913 F. Supp. 2d 1001
S.D. Cal.2012Background
- Nordstrom's salespeople are paid on commission with a guaranteed minimum draw for selling time; non-sell time (stocking, pre-opening, post-closing) is paid at an hourly rate, with average hourly pay across all hours used to assess minimum wage compliance; Balasanyan alleges underpayment across the country for non-sell time and non-commission activities; Maraventano alleges California wage and related claims but no FLSA claim; the court granted summary judgment on Balasanyan's FLSA claim but denied summary judgment on all other claims; the court analyzed Armenta line of California cases and the DLSE guidance on draw-against-commission plans; the court concluded that pay averaging for all hours may violate California law and that derivative claims depend on the viability of the wage claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Balasanyan's FLSA claim survives. | Balasanyan argues weekly averaging deprives employees of minimum wage. | Nordstrom argues averaging above minimum wage for selling time complies with FLSA. | Balasanyan's FLSA claim granted |
| Whether Balasanyan's California minimum wage (§§1194, 1197) claims survive. | Balasanyan asserts failure to pay for non-sell time not compensated by the draw. | Nordstrom contends the plan complied with minimum wage and the non-sell time was paid hourly. | Balasanyan's California wage claims survive summary judgment |
| Whether Balasanyan's Breach of Contract claim is viable. | Balasanyan contends non-sell time beyond 30 minutes was contractually due. | Nordstrom paid non-sell time hourly and argued reporting/damages issues. | Denied as to this claim (genuine issues remain) |
| Whether derivative claims survive. | Derivative claims depend on wage violation viability. | If wage claims fail, derivative claims fail. | Derivatives survive to the extent wage claims survive |
| Whether Maraventano claims are resolved by the ruling on Balasanyan. | Maraventano seeks separate California wage and related claims. | Different class, no FLSA claim asserted. | Ruling does not grant summary judgment on Maraventano’s claims; they remain denied |
Key Cases Cited
- Armenta v. Osmose, 135 Cal.App.4th 314 (Cal. Ct. App. 2005) (average pay methods may violate minimum wage for non-productive time)
- Muldrow v. Surrex Solutions Corp., 208 Cal.App.4th 1381 (Cal. Ct. App. 2012) (commissioned employees exemption and related overtime considerations)
- Ramirez v. Yosemite Water Co., 20 Cal.4th 785 (Cal. 1999) (selling-related work often treated as selling time)
- Klinghoffer Bros. Realty Corp., 285 F.2d 487 (2d Cir. 1960) (minimum wage expressed by hourly standard; weekly averaging context cited)
- Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728 (U.S. 1981) (contractual wage plans cannot extinguish minimum wage rights)