                          RECOMMENDED FOR FULL-TEXT PUBLICATION
                              Pursuant to Sixth Circuit I.O.P. 32.1(b)
                                     File Name: 19a0114p.06

                   UNITED STATES COURT OF APPEALS
                                  FOR THE SIXTH CIRCUIT



 HOWARD HOLT; MARTIN ERSKINE,                           ┐
                            Plaintiffs-Appellants,      │
                                                        │
                                                         >      No. 18-1981
        v.                                              │
                                                        │
                                                        │
 CITY OF BATTLE CREEK,                                  │
                                 Defendant-Appellee.    │
                                                        ┘

                          Appeal from the United States District Court
                     for the Western District of Michigan at Grand Rapids.
                       No. 1:15-cv-00931—Janet T. Neff, District Judge.

                                    Argued: May 3, 2019

                               Decided and Filed: June 3, 2019

                     Before: GUY, CLAY, and GRIFFIN, Circuit Judges.

                                     _________________

                                         COUNSEL

ARGUED: Robert Anthony Alvarez, Agustin Henriquez, Jr., AVANTI LAW GROUP, PLLC,
Wyoming, Michigan, for Appellants. Gregory N. Longworth, CLARK HILL PLC, Grand
Rapids, Michigan, for Appellee. ON BRIEF: Robert Anthony Alvarez, AVANTI LAW
GROUP, PLLC, Wyoming, Michigan, for Appellants. Gregory N. Longworth, CLARK HILL
PLC, Grand Rapids, Michigan, for Appellee.
                                     _________________

                                          OPINION
                                     _________________

       CLAY, Circuit Judge.     Plaintiffs Howard Holt and Martin Erskine appeal from the
judgment entered in favor of Defendant City of Battle Creek on Plaintiffs’ claim that Defendant
 No. 18-1981                     Holt, et al. v. City of Battle Creek                     Page 2


violated the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201, et seq., by failing to pay
Plaintiffs overtime wages. For the reasons set forth below, we AFFIRM the decision of the
district court.

                                        BACKGROUND

                                        Factual History

        Plaintiffs Holt and Erskine each served as a battalion chief in Defendant’s fire
department. Holt was the “suppression” battalion chief from 2007 until his retirement in 2015;
Erskine became the “administrative” battalion chief in 2012 and has not retired. Battalion chiefs
are second in command in the fire department hierarchy, behind the fire chief but ahead of other
employees. Plaintiffs served under three different fire chiefs: Chief Larry Hausman from 1997
through April 2013, Chief Jackie Hampton from April 2013 through January 2014, and Chief
Arthur David Schmaltz from February 2014 through the rest of the time period at issue.

I. Battalion Chief Job Responsibilities

        The City of Battle Creek’s job description for battalion chiefs included the following
summary of the position’s responsibilities:

        Provides supervision to fire fighting personnel; Implements the incident command
        system and serves as incident commander at all incidents; Accepts responsibility
        for assigned administrative and fire prevention functions; Functions as the chief
        administrative officer of the department in absence of the Fire Chief and Deputy
        Fire Chief; Actively supports the decisions and policies of the City and fire
        administration and performs related work as required.

(Appellee Appendix, Joint Exhibit 5, A32.) The document also described essential job functions
of the battalion chiefs, which included “[p]repar[ing] and administer[ing] disciplinary actions
against subordinate personnel in the form of coaching and counseling, oral and written
reprimands;” “[c]onduct[ing] evaluations of immediate subordinate personnel, review[ing]
evaluations of other personnel assigned to shift, and provid[ing] feedback to subordinate
personnel;” “[i]nspect[ing] fire stations, apparatus, equipment, and personnel to ensure
operational readiness on a daily basis;” and “[p]lan[ning] and coordinat[ing] daily activities of
shift personnel in concert with training, pre-plan inspections, maintenance, and public activities
 No. 18-1981                     Holt, et al. v. City of Battle Creek                      Page 3


such as fire prevention.” (Id.) While Plaintiffs did not have direct authority to make hiring and
firing decisions, they conducted performance evaluations that were used in the promotional
process and were otherwise involved in advancement decisions.

