Gorman v. Consolidated Edison Corp. ( 2007 )

05-6546-cv (L)
Gorman v. The Consol. Edison Corp.
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term, 2006
(Argued: February 15, 2007 Decided: May 30, 2007)
Docket Nos. 05-6546-cv; 06-2241-cv
- - - - - - - - - - - - - - - - - - - -x
JAMES H. GORMAN, JR. et al.,
Plaintiffs-Appellants,
EDGARDO CARBALLO, CRAIG M. CUVELIER,
FREDERICK J. GALBRAITH, ROBERT VETERAMO,
RICHARD P. JONES, JAMES M. CILLO ,
Plaintiffs,
-v.-
THE CONSOLIDATED EDISON CORPORATION,
Defendant-Appellee.
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JAMES H. GORMAN, JR. et al.,
Plaintiffs-Appellants,
-v.-
ENTERGY NUCLEAR OPERATIONS, INC.,
Defendant-Appellee.
- - - - - - - - - - - - - - - - - - - -x
1
Before: JACOBS, Chief Judge, CALABRESI, Circuit
Judge, and BERMAN, District Judge.*
Consolidated appeals from judgments of the United
States District Court for the Southern District of New York
(McMahon, J. and Robinson, J.) dismissing claims asserted
under the Fair Labor Standards Act and New York Labor Law,
by employees seeking payment of wages for activities
incident to the start and end of the work day.
Affirmed.
JOSEPH P. CAREY, Joseph P.
Carey, P.C., Fishkill, New York
(Annette G. Hasapidis, Law
Offices of Annette G. Hasapidis,
South Salem, New York, on the
brief), for Plaintiffs-
Appellants.
DAVID J. REILLY (Mary K.
Schuette, Eva L. Martinez,
Barbara Jane Carey, on the
brief), Consolidated Edison
Company of New York, Inc., Law
Department, New York, New York,
for Defendant-Appellee The
Consolidated Edison Corporation.
JONATHAN M. KOZAK (Joseph M.
Martin, on the brief), Jackson
Lewis LLP, White Plains, New
York, for Defendant-Appellee
Entergy Nuclear Operations, Inc.
*
The Honorable Richard M. Berman, of the United States
District Court for the Southern District of New York,
sitting by designation.
2
DENNIS JACOBS, Chief Judge:
In these consolidated appeals under the Fair Labor
Standards Act (“FLSA”), employees of a nuclear power station
sue their present and former employers (variously)
challenging computation of overtime and seeking payment of
wages for the time it takes for security-related procedures
at ingress to the plant, for suiting up, for some
intervening steps, and for the same in reverse. FLSA, 29
U.S.C. § 201 et seq., as amended by the Portal-to-Portal
Act, 61 Stat. 86-87 (codified at 29 U.S.C. § 254(a)). The
plaintiffs work at the Indian Point II nuclear power plant
(“Indian Point” or “the plant”), which was owned and
operated by defendant Consolidated Edison Company of New
York, Inc. (“Con Ed”), and was sold in September 2001 to
defendant Entergy Nuclear Operations, Inc. (“Entergy”).
In the action against Con Ed, plaintiffs claim that the
method of calculating the hourly overtime rate inadequately
accounts for the premium paid to those who work the
nightshifts. The United States District Court for the
Southern District of New York (McMahon, J.) dismissed, and
plaintiffs moved for leave to file an amended complaint.
The proposed amended complaint asserted the different and
3
distinct FLSA claim to be paid wages for time spent in
security procedures and in “donning and doffing” required
protective gear (to use the term of art). Judge McMahon
denied the motion for leave to amend as futile.
The suit against Entergy asserted claims which were
substantially similar to those in the proposed amended
complaint against Con Ed.1 The district court (Robinson,
J.) granted Entergy’s motion to dismiss, and denied
plaintiffs’ motion for leave to amend as futile.
On appeal, each case presents the question whether
ingress and egress and donning and doffing are compensable
under the FLSA. Also at issue is the propriety of Con Ed’s
method of calculating plaintiffs’ hourly overtime rate.
There are also state law claims; but it is stipulated that
those claims are controlled by our adjudication of the FLSA
claims.
