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FLSA at the Supreme Court
March 30, 2007 by Ross Runkel at LawMemo
The Supreme Court will decide the validity of a DOL regulation exempting certain home care workers from the Fair Labor Standards Act (FLSA).
Long Island Care at Home Ltd v. Coke will be argued at the US Supreme Court April 16, 2007. [Details]
Employee: Evelyn Coke. Her job was to provide "companionship services" for individuals who were not able to care for themselves. She worked in private homes.
Employer: Long Island Care at Home Ltd, which hires employees like Coke and assigns them to work in private homes.
Statute: The FLSA has an exemption for employees engaged in "companionship services." If Coke had been paid by the families, then she clearly would not get FLSA coverage.
Regulation adopted by Department of Labor: A 30-year-old regulation says that the statutory exemption applies even if Coke is paid by an outside agency.
2nd Circuit decision: The circuit court held that DOL's regulation cannot be enforced because it was not entitled to deference under the rules of Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984), or Skidmore v. Swift & Co., 323 U.S. 134 (1944).
My prediction: Coke will lose; the DOL regulation will be enforced.
The legal issue is whether the courts must defer to the DOL's regulation. The 2nd Circuit held that the regulation is not entitled to deference under Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984), because it is an interpretive rather than a legislative regulation.
I think that's legally wrong. The statute left a gap, DOL had authority to fill the gap, and DOL filled it after notice-and-hearing procedures. The 2nd Circuit made a big deal out of where this regulation was positioned - under the heading "Interpretation" - but that misses the point. The real question is whether DOL intended the regulation to govern the conduct of private parties as opposed to being merely guidance for its own internal purposes. This was not a mere guideline for DOL employees; it was intended to regulate private conduct. Therefore, courts must defer to DOL under Chevron even if the regulation is inconsistent with other DOL regulations (which it is).
If I'm wrong on Chevron deference and the Court applies Skidmore v. Swift & Co. instead, then Coke should win because DOL's explanation of the regulation is not persuasive at all.
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Airline strike injunction affirmed
March 29, 2007 by Ross Runkel at LawMemo
The injunction against a strike by the Association of Flight Attendants against Northwest Airlines has been upheld by the 2nd Circuit.
Northwest Airlines v. Assoc of Flight Attendants (2nd Cir 03/29/2007)
After Northwest went into bankruptcy it rejected its collective bargaining agreement (CBA) with the union and imposed new terms and conditions on the flight attendants. (That's allowed by the bankruptcy laws.)
The union wanted better terms, and threatened to strike.
So Northwest got a federal judge to issue a temporary injunction against a strike.
Today the 2nd Circuit upheld the temporary injunction after analyzing the Bankruptcy Code, the Railway Labor Act (RLA), and the Norris-LaGuardia Act.
In concluding that the strike could be enjoined, the court said: "(1) Northwest's rejection of its CBA after obtaining court authorization to do so under 11 U.S.C. § 1113 abrogated (without breaching) the existing collective-bargaining agreement between the AFA and Northwest, which thereafter ceased to exist; (2) Northwest's abrogation of the CBA necessarily terminated the status quo created by that agreement, after which termination both the RLA's explicit status quo provisions and the implicit status quo requirement of Section 2 (First) ceased to apply; but (3) the AFA's proposed strike would, at present, violate the union's independent duty under the RLA to "exert every reasonable effort to make ... [an] agreement[]," 45 U.S.C. § 152 (First), and thus may be enjoined."
My view: This is a much narrower reason than the reason used by the trial judge. The trial judge reasoned that any such work stoppage would cause irreparable harm and, at this juncture, violate the Railway Labor Act. The 2nd Circuit's reasoning suggests that the union might be able to strike if it first exerts "every reasonable effort" to reach an agreement.
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IRCA did not override wage claim
March 28, 2007 by Ross Runkel at LawMemo
Another court has weighed in on the question of undocumented workers' wage claims.
