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Full Opinion
UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
__________________
No. 98-31321
__________________
ELDON P. DUFRENE, ET AL.,
Plaintiffs,
ELDON P. DUFRENE, ERNEST JOHNSON, SR.,
on behalf of themselves and others similarly situated,
KEVIN MELENDEZ, HOWARD SELF, VERNON ROSS, ET AL.,
Plaintiffs-Appellants,
versus
BROWNING-FERRIS, INC.,
Defendant-Appellee.
_________________________________________________________________
Appeal from the United States District Court
for the Eastern District of Louisiana
_________________________________________________________________
March 20, 2000
Before JONES, BARKSDALE, and DENNIS, Circuit Judges.
RHESA HAWKINS BARKSDALE, Circuit Judge:
For the summary judgment awarded Browning-Ferris, Inc. (BFI),
on the basis that overtime paid its day-rate employees is not
violative of the Fair Labor Standards Act, 29 U.S.C. §§ 201-19
(FLSA), primarily at issue is whether 29 C.F.R. § 778.112 (method
for computing overtime pay for day-rate employees) is a permissible
interpretation of the FLSA. We AFFIRM.*
I.
*
This case was consolidated for oral argument with Hartsell v.
Dr. Pepper Bottling Co., No. 98-11436, ___ F.3d ___ (5th Cir.
2000), which also concerns 29 C.F.R. § 778.112 â particularly,
whether employees must have agreed to be paid on a day-rate basis
in order for the section to apply. The opinion in that case is
being issued simultaneously with this opinion.
Dufrene and the other plaintiffs (employees) are or were
employed by BFI as drivers for recycling trucks or as drivers or
hoppers for garbage trucks. (Hoppers ride on the truck, retrieve
garbage, and empty it into the truck.)
BFI paid employees a day-rate: they were guaranteed a dayâs
pay, regardless of the number of hours worked that day. After a
60-day probationary period, they received holiday pay, and certain
sick days. After one year of service, they received one week paid
vacation.
Employees state that BFI regularly required them to work in
excess of 40 hours a week; and that they were almost never allowed
to stop working after eight hours or less, even if that dayâs
assigned route was completed, but, instead, were required to work
additional routes.
In district court, the parties stipulated:
The overtime compensation is calculated as
follows: Employees are given their day rate
and it is multiplied by the number of days
worked to determine the amount of compensation
due [for the week]. The total amount of
compensation is then divided by the total
number of hours worked to derive the hourly
rate. The hourly rate is then divided by 2
and that amount is multiplied by the number of
overtime hours. This calculation yields the
total amount to be paid in overtime.
In March 1997, employees filed this action, claiming this
method violated the FLSA. On cross motions for summary judgment,
the district court held: employees were paid a day-rate; BFIâs
overtime method complied with 29 C.F.R. § 778.112; and,
correspondingly, it did not violate the FLSA.
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II.
A summary judgment is reviewed de novo. E.g., Morris v. Covan
World Wide Moving, Inc., 144 F.3d 377, 380 (5th Cir. 1998). For
that review, we apply the same standard as the district court.
E.g., Drake v. Advance Const. Serv., Inc., 117 F.3d 203, 204 (5th
Cir. 1997). Such judgment is proper when the summary judgment
record, viewed in the light most favorable to non-movant,
establishes there is no material fact issue and movant is entitled
to judgment as a matter of law. FED. R. CIV. P. 56(c); Drake, 117
F.3d at 204.
Employees contend that the overtime method violates the FLSA;
that 29 C.F.R. § 778.112 does not apply, because they did not
clearly understand it would be used in calculating their overtime
pay, and, alternatively, because they receive âother compensationâ,
as referenced in that section; and finally, their collective
bargaining agreement defines a day as eight hours, the day-rate
compensates them only for working eight hours, and,
correspondingly, they are entitled to additional compensation for
hours worked in excess of that.
A.
Employees maintain that the overtime method violates the FLSA
requirement to pay time and a half for all hours worked in excess
of 40 in a week. BFI responds that it pays such overtime in
accordance with 29 C.F.R. § 778.112, one of the Department of
Laborâs interpretations of the FLSAâs overtime payment
requirements. An administrative agencyâs statutory interpretation
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is reviewed pursuant to Chevron, U.S.A., Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837 (1984) (if intent of Congress
is clear, give it effect; if such intent ambiguous or silent, did
Congress delegate to agency authority to interpret statute; and, if
such delegation and if agencyâs interpretation permissible, court
should defer to it).
1.
The interpretation at issue, 29 C.F.R. § 778.112, provides:
If the employee is paid a flat sum for a dayâs
work or for doing a particular job, without
regard to the number of hours worked in the
day or at the job, and if he receives no other
form of compensation for services, his regular
rate is determined by totaling all sums
received at such day rates or job rates in the
workweek and dividing by the total hours
actually worked. He is then entitled to extra
half-time pay at this rate for all hours
worked in excess of 40 in the workweek.
Addressed first is âwhether Congress has directly spoken to
the precise question at issueâ. Chevron, 467 U.S. at 842. Section
7(a)(1) of the FLSA provides in pertinent part that
no employer shall employ any of his employees
... for a workweek longer than forty hours
unless such employee receives compensation for
his employment in excess of the hours above
specified 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).
