Summary Judgment – Issue of Material Fact

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7^th Circuit Court of Appeals

Case Name: Tom Reed, et al., v. Brex, Inc., et al.,

Case No.: 20-1697

Officials: SYKES, Chief Judge, and HAMILTON and BRENNAN, Circuit Judges.

Focus: Summary Judgment – Issue of Material Fact

At the center of this overtime pay case is a complicated payment scheme for auto repair technicians. The Fair Labor Standards Act generally requires that covered workers be paid extra for overtime work, but it exempts from that requirement some retail and service employees who are paid bona fide commissions. Plaintiffs Tom Reed and Michael Roy are auto repair technicians for defendant Brex, Inc. They claim that Brex’s payment plan is not a true commission, so that under the Act they are paid hourly wages and thus are entitled to overtime pay. Brex counters that, when one peels back the layers of its complex payment system, it is in fact a bona fide commission based on each technician’s sales during a pay period. The district court granted summary judgment for Brex based on the bona fide commission exemption.

Reed and Roy argue that genuine issues of material fact preclude summary judgment on this theory, but their arguments are not persuasive. First, we reject their attempts to cite new facts and calculations for the first time on appeal for reasons we discussed above. Second, plaintiffs characterize regulatory interpretation as a question of fact for the jury—but they do not contest the actual facts, which are that Brex technicians are paid a straight commission 84 percent of the time. Plaintiffs have not cited any evidence from which a jury could conclude that the guarantee is actually a salary, even considering the modest hourly bonuses offered to well-credentialed technicians. See Yi; 480 F.3d at 510 (affirming summary judgment even though technicians were paid different baseline hourly rates based on skill and experience). Reed and Roy make other undeveloped factual arguments in favor of reversal, but such arguments and legal arguments unsupported by pertinent authority are waived. See, e.g., Williams v. Board of Education of City of Chicago, 982 F.3d 495, 511 (7th Cir. 2020). They claim that the fact that the guaranteed wage floor is paid for 16 percent of all workweeks raises an issue of fact for the jury as to whether the guarantee operates as an integral part of a true commission system. That figure shows only that the guarantee occasionally guarantees. And the Act permits guarantees. Plaintiffs’ observation of this fact, without any citation to relevant authority or attempt to situate Brex’s practices within the permissive statutory and regulatory framework, cannot defeat summary judgment on its own. That is especially true here, where the undisputed evidence presented to the district court showed that there was substantial hourly and weekly variation in pay and that the guarantees are therefore “computed in accordance with a bona fide commission payment plan or formula under which the computed commissions vary in accordance with the employee’s performance on the job.” 29 C.F.R. § 779.416(b). We affirm.

Affirmed

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Derek A Hawkins is Corporate Counsel, at Salesforce.