Duplessis v. Delta Gas, Inc.

640 F. Supp. 891
CourtDistrict Court, E.D. Louisiana
DecidedJuly 23, 1986
DocketCiv. A. 85-2754
StatusPublished
Cited by5 cases

This text of 640 F. Supp. 891 (Duplessis v. Delta Gas, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Duplessis v. Delta Gas, Inc., 640 F. Supp. 891 (E.D. La. 1986).

Opinion

FINDINGS OF FACT AND CONCLUSIONS OF LAW

PATRICK E. CARR, District Judge.

This matter came on for trial before the Court, sitting without a jury, on June 23, 1986. The plaintiffs 1 are all employees of the defendant, Delta Gas, Inc., a wholly owned subsidiary of defendant Louisiana Energy and Development Corporation (LEDCO). Prior to 1980, the plaintiffs were paid on an hourly basis and received “time and a half” for overtime. In that year, plaintiffs signed “agreements” by which they were placed on salary, plus benefits 2 , and no longer received overtime compensation. On July 1, 1985, after this suit was filed, defendant returned plaintiffs to the hourly pay scale and again paid overtime compensation, but no other benefits.

Plaintiffs brought suit under the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201, et seq., seeking to recover the unpaid overtime compensation, liquidated damages and reasonable attorneys’ fees. 3 It was not disputed that at all times the plaintiffs were protected employees under the FLSA. Additionally, prior to trial the parties entered a stipulation setting forth the amount of overtime worked by each employee during the preceding three years and the proper rate of overtime pay for each. The essential dispute revolved around one employee, John C. Ragas, Sr., whose time records for a one and one half year period had been lost and for whom no stipulation could be reached for that period. The parties also dispute whether or not overtime compensation is due for lunch hours which were not actually taken. Defendants also sought credit for the benefits paid, asserting that such benefits were intended to compensate the employees in lieu of overtime, pursuant to 29 U.S.C, § 207(h). Further, defendants acknowledged that their conduct was in violation of the FLSA, but seek to limit plaintiffs’ recovery to a period of two years and avoid the imposition of liquidated damages by showing good faith and reasonableness in their conduct pursuant to the Portal-to-Portal Pay Act, 29 U.S.C. § 260.

At the close of all of the evidence, the Court took the matter under submission and the parties were given time to file post-trial memoranda. Now, upon consideration of the entire record the documents in evidence, the testimony of the witnesses, and the law applicable to this case, the Court renders its findings of fact and conclusions of law in accordance with Rule 52 of the Federal Rules of Civil Procedure.

The Court has jurisdiction pursuant to 28 U.S.C. § 1331, and 29 U.S.C. § 216(b). Venue is proper.

Defendant, Louisiana Energy & Development Corporation is a Louisiana holding company. Its wholly owned subsidiary, defendant, Delta Gas, Inc., is a local distribution company served by an interstate pipeline, and in such capacity distributes natural gas to residential and commercial customers in Plaquemines Parish, Louisiana. *893 With the exception of J.C. Ragas, all plaintiffs were employed by defendant Delta as laborers. Plaintiff Ragas was employed by Delta in the Meter Technician Department. At the pertinent times, Ragas’ time records were kept separately from that of the other plaintiffs.

Prior to 1980, all plaintiffs were paid on an hourly basis and received no fringe benefits. They were, however, compensated at time and one half for overtime hours worked. In that year, however, all employees became salaried by signing “agreements” with Delta and began receiving pay for “non-productive hours attributable to absence for sickness, attendance of funerals, jury duty and personal reasons.” See Fact Stipulation, p. 4. They also received end of the year bonuses.

J.Q. Delap, Jr., the Executive Vice President of Delta, initiated the change from hourly to salary pay. Mr. Delap testified that at the time he initiated the change in pay, the company was having personnel problems, that the employees were working too much overtime and that his job was to straighten out the problems and ‘get the company making money.’ Hence, Mr. Delap devised a ‘disincentive’ overtime plan whereby no overtime would be paid and instead all employees would be placed on salary plus benefits.

The monthly salary figure was derived by figuring out the monthly amount of hourly pay, adding to that an average of the overtime worked in the past, and giving the employee an increase in pay. According to Mr. Delap, the purpose of the plan was not to save the company money. Rather, Mr. Delap testified, the plan was devised to encourage the employees to perform their work during regular working hours and increase the efficiency of the company’s operations. In fact, the monthly salary proposal would result in an overall increase in cost. 4

Mr. Delap, who has a Masters Degree in Business Administration, acknowledged that at the time in question he was aware that the employees were covered by the FLSA: He testified that he thought, however, that the “agreements” signed by the employees would constitute adequate waivers under the FLSA. Mr. Delap did not consult with an attorney prior to drafting the “agreements”.

These “agreements” were entitled monthly salary proposals. Each employee was given a separate form and the opportunity to accept or reject the proposals. Under cross examination, Mr. Delap acknowledged that the company would have no recourse if the employees refused to go on salary. According to Mr. Delap, the employees were urged to join the “Delta team” but were assured that they would be retained on an hourly basis with no benefits, as before, if they rejected the proposal.

Mr. Delap acknowledged that there were initially several rejections; however, he met with the employees several times, explained the benefits of the plan, and eventually all signed the agreements to go on salary. Contrary to this testimony is that of the plaintiffs who testified that their immediate supervisors threatened them with the loss of their jobs if they refused to be paid on a monthly basis.

The Court finds that the monthly salary proposal was highly unpopular with the employees who were justifiably concerned for their rights to overtime pay. In fact, under cross examination, although Mr. Delap insisted that the company had no intention of working the employees overtime, he admitted that there would be nothing to prevent the company from abusing the employees through overtime work. Further, the Court specifically finds that the “agreements” were not voluntary but rather were coerced by threats of job loss.

Mr.

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Bluebook (online)
640 F. Supp. 891, Counsel Stack Legal Research, https://law.counselstack.com/opinion/duplessis-v-delta-gas-inc-laed-1986.