Petition for Writ of Certiorari — Long Island Care at Home, Ltd. v. Coke

Supreme .

O p en (Court U.S.

No. 06- 06-593 SEP 26 2006

F THE CLERK

IN THE

Supreme Court of the United States

LONG ISLAND CARE AT HOME, LTD. AND

MARYANN OSBORNE,

Petitioners.

Vv.

EVELYN COKE,

Respondent.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Second Circuit

PETITION FOR A WRIT OF CERTIORARI

DANIEL S. ALTER H. BARTOW FARR, Ill

ALTER & ALTER (Counsel of Record)

300 East 42nd Street RICHARD G. TARANTO

10th Floor FARR & TARANTO

New York, NY 10017 1220 19th Street, NW

(212) 867-7777 Suite 800

Washington, DC 20036

(202) 775-0184

WiLSON-EPES PRINTING CO., INC - (202) 789-0096 -— WASHINGTON, D C. 20001

wae

QUESTIONS PRESENTED

1. Whether the Second Circuit erred in refusing to give

deference under Chevron, U.S.A., Inc. v. Natural Res. Def.

Council, inc., 467 U.S. 837 (1984), to a thirty-year-old

Department of Labor regulation—a regulation that has twice

been upheld by the Tenth Circuit—on the ground that, even

though it was promulgated under express grants of legislative

authority and after full notice-and-comment rulemaking, the

regulation was contained in a subpart headed “Interpreta-

tions.”

2. Whether, in holding that a longstanding Department of

Labor regulation was not persuasive and thus undeserving of

any deference under Skidmore v. Swift & Co., 323 U.S. 134

(1944), the Second Circuit erred by failing to address the

governing provisions of the Fair Labor Standards Act and by

declining to give any weight to the Department’s interpreta-

tion of its own regulations.

(1)

il

RULE 29.6 STATEMENT

Petitioner Long Island Care at Home, Ltd. has no parent

company, and there are no publicly held companies that hold

any stock of Long Island Care at Home, Ltd.

TABLE OF CONTENTS

ee yg 8 1, | |.)

TAFE BOLD DEPLETE cesesecccsssovssevssosnscsscsososssesensens

OPENING BELOW .......00...rcceeoresversreesssosserssnsnenrecsesese

ET vivcintisindeitinsihindciniineniiomnnnenuananernsionnnens

STATUTORY AND REGULATORY PROVISIONS

RES RES a I ir rece Ea ene Oe ee NES

SE TIIIITTE ‘dchctuiopncicsindinmcdiniiseninniines A RANEES SS MOONE POD

A. The Statutory and Regulatory Framework ..........

She. nan ccinsthbdinadiabuiniiaspinnnesdinensenselisonipeiibieialtediiées

REASONS FOR GRANTING THE WRIT ..................

I. THE SECOND CIRCUIT DECISIONS, BY

INVALIDATING A REGULATION TWICE

UPHELD BY THE TENTH CIRCUIT, DIS-

RUPT LONGSTANDING PRACTICES AND

THREATEN A SERIOUS DISLOCATION

Il. THE DECISIONS BELOW WRONGLY

FAIL TO GIVE CHEVRON DEFERENCE

TO A REGULATION PROMULGATED

UNDER EXPRESS DELEGATIONS OF

LAWMAKING AUTHORITY AND AFTER

NOTICE-AND-COMMENT RULEMAKING.

Ill. THE DECISIONS BELOW, IN REFUSING

TO ACCORD EVEN SKIDMORE. DEF-

ERENCE, CONTRAVENE THE PROVI-

SIONS OF THE ACT AND IMPROPERLY

DISREGARD THE DEPARTMENT’S IN-

TERPRETATION OF ITS OWN REGULA-

A NY NY NHN

10

13

16

23

iV

TABLE OF CONTENTS—Continued

CONCLUSION ...

APPENDICES

APPENDIX A:

APPENDIX B:

APPENDIX C:

APPENDIX D:

APPENDIX E:

APPENDIX F:

APPENDIX G:

SEETHER EEE EEE HEE Oe

SORE REET EEE EEE ERE EHH ee

Second Circuit Opinion.................+.

District Court Opinion ..............006

Second Circuit Stay Order-..............

Wage and Hour Advisory Memo-

CRORE EEE EOE HETERO

Statutes and Regulations..................

Se

Page

V

TABLE OF AUTHORITIES

CASES Page

Alaska Dept. of Health and Social Services v.

Centers for Medicare and Medicaid Services,

424 F.3d 931 (9th Cir. 2005)........... guagenbuaceaies 19

American Airlines, Inc. v. Dept. of Transporta-

tion, 202 F.3d 788 (Sth Cir. 2000)...........00000... 22

American Mining Congress v. Mine Safety &

Health Admin., 995 F.2d 1106 (D.C. Cir.

ESSE eee eee 21

Arnold v. Ben Kanowsky, Inc., 361 U.S. 388

EL ce 6

Auer v. Robbins, 519 U.S. 452 (1997)........cccc000. 9,12, 18

Barnhart v. Walton, 535 U.S. 212 (2002) ............. 19, 23

Bowles v. Seminole Rock & Sand Co., 325 U.S.

acini cdaessennenstaate 13, 28

Chevron, U.S.A., Inc. v. Natural Res. Def.

