Giguere v. Port Resources Inc. , 927 F.3d 43 ( 2019 )

United States Court of Appeals
For the First Circuit
Nos. 18-2073
18-2163
DAVID GIGUERE, on his own behalf and on behalf of all others
similarly situated,
Plaintiff, Appellee/Cross-Appellant,
KELLON ALEXIS; SYLVIA OUELLETTE; LINDA PERRY; LEE SOUTHWICK;
KIMBERLY FARRELL; MARY FEELEY; LINDSAY GAGNE; JERRY GARCIA;
CRYSTAL JACKMAN; RYAN JARRELL; RENEE JORDAN; CHRISTINE POORE;
BRIE GAIA REED; NEVERLY RUDA; ZU-CHYUN SPEAKER;
RENOVAT BARAGENGANA; ROBERT BISSELL; THERESA BISSELL; LONG CAO;
DARREN CHEVRIER; KENNETH COLE; CYNTHIA COOKINGHAM;
SUSAN DESJARDINS; JOHN FARRELL; ROBERT BROGDEN; DEBRA DOW;
PAIGE HARRIS; SUSAN MACDONALD; ERIC NKURUNZIZA;
EULADE NKURUNZIZA,
Plaintiffs,
v.
PORT RESOURCES INC.,
Defendant, Appellant/Cross-Appellee.
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MAINE
[Hon. Nancy Torresen, U.S. District Judge]
Before
Lynch, Kayatta, and Barron,
Circuit Judges.
Timothy H. Norton, with whom Graydon G. Stevens and Kelly,
Remmel & Zimmerman were on brief, for Port Resources, Inc.
Peter Mancuso, with whom Andrew Schmidt and Andrew Schmidt
Law PLLC were on brief, for David Giguere.
June 19, 2019
LYNCH, Circuit Judge. The Fair Labor Standards Act
(FLSA), 29 U.S.C. § 201 et seq., sets federal minimum-wage,
maximum-hour, and overtime guarantees. When an employer fails to
meet these requirements, the FLSA gives employees a private right
of action to recover their due. Id. § 216(b).
These cross-appeals come from an action, brought as an
FLSA collective action and as an individual action under analogous
Maine labor laws, to recover what are alleged to be unpaid overtime
wages. The employer, defendant Port Resources, disputes that such
wages are owed. Under its sleep-time policy, Port Resources did
not pay employees like plaintiff David Giguere for eight hours
each night, even though the employees were on duty during that
time.
The district court found that this policy was unlawful,
Giguere v. Port Res., Inc. (Giguere I), No. 16-CV-58-NT, 2018 WL
1997754, at *10 (D. Me. Apr. 27, 2018), and so awarded back wages
to the collective-action plaintiffs and treble damages to Giguere,
Giguere v. Port Res., Inc. (Giguere II), No. 16-CV-58-NT, 2018 WL
5268600, at *5 (D. Me. Oct. 23, 2018).
Finding no error in the district court's carefully
reasoned opinions, we affirm.
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I.
A.
Port Resources is a nonprofit organization that runs
group homes (which it calls "programs") that provide housing and
services to adults with developmental disabilities and behavioral
health challenges. It uses a long-term-staff model to care for
program clients. Its long-term staff provide daily living skills
development, administer medication, and assist with personal care
and community integration. And, true to that name, long-term staff
work long shifts -- seven days on and seven days off, from Thursday
to Thursday. One set of long-term staff alternates with another
assigned to the same residence. Twenty Port Resources programs
have this setup, and eleven of those twenty also have "overnight
awake staff" responsible for attending to clients during the night,
as necessary.
A long-term staff's weeklong shift includes four four-
hour unpaid breaks and eight hours of nightly unpaid sleep time.
This sleep-time arrangement is governed by a written "Sleep Time
Agreement," which provides in full:
This confirms the agreement between Port
Resources and a Direct Support Professional
who may be assigned to be on duty for one or
more twenty-four (24) [hour] shifts.
Under wage and hour guidelines, 29 C.F.R.
sections 785.221 and 785.23, where an employee
1 Though Port Resources cites section 785.22, in this
litigation it has "affirmatively conceded that it is not relying
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is required to be on duty for 24 hours or more,
the employer and the employee may agree to
exclude from hours worked a bona fide meal
period and a bona fide regularly scheduled
sleeping period of not more than 8 hours,
provided that adequate sleeping facilities are
furnished by the employer and the employee can
usually enjoy an uninterrupted night's sleep.