We affirm.
1
Plaintiffs’ proposed amended complaint identified no
additional activities. As the district court observed, the
proposed changes simply “add details about the procedures
[plaintiffs are] required to perform [and] do not alter the
non-compensable nature of the activities [they] are required
to perform before and after work.” Gorman v. Entergy, No.
04 Civ. 8484 (S.D.N.Y. filed Apr. 17, 2006).
4
I
The FLSA, 29 U.S.C. § 201 et seq., was enacted to
ensure that employees receive a “fair day’s pay for a fair
day’s work,” Overnight Motor Transp. Co. v. Missel, 316 U.S.
572, 578 (1942) (quoting 81 Cong. Rec. 4983 (1937) (message
of President Franklin D. Roosevelt)), superseded by statute,
Portal-to-Portal Act, 61 Stat. 86-87, as recognized in Trans
World Airlines v. Thurston, 469 U.S. 111, 128 n.22 (1985).
On the pay end, the FLSA “guarantee[s] compensation for all
work or employment engaged in by employees covered by the
Act.” Tennessee Coal, Iron & R. Co. v. Muscoda Local No.
123, 321 U.S. 590, 602-03 (1944). But not all work-related
activities constitute “work or employment” that must be
compensated. Kavanagh v. Grand Union Co., Inc., 192 F.3d
269, 271-72 (2d Cir. 1999).
In a short-lived 1946 holding, the Supreme Court
construed the FLSA to require pay for the time employees
spent walking on the employer’s premises before clocking in,
and for donning and doffing aprons and overalls. Anderson
v. Mount Clemens Pottery Co., 328 U.S. 680, 691-93 (1946),
superseded by statute, Portal-to-Portal Act, 61 Stat. 86-87,
as recognized in Reich v. N.Y. City Transit Auth., 45 F.3d
5
646, 649 (2d Cir. 1995). In 1947, the Portal-to-Portal Act
created two exceptions from FLSA-mandated compensation:
(1) walking, riding, or traveling to and from
the actual place of performance of the
principal activity or activities which such
employee is employed to perform, and
(2) activities which are preliminary to or
postliminary to said principal activity or
activities,
which occur either prior to the time on any
particular workday at which such employee
commences, or subsequent to the time on any
particular workday at which he ceases, such
principal activity or activities.
29 U.S.C. § 254(a). Each of the two subsections bears upon
plaintiffs’ claims.
Under subsection (1), no pay is required for travel to
and from the place where the employee performs his
“principal activities”; the FLSA regulations define
“principal activities” as those “which the employee is
employed to perform.” 29 C.F.R. § 790.8(a) (internal
quotation marks omitted). Subsection (2) of the Portal-to-
Portal Act undid the Anderson holding that required
compensation for putting on aprons and overalls, and thus
“was intended to relieve employers from liability for
preliminaries, most of them relatively effortless, that were
thought to fall outside the conventional expectations and
6
customs of compensation.” N.Y. City Transit Auth., 45 F.3d
at 649. A substantial body of case law discusses subsection
(2)’s distinction between (on the one hand) preliminary and
postliminary activities and (on the other) the principal
activities of employment; but the distinction remains
elusive in application.
Nine years after the Portal-to-Portal Act, the Supreme
Court considered whether changing clothes and showering were
among the principal work activities for workers at a battery
plant who “must make extensive use of dangerously caustic
and toxic materials, and are compelled by circumstances,
including vital considerations of health and hygiene, to
change clothes and to shower.” Steiner v. Mitchell, 350
U.S. 247, 248 (1956). After allowing that preliminary and
postliminary “changing clothes and showering under normal
conditions” were indisputably non-compensable, id. at 249,
the Court described the highly corrosive and toxic
substances that permeate the battery plant, and ruled that:
activities performed either before or after the
regular work shift . . . are compensable under the
portal-to-portal provisions of the Fair Labor
Standards Act if those activities are an integral
and indispensable part of the principal activities
for which covered workmen are employed and are not
specifically excluded by [subsection 1 of the
Portal-to-Portal Act].
7
Id. at 256 (emphasis added). Thus, after Steiner,
activities that are “integral and indispensable” to
principal activities are compensable under the FLSA (as well
as the principal activities themselves).
