Tag Archives: 29 U.S.C. § 203(o)

S.D.Fla.: Employer Need Not Pay Employee MW For All Hours Worked to Take Advantage of Tip Credit

Goldin v. Boce Group, L.C.

This case was before the court on defendant’s motion to dismiss, for failure to state a claim.  The plaintiff’s theory of relief for minimum wage violations arose from the fact that while he worked 51 hours per week, each week, Defendants paid Plaintiff the required reduced minimum wage for only forty hours, and failed to pay him at all for the additional eleven hours of overtime. Plaintiff claimed that because Defendants “did not pay Plaintiff the required amount for every hour he worked,” they were not permitted to take advantage of the tip credit at all and must disgorge the entire tip credit.  Inasmuch as the FLSA requires that employers who seek to take the tip credit must pay tipped minimum wage in order to do so, this theory would seem to make perfect sense, however the court disagreed and dismissed the case.

The court reasoned:

“There is no basis in the FLSA for the relief Plaintiff seeks. The FLSA clearly lays out the prerequisites an employer must meet in order to claim the tip credit. There are only two: (1) the employer must inform the employee that the employee will be paid the reduced minimum wage; and (2) all tips received by the employee must be retained by the employee. 29 U.S.C. § 203(m).  There is no “condition precedent” that the reduced cash wage be paid for every hour worked before an employer is entitled to claim the statutorily-mandated tip credit. See id. Congress could, and did, write into the FLSA express conditions precedent to the application of the tip credit. The Court declines to read a condition precedent into the statute where Congress did not create one. In re Tennyson, 611 F.3d 873, 877 (11th Cir.2010) (stating that where statute is “clear, unambiguous, and does not result in any absurd consequences,” the Court “will not … read into the text of the statute an unstated purpose.”).

In addition, the FLSA very clearly lays out the remedies available to employees who are subject to FLSA violations by employers. Successful FLSA plaintiffs are entitled to recover “the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and [ ] an additional equal amount as liquidated damages.” 29 U.S.C. § 216(b). Congress wrote specific remedies into the statute. Congress did not choose to include as a remedy disgorgement of the tip credit where the plaintiff is a tipped employee. The Court will not write this additional remedy into the statute where Congress did not see fit to do so. See In re Tennyson, 611 F.3d at 877.

In addition, two other divisions of court in this District have rejected Plaintiff’s theory on almost identical facts. See Muldowney v. Mac Acquisition, LLC, Case No. 09–22489–CIV, 2010 WL 520912 (S.D.Fla. Feb. 9, 2010) (Huck, J.); Perez v. Palermo Seafood, Inc., Case No. 07–21408–CIV, 2008 WL 7505704 (S.D.Fla. May 8, 2008) (O’Sullivan, M.J.). In both cases, a tipped employee who was paid the reduced minimum wage for some hours claimed their employers were not entitled to claim the tip credit because they were not paid for “off-the-clock work.”

In Palermo Seafood, Magistrate Judge O’Sullivan found no textual support in the statute for the plaintiff’s position, observing: “The cases that have disallowed the tip credit have done so because the employer failed to comply with one, or both, of the following requirements: (1) the employee receive proper notice of the tip credit and (2) that the employee is not required to share his or her tips with non-tipped employees.” 2008 WL 7505704 at *2. Accordingly, Judge O’Sullivan found tip credit should apply to the plaintiff’s regular shift hours, for which she was compensated at the reduced minimum wage. Id. at *1.

In Muldowney, Judge Huck came to the same conclusion:

Section 203(m) merely prescribes the method for calculating a tipped employee’s wages and sets forth two explicit requirements that must be met for an employer to claim the tip credit, both of which are satisfied in this case. The statute says nothing about unpaid wages due to off-the-clock hours. Further, by rejecting Plaintiff’s interpretation, she is not left without a remedy: she can seek unpaid wages for her alleged off-the-clock hours under state law or other sections of the FLSA. Therefore, the Court finds that Defendants are entitled to the tip credit for hours where Plaintiff was paid the specified reduced cash wage.2010 WL 520912 at *1.

