sufficient to establish the exempt status of an employee.

[SHRM members-only toolkit: Complying with California Wage Payment and Hours of Work Laws]

Applying these definitions, the appeals court found sufficient evidence to support the jury's conclusion that the executive exemption applied. The court rejected the chef's claim that because the restaurant never specified the percentage of time each day that he spent performing executive or managerial duties, it failed to show that he fell under the exemption.

That the restaurant did not separately and specifically identify how much time the chef spent on each exempt versus nonexempt activity does not mean the restaurant failed to carry its burden to show the chef was primarily engaged in duties that met the test, the court said. The jury may draw reasonable inferences from the witnesses' testimony and other evidence that established how the chef spent the majority of his time.

Witness testimony in this case established that the chef was in charge of the kitchen and meat department. He would direct the front of the house and instruct other managers to fix things in the kitchen and place ads in the newspaper for him. He would "prepare everything, check everything" and give orders to other employees and managers. He never cleaned and did not stay late to help the other cooks close down the restaurant.

Although there was some contradictory testimony as to whether the chef performed executive duties more than half the time, the court noted that it was up to the jury to weigh all of the evidence, and it could choose to believe the testimony of the majority of the witnesses that the chef spent most of his time on executive tasks.

The court, therefore, affirmed the jury verdict in favor of the restaurant.

Yeo v. Park Dae Gam Ne Inc., Calif. Ct. App., No. B291363 (Dec. 9, 2019).

Professional Pointer: Determining whether the executive exemption to the requirement to pay overtime applies requires consideration of all the relevant facts. As this court noted, just looking at the job title—"manager," for example, or, in this case, "head chef"—does not end the inquiry.  

Joanne Deschenaux, J.D., is a freelance writer in Annapolis, Md.