       An internal department memo described the different areas of responsibility of the
administrative and suppression battalion chiefs.      Erskine’s responsibilities as administrative
battalion chief included training fire department personnel, ensuring road safety, creating a “plan
of the day” and “plan of the week” for the officers and firefighters, and approving vacation
requests. As suppression battalion chief, Holt’s responsibilities listed in the memo included
serving as the immediate supervisor for station officers, maintaining fire department standards,
handling facility issues, and overseeing uniforms and supplies.

       Chief Hausman testified that the “primary responsibility” of the battalion chiefs and fire
chief was “not physical work, it was . . . management and leadership,” and that the “majority” of
their jobs consisted of “administrative functions, you know, management.” (R. 122, Hausman
Deposition, PageID # 1012.)       When called to a fire, a battalion chief’s role as incident
commander, according to Chief Hausman, was to remain in the vehicle and “manage, lead, and
direct” the fire suppression efforts by “monitoring the situation[ and] taking input from the
company officers.” (Id. at PageID # 1013.) Chiefs Hausman and Schmaltz each testified that
they gave particular weight to Holt’s recommendations regarding discipline; Schmaltz referred to
the battalion chiefs as his “senior staff.” (R. 128, Transcript, PageID # 1077.) Holt and Erskine
each testified that while they had the power to issue verbal and written reprimands, the ultimate
decision as to discipline rested with the fire chief, and the fire chief occasionally overrode
Plaintiffs’ disciplinary recommendations.

II. Standby Duty

       As battalion chiefs, Plaintiffs were required to periodically serve on “standby” duty.
Standby duty typically rotated between Holt, Erskine, and the fire chief, with the individual
serving on standby required to be “on call” from 5:00 pm until 8:00 am the following morning
 No. 18-1981                        Holt, et al. v. City of Battle Creek                          Page 4


for seven days.1 Plaintiffs received 1.5 hours of pay for each day of standby duty, in addition to
overtime pay for hours worked if they were called back to active duty while on standby. The
individual on standby duty was required to monitor a pager and a radio, answer phone calls if
needed, and help handle problems if they arose.

        Plaintiffs were occasionally required to respond to the scene of a fire while on standby
duty. Therefore, Plaintiffs’ activities were somewhat restricted during the weeks they were on
standby. The officer on standby duty could not drink alcohol or go out of town. Plaintiffs both
testified that they stopped playing organized sports while on standby, out of concern that they
would not hear the pager if it went off while they were playing. Holt testified that when he and
his wife went out to eat while he was on standby, they had to take two cars so that she would not
be left stranded at the restaurant if he had to go to the scene of a fire; Holt’s wife testified that
“when he was on call, we were pretty much prisoners right there in the house.” (R. 128,
Transcript, PageID # 1104.) Mrs. Holt also testified that standby duty disrupted their sleep,
because the pager would occasionally go off during the night if an “all stations” fire occurred.

        Chief Hausman’s testimony differed from Plaintiffs’ regarding the restrictiveness of
standby duty. While Holt and Erskine testified that they continually monitored their radios
during standby duty, Hausman testified that there was “no expectation [that] the radio [would be]
monitored 24/7” during standby, because the pager provided sufficient notice of an alarm.
(R. 122, Hausman Deposition, PageID # 1014.) Chief Schmaltz testified that he left his radio in
his car when he was at home on standby duty for the same reason. Hausman also testified that
other battalion chiefs had been able to engage in activities such as golfing and working on a
horse farm while on standby. Hausman stated that standby duty was not so onerous as to prevent
him from effectively using his time for personal pursuits.

