## Facts

- Current and former supermarket employees brought a class action alleging unpaid overtime and related wage violations under the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL) against corporate entities operating a large grocery chain and certain individuals.
- After the court found liability and approved a settlement, the corporate defendants defaulted on settlement obligations.
- Plaintiffs sought partial summary judgment that John Catsimatidis—chairman, president, CEO, and an owner—was personally liable as an “employer.”
- Evidence showed Catsimatidis had ultimate authority and exercised operational control, including hiring and firing senior managers, signing paychecks, directing capital and business decisions, and regularly visiting stores and giving directions affecting store operations.
- There was no showing that Catsimatidis personally designed the challenged overtime practices or directly supervised plaintiffs’ hours and pay decisions at a detailed level.
- The district court held Catsimatidis was an employer under both FLSA and NYLL and imposed joint and several liability; he appealed only the ruling imposing individual liability.

## Issues

1. Whether Catsimatidis qualified as an “employer” under the FLSA, making him personally liable for wage-and-hour violations based on the economic reality of his control over the enterprise.
2. Whether summary judgment properly determined Catsimatidis was an “employer” under the NYLL, and whether the applicable state-law standard required further analysis.

## Decision

- The Second Circuit affirmed that Catsimatidis was an “employer” under the FLSA and could be held personally liable.
- The court vacated the NYLL portion of the partial summary judgment and remanded for further consideration because the state-law issue had not been meaningfully analyzed and the parties disputed whether the court needed to decide a distinct NYLL standard.

## Legal Principles

- The FLSA defines “employer” broadly to include any person acting directly or indirectly in the interest of an employer in relation to an employee.
- The Second Circuit applies an “economic reality” inquiry considering, among other factors, whether the individual: (1) had power to hire and fire; (2) supervised and controlled schedules or conditions of employment; (3) determined rate and method of payment; and (4) maintained employment records; no single factor is dispositive.
- A corporate officer’s title or ownership alone does not create FLSA liability; liability turns on whether the individual possessed and exercised operational control sufficient to give functional control over employees’ terms and conditions.
- An individual may be an FLSA employer even without personally implementing the specific unlawful wage policy, if the individual’s operational control affects employees’ work conditions in practice.
- Where the governing standard under state wage law may differ from the FLSA, summary judgment requires an adequate, state-law-specific analysis before imposing individual liability.

## Conclusion

The Second Circuit held that a CEO-owner who actively exercised operational control over a large supermarket chain was an “employer” under the FLSA and could be personally liable for wage violations, but it vacated and remanded the NYLL ruling due to unresolved state-law questions and insufficient analysis of the NYLL standard.


Irizarry v. Catsimatidis, 722 F.3d 99 (2d Cir. 2013)