On the same day Steiner issued, the Supreme Court
decided a slaughterhouse case, holding that knife-sharpening
is “an integral part of and indispensable to the various
butchering activities for which [the workers] were
principally employed.” Mitchell v. King Packing Co., 350
U.S. 260, 263 (1956). The Mitchell Court shed light on the
meaning of “integral” (as used in Steiner): sharpening
knives is both indispensable to the task of butchering
animals, and intrinsically “connected with” it. Id. at 262.
The Court cited the testimony of a supervisor to the effect
that “a dull knife would slow down production . . . , affect
the appearance of the meat as well as the quality of the
hides, cause waste and make for accidents; ‘that a knife to
be of any practical value in a knife job has to be sharp.’”
Id. (ellipses omitted).
In a more recent case, IBP v. Alvarez, the parties left
uncontested the finding that the donning and doffing of
“unique protective gear” constitute “principal activities”;
8
at issue in the Supreme Court was: whether employees must
be paid for time waiting to enter the locker room, time in
transit from the locker room to the job-site, and time in
transit back to the locker room. 546 U.S. 21, 29-30, 39-40
(2005).
The Court first held that “any activity that is
‘integral and indispensable’ to a ‘principal activity’ is
itself a ‘principal activity’ under . . . the Portal-to-
Portal Act.” Id. at 37. Since it was uncontested that the
specialized protective gear was “integral and indispensable”
under Steiner, the donning and doffing was itself a
“principal activity.” And because employees are paid for a
continuous workday--which begins with the first principal
activity and ends with the last--the Portal-to-Portal Act
has no application once the workday has begun. Id. at 28-29
(citing 29 C.F.R. § 790.6(a)). Therefore, “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
[compensable].” Id. at 37.
Nevertheless, the Court held that awaiting the first
principal activity of the workday is not itself a principal
9
activity, id. at 40; it cited 29 C.F.R. § 790.7(g), which
“characterizes the time that employees must spend waiting to
check in . . . as generally a ‘preliminary’ activity covered
by the Portal-to-Portal Act.” Id. at 41-42. As the Court
emphasized, “the fact that certain preshift activities are
necessary for employees to engage in their principal
activities does not mean that those preshift activities are
‘integral and indispensable’ to a ‘principal activity’ under
Steiner.” Id. at 40-41.
II
Before the Indian Point employees can perform the tasks
for which they were hired, they spend between ten and thirty
minutes a day passing through multiple layers of security
and suiting up. Am. Compl. ¶ 19. The question is whether
these activities are “‘integral and indispensable’ to a
‘principal activity’ under Steiner,” IBP, 546 U.S. at 39-40,
and therefore (under IBP) principal activities in
themselves. If so, they are compensable under the FLSA.
We review de novo a district court’s grant of a motion
to dismiss under Rule 12(b)(6). E & L Consulting, Ltd. v.
Doman Indus. Ltd., 472 F.3d 23, 28 (2d Cir. 2006). For the
10
purpose of such a review, this Court must accept as true all
allegations in the complaint and draw all reasonable
inferences in favor of the non-moving party. Taylor v. Vt.
Dep’t of Educ., 313 F.3d 768, 776 (2d Cir. 2002).
Generally, we review a district court’s denial of a motion
to amend under the abuse of discretion standard. Commander
Oil Corp. v. Barlo Equip. Corp., 215 F.3d 321, 333 (2d Cir.
2000). “However, if the denial of leave to amend is based
upon a legal interpretation . . . we review [it] de novo.”
Littlejohn v. Artuz, 271 F.3d 360, 362 (2d Cir. 2001) (per
curiam). Here, each district judge denied the motions for
leave to amend as futile based on their interpretation of
the FLSA; so we review those denials de novo.