Council, Inc., 467 U.S. 837 (1984)... passim

Christenser v. Harris County, 529 U.S. 576

SE cca eee 10, 17, 29

Chrysler Corp. v. Brown, 441 U.S. 281 (1979)..... 21

Columbia Broadcasting System v. United States,

act cctaisaneenemsnannnenns 22

Gonzales v. Oregon, 546 U.S. __, 126 S. Ct.

SEES ee 16, 17

Jay v. Boyd, 351 U.S. 345 (1956) .......cccccceereeees 29

Johnston v. Volunteers of America, Inc., 213 F.2d

559 (2000), cert. denied, 532 U.S. 1072

EEE re 8,11, 14

Koyo Seiko Co., Ltd. v. United States, 258 F.3d

i irsicecntrcencennnenien 19

Lincoln v. Vigil, 508 U.S. 182 (1993)..........ccce 17

Long Island Care at Home, Ltd. v. Coke, 126 S.

TT csc iniccitasesscsinbcippenctgnnnanseenanmcnceen 1]

vi

TABLE OF AUTHORITIES—Continued

Page

Martin v. Occupational Safety and Health

Review Comm'n, 499 U.S. 144 (1991) .............. 23, 29

Metropolitan Stevedore Co. v. Rambo, 521 U.S.

Ir AITTITTITTUTINdshroisicianhiteiataiceaaaiinibaniaseentaliainlaisilatandadatiaaes 23

Mitchell v. Lublin, McGaughy & Assocs., 358

ST TET IT ichnidinsennltibinbinsteintthincdenabamiameniatiias 6

Motion Picture Ass'n of America, Inc. v. FCC,

309 F.3d 796 (D.C. Cir. 2002)..............00cceessees 20

National League of Cities v. Usery, 426 U.S. 833

PITTED seaiinsiheanennibaeibinaiisdiamcadiabateldiniaiiiediicahiiaaiag 3, 25

National Cable & Telecomm. Ass'n v. Brand X_ |

Internet Services, 545 U.S. 967 (2005) ............. 12,19

Perez-Olivo v. Chavez, 394 F.3d 45 (lst Cir.

STs eieseniheiaabaeielmailmnahietiastatimeenad 19, 20

Robertson v. Methow Valley Citizens Council,

I I i sicicinlieiinitiintimerainiiantimetanis 28

Shotz v. City of Plantation, Fla., 344 F.3d 1161

IN, I icine aliaaitinttaiiieaa 12,19

Skidmore v. Swift & Co. 323 US. 134

Sa ciihishiniiniiesisisaiipaihdititiaintaeaaidnininniaeiaeamea 2, 8, 12, 23

Splane v. West, 216 F.3d 1058 (Fed. Cir. 2000).... 22

Stinson v. United States, 508 U.S. 36 (1993) ....13, 28, 29

Sutton v. United Air Lines, Inc., 527 U.S. 471

SETI UI inseticiniiaciiaiipintndehitridaeiinnseiaamuinantteinainaiitaliaaiates 28

Thomas Jefferson Univ. v. Shalala, 512 U.S. 504

EU all rsishsiciesnnieeshiieinesinicenihuaibiisininniaiegbiadsaiiieninmeniee 22, 28

Tony and Susan Alamo Foundation v. Secretary

of Labor, 471 U.S. 290 (1985).......cccccecceeeeees 3, 25

United States v. Cleveland Indians Baseball Co..,

ee ae SUT citinsiichiscnshiniiiubincinenmsatnesiemann 29

United States v. Mead Corp., 533 U.S. 218

ITT atiasnsnetnineienennvengesebiannepmnmepnismmimeneR passim

vil

TABLE OF AUTHORITIES—Continued

Page

Whitaker v. Thompson, 353 F.3d 947 (D.C. Cir.

Sianeli icitiniuititeieniadeeiiindaniintiienatianatininiiieapiiiaiadliniipmianines 12,19

White v. Scibana, 390 F.3d 997 (7th Cir. 2004)..... 12, 19

White v. Shalala, 7 F.3d 296 (2d Cir. 1993).......... 6

Yellow Transportation, Inc. v. Michigan, 537

Se IIIT ccusshsihissiistnicwcsiniiaiipulapatlenneiiilbdieiinatiiiia 18

OTHER MATERIALS

ae Oe SE iciisdccniiccinssesndsiisieniiinnniniaianiniien 20

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Is TPTIIITT sscstsiieittbaicseceiincibatiahuciaddeininiialainiaiasneiibeniin 2

See kisisicicisieeniecliciicdaeinietieniaeliddhiadlieiiiabitie 3, 25

Ii STITT iciinethishcientitbiapciinahitanieldeasiidandaieiinimaihsialeediealie 3

SUT teehee 3, 25, 26

| ERE ene er ns nee a Se 3

His Sent inieuiniescciinchselebhiihinigielilaiaai 3, 25, 26

2} SNES ean ce sen nnn rence RO passim

ie Oe TD sctosccinsitinieimnsinisniinates 3, 25

Ne a