At issue is what is that âregular rateâ for employees paid by
a day, not hourly, rate. Because the FLSA does not define âregular
rateâ, Congress did not clearly express its intent on this precise
question.
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The second inquiry is whether Congress delegated to the
Secretary of Labor authority to interpret âregular rateâ. Chevron,
467 U.S. at 843-44. Congress explicitly granted the Secretary the
duty to administer the FLSA. 29 U.S.C. § 204. âBy granting the
Secretary of Labor the power to administer the FLSA, Congress
implicitly granted him the power to interpretâ 29 U.S.C. §
207(a)(1), the FLSA provision at issue. Condo v. Sysco Corp., 1
F.3d 599, 605 (7th Cir. 1993).
The third inquiry is whether § 778.112 is a permissible
interpretation of the FLSA; if it is, it is entitled to deference.
Chevron, 467 U.S. at 844. Employees make much of the undisputed
fact that the greater the number of hours worked, the lower the
regular rate, and, as a result, the lower the overtime
compensation.
But, âthat does not cause the system to run afoul of the FLSA
if, as in this case, the regular rate remains constant within each
workweek and the employee receives one and one-half his regular
rate of compensationâ. Condo, 1 F.3d at 605. Cf. Overnight Motor
Transp. Co. v. Missel, 316 U.S. 572, 580 (1942) (method for
calculating overtime pay for weekly-wage employee did not violate
FLSA simply because regular rate decreased as number of hours
worked in a week increased, so long as employee received, as
overtime compensation, 150% of his regular rate). Therefore,
because each employee is receiving 100% of his regular rate for
each hour worked, plus an additional one-half of that regular rate
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for each hour in excess of 40 in a week, § 778.112 is a permissible
interpretation of the FLSA, entitled to deference.
2.
For the reasons that follow, we conclude that § 778.112
applies to employees. The parties have stipulated that employees
were paid a day-rate, paid regardless of the number of hours worked
in a day. And, they are paid only for the number of days worked in
a week.
Employees contend, however, that, before § 778.112 can be used
to calculate their regular rate of pay, and, correspondingly, their
overtime pay, they must clearly understand that the day-rate covers
the hours the job may demand. They maintain that, because 29
C.F.R. § 778.114 requires a clear understanding prior to
application, § 778.112 must as well.
The plain language of § 778.112 is directly contrary to this
claim. It has no requirement that employees consent to its
application. The triggering requirement is solely that employees
are paid a day or job rate.
On the other hand, § 778.114(c) states: âThe âfluctuating
workweekâ method of overtime payment may not be used ... unless the
employee clearly understands that the salary covers whatever hours
the job may demand in a particular workweekâ. (Emphasis added.)
But, employees here are not paid a salary for a workweek. Instead,
they are paid for the number of days they work in a week: a day-
rate.
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Accordingly, § 778.114 does not apply. For FLSA purposes,
employee agreement to application of § 778.112 is not required.
3.
Next, employees assert that § 778.112 applies only if no other
form of compensation is received; and that, because they received
sick days, paid vacation, and other fringe benefits, the provision
cannot be applied to them. This point was not presented in
district court. In fact, it was not raised here until employeesâ
reply brief.
Generally, we do not address points raised for the first time
in a reply brief. Whitehead v. Food Max of Mississippi, Inc., 163
F.3d 265, 270 (5th Cir. 1998). In any event, our review, at most,
would be only for plain error. Under this quite narrow standard of
review, if the error is âclearâ or âobviousâ, and affects
âsubstantial rightsâ, we have discretion to correct such forfeited
error if it affects the fairness, integrity, or public reputation
of judicial proceedings. E.g., United States v. Calverley, 37 F.3d
160, 162-64 (5th Cir. 1994) (en banc), cert. denied, 513 U.S. 1196
(1995).
Sick days and other fringe benefits are not âother
compensationâ. See 29 C.F.R. § 778.200 (1999) (for calculating
regular rate for overtime pay, payments for vacation, holiday,
illness, retirement, health insurance, or similar benefits not
compensation). There was no plain error.
B.
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Finally, employees seek assistance from their collective
bargaining agreement (CBA).
1.
First, they note that the CBA defines a day as eight hours and
the day-rate compensates them for such hours. They contend that,
because a day is so defined, the day-rate compensates them only for
up to eight hours worked, and, correspondingly, it cannot be used
to compensate them for any hours worked in a day in excess of that.
Consequently, they contend that BFI, in violation of the FLSA, has
not paid them their regular rate for such excess hours.
This action, however, is for claimed violation of the FLSA
overtime provisions, not of the CBA. Because the overtime payment
method complies with § 778.112, this contention is without merit.
2.
Employeesâ contention that the CBA gives them an independent
right to overtime pay after an eight-hour day is also without
merit. The CBA states that this day-is-eight-hours-provision
âshall not be construed as a basis for the calculation of
overtimeâ. Again, this dispute concerns, at best, a violation of
the CBA, not the FLSA. (Needless to say, as employees concede,
this action is not to enforce the CBA.)
III.
For the foregoing reasons, the judgment is
AFFIRMED.
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