Paragraph 15 of the amended complaint against Entergy
(which is substantially similar to the proposed amended
complaint against Con Ed, see n.1, supra) specifies the
activities for which pay is sought:
(i) Waiting in traffic outside the plant
entrance;
(ii) Badge inspection at the entrance,
including a visual check of the interior of the
11
car, and occasional random vehicle inspection
(engine, trunk, glove compartment, undercarriage);
(iii) Parking and walking to the command post;
(iv) At the command post, waiting in line and
passing through a radiation detector, x-ray
machine, and explosive material detector;
(v) Waiting in line to swipe an ID badge and
to palm a sensor;
(vi) Going to the locker room to obtain and
don metal capped safety boots, safety glasses, and
a helmet (if applicable);
(vii) Walking to the job-site;
(viii) And at the end of the shift, doing many
of these things in reverse.2
Am. Compl. ¶ 15.
Plaintiffs’ contention that these activities are
“integral and indispensable to the performance of [their]
principal activities,”3 Am. Compl. ¶ 15, relies chiefly on
2
The egress radiation-test is apparently more
sensitive and takes more time.
3
The pleadings (and the proposed amended pleadings)
omit plaintiffs’ particular responsibilities; but
plaintiffs’ counsel said at argument that plaintiffs work in
chemical applications, radiology, maintenance and the
12
the idea that they are “indispensable” or required--without
accounting for Steiner’s requirement that they be “integral”
as well. Steiner, 350 U.S. at 256.
“Indispensable” is not synonymous with “integral.”
“Indispensable” means “necessary.” See Webster’s Third New
Int’l Dictionary (Unabridged) 1152, 1510-11 (1986).
“Integral” means, inter alia, “essential to completeness”;
“organically joined or linked”; “composed of constituent
parts making a whole.” Id. at 1173. At the same time, “it
is one of the surest indexes of a mature and developed
jurisprudence not to make a fortress out of the dictionary.”
Cabell v. Markham, 148 F.2d 737, 739 (2d Cir. 1945). The
caselaw gives better guidance by apt examples: Sharpening
the knife is integral to carving a carcass, Mitchell, 350
U.S. at 263; powering up and testing an x-ray machine is
integral to taking x-rays, Kosakow v. New Rochelle Radiology
Assocs., P.C., 274 F.3d 706, 717-18 (2d Cir. 2001); and
feeding, training and walking the dog is integral to the
work of a K-9 officer, Reich v. N.Y. City Transit Auth., 45
F.3d 646 (2d Cir. 1995), limited in part by IBP, 546 U.S. at
21. See also IBP, 546 U.S. at 40-41 (observing that
control room.
13
activities which are “necessary” (or indispensable) to a
principal activity are not thereby “integral and
indispensable”); 29 C.F.R. § 790.7(d) (noting, for example,
that “the carrying by a logger of a portable power saw or
other heavy equipment (as distinguished from ordinary hand
tools) on his trip into the woods to the cutting area . . .
is not segregable from the simultaneous performance of his
assigned work” and is thus integral to his principal
activities) (emphasis added).
Steiner is in one sense the most apt analog, dealing as
it does with donning and doffing gear that protects against
workplace dangers that transcend ordinary risks. At issue
in Steiner was exposure to corrosive and toxic substances
that permeated a battery plant; at issue here is the
security of a nuclear power plant. The analogy is, however,
unsustainable. The Steiner opinion invites a narrow
interpretation: “[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.” 350 U.S. at 256. Without the taking of the
measures required, the environment of the battery plant
14
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 249, 250. Steiner
therefore supports the view 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, just as a diver’s donning of wetsuit,
oxygen tank and mouthpiece may be integral to the work even
though it is not the (underwater) task that the employer
wishes done.
By contrast, the activities for which plaintiffs here
seek compensation, while arguably indispensable, are not
integral to their principal activities.4
A. Ingress and Egress Security Procedures
The activities required to enter and exit Indian Point-
-from waiting in line at the vehicle entrance through the
final card-swipe and handprint analysis--are necessary in
4
In the nuclear containment area--which more closely
resembles the battery plant--Indian Point employees wore
specialized gear and dosimeters, and were compensated for
donning and doffing.