The Court agrees with these two well-reasoned decisions. However, this does not mean, as Plaintiff argues, that employers are therefore not required to pay employees the minimum wage for every hour worked. Of course employers must compensate employees at the required rate for every hour worked, and of course the failure to do so is a violation of the FLSA. 29 U.S.C. § 206(a)(1) (providing minimum wage amounts); 29 U.S.C. § 215(a)(2) (creating cause of action for violation of minimum wage and overtime provisions).”

It should be noted that this decision and the 2 decisions on which it relies were all rendered in the Southern District of Florida.  As tipped employee cases continue to become more and more prevalent though, as a result of tremendous amount of abuses of tipped workers in various industries, it will be interesting to see if courts outside of the Southern District of Florida have a different take, based on the text of 203(m).

Click Goldin v. Boce Group, L.C. to read the entire order.

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6th Cir.: Although Changing Into PPE At Food-Processing Plant Is “Changing Clothes” and Excluded Under 203(o), It Is A Principle Activity And Begins The “Continuous Workday”

Franklin v. Kellogg Co.

This case was before the Sixth Circuit on appeal from the order at the court below granting Defendant summary judgment in all respects with regard to Plaintiff’s claims that she was entitled to be paid for changing into required personal protection equipment (“PPE”) each day, before she could perform their work on Defendant’s plant floor.  The Court affirmed the lower court’s holding that time spent changing into the PPE could be properly excluded by continued practice under 203(0), but remanded the case to determine whether there was significant time the that elapsed after the donning of the PPE, before Plaintiff was put “on the clock,” because such time was compensible under the “continuous workday” if it was not deemed de minimus.

The Court reasoned:

“B. Post-Donning/Pre-Doffing Walking Time

Franklin argues that if we conclude that her time spent donning and doffing the uniform and equipment is excluded under § 203(o), she is still entitled to compensation for her time spent walking between the locker room and the time clock, because those activities are “principal activities.” Under the “continuous workday” rule, “the ‘workday’ is generally defined as ‘the period between the commencement and completion on the same workday of an employee’s principal activity or activities.’ “ IBP, Inc. v. Alvarez, 546 U.S. 21, 29 (2004) (quoting 29 C.F.R. § 790.6(b)). In addition, “during a continuous workday, any walking time that occurs after the beginning of the employee’s first principal activity and before the end of the employee’s last principal activity is … covered by the FLSA,” and must be compensated. Id. at 37. Principal activities are those that are an integral and indispensable part of the activities which the employee is employed to perform. See Steiner v. Mitchell, 350 U.S. 247, 256 (1956).

1. Does Exclusion Under § 203(o) Affect Whether an Activity is a Principal Activity?

One court recently explained that “[t]he courts have taken divergent views” on the issue of whether activities deemed excluded under § 203(o) may still constitute “principal activities.” In re Tyson Foods, Inc., 694 F.Supp.2d 1358, 1370 (M.D.Ga.2010). Some courts have concluded that time that is excluded under § 203(o) may still be a “principal activity,” because § 203(o) only addresses the compensability of the time, not whether it is integral and indispensable. See, e.g., id. at 1371 (“After considering both of these positions, the Court concludes that § 203(o) only relates to the compensability of time spent donning, doffing, and washing of the person and that it does not mean that § 203(o) tasks cannot be considered principal activities that start the continuous workday.”); Andrako v. U.S. Steel Corp., 632 F.Supp.2d 398, 413 (W.D.Pa.2009) (“Section 203(o) relates to the compensability of time spent donning, doffing, and washing in the collective-bargaining process. It does not render such time any more or less integral or indispensable to an employee’s job.”); Gatewood v. Koch Foods of Miss., LLC, 569 F.Supp.2d 687, 702 (S.D.Miss.2008) (“Although the act of ‘changing clothes’ itself is barred based on § 203(o) …, the activities that occur after changing into sanitary gear and before changing out of sanitary gear are not impacted by the defense.”); Figas, 2008 WL 4170043, at *20 (“[T]he character of donning and doffing activities is not dependent upon whether such activities are excluded pursuant to a collective-bargaining agreement.”). In contrast, some courts-including the district court presiding over the instant case-have concluded that “once an activity has been deemed a section 3(o) activity, it cannot be considered a principal activity.” Sisk v. Sara Lee Corp., 590 F.Supp.2d 1001, 1011 (W.D.Tenn.2008); see also Salazar v. Butterball, LLC, No. 08-cv-02071-MSK-CBS, 2009 WL 6048979, at * 14 (D.Colo. Dec. 3, 2009) (following Sisk); Hudson v. Butterball, LLC, No. 08-5071-CV-SW-RED, 2009 WL 3486780, at *4 (W.D.Mo. Oct. 14, 2009) (“Because time [plaintiff] spent sanitizing, donning, and doffing is excluded from hours worked under § 203(o), the walking time did not follow or precede a principal work activity, and therefore is not compensable.”). Although the latter position was consistent with the 2007 Opinion Letter, the June 16 Interpretation rejected that position and concluded that “clothes changing that is covered by § 203(o) may be a principal activity.” Compare 2007 Opinion Letter with June 16 Interp.