If the sleeping period is interrupted by a
call to duty, the interruption will be counted
as hours worked. If the employee cannot get
at least 5 hours' sleep during the scheduled
sleep period, the entire time should be
treated as working time. The eight-hour
sleeping period will be excluded from hours
worked unless performance of work duties is
required.
If the Direct Support Professional does have
to work during the sleep period, they should
record their time worked on the daily service
charts and notify their Program Manager of the
interruption so that their electronic time
sheet can be corrected.
If anyone has any questions, please feel free
to contact the Director of Human Resources.
It remains contested how often long-term staff must attend to the
program clients during scheduled sleep time.
Port Resources has chosen to compute its payroll
workweek from Sunday to Sunday, so each long-term-staff shift spans
two payroll workweeks. This means that Port Resources pays long-
term staff for forty hours of work during their first payroll
workweek (Thursday to Saturday) and for fifty-six hours of work
on [section] 785.22 to support its sleep policy." Giguere I, 2018
WL 1997754, at *9 n.12.
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during their second (Sunday to Thursday). Port Resources does not
pay its long-term staff for their fifty-six hours of sleep time
(Thursday to Thursday).
B.
David Giguere, a former Port Resources employee, sued
Port Resources, alleging that its sleep-time policy violated the
FLSA; the Maine Wages and Medium of Payment Act (the Wages Act),
Me. Stat. tit. 26, §§ 621-A, 626-A, 629; and the Maine Minimum
Wage Law, id. §§ 663, 664, 670.2
The district court conditionally granted collective
action status for the FLSA claim, and thirty individual employees
besides Giguere opted in. Giguere brought his Maine claims only
on his own behalf.3
Both parties moved for summary judgment, which the
district court granted to Giguere and the other collective-action
plaintiffs on the FLSA claim and to Giguere on his two Maine law
counts.4 Giguere I, 2018 WL 1997754, at *10. The district court
2 Giguere also brought, but then voluntarily withdrew, a
claim for alleged breach of contract and unjust enrichment.
3 To be more precise, Giguere at first sought class action
status for his Maine law counts, but later voluntarily abandoned
that request.
4 The district court then held a bench trial to determine
whether Port Resources could establish a good-faith defense to
liquidated damages under the FLSA. The district court found that
Port Resources had acted in good faith and the parties stipulated
to the back wages owed each plaintiff.
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then awarded Giguere treble damages under the Wages Act. Giguere
II, 2018 WL 5268600, at *5.
Both parties appealed.
II.
We review the district court's summary judgment rulings
de novo. Jakobiec v. Merrill Lynch Life Ins. Co., 711 F.3d 217,
223 (1st Cir. 2013). And because the parties filed cross-motions
for summary judgment, we "view each motion separately, drawing all
inferences in favor of the nonmoving party." Fadili v. Deutsche
Bank Nat. Tr. Co., 772 F.3d 951, 953 (1st Cir. 2014).
A.
Port Resources argues that the district court erred in
concluding that it had violated the FLSA by not compensating its
long-term staff for their sleep time. We find no such error, so
we affirm.
We begin with background. The FLSA's usual rule is that
an employer must pay an employee for all time the employee is
required to spend at a worksite, even sleep time. See 29 C.F.R.
§ 785.7 ("The workweek ordinarily includes 'all the time during
which an employee is necessarily required to be on the employer's
premises, on duty or at a prescribed work place.'" (quoting
Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 690-91 (1946))).
But the Department of Labor's (DOL) regulations also provide that
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if "certain conditions" are met, an employer may carve worksite
sleep time out of an employee's hours worked. Id. § 785.20.5
Port Resources relies on one such sleep-time regulation:
29 C.F.R. § 785.23, which covers "live-in" employees. If such an
employee "resides on his employer's premises on a permanent basis
or for extended periods of time," he and the employer may enter
into "any reasonable agreement" about payment for sleep time. Id.No one claims this regulation is unambiguous. Aware of
confusion about the regulation, DOL interpreted the term "extended
periods of time" in a 1988 enforcement memorandum. That memorandum
stated that an employee meets the extended-periods-of-time
standard when, as relevant here, he "resides on the premises for
a period of at least 120 hours in a workweek." U.S. Dep't of
Labor, Wage & Hour Div., Enforcement Policy, (June 30, 1988), 1988
WL 614199, at *2 (emphasis added). The memorandum defined
"workweek" as "seven consecutive 24-hour periods," citing 29
C.F.R. § 778.105, id., which provides that an employee's workweek
"need not coincide with the calendar week," but once the employer
has established when the workweek begins, the workweek's span
5 Section 785.20 states: "Under certain conditions an
employee is considered to be working even though some of his time
is spent in sleeping or in certain other activities." Though this
might be read to imply that sleep time is generally not counted as
hours worked, context shows the opposite. In immediately following
sections, DOL carefully delineates when an employer may exclude
worksite sleep time from an employee's hours worked.