15
the sense that they are required and serve essential
purposes of security; but they are not integral to principal
work activities. These security-related activities are
modern paradigms of the preliminary and postliminary
activities described in the Portal-to-Portal Act, in
particular, travel time. The plain wording of subsection
(1) of the Portal-to-Portal Act exempts from the FLSA:
“walking, riding, or traveling to and from the actual place
of performance of the principal activity or activities which
such employee is employed to perform.” 29 U.S.C. §
254(a) (1); see also 29 C.F.R. § 790.7(c).5
Plaintiffs argue that the Portal-to-Portal Act was
enacted when the time-consuming security measures at issue
may not have been envisioned, and there is some force to the
observation that security measures at sensitive facilities
(and elsewhere) are becoming increasingly invasive, layered
and time-consuming. But the text of the statute does not
depend on the purpose of any preliminaries, or how much time
such preliminaries may consume. Travel time was held to be
5
Rules may yield to particular instances. For
example, passing through preliminary security procedures may
be integral to the principal activity of an employee
responsible for monitoring, testing and reporting on the
plant’s infrastructure security.
16
“normal” (and therefore outside the FLSA) in Kavanagh v.
Grand Union Co., Inc., even though the plaintiff (who
performed mechanical services in defendant’s supermarkets)
commuted five to nine hours a day depending on the
supermarkets to which he was dispatched. 192 F.3d 269, 272-
73 (2d Cir. 1999). Normal travel time “does not represent
an objective standard of how far most workers commute or how
far they may reasonably be expected to commute. Instead, it
represents a subjective standard, defined by what is usual
within the confines of a particular employment
relationship.” Id. at 272. By the same token, security
measures that are rigorous and that lengthen the trip to the
job-site do not thereby become principal activities of the
employment. At Indian Point, this is easily demonstrated
because the security measures at entry are required (to one
degree or another) for everyone entering the plant--
regardless of what an employee does (servicing fuel rods or
making canteen sandwiches)--and including visitors. See
Gorman v. Entergy, No. 04 Civ. 8484 (S.D.N.Y. filed Apr. 17,
2006) (citing plaintiffs’ memorandum in opposition to
defendant’s motion to dismiss).
17
B. Donning and Doffing of Protective Gear
Similarly, a helmet, safety glasses, and steel-toed
boots may be indispensable to plaintiffs’ principal
activities without being integral.6 The donning and doffing
of such generic protective gear is not different in kind
from “changing clothes and showering under normal
conditions,” which, under Steiner, are not covered by the
FLSA. 350 U.S. at 249. Among the activities classified in
the regulations as preliminary and postliminary are
“checking in and out and waiting in line to do so, changing
clothes, washing up or showering, and waiting in line to
receive pay checks.” 29 C.F.R. § 790.7(g) (emphasis added).
The donning and doffing of generic protective gear is not
rendered integral by being required by the employer or by
government regulation. See Reich v. IBP, Inc., 38 F.3d
1123, 1126 (10th Cir. 1994) (holding that donning and
doffing safety glasses, a pair of earplugs, a hard hat and
safety shoes, “although essential to the job, and required
by the employer,” are pre- and postliminary activities) ;
6
At argument, plaintiffs’ counsel conceded that the
protective gear listed in the complaint (helmets, safety
glasses, and steel-toed shoes) were the only protective gear
that plaintiffs were required to wear; if given the
opportunity to re-plead, counsel would not supplement.
18
Anderson v. Pilgrim’s Pride Corp., 147 F. Supp. 2d 556, 563
(E.D. Tex. 2001) (same), aff'd, 44 Fed. Appx. 652 (5th Cir.
2002) (not precedential). But see Alvarez v. IBP, Inc., 339
F.3d 894, 903 (9th Cir. 2003) (observing that the “donning,
doffing, and cleaning of non-unique gear (e.g., hardhats)
[is] ‘integral and indispensable’ as that term is defined in
Steiner”), aff’d on other grounds, IBP, 546 U.S. at 21. The
donning and doffing of a helmet, safety glasses and boots
are “relatively effortless,” non-compensable, preliminary
tasks. N.Y. City Transit Auth., 45 F.3d at 649. And even
if the donning and doffing of a helmet, safety glasses and
steel-toed boots were “integral and indispensable” to
plaintiffs’ principal activities, we would be required to
19
consider whether the time so spent was de minimis.7 See id.7
As this Court explained in New York City Transit
Authority:
[T]he de minimis doctrine was first articulated by
the Supreme Court in Anderson . . . : “When the
matter in issue concerns only a few seconds or
minutes of work beyond the scheduled working
hours, such trifles may be disregarded. . . . It
is only when an employee is required to give up a
substantial measure of his time and effort that
compensable working time is involved.”
