Donovan v. Public Service Co. of New Mexico

607 F. Supp. 784, 27 Wage & Hour Cas. (BNA) 247, 1984 U.S. Dist. LEXIS 24769
CourtDistrict Court, D. New Mexico
DecidedJuly 27, 1984
DocketCiv. No. 83-0296-JB
StatusPublished
Cited by2 cases

This text of 607 F. Supp. 784 (Donovan v. Public Service Co. of New Mexico) is published on Counsel Stack Legal Research, covering District Court, D. New Mexico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Donovan v. Public Service Co. of New Mexico, 607 F. Supp. 784, 27 Wage & Hour Cas. (BNA) 247, 1984 U.S. Dist. LEXIS 24769 (D.N.M. 1984).

Opinion

MEMORANDUM OPINION AND ORDER

BURCIAGA, District Judge.

THIS MATTER comes before the Court on cross-motions for summary judgment. The Court, having read the memoranda of the parties, and being otherwise fully advised in the premises, finds that the plaintiff’s motion for summary judgment should be granted in part and that defendant’s motion should be denied.

This action is brought by the Secretary of Labor to enjoin the defendant from violating provisions of the Fair Labor Standards Act [“F.L.S.A.”], 29 U.S.C. § 201 et seq., and to further enjoin the defendant from continuing to withhold overtime pay allegedly due to its employees. The parties have filed a stipulation of facts sufficient to decide most of the issues before the Court. In May, 1979, the defendant, through collective bargaining with the employees at its San Juan Unit, negotiated a union contract which included a provision whereby employees would work a shift of ten consecutive days at regular pay. The collective bargaining agreement provided that each of six crews was scheduled to work the ten-day shift on a rotating basis. Thus, under this provision, an employee would work a ten-day shift every sixth and seventh work week (six consecutive, eight-hour days in one work week and four consecutive eight-hour days in the next work week). The rest of the time an employee would work regular, 40-hour weeks. In August, 1981, as a result of an internal review and evaluation of its overtime policies, the defendant realized this provision, with its inclusion of a six-day work week, was violative of the overtime requirements of § 7 of the F.L.S.A., 29 U.S.C. § 207. Through collective bargaining, the defendant renegotiated the ten-day shift provision, implementing changes effective October 6, 1981, which the defendant and the union believed brought the provision into compliance with the F.L.S.A. provisions governing overtime. In February, 1982, the Wage and Hour Division of the Department of Labor began an investigation into the possibility that defendant owed back pay to its employees for .overtime worked under the ten-day provision of the 1979 contract. In November, 1982, defendant paid its employees for the previously unpaid overtime for the period from November 5, 1980, to November 5, 1982. Plaintiff filed suit on March 1, 1983. Now at issue is whether defendant is liable for back pay prior to November 5, 1980.

Resolution of this issue requires an analysis of the applicable statute of limitations, 29 U.S.C. § 255(a). Pursuant to 29 U.S.C. § 255(a), an action to enforce payment of unpaid overtime compensation may be brought within two years of the accrual of the claim, except that an action arising out of a willful violation may be commenced within three years after the claim accrued. If the two-year statute of limitations applies, the Secretary may not pursue this action for unpaid overtime compensation earned prior to March 1, 1981. If the [786]*786three-year statute applies, however,, the Secretary may seek employee compensation for all overtime worked subsequent to March 1, 1980.

The Court finds that the three year statute of limitations is applicable. The term “willful” is a term of art as used in the F.L.S.A. context. The Tenth Circuit has rejected the view that a “willful violation” requires an intentional disregard or deliberate indifference to the requirements of the F.L.S.A. A violation is willful if the employer “knew or should have known of an appreciable possibility that the employees were covered by the [F.L.S.A.].” Donovan v. M & M Wrecker Service, Inc., 733 F.2d 83, 85 (10th Cir.1984); see also Donovan v. McKissick Products Co., 719 F.2d 350, 354 (10th Cir.1983), cert. denied, — U.S. -, 104 S.Ct. 2657, 81 L.Ed.2d 363 (1984); E.E.O.C. v. Central Kansas Medical Center, 705 F.2d 1270, 1274 (10th Cir.1983). By affidavit, defendant states that at the time the collective bargaining agreement was reached in May, 1979, both the defendant and the union believed the provision complied with the F.L.S.A. Affidavit of Ron Mershon at ¶ 3; affidavit of Michael Patchell at 113. This is sufficient to show that the defendant knew that its employees were covered by the F.L.S.A. The defendant, therefore, willfully violated the F.L. S.A., although there is no evidence that the violation was intentional or deliberate. The three-year statute of limitations provision applies.

As a second argument, defendant contends that it cannot be held liable because it has complied with the administrative requirements of the F.L.S.A. in making payments for the period from November 5, 1980, to November 5, 1982, and that the Secretary is precluded from seeking further recovery of back overtime pay by the policies of the Department of Labor. This argument is premised on provisions of the “Field Operations Handbook” of the Wage and Hour Division of the Department of Labor. These provisions, however, are merely guidelines and do not carry the force of law. See Brennan v. Ace Hardware Corp., 495 F.2d 368, 376 (8th Cir.1974); Marshall v. Krystal Co., 467 F.Supp. 9, 82 C.C.H.Lab. Cases ¶ 33,603 (E.D.Tenn., 1977); Hawkins v. Agricultural Stabilization & Conservation Committee, 149 F.Supp. 681 (S.D.Tex.1957), aff'd, 252 F.2d 570 (5th Cir.1958). The language of the guidelines themselves establish that they are norms which govern the typical case, but which allow for variation and exception.

Further, there is no indication that the Secretary has failed to comply with these guidelines. By affidavit, plaintiff has established that the Department of Labor intended to seek back payment for the two-year period preceding February 19, 1982, the time the investigation was begun. Ward affidavit at 112; Rice affidavit at ¶ 3; Bird affidavit at II 8. Unilaterally, the defendant determined to make back payment for the two-year period preceding November 5, 1982. Thus, under the defendant’s calculation, the illegal contract was in force for only 11 months of the covered period, whereas the plaintiff sought back pay for a period which included 19 months during which the illegal contract was in force. Although there appears to have been a communications problem between the plaintiff and the defendant with regard to the beginning and ending dates of the two-year period, the plaintiff did not stray from the guidelines which provide that, at the administrative level, the Department of Labor will generally pursue back pay for only a two-year period. The Handbook provides that back pay usually will be requested for the period extending two years from the date payment was first requested or for the period covered by the investigation, whichever is shorter. Field Operations Handbook § 53c02(a).

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607 F. Supp. 784, 27 Wage & Hour Cas. (BNA) 247, 1984 U.S. Dist. LEXIS 24769, Counsel Stack Legal Research, https://law.counselstack.com/opinion/donovan-v-public-service-co-of-new-mexico-nmd-1984.