VERKUILEN v. MEDIABANK (May 27, 2011)

MediaBank provides complex software programs to advertising agencies. The software integrates a number of different functions and is custom-designed to meet the varying needs of its purchasers. MediaBank employs Penny Verkuilen as an account manager. In that position, she acted as a liaison between the company’s software engineers and its customers. She had to make sure she understood the customers' needs, communicated those needs to the engineers, and trained the customers on the finished product. Verkuilen brought suit against MediaBank under the Fair Labor Standards Act, alleging that she was denied overtime. Judge Grady (N.D. Ill.) granted summary judgment against her on the ground that she fit within the administrative exception to the overtime requirement. Verkuilen appeals.

In their opinion, Chief Judge Easterbrook and Judges Cudahy and Posner affirmed. The Court started with the "pretty vague" Department of Labor regulation describing the administrative exception. It provides that the employee’s "primary duty" must include the exercise of discretion and independent judgment and must include non-manual work directly related to general business operations of the employer or its customers. The Court concluded that Verkuilen’s primary duty was directly related to the business operations of her employer and its customers. She was directly responsible for understanding each customer's needs, translating those needs into specifications that could be understood by the software engineers, and assisting the customers in implementing the solution. In fact, the Court believed that Verkuilen was a "picture-perfect example" of someone to whom the overtime requirement should not apply.