Coma Corp v. Kansas Dept of Labor (Kansas 03/23/2007) rejected the idea that the federal Immigration Reform and Control Act (IRCA) preempted certain state labor laws. The Kansas court concluded that the Kansas Wage Payment Act applied to earned, but unpaid, wages of an undocumented worker.
The court found that to deny or to dilute an action for wages earned but not paid on the ground that such employment contracts were illegal, would directly contravene the public policy of the State of Kansas of protecting wages and wage earners.
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Is Ken Starr Supreme Court Justices' "employer"?
March 27, 2007 by Ross Runkel at LawMemo
High Court Advocate Ken Starr Is Justices' Summer Employer is the headline for Tony Mauro's commentary at today's Legal Times.
An interesting story. Ken Starr wears three hats:
- Dean of the Pepperdine Law School in Malibu, California
- Of Counsel at the Kirlkand & Ellis law firm
- Advocate for one of the parties in a pending Supreme Court case. Not just any case. This is Morse v. Frederick, in which a high school principal suspended a kid for unfurling a "Bong Hits 4 Jesus" banner at a parade.
Two Justices - Scalia and Alito - will be employed by Pepperdine Law School this summer to teach in a couple of summer programs.
At the Supreme Court Times blog I've raised the question of a conflict of interests.
Here I want to explore whether it is accurate to say that Starr will be the Justices' "employer."
Most lawyers will insist that the answer is no, a law school dean is not the "employer" of the law school's faculty members. The school is the employer of both the dean and the faculty members. It's probably more accurate to say that Starr will be the Justices' supervisor or manager. (Of course, for purposes of analyzing a conflict of interests, that simply shifts the question.)
Under California law, however, a supervisor can be individually liable for certain violations of California's Fair Employment and Housing Act (FEHA). Jones v. Lodge at Torrey Pines (California Ct App 02/05/2007).
So Starr will not be in what I would call a traditional "employer" role. Yet he will be in a role which is not exactly "co-employee."
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Whistleblower loses Supreme Court case
March 27, 2007 by Ross Runkel at LawMemo
What did he know, and when did he know it?
James Stone thought his ex employer was cheating the government. So he sued under the False Claims Act, hoping to get a chunk of money for his efforts.
One problem. Stone had to be an "original source" of information provided to the government. The US Supreme Court held (6-2) that he was not. Rockwell International Corp v. United States (US Supreme Court 02/27/2007)
Stone predicted that Rockwell's system for creating solid "pondcrete" blocks from toxic pond sludge and cement would not work because of problems in piping the sludge. However, Rockwell successfully made such blocks and discovered "insolid" ones only after Stone was laid off in 1986. In 1989, Stone filed a qui tam suit under the False Claims Act, which prohibits submitting false or fraudulent payment claims to the United States. In order to bring a qui tam suit, one must be an "original source" - one who "has direct and independent knowledge of the information on which the allegations are based and has voluntarily provided the information to the Government before filing an action … based on the information."
Stone did not allege that his predicted defect caused the insolid blocks. Intead, he alleged that the pondcrete failed because a new foreman used an insufficient cement-to-sludge ratio.
Stone's knowledge fell short. The only false claims found by the jury involved insolid pondcrete discovered after Stone left his employment. Thus, he did not know that the pondcrete had failed; he predicted it. And his prediction was a failed one, for Stone believed the piping system was defective when, in fact, the pondcrete problem would be caused by a foreman's actions after Stone had left the plant.
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Nurse was not "supervisor" under NLRA
March 25, 2007 by Ross Runkel at LawMemo
The battle continues over the line between "supervisor" and "employee," and the DC Circuit just reversed the NLRB's decision that a registered nurse was a supervisor. The opinion was written by Senior Judge Harry Edwards - a recognized expert on labor law.
Jochims v. NLRB (DC Cir 03/23/2007), reversing Wilshire at Lakewood, 345 NLRB No. 80 (2005) (2-1).