45 F.3d at 652 (quoting Anderson, 32 U.S. at 692). Three
factors bear upon the determination of whether the time
spent in a particular activity is de minimis: (1) the
administrative difficulty of recording the time; (2) the
size of the claim in the aggregate; and (3) whether the
tasks occur regularly. Id. (citing Lindow v. United States,
738 F.2d 1057, 1062-63 (9th Cir. 1984)).
The tasks here are repeated daily and there would be
little administrative difficulty in recording them. As to
the size of the potential claim, plaintiffs’ counsel was
asked at argument: “Is there anything special about these
shoes or glasses, or safety caps that takes longer than what
we could, in or own experience, know about putting [them]
on?” Counsel responded: “Not to my knowledge.” And counsel
acknowledged that these shoes are not somehow more
complicated than an ordinary shoe.
The pleadings would not contradict a conclusion that
the time so spent would be de minimis; but we decide this
case on the ground that the activities at issue are
preliminary and postliminary because that conclusion is more
easily arrived at on the pleadings. Moreover, it is perhaps
unclear (after IBP’s continuous workday rule) whether the de
minimis test measures only the first integral and
indispensable activity of the day, or includes as well all
intervening steps that precede the next principal activity
of the continuous workday.
20
at 652-53.
* * *
Because plaintiffs can prove no set of facts entitling
them to compensation for time spent entering and exiting the
facility, and donning and doffing a helmet, safety glasses
and boots, we affirm the dismissal of plaintiffs’ claims
against Entergy and the denial by both district judges of
leave to amend the complaints.
III
Plaintiffs challenge the grant of summary judgment
dismissing their overtime-compensation claims against Con
Ed. According to plaintiffs, the method used to calculate
the hourly rate for overtime work inadequately accounted for
the premium rate paid for nightshifts at the plant.
We review de novo the district court's grant of summary
judgment, construing the facts in the light most favorable
to the non-moving party. Cioffi v. Averill Park Cent. Sch.
Dist. Bd. of Educ., 444 F.3d 158, 162 (2d Cir. 2006).
Summary judgment is appropriate only where “there is no
genuine issue as to any material fact and . . . the moving
21
party is entitled to a judgment as a matter of law.” Fed.
R. Civ. P. 56(c).
The FLSA generally requires that an employee who works
more than forty hours in a given week be paid for the excess
time at a rate “not less than one and one-half times the
regular rate at which he is employed.” 29 U.S.C. §
207(a)(1) (emphasis added). The regular rate is “all
remuneration for employment paid to . . . the employee,”
minus certain exceptions inapplicable here. Id. at §
207(e). As the Supreme Court has explained, it is “the
hourly rate actually paid the employee for the normal, non-
overtime workweek,” and “must reflect all payments which the
parties have agreed shall be received regularly during the
workweek, exclusive of overtime payments.” Walling v.
Youngerman-Reynolds Hardwood Co., 325 U.S. 419, 424-25
(1945).
The collective bargaining agreement (“CBA”) between
plaintiffs and Con Ed created a three-tiered compensation
structure: (i) “straight” or “basic” time for day shifts,
(ii) an 8% premium for the evening shift (between 6:00 p.m.
and midnight), and (iii) a 10% premium for the nightshift
22
(between midnight and 7:00 a.m.). These latter two premiums
are collectively referred to as the nightshift differential.
Con Ed argues that the regular rate should be
calculated using “a weighted average of the employee’s
earnings at each rate of pay worked that week (i.e. basic
rate, 8% nightshift . . . differential rate, or 10%
nightshift differential rate).” In other words, the regular
rate should be derived from the total compensation paid to
an employee in a given pay period divided by the number of
hours worked; such a calculation naturally encompasses the
nightshift differentials, if any, worked by the employee.8
The plaintiffs contend that “[t]here is no reason to
determine a weighted average” because “pursuant to the CBA[,
plaintiffs] are employed solely on the basis of a single
hourly rate, which is their respective ‘regular rate.’”“
Plaintiffs argue that this “single hourly rate” should be
8
The method Con Ed actually uses has more steps, but
yields the same result as a more simple weighting
calculation. Con Ed’s method (1) calculates how much
additional money an employee earned as a result of the
nighttime differentials; (2) divides that number by the
total number of hours worked in the week; (3) multiplies
that number by the number of overtime hours worked in the
week; (4) it then divides that number in half (to account
for the time-and-a-half); and (5) compensates the employee
by that additional increment.
