Between June 10 and September 23, 1998, Jerry Gieg worked for DDR, Inc., doing business as Courtesy

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Between June 10 and September 23, 1998, Jerry Gieg worked for DDR, Inc., doing business as Courtesy Ford in Portland, Oregon. Gieg was a finance and insurance manager. His duties included verifying information in the deals between customers and the sales staff and completing the required forms. He also sold credit-insurance policies, extended warranties, alarm systems, and paint and fabric protection packages. Gieg was paid exclusively through commissions on the products he sold, not from the sales or leases of vehicles. He earned $24,025.16, which exceeded one and a half times the minimum wage. Seeking overtime pay, Gieg filed a suit in a federal district court against DDR. The Fair Labor Standards Act exempts employers from paying overtime to “any employee of a retail or service establishment” if the employee’s regular rate of pay is more than one and a half times the minimum wage and if “more than half his compensation . . . represents commissions on goods or services.” Gieg claimed, in part, that he was not subject to this provision because he was not engaged in Courtesy’s “retail” activity. How should the court rule? Why?

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Business Law Text and Cases

ISBN: 978-0324655223

11th Edition

Authors: Kenneth W. Clarkson, Roger LeRoy Miller, Gaylord A. Jentz, F

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