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"remains fixed regardless of the schedule of hours worked by [the
employee]," 29 C.F.R. § 778.105.
Port Resources concedes that it "established" a Sunday-
to-Sunday workweek for payroll purposes. And it makes no attempt
to show that its long-term staff reside on its premises for 120
hours within that payroll workweek.
Port Resources instead argues that DOL did not in its
memorandum intend to make the workweek the baseline for determining
whether an employee resided on the employer's premises for
"extended periods of time." This argument turns on the text of
DOL's 1988 memorandum, so we quote that memorandum's key language
in full:
Under circumstances where an employee does not
maintain his or her permanent residence on the
premises and does not otherwise reside on the
premises 7 days a week, [DOL's Wage and Hour
Division (WH)] will consider an employee who
sleeps in private quarters, in a homelike
environment, to reside on the premises for an
extended period of time within the meaning of
[section] 785.23 if the employee resides on
the premises for a period of at least 120 hours
in a workweek.
WH is refining and restating the minimum
conditions required to meet this rule. An
employee will be found to reside on the
premises for extended periods of time if:
(1) the employee is on duty at the group
home and is compensated for at least
eight hours in each of five consecutive
24-hour periods; and
(2) the employee sleeps on the premises
for all sleep periods between the
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beginning and end of this 120-hour
period.
1988 WL 614199, at *2. Port Resources argues that after laying
out its 120-hours-in-a-workweek standard, DOL then "refin[ed] and
restat[ed] the minimum conditions required to meet this rule"
without any mention of the term "workweek." Port Resources then
attempts to bolster this argument with opinion letters,
interpretations, and bulletins spanning the three decades since
DOL's 1988 memorandum.
While the question is not free from doubt (and further
clarification from DOL may be warranted6), we think Giguere has
the better reading of DOL's memorandum. First, nothing in the
language Port Resources relies on repudiates the DOL's statement
that the extended-periods-of-time standard requires "reside[nce]
on the [employer's] premises for a period of at least 120 hours in
a workweek." The language Port Resources relies on follows
directly after that statement. So Port Resources' argument is
that DOL announced a workweek-based rule in one breath and then
disclaimed it in the next. The better reading of the language
6 We note that neither party sought guidance from DOL on
this issue. See 29 C.F.R. § 785.1 (noting that "[i]f doubt arises"
in "determining what constitutes working time" under DOL's
regulations, the party in doubt should send "inquiries" to DOL).
And neither party has asked that we seek guidance from DOL. So,
preferring not to further delay resolution of this case, we will
proceed without seeking such clarification.
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Port Resources relies on is that it is what it says it is: a
refinement of "this rule" -- that is, DOL's workweek-based rule.
Second, the 1988 memorandum has not been superseded. It
remains the most comprehensive of DOL's analyses of section 785.23.
And DOL's later documents do not deviate from its analysis; rather,
they continue to reference the 1988 memorandum. DOL has, as
recently as 2014, referred to the 1988 memorandum in interpreting
section 785.23. See U.S. Dep't of Labor, Wage & Hour Div.,
Administrator's Interpretation No. 2014-1 (Mar. 27, 2014), 2014 WL
1276986 at *12 n.22.
And third, Port Resources' argument requires us to
assume that DOL did not "consciously" establish the workweek
standard. But DOL not only used the term "workweek," it also noted
that "workweek" and several terms like it "ha[d] caused some
difficulty." 1988 WL 614199, at *2. It then listed those terms
and "defined [them] for further guidance." Id. And its definition
of "workweek" referred to an already promulgated regulation: 29
C.F.R. § 778.105. This careful attention belies Port Resources'
argument.
We conclude that the better reading of DOL's memorandum
is that the agency analyzes section 785.23 with reference to an
employer's workweek. The question then becomes one of deference.
The parties dispute whether the rubric of Auer v. Robbins, 519
U.S. 452 (1997), or Skidmore v. Swift & Co., 323 U.S. 134 (1944),
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applies. We need not address this issue because, even were we to
agree with Port Resources that Skidmore, not Auer, applies, we see
no reason to depart from DOL's understanding of its own regulation.
Cf. Fawcett v. Citizens Bank, N.A., 919 F.3d 133, 138 (1st Cir.