We agree with the courts that have taken the position that compensability under § 203(o) is unrelated to whether an activity is a “principal activity.” Accordingly, we must consider whether time spent donning and doffing the standard equipment and uniform is integral and indispensable to Franklin’s job.

2. Integral and Indispensable

Kellogg asserts that even though it requires its employees to wear these items, changing into them is not “integral and indispensable” under the FLSA. In Steiner, the Supreme Court concluded that changing into protective gear before beginning the shift and showering and changing out of the protective gear at the end of the shift was an integral and indispensable part of employment at a battery-manufacturing plant. 350 U.S. at 256 (“[I]t would be difficult to conjure up an instance where changing clothes and showering are more clearly an integral and indispensable part of the principal activity of the employment than in the case of these employees.”) The Court did not address whether “changing clothes and showering under normal conditions” was integral and indispensable to the principal activity of work, and it did not explicitly hold that changing clothes and showering can only be integral and indispensable when the working environment was toxic or lethal. See id. at 249, 256. Nonetheless, at least one court applying Steiner has made that distinction. See Gorman v. Consol. Edison Corp., 488 F.3d 586, 594 (2d Cir.2007). In Gorman, the Second Circuit held that donning and doffing of protective gear-helmet, safety glasses, and steel-toed boots-was not integral and indispensable to employment at a nuclear power plant. Id. It distinguished Steiner because “the environment of the battery plant could not sustain life-given the toxic substances in liquid, solid, powder, and vapor form (and in the dust of the air) that ‘permeate[d] the entire [battery] plant and everything and everyone in it.’ “ Id. at 593 (quoting Steiner, 350 U.S. at 249) (alterations in original). It interpreted Steiner narrowly for the proposition “that when work is done in a lethal atmosphere, the measures that allow entry and immersion into the destructive element may be integral to all work done there.” Id. However, under Gorman, when such a lethal environment is not present and the gear is not literally required for entry into the plant, donning and doffing gear is not integral.

The Second Circuit’s position appears to be unique. The Ninth and Eleventh Circuits have both interpreted Steiner less narrowly. For example, relying on 29 C.F.R. § 790.8(c), the Ninth Circuit explained that “ ‘where the changing of clothes on the employer’s premises is required by law, by rules of the employer, or by the nature of the work,’ the activity may be considered integral and indispensable to the principal activities.” Ballaris v. Wacker Siltronic Corp., 370 F.3d 901, 910 (9th Cir.2004), quoting Mitchell v. King Packing Co., 350 U.S. 260, 262-63 (1956) (holding that changing into and out of plant uniforms was integral and indispensable to the principal activities because the employer required its employees to wear the uniforms and doing so was performed for the benefit of the company); see also Alvarez, 339 F.3d at 902-03 (“To be ‘integral and indispensable,’ an activity must be necessary to the principal work performed and done for the benefit of the employer.”). Similarly, the Eleventh Circuit held that the following three factors are relevant to the issue of whether an activity is integral and indispensable: “(1) whether the activity is required by the employer; (2) whether the activity is necessary for the employee to perform his or her duties; and whether the activity primarily benefits the employer.” Bonilla v. Baker Concrete Constr., Inc., 487 F.3d 1340, 1344 (11th Cir.2007) (concluding that time spent going through security screening made mandatory by the FAA was not integral and indispensable because it was not for the benefit of the employer). We follow the reasoning of Ballaris and Bonilla.

