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Covington Scores Significant Victory for Family Dollar

March 30, 2011

WASHINGTON, DC, March 30, 2011 — Covington & Burling LLP has secured an important victory in the U.S. Court of Appeals for the Fourth Circuit on behalf of Family Dollar Stores, Inc., which had been accused of violating the Fair Labor Standards Act.

At issue is whether a group of current and former managers at Family Dollar Stores should qualify for overtime pay as non-exempt employees under the law. The Court of Appeals concluded that Irene Grace, the lead plaintiff in the case, was an executive and therefore exempt from overtime pay. The panel ruled that the exemption does not turn solely on the amount of time spent on non-executive tasks.

The court rejected the plaintiffs’ arguments and granted summary judgment to Family Dollar Stores, noting that the plaintiff "was the person responsible for running the store. …In the absence of her management, her store could not have functioned."

Family Dollar is a national discount retail chain, operating over 6,800 stores in 44 states.

“The number of FLSA actions has grown exponentially in recent years and the Fourth Circuit’s decision could have an influence on other cases raising similar issues,” said Robert Long, who led the Covington team and argued the appeal.

Covington appellate litigation associate Mark Mosier assisted Mr. Long on the case. Also on the team were employment & executive disputes partner Tom Williamson and associates Shimica Gaskins and Brian Foster, litigation partner Rod McKelvie and associate Elizabeth Canter, and white collar senior of counsel Michael Chertoff. All are based in the firm’s Washington office.

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