2019). DOL set forth its interpretation of section 785.23 in an
enforcement memorandum. And as the Supreme Court has cautioned,
"[g]ood administration of the [FLSA] and good judicial
administration alike require that the standards of public
enforcement and those for determining private rights shall be at
variance only where justified by very good reasons." Skidmore,
323 U.S. at 140. Port Resources points to no such "very good
reasons" here.
Port Resources argues that a fixed workweek standard
goes against the principle that an employee's work schedule need
not coincide with his payroll workweek. But that principle does
not carry the day. The question is not whether Port Resources can
structure its employees' shifts to, for instance, minimize its
overtime obligations, but whether those employees reside on Port
Resources' premises for "extended periods of time." And under the
most likely reading of DOL's interpretation, the employees do not.
Port Resources' remaining argument is that implementing
a workweek standard is arbitrary. We think not. The workweek is
the "basic unit" of the FLSA. O'Brien v. Town of Agawam, 350 F.3d
279, 298 (1st Cir. 2003); see 29 U.S.C. § 207(a)(1); cf. 29 C.F.R.
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§ 776.4(a) ("The workweek is to be taken as the standard in
determining the applicability of the Act."). There is nothing
arbitrary about using the FLSA's "basic unit" of time in
interpreting the phrase "extended periods of time."
Measuring "extended periods of time" with reference to
the workweek "established" under section 778.105 also makes sense
within DOL's regulatory scheme. The agency has instructed that
the FLSA "takes a single workweek as its standard." 29 C.F.R.
§ 778.104. From this we conclude that the workweek the employer
has chosen is the workweek the employer has chosen.7
We are also mindful of the interpretive rule that
ambiguities in the exceptions to the FLSA's general rules should
be resolved in favor of employees. See Cash v. Cycle Craft Co.,
508 F.3d 680, 683 (1st Cir. 2007) (noting that the FLSA's remedial
nature "'requires that [its] exemptions be narrowly construed
against the employers seeking to assert them' and 'limited to those
establishments plainly and unmistakably within [the exemptions']
terms and spirit.'" (alterations in original) (quoting Reich v.
John Alden Life Ins. Co., 126 F.3d 1, 7 (1st Cir. 1997))); cf.
7 Port Resources can set the start of its workweek to
minimize its overtime obligations. See Abshire v. Redland Energy
Servs., LLC, 695 F.3d 792, 795-96 (8th Cir. 2012); Johnson v.
Heckmann Water Res. (CVR), Inc., 758 F.3d 627, 633 (5th Cir. 2014).
And it can set the start of its week to minimize its sleep-time-
payment obligations. But, having made its choice, Port Resources
cannot now complain that it is unfair to hold it to it.
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O'Connor v. Oakhurst Dairy, 851 F.3d 69, 79 (1st Cir. 2017) (noting
a parallel "default rule of construction under Maine law"). The
FLSA was designed to protect workers "from 'the evil of overwork
as well as underpay.'" Barrentine v. Arkansas-Best Freight Sys.,
Inc., 450 U.S. 728, 739 (1981) (internal quotation marks omitted)
(quoting Overnight Motor Transp. Co. v. Missel, 316 U.S. 572, 578
(1942)). Section 785.23 advances that purpose by carefully
distinguishing between "live-in" employees, who are essentially at
home on the employer's premises, and nonresidential employees, who
are not. And DOL's interpretation of that regulation, as we have
construed it, provides a useful frame of reference -- the
workweek -- to analyze that distinction.
Applying that interpretation, we hold that Port
Resources has not carried the burden necessary to invoke section
785.23. We affirm the district court's finding that Port
Resources' sleep-time policy violated the FLSA.
B.
The remaining issues arise under Maine law and relate
only to the district court's damages award, not its liability
determination.8 The district court held that Port Resources had
8 The district court found that "Maine [wa]s likely to
follow federal law" on sleep time. Giguere I, 2018 WL 1997754, at
*10; see TerMorshuizen v. Spurwink Servs., Inc., Cum-18-288, 2019
WL 2181252, at *3 (Me. May 21, 2019). So, because it had granted
summary judgment to Giguere on his FLSA claim, the district court
"f[ound] that summary judgment for Giguere [wa]s also appropriate
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violated both the Wages Act and the Minimum Wage Law. Giguere I,
2018 WL 1997754, at *10. It awarded Giguere treble damages under
the Wages Act but did not also award him double damages under the
Minimum Wage law, concluding that Maine's rule against double
recovery precluded the second, smaller damage award. Giguere II,
2018 WL 5268600, at *4.
Both parties argue that the district court erred:
Giguere argues that he has a right to recover under both the Wages
Act and the Minimum Wage law. And Port Resources argues that he
is only entitled to recovery under the Minimum Wage Law. We reject
both arguments in turn.