Under the broader interpretation of integral and indispensable, donning and doffing the uniform and equipment is both integral and indispensable. First, the activity is required by Kellogg. Second, wearing the uniform and equipment primarily benefits Kellogg. Certainly, the employees receive protection from physical harm by wearing the equipment. However, the benefit is primarily for Kellogg, because the uniform and equipment ensures sanitary working conditions and untainted products. Because Franklin would be able to physically complete her job without donning the uniform and equipment, unlike the plaintiffs in Steiner, it is difficult to say that donning the items are necessary for her to perform her duties. Nonetheless, considering these three factors, we conclude that donning and doffing the uniform and standard equipment at issue here is a principal activity. See IBP, Inc., 546 U.S. at 37 (“[A]ny activity that is ‘integral and indispensable’ to a ‘principal activity’ is itself a ‘principal activity.’ ”) Accordingly, under the continuous workday rule, Franklin may be entitled to payment for her post-donning and pre-donning walking time. Because there are questions of fact as to the length of time it took her to walk from the changing area to the time clock and whether that time was de minimis, however, we reverse and remand to the district court for further consideration of this issue.”

To read the entire opinion, click here.

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203(o) Does Not Extend To PPE Worn By Employees That Is Required By Law, The Employer Or Due To The Nature Of The Job; Changing Clothes May Be Principal Activity, Starting Continuous Workday, Says DOL

Administrator’s Interpretation No. 2010-2

Today, the DOL issued its second Administrative Interpretation of 2010.  The subject of this interpretation was the oft-litigated issue of the definition of “clothes” under 29 U.S.C. 203(0), which has been the subject of countless so-called “donning and doffing” cases. 

Significantly the DOL concluded that:

(1)  “Based on its statutory language and legislative history, it is the Administrator’s interpretation that the § 203(o) exemption does not extend to protective equipment worn by employees that is required by law, by the employer, or due to the nature of the job. This interpretation reaffirms the interpretations set out in the 1997, 1998 and 2001 opinion letters and is consistent with the “plain meaning” analysis of the Ninth Circuit in Alvarez. Those portions of the 2002 opinion letter that address the phrase “changing clothes” and the 2007 opinion letter in its entirety, which are inconsistent with this interpretation, should no longer be relied upon.”

and

(2) “Consistent with the weight of authority, it is the Administrator’s interpretation that clothes changing covered by § 203(o) may be a principal activity. Where that is the case, subsequent activities, including walking and waiting, are compensable. The Administrator issues this interpretation to assist employees and employers in all industries to better understand the scope of the § 203(o) exemption.”

To read the entire Administrator’s Interpretation, click here.

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D.Colo.: Time Spent By Police Officers Donning And Doffing Their Uniforms And Equipment Is Compensable, Because It Is Integral And Indispensable To Their Police Duties

Rogers v. City and County of Denver

This case was before the Court on the parties’ respective motions for summary judgment.  Plaintiffs made several claims for unpaid wages based on a variety of “off-the-clock” claims.  Although the Court denied the parties’ motions with respect to most of the claims–either because the record was not fully developed, or because there were issues of fact–it held that the donning and doffing of uniforms and equipment by certain officers was compensable time.