Lisa Jochims filed an unfair labor practice charge against the employer asserting unlawful discharge for engaging in protected activities. The parties agreed that if Jochims was an "employee" and not a "supervisor" under the National Labor Relations Act (NLRA), the employer committed an unfair labor practice. The National Labor Relations Board's (NLRB) initial decision found that Jochims was an "employee" and the supplemental decision found that Jochims was a "supervisor." The DC Circuit reversed the NLRB's supplemental decision.
The NLRB cited four factors in finding Jochims was a supervisor: (1) she completed written reports of employee misconduct; (2) she sent two employees home for misconduct as directed by management; (3) she let two employees leave work for family emergencies; and (4) she completed part of one evaluation of a probationary employer.
The NLRA defines a supervisor as "any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action." Under the three part test, employees are statutory supervisors if (1) they hold the authority to engage in any 1 of the 12 listed supervisory functions, (2) their exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment, and (3) their authority is held in the interest of the employer.
The court stated that this case did not rest on the "responsibly direct" portion of the definition of "supervisor," and was not about Jochims involvement in a "system" of progressive discipline.
In response to the NLRB's four factors finding Jochims had supervisory authority, the court found: (1) there was insufficient evidence to show supervisory status where no evidence was produced showing that Jochims' authority to write up an employee was a prerequisite to discipline, or that it routinely resulted in discipline against an employee, or that it inevitably resulted in the initiation of discipline; (2) Jochims neither made the decision to send the employees home nor recommended any such action; (3) NLRB precedent made clear that supervisory authority did not necessarily lie where authority to let employees leave early was limited to emergency situations; and (4) an evaluation did not indicate supervisory authority unless it effectively recommended discipline or directly affected an employee's job status.
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Undocumented workers get prevailing wage
March 22, 2007 by Ross Runkel at LawMemo
Can undocumented workers recover wages due under California's prevailing wage law? Or is such a suit barred by the federal Immigration Reform and Control Act (IRCA) and Hoffman Plastic Compounds, Inc. v. NLRB?
According to the California Court of Appeal, the workers' suit can proceed.
Reyes v. Van Elk (California Ct App 03/14/2007)
Reyes sued the employer, seeking (among other things) wages allegedly due under California’s prevailing wage law. The trial court granted summary judgment in favor of the employer, based on its determination that 1) undocumented workers were precluded by the federal Immigration Reform and Control Act (IRCA) and Hoffman Plastic Compounds, Inc. v. NLRB, 535 US 137 (2002) from asserting such claims; and 2) the Supremacy Clause of the United States Constitution and IRCA preempted California statutes declaring immigration status irrelevant to claims under California’s labor, employment, civil rights, and employee housing laws.
The California Court of Appeal reversed.
1) In Zavala v. Wal-Mart Stores, Inc. 393 F.Supp.2d 295 (D.N.J. 2005), the court concluded that workers are not precluded by their undocumented status from obtaining relief under the Fair Labor Standards Act (FLSA) for work already performed. That position is in accord with post-Hoffman interpretations by the Department of Labor and post-Hoffman court decisions construing the FLSA to cover undocumented workers. Agreeing with the reasoning set forth in those decisions, the court concluded that the employees were not precluded from pursuing their claims.
2) California Labor Code Section 1171.5 provides that immigration status is irrelevant to claims under California’s labor, employment, civil rights, and employee housing laws. The court concluded that Section 1171.5 is not preempted by federal law. The court reasoned that “[t]he ultimate goal of the IRCA is to control illegal immigration into the United States by prohibiting the employment of unauthorized aliens …. Allowing employers to hire undocumented workers and pay them less than the wage mandated by statute is a strong incentive for the employers to do so, which in turn encourages illegal immigration.”
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Personnel files, reputation, and the constitution
March 16, 2007 by Ross Runkel at LawMemo
"Stigma plus" without publication is what it is called. The result: a public employer violates the due process clause by putting damaging information into a personnel file without giving the employee a name-clearing hearing.
Sciolino sued his public employer (a city), claiming a deprivation of his 14th Amendment liberty interests without due process. The trial court dismissed the case. The 4th Circuit vacated and remanded.