Maine law provides that a plaintiff may not receive two
damages awards for the same loss. Theriault v. Swan, 558 A.2d
369, 372 (Me. 1989). A potential exception to this no-double-
recovery rule arises when the two damages awards serve different
purposes; that is, when one is remedial and the other is punitive.
See, e.g., St. Luke's Cataract & Laser Inst., P.A. v. Sanderson,
573 F.3d 1186, 1204 (11th Cir. 2009). Both parties agree that the
on [his] Maine law claims." Giguere I, 2018 WL 1997754, at *10.
Port Resources says that if we reverse the district court's FLSA
judgment we should overturn its conclusion that Port Resources
also violated Maine law. Giguere, in turn, argues that we can
affirm the district court's judgment that Port Resources violated
Maine law even if we reverse its judgment that Port Resources
violated the FLSA. Since we have affirmed the district court's
FLSA determination, we affirm on the Maine law count without
addressing either party's argument.
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damages for Port Resources' violations of the Minimum Wage Law are
remedial, so the question on appeal is whether the penalties for
violating the Wages Act are punitive, so as to require two
payments.
The Maine Supreme Judicial Court has strongly suggested
that the Wages Act's purpose is remedial. See Bisbing v. Me. Med.
Ctr., 820 A.2d 582, 584-85 (Me. 2003) (awarding the plaintiff
appellate attorneys' fees under the Wages Act, as the Court had
done "under other remedial statutes," id. at 585, and referencing
the statute's "broadly protective purpose," id. at 584). Maine
Wages Act violations entitle a plaintiff to unpaid wages plus "an
additional amount equal to twice the amount of unpaid wages as
liquidated damages." Me. Stat. tit. 26, § 626-A; see Cooper v.
Springfield Terminal Ry. Co., 635 A.2d 952, 955 (Me. 1993). In
Maine, such statutory treble damages provisions are generally
considered remedial rather than punitive in nature. Andrew M.
Horton & Peggy L. McGehee, Maine Civil Remedies 77 & n.132 (4th
ed. 2004) (citing Michaud v. City of Bangor, 203 A.2d 687 (Me.
1964)). So we conclude, as did the district court, that Maine
courts would likely view any damages for Port Resources' Wages Act
violation to be remedial. And because both of Giguere's available
damages awards had a remedial purpose, the district court properly
awarded him only one.
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Port Resources argues that the district court picked the
wrong one. It argues that the district court should not have
awarded Giguere treble damages under the Wages Act because nearly
all Giguere's unpaid sleep hours were overtime. The Minimum Wage
Law grants the right to overtime pay, so Port Resources argues
that double damages under that law was the proper remedy.
This argument rests on the canon against superfluity.
Most Minimum Wage Law violations, Port Resources argues, will also
violate the Wages Act. And because the Wages Act provides the
greater remedy -- treble damages -- plaintiffs will always choose
that award. So to avoid making the Minimum Wage Law's double-
damages remedy superfluous, we should not allow recovery under the
Wages Act for overtime violations.
There are at least two problems with this argument.
First, Giguere is entitled to recovery under the Wages Act. So to
hold that he cannot recover his due, we would have to create an
exception to recovery under that Act. But the Wages Act provides
that any employer who violates its provisions "is liable." Me.
Stat. tit. 26, § 626-A. It does not say "is liable unless the
unpaid wages are for overtime." We see no reason to depart from
the Wages Act's unambiguous language. See Gould v. A-1 Auto, Inc.,
945 A.2d 1225, 1229 (Me. 2008).
And second, the argument fails on its own terms. Under
the Wages Act, an employer cannot require, or even permit, an
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employee "to work without monetary compensation." Me. Stat. tit.
26, § 629(1). The Minimum Wage Law, by contrast, provides that
"[a]n employer may not require an employee to work more than 40
hours in any one week unless [1.5] times the regular hourly rate
is paid for all hours actually worked in excess of 40 hours in
that week." Id. § 664(3). The two laws target different concerns:
The Wages Act provides a remedy for unpaid work, while the Minimum
Wage Law provides a remedy for underpaid work. And because this
is the case, Port Resources' superfluity argument is meritless.
The district court properly awarded Giguere treble
damages as a remedy for Port Resources' Wages Act violation.
III.
We affirm. Costs are awarded to Giguere.
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