“The first claim seeks compensation for time spent putting on and taking off the police uniform and equipment required for conducting police activity. For convenience of analysis, this claim is considered as it applies to patrol officers. The DPD Operations Manual prescribes the basic uniform to be worn on duty. It consists of a uniform shirt, uniform trousers, trouser belt, socks and authorized footwear. (DPD Op. Manual § 111.02.) A uniformed officer is generally required to carry a metal badge and nameplate, current DPD identification card, a valid Colorado driver’s license, and a standard uniform belt (“duty belt”) containing an authorized holster and firearm, ammunition case and ammunition, handcuffs and handcuff case, department issued tear gas and holder, flashlight, baton ring and belt “keepers.” (Id. § 111.03.) Uniformed officers are not required to wear basic hats or reflective apparel or carry batons, but officers must have those items available at all times. (Id. §§ 111.02(1), 111.02(12) & 111.03(13)). The Operations Manual describes particular situations in which basic hats and reflective apparel must be worn. The wearing of ballistic vests is encouraged, but not required. (Id. § 111.05(2)(e)).

The DPD does not require that donning and doffing the basic uniform take place at the assigned work station. Some district headquarters have storage lockers and rooms available for use at the officer’s individual choice. Some district buildings are too small and the officers must report in full uniform. The City argues that the option to put on and take off the uniform at home or elsewhere distinguishes this case from precedents established in the context of the meat industry and other hazardous occupations.

The option to change away from the duty station is not determinative. The principal activity of the patrol officers is policing the community. The police uniform is not “clothing” in any ordinary sense. It is the visible sign of authority and an essential element of the officer’s ability to command compliance with his commands and directives. It is analogous to the judicial robe. The uniform includes the equipment that are the tools that enable the officer to use physical force, including deadly force, for the protection of himself and others as circumstances require.

The City argues that the Plaintiffs’ clothes changing activities are excluded from compensation under 29 U.S.C. § 203(o). That section provides:

Hours Worked.-In determining for the purposes of sections 206 and 207 of this title the hours for which an employee is employed, there shall be excluded any time spent in changing clothes or washing at the beginning or end of each workday which was excluded from measured working time during the week involved by the express terms of or by custom or practice under a bona fide collective-bargaining agreement applicable to the particular employee.

CBAs between the City and the Denver Police Protective Association have been in effect since January 1, 1996. DPD officers have never been compensated for donning and doffing their uniforms and personal equipment. The City contends that this history of non-compensation shows an established custom or practice under the CBAs.

That argument is not persuasive.  Silence in collective bargaining is not the equivalent of a custom or practice of non-compensability.

In December 1985, the United States Department of Labor (“DOL”) issued a Wage and Hour Opinion Letter, stating that the time spent by a uniformed police officer donning and doffing the required uniform was not compensable time under the FLSA, where a collective bargaining agreement between a city and the union had no express provision regarding the compensability of clothes-changing time and there had been no custom or practice between the parties to consider such clothes changing time compensable. Wage & Hour Opinion Letter, Dec. 30, 1985, 1985 WL 1087351, Def.’s Ex. A-98. That opinion letter is not persuasive, but may be considered with respect to the issue of willfulness. Similarly, Wage & Hour Advisory Memorandum No.2006-2 dated May 31, 2006 (opining that changing into gear is not a principal activity if employees have the option and the ability to change at home) is relevant only to the issue of willfulness.

The judicially-created de minimis rule provides an exception to the FLSA’s requirement that all work be compensated.  There are genuine issues of material fact regarding the time and effort required to don and doff the DPD uniform and protective gear. The City’s de minimis defense is a factual issue for trial.

While donning and doffing the patrol officers uniform and equipment is compensable time under the FLSA as activity that is integral and indispensable to their police duties, the continuous work day does not begin or end with that activity. The plaintiffs are not asking for time spent commuting for those officers who chose to change at home. This ruling is applicable only to the uniformed officers on official duty. The facts concerning wearing uniforms and equipment during secondary employment are not adequately presented in the papers filed.   Similarly there is no clear evidentiary record concerning detectives and other non-uniformed officers.”

This decision appears to be in direct conflict with the Ninth Circuit’s recent decision discussed here, which held that time spent donning and doffing police uniforms and equipment was not compensable, because officers had the option of doing it at home.

Click here to read the entire decision.

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Filed under Donning and Doffing, Municipal Employees, Uncategorized, Work Time