23
the 10% nightshift differential, regardless of the shift
actually worked, by virtue of CBA Paragraph 13(b):
“Assignment to Work Functions: Any employee assigned to
perform any lower or lateral job or function, except
pursuant to a demotion, shall receive his regular rate of
pay while performing such work.” We fail to see how this,
or any other provision of the CBA supports plaintiffs’
argument.9
This Court has already validated the weighted average
method of determining the regular rate, which we described
as “properly calculated by adding all of the wages payable
for the hours worked at the applicable shift rates and
dividing by the total number of hours worked.” Brock v.
9
The clear and unambiguous language of Paragraph 13(b)
simply provides that temporary reassignments that pay less
will not affect an employee’s actual compensation, unless
the reassignment was a result of a demotion. See Duse v.
Int’l Bus. Machs. Corp., 252 F.3d 151, 158 (2d Cir. 2001)
(“Where the language of the contract is clear and
unambiguous, the contract is to be given effect according to
its terms and those terms may be the basis for summary
judgment.”) (internal citations omitted). Plaintiffs’
argument that the contractual provision establishes a single
hourly rate is nonsensical; the CBA expressly provides for
at least three rates (straight time, the 8% evening premium,
and the 10% night premium). See Bank Julius Baer & Co. v.
Waxfield Ltd., 424 F.3d 278, 283 (2d Cir. 2005) (observing
that “canons of construction” forbid contractual
interpretations that “lead to absurd results”).
24
Wilamowsky, 833 F.2d 11, 14 (2d Cir. 1987); see also id. at
14, 17 (approving the district court’s conclusion “that the
statutory regular rate was . . . the weighted average hourly
rate of all compensation received by the employee”).10
Moreover, the FLSA regulations expressly approve the
weighted average method:
Where an employee in a single workweek works at
two or more different types of work for which
different nonovertime rates of pay . . . have been
established, his regular rate for that week is the
weighted average of such rates. That is, his
total earnings (except statutory exclusions) are
computed to include his compensation during the
workweek from all such rates, and are then divided
by the total number of hours worked at all jobs.
29 C.F.R. § 778.115.1110
In Brock, as here, pay for each of three shifts was
paid at a different hourly rate. 833 F.2d at 13-14. For
overtime, the employer generally paid employees 150% of the
day-shift rate (that being the lowest hourly rate paid for
non-overtime work). Id. In Brock, we rejected that pay in
favor of the weighted average method. Id. at 14.
11
As plaintiffs observe, the example used in this
regulation assumes that the two rates of pay are a result of
different jobs, not nighttime differentials. But this
observation misapprehends the purpose of the regulation,
which is simply to provide an example of a means of
calculating the regular rate. See 29 C.F.R. § 778.109 (“The
following sections give some examples of the proper method
of determining the regular rate of pay in particular
instances . . . .” (emphasis added)).
25
Finally, plaintiffs’ argument under the CBA succumbs to
the rule that “the regular rate of pay cannot be left to a
declaration by the parties as to what is to be treated as
the regular rate for an employee[;] it must be drawn from
what happens under the employment contract.” Bay Ridge
Operating Co. v. Aaron, 334 U.S. 446, 464 (1948) (emphasis
added) ; see also Walling, 325 U.S. at 424 (observing that
the regular rate “is not an arbitrary label chosen by the
parties; it is an actual fact”); 29 C.F.R. § 778.109 (same).
Because Con Ed’s weighted average method adequately accounts
for the compensation actually received by employees in
calculating the regular rate, we affirm the district court’s
grant of summary judgment to Con Ed.
* * *
For the foregoing reasons, the judgments of the
district courts are affirmed.
26