Labor & Employment Law Daily Wrap Up, WAGE-HOUR—EXEMPTIONS—N.D. Tex.: Engineering firm’s former business manager not exempt under the FLSA administrative exemption, (Dec 4, 2025)

By Marjorie Johnson, J.D.

She was not paid on a “salary basis” under Section 602(a) since she undisputedly did not receive “a full, preset salary for each 40-hour workweek that was not subject to reduction because of the number of hours or days she worked.”

A former business manager for an engineering firm, who established that her weekly pay was docked if she fell anywhere short of 40 hours, was not exempt from FLSA overtime requirements under the bona fide administrative exemption, a federal district court ruled in granting her motion for summary judgment on the employer’s statutory affirmative defense to her claims for unpaid overtime pay. Because the employer failed to create triable issues as to whether the employee was paid on a “salary basis” under either Section 602(a) or Section 604(b), the court declined to address the “salary level” or “job duties” tests. However, the court denied summary judgment as to her claim that the extended three-year FLSA limitations period applied since genuine disputes of material fact remained as to willfulness (Brewer v. Mbroh Engineering, Inc., No. 3:22-CV-1861-K (N.D. Tex. Dec. 2, 2025)).

Promoted to business manager. The engineering firm hired the employee in 2016, and in 2020 she was promoted to the position of business manager. In that role, she ran the engineering company’s office, which included providing daily office support for all staff by assisting with HR and IT related items, ordering lunches and weekly breakfasts, handling property management requests, and setting up and maintaining vendor accounts.

Overtime hours not paid. Her work schedule was Monday through Friday from 7:30 a.m. until 4:30 p.m. with a one-hour lunch break. However, she claimed that she routinely worked over 40 hours per week, but was either not compensated at all for the overtime or was paid only straight-time and not time-and-a-half. Her overtime included brief periods of time, such as 30 minutes to pick up breakfast for the office, to lengthier periods of time spent working late and on weekends on various office matters. She estimated that she regularly worked seven to ten hours of overtime each week during the relevant time period for which she was not compensated.

Lawsuit. In 2022, she filed this lawsuit asserting the firm and its owner (collectively, the employer) willfully violated the FLSA by failing to pay her time-and-a-half for the overtime hours she worked. The employer denied owing and/or failing to pay her any overtime pay (or liquidated damages) and claimed that the was exempt under the FLSA’s administrative exemption, amongst other defenses.

Employee’s SJ motion. The employee moved for summary judgment on the employer’s statutory affirmative defense as well as on the limitations-period applicable to her FLSA claim, which she asserted was three years because the employer allegedly acted willfully, and on her claims for almost $60,000 in compensatory and liquidated damages and for attorneys’ fees.

Administrative exemption. The FLSA’s protections do not apply to an employee who works in a bona fide executive, administrative, or professional capacity (the EAP exemption), explained the court, and three criteria must be met for an employee to fall within the exemption. First, the “salary basis” test requires that the employee “receives a ‘predetermined and fixed salary’—one that does not vary with the precise amount of time he works.” Second, the “salary level” test requires that an employee’s “preset salary exceeds a specified amount.” Third, the “job duties” test examines the employee’s job duties. Here, because the employer failed to establish the first factor, the employee was entitled to summary judgment on this issue.

Salary basis test. An employer has one of two avenues under the regulations for establishing that an employee is paid on a salary basis: 29 C.F.R. §§ 541.602(a) and 541.604(a), and 29 C.F.R. § 541.602(b). Section 602(a), the so-called “main salary-basis provision,” provides that an employee will be considered to be paid on a salary basis if she “receives each pay period on a weekly basis, or less frequent basis, a predetermined amount constituting all or part of the employee’s compensation, which amount is not subject to reduction because of variations in the quality or quantity of the work performed.” Section 602 further requires that the employee “receive the full salary for any week in which the employee performs any work without regard to the number of days or hours worked,” emphasized the court.

Section 604(b) addresses payments “on an hourly, a daily or a shift basis.” Under Section 604(b), an hourly-rate employee is considered paid on a “salary basis” if they also receive both a “minimum weekly required amount paid on a salary basis,” and “there is a reasonable relationship between the weekly guarantees salary and the employee’s actual earnings.”

Section 602(a). The employer failed to establish that the employee was paid on a salary basis under Section 602(a) since it failed to dispute evidence that she was not paid a predetermined amount each week irrespective of the number of hours she worked that week. In particular, she established she was not compensated for a full 40-hour work week if she fell short, even by as little as 30 minutes, and did not have vacation time or personal time off (PTO) to cover the shortfall. As the Supreme Court observed in Helix Energy Sols. Grp., Inc. v. Hewitt, “[a] worker paid by the day or hour—docked for time he takes off and uncompensated for time he is not needed—is usually understood as a daily or hourly wage earner, not a salaried employee [pursuant to Section 602(a)].”

Section 604(b). The employer also failed to create a triable issue as to whether the employee paid on a salary basis under Section 604(b) since there was no evidence that both of Section 604(b)’s “strict conditions” have been met. Specifically, the employer failed to show that the company guaranteed that she would receive “at least the minimum weekly required amount paid on a salary basis regardless of the number of hours, days or shifts worked, and a reasonable relationship exists between the guaranteed amount and the amount actually earned.”

Triable issues as to willfulness. However, the employee’s bid for summary judgment on her claim that the extended three-year statute of limitations applied failed since triable issues remained as to whether she established all of the essential elements of willfulness. And because triable issues existed as to which limitations period applied, the court also denied summary judgment on her claim for compensatory and liquidated damages and attorney fees.

The case is No. 3:22-CV-1861-K.

Judge: Kinkeade, E.

Attorneys: Clay A. Hartmann (Law Offices of Clay A. Hartmann) for Tamesha Brewer. Steven E. Clark (Law Offices of Steven E. Clark) and Beth Ann Blackwood (Geary Porter & Donovan) for Mbroh Engineering Inc. and Anthony Mbroh.

Companies: Mbroh Engineering Inc.

Cases: WageHour Exemptions Overtime Procedure RemediesDamages AttorneysFees TexasNews