                                          Procedural History

        On September 12, 2015, Plaintiffs filed a complaint in federal court alleging that the City
of Battle Creek had violated the FLSA by failing to pay overtime for hours worked in excess of

         1In 2015, the City of Battle Creek transitioned from the week-long standby system to 24-hour shift
rotations, with battalion chiefs now paid for every hour they are on call.
 No. 18-1981                     Holt, et al. v. City of Battle Creek                      Page 5


40 per week due to standby duty. Defendant filed a motion to dismiss in favor of arbitration on
July 20, 2016 and a motion for summary judgment on November 13, 2017; the district court
denied both motions. After a bench trial, the district court ruled that Plaintiffs were exempt from
the FLSA’s overtime pay requirement under both the executive and the administrative
exemptions. The district court also held that, even if Plaintiffs “were within the classes of
employees subject to FLSA coverage, their duties during standby time were not so onerous as to
prevent them from effectively using the time for personal pursuits.” (R. 129, Transcript, PageID
# 1333.) This appeal followed.

                                         DISCUSSION

I. Applicability of the “Fair Reading” Standard

                                      Standard of Review

       “After a bench trial, we review the district court’s factual findings for clear error and its
conclusions of law de novo.” Foster v. Nationwide Mut. Ins. Co., 710 F.3d 640, 643–44 (6th Cir.
2013). Because this issue involves a legal question, we review it de novo.

                                             Analysis

       The FLSA requires employers to pay overtime compensation to employees who work
more than 40 hours a week. The FLSA exempts certain classes of employees from the overtime
pay requirements. 29 U.S.C. § 213. Until recently, courts “narrowly construed [the exemptions]
against the employers seeking to assert them.” See, e.g., Thomas v. Speedway SuperAmerica,
LLC, 506 F.3d 496, 501 (6th Cir. 2007) (quoting Arnold v. Ben Kanowsky, Inc., 361 U.S. 388,
392 (1960)). In the 2018 case Encino Motorcars, LLC v. Navarro, however, the Supreme Court
held that courts should apply a “fair reading” to the exemptions. 138 S. Ct. 1134, 1142 (2018).
The district court in this case followed the Supreme Court’s instruction to give the exemptions a
fair reading, and under that standard, it determined that Plaintiffs were exempt from the FLSA’s
overtime requirement under the executive and administrative exemptions.

       Plaintiffs argue that the district court erred in applying the fair reading standard to the
FLSA exemptions. According to Plaintiffs, the Supreme Court’s language in Encino endorsing a
 No. 18-1981                      Holt, et al. v. City of Battle Creek                       Page 6


“fair” instead of a “narrow” construction of the FLSA exemptions is dicta as applied to anything
other than the salesman exemption that was under consideration in Encino. Under Plaintiffs’
theory, all exemptions other than the salesman exemption are still subject to a narrow
interpretation.

       Plaintiffs’ theory is incorrect. Even if the Supreme Court’s statement in Encino was dicta
outside of the context of the salesman exemption, “[l]ower courts are obligated to follow
Supreme Court dicta, particularly where there is not substantial reason for disregarding it, such
as age or subsequent statements undermining its rationale.” In re Baker, 791 F.3d 677, 682 (6th
Cir. 2015) (alteration in original) (quoting ACLU of Ky. v. McCreary Cty., Ky., 607 F.3d 439,
447–48 (6th Cir. 2010)). Encino is a recent Supreme Court decision, and there have been no
intervening Supreme Court cases casting doubt on its analysis. Moreover, this Court and others
have applied Encino’s fair reading standard outside of the salesman exemption. See Mosquera v.
MTI Retreading Co., 745 F. App’x 568, 570–71 (6th Cir. 2018) (professional exemption); Flood
v. Just Energy Mktg. Corp., 904 F.3d 219, 228 (2d Cir. 2018) (outside salesman exemption);
Carley v. Crest Pumping Techs., LLC, 890 F.3d 575, 579 (5th Cir. 2018) (Motor Carrier Act
exemption). The district court was bound by the Supreme Court’s pronouncement in Encino,
and it did not err by applying the fair reading standard in this case.

II. Applicability of the Exemptions

                                        Standard of Review

       As explained above, we review the district court’s factual findings for clear error and
conclusions of law de novo. Fed. R. Civ. P. 52(a); Foster, 710 F.3d at 644. This issue involves
the district court’s factual findings, so clear error review applies.       Icicle Seafoods, Inc. v.
Worthington, 475 U.S. 709, 713 (1986) (“[T]he facts necessary to a proper determination of the
legal question whether an exemption to the FLSA applies in a particular case should be reviewed
by the courts of appeals [for clear error] . . . .”). “In [its] review of the district court’s factual
findings, this Court gives due regard to the district court’s opportunity to judge the credibility of
the witnesses.” Perkins v. Am. Elec. Power Fuel Supply, Inc., 246 F.3d 593, 597 (6th Cir. 2001).
“Clear error will be found only when the reviewing court is left with the definite and firm
 No. 18-1981                           Holt, et al. v. City of Battle Creek                                Page 7


conviction that a mistake has been committed.” Max Trucking, LLC v. Liberty Mut. Ins. Corp.,
802 F.3d 793, 808 (6th Cir. 2015). As the Supreme Court has explained:

        If the district court’s account of the evidence is plausible in light of the record
        viewed in its entirety, the court of appeals may not reverse it even though
        convinced that had it been sitting as the trier of fact, it would have weighed the
        evidence differently. Where there are two permissible views of the evidence, the
        factfinder’s choice between them cannot be clearly erroneous.

Anderson v. Bessemer City, 470 U.S. 564, 573–74 (1985). Therefore, “when a trial judge’s
finding is based on his decision to credit the testimony of one of two or more witnesses, each of
whom has told a coherent and facially plausible story that is not contradicted by extrinsic
evidence, that finding, if not internally inconsistent, can virtually never be clear error.” Id. at
575.

                                                     Analysis

        The district court found that Plaintiffs were exempt from the FLSA’s overtime pay
requirements under both the executive and the administrative exemptions. Plaintiffs argue this
was clear error.2 For the reasons set forth below, the district court did not clearly err in finding
Plaintiffs exempt from the FLSA’s overtime pay requirements.

        The executive exemption of the FLSA has four elements. 29 C.F.R. § 541.100. Only the
second and fourth elements are at issue in this case. The second element states that an executive
employee is one “[w]hose primary duty is management of the enterprise in which the employee
is employed or of a customarily recognized department or subdivision thereof.” 29 C.F.R.
§ 541.100(a)(2). The fourth element states that an executive employee is one “[w]ho has the
authority to hire or fire other employees or whose suggestions and recommendations as to the
hiring, firing, advancement, promotion or any other change of status of other employees are
given particular weight.” 29 C.F.R. § 541.100(a)(4).

        2Plaintiffs  also argue that the district court erred by not “methodically dissecting and analyzing each
separate workweek” to determine whether the exemptions applied at any given time. (Plaintiffs’ Br. at 34.)
However, the section of the FLSA regulations that Plaintiffs cite in support of that proposition is not applicable to
this case, because it only relates to the exemptions applicable to agricultural workers. 29 C.F.R. § 780.11. The
regulations applicable to the executive and administrative exemptions, in contrast, state that an employee may be
subject to the exemptions even if part of that employee’s time is spent performing nonexempt work. 29 C.F.R.
§ 541.700.
 No. 18-1981                      Holt, et al. v. City of Battle Creek                      Page 8


        A. Primary Duty

        The district court found that Plaintiffs’ primary duty was managerial in nature, satisfying
the second element of the executive exemption. The district court focused on the fact that
Plaintiffs “were required to directly supervise lower-ranking officers and personnel, evaluate
personnel, administer and enforce department policy, and coordinate the day-to-day operations
of the department.” (R. 129, Transcript, PageID # 1321.) The district court pointed to several
pieces of evidence and testimony that supported this finding. It noted that testimony established
that the battalion chiefs were expected to “take charge and operate as the incident commanders at
the scene of a fire.” (Id. at PageID # 1322 (internal quotations omitted).) Additionally, the
district court stated:

        Chief Schmaltz and Chief [Hausman] both testified that plaintiff Holt was “in
        charge” of all suppression personnel and plaintiff Erskine was “in charge” or
        “oversaw” the training division. Approximately 27 lieutenants and captains
        directly reported to plaintiff Holt[,] who monitored their adherence to standards.
        Moreover, Chief [Hausman] testified that if any fire fighter “had a problem[,]” he
        or she would take it to plaintiff Holt.

(Id. at PageID # 1322–23.) Finally, the district court recognized that even Plaintiffs had referred
to themselves as “management” in a June 4, 2014 letter to Chief Schmaltz.

        This evidence supports the district court’s conclusion that Plaintiffs’ primary duty was
management of the City of Battle Creek fire department. Plaintiffs argue that the district court’s
conclusion was clear error because Plaintiffs’ “actual[] job duties, not the ones described in their
[Standard Operating Procedures], were that of a regular rank and file firefighter, with [a] few
added responsibilities for the sake of preserving order in chaos in a fire fight.” (Plaintiffs’ Reply
Br. at 7.) In essence, Plaintiffs argue that the district court should have weighed the evidence
differently to conclude that Plaintiffs’ primary duties were not managerial. This argument is
unpersuasive. Ample evidence supports the district court’s conclusion, so this Court cannot
second-guess the district court’s factual findings. See Anderson, 470 U.S. 573–74. The district
court did not commit clear error in concluding that Plaintiffs’ duties were primarily managerial.
 No. 18-1981                      Holt, et al. v. City of Battle Creek                      Page 9


       B. Recommendations Given Particular Weight

       The district court found that the fourth element of the executive exemption was also
satisfied. While the district court recognized that Plaintiffs did not have independent authority to
hire, fire, or suspend fire fighters, it credited certain testimony as showing that Plaintiffs’
“suggestions and recommendations as to hiring, firing, advancement, promotion or any other
change of status of other employees were given ‘particular weight.’”           (R. 129, Transcript,
PageID # 1324–25.) The district court stated:

       Chief [Hausman] testified that plaintiff Holt was the person who was responsible
       for oral and written disciplinary proceedings of the fire fighters, and that Holt
       issued the “majority” of the discipline in the department. Chief [Hausman]
       testified that he gave “a lot of weight” to plaintiff Holt’s recommendation, that he
       did “not operate in a vacuum.” Chief [Hausman] also specifically testified that
       plaintiff Erskine, the administrative battalion chief, was responsible for managing
       vacation and “Kelly days” in the department.

(Id.) The district court also pointed to Chief Schmaltz’s testimony that he “specifically requested
[P]laintiffs’ input concerning personnel decisions” and the testimony of the former employee
relations director for the City of Battle Creek that Plaintiffs played a “significant role” in hiring
decisions. (Id. at PageID # 1325.)

       Plaintiffs again argue that the district court’s conclusion was erroneous. Plaintiffs point
to specific pieces of evidence purportedly showing that they did not have the requisite authority
regarding personnel decisions under 29 C.F.R. § 541.100(a)(4). Specifically, Plaintiffs highlight
parts of their testimony in which they described times the fire chiefs overruled Plaintiffs’
disciplinary recommendations. However, this element of the executive exemption does not
require courts to ask whether an employee’s recommendations as to personnel decisions were
accepted every single time—instead, it presents the question of whether those recommendations
were given “particular weight,” which is precisely what the district court found. This argument
presents yet another example of the district court making a reasonable choice between two
permissible views of the evidence. See Anderson, 470 U.S. 573–74. The district court cited
sufficient evidence to support its finding that Plaintiffs’ recommendations were given particular
weight. The district court did not commit clear error in reaching that conclusion.
 No. 18-1981                      Holt, et al. v. City of Battle Creek                     Page 10


       Our determination that the district court did not commit clear error in finding Plaintiffs
subject to the executive exemption is sufficient to uphold the district court’s denial of Plaintiffs’
claim for overtime compensation under the FLSA. Therefore, we need not address the district
court’s additional conclusions that Plaintiffs were also subject to the FLSA’s administrative
exemption and that, even if the exemptions did not apply, standby time was not so onerous as to
be compensable under the FLSA.

                                         CONCLUSION

       The district court did not commit clear error in holding that Plaintiffs were subject to the
executive exemption under the FLSA. We therefore AFFIRM the decision of the district court.