Sciolino v. Newport News (4th Cir 03/12/2007)
Sciolino alleged that he was deprived of his liberty interests in his reputation and ability to obtain future employment, when the employer placed damaging information in his personnel file without a name clearing hearing. The 4th Circuit concluded that Sciolino did not allege the likelihood that prospective employers or members of the public would see the damaging information, and that the trial court thus did not abuse its discretion in dismissing the complaint. The court also concluded, however, that the trial court abused its discretion when it denied Sciolino’s motion to amend his complaint to include such an allegation.
To state this type of liberty interest claim (often called a “stigma plus” claim), a plaintiff must allege that the charges against him (1) placed a stigma on his reputation; (2) were made public by the employer; (3) were made in conjunction with his termination or demotion; and (4) were false.
The issue in this case involved the second (“dissemination”) element. Sciolino argued that the mere possibility of publication is enough to satisfy this element. Not surprisingly, the employer argued that actual publication was required.
The trial court opted for a “likelihood of publication” approach. There is a split among the circuits on this issue - resulting in several different approaches. The court concluded that an employee sufficiently states the second element when he alleges that prospective employers are likely to see the stigmatizing allegations. The court noted that if actual dissemination were required, “the information would have already been communicated to a potential employer, the employee’s job opportunities foreclosed, and his reputation damaged before any possibility for a name-clearing hearing.”
My view: Seems like a candidate for US Supreme court review. An important and recurring question under the constitution, plus a solid split among the circuit courts.
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Walgreens: "store assignments based on race"
March 08, 2007 by Ross Runkel at LawMemo
The EEOC claims Walgreens assigns managers, trainees, and pharmacists based on race - assigning them to low-performing stores and to stores in African American communities because of their race.
[Details in EEOC press release]
EEOC St. Louis District Director James R. Neely, Jr., said, "Essentially, Walgreens has made store assignments based on race. This policy has served to restrict the opportunities for advancement of African American employees at Walgreens stores nationwide."
So the EEOC has sued Walgreens in the U.S. District Court for the Southern District of Illinois.
A group of current and former African American managers filed a private lawsuit making similar allegations in June 2005. That lawsuit is currently pending in the U.S. District Court for the Southern District of Illinois, and the plaintiffs in that case have asked the court to certify it as a class action.
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State controls interstate overtime
March 06, 2007 by Ross Runkel at LawMemo
Larie Bostain was an interstate truck driver who wanted to be paid overtime, as required by Washington State's Minimum Wage Act. Although he worked in excess of 40 hours per week, he did not work more than 40 hours a week within the State of Washington.
The problem for the courts was whether to count all hours worked, or only hours worked within the State of Washington.
Held, in a 5-4 vote: Overtime pay for Washington interstate truck drivers included time driving outside Washington. Bostain v. Food Express (Washington 03/01/2007) Majority Opinion | Dissenting Opinon
The issue for the Washington Supreme Court was whether the Washington State's Minimum Wage Act (MWA) applied to interstate truckers whether driving within the state or outside the state.
The court noted that Bostain was a Washington employee. The court interpreted the MWA for overtime (RCW 49.46.130) to apply to Washington employees driving in state and driving outside Washington. The court concluded that the Department of Labor and Industries rules (WAC 296-128-011 and WAC 296-128-012), defining hours for purposes of the overtime provisions, as hours worked within Washington's borders were not consistent with the plain language of the statutes being implemented, nor with the stated purpose of the MWA, nor with the principles that apply to interpretation of remedial legislation governing payment of wages in this state. The court rejected the employer's commerce clause violation argument.
The majority thought this result was required by the plain language of the statute.
The DISSENT thought the opposite conclusion was required by the plain language of the statute. In addition, the dissent thought the result was prohibited by the US constitution's commerce clause.
My view: I just love it when two groups of judges use the "plain meaning" of a statute to reach opposite conclusions. Doesn't that fact, all by itself, nean that there is no plain meaning? Go figure.
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Editor: Ross Runkel, Professor of Law Emeritus. email Ross@LawMemo.Com, Phone 503-399-8028. Copyright LawMemo, Inc.
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