In the case of Taylor v. AutoZone Inc., a group of salaried store managers filed a collective lawsuit against AutoZone, alleging that they were misclassified as exempt employees under the Fair Labor Standards Act (FLSA). The employees claimed that although they were given managerial titles and paid a salary, their primary job duties were non-executive in nature, often involving routine tasks with limited decision-making authority.
AutoZone classified all store managers nationwide as exempt from overtime and did not pay them additional wages for hours worked beyond 40 each week. The plaintiffs argued that the company’s uniform policies and centralized control meant that store managers had minimal authority to hire, fire, or make independent decisions, making the “executive exemption” classification invalid.
The district court initially granted summary judgment in favor of AutoZone, but the Ninth Circuit Court of Appeals reversed the decision, stating that conflicting evidence about job duties required a trial. After further review, the court granted collective class certification for over 1,400 current and former store managers across the country.
Key lessons from this case:
- Exemption from overtime depends on job function, not salary status. Even if an employee is salaried, they must perform executive-level duties to be legally exempt.
- Companywide exemption classifications carry legal risk. Blanket policies that treat all managers as exempt without reviewing daily responsibilities can lead to collective action lawsuits.
- Collective actions can proceed when misclassification stems from a uniform policy. Courts allow group claims when employees share similar job roles, oversight, and lack of decision-making authority.
If you want to know more about salaried employee rights, read our guide on What are my rights as a salaried employee in Arizona?
