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11th Cir.: FLSA Means What It Says; When An Enterprise Grosses $500,000 Per Annum And Two Or More Employees Handle Goods That Previously Traveled In Interstate Commerce, There Is Enterprise Coverage

Polycarpe v. E&S Landscaping Service, Inc.

This consolidated appeal was before the Court after each one of the six (6) cases was dismissed for lack of enterprise coverage.  In five (5) of the six (6) cases there was proof that the Defendants had gross revenues of $500,000.00 per year or more.  Thus, the only question is whether otherwise “local” businesses came under the coverage of the FLSA, due to the fact that each had two (2) or more employees who handled goods or products that had previously traveled in interstate commerce (the “handling clause”).  Answering in the affirmative, the Eleventh Circuit ended a battle of statutory misinterpretation that had gained steam in the past few years, and read the statute as written.  In so doing, the Court rejected the “coming to rest” doctrine in the context of enterprise coverage and made clear the doctrine only applies in the individual coverage context.

In each instance, the Court held that the district courts below  incorrectly relied on the “coming to rest” doctrine and misinterpreted the ultimate consumer exception in concluding that Plaintiffs could not show enterprise coverage under the FLSA.  In some instances, the Court also noted that the district court failed to consider whether the evidence that Plaintiffs presented raised a genuine and important question of fact under the handling clause; instead of analyzing that portion of the FLSA, the district court mistakenly relied on the interpretive framework of an individual-coverage case.

To read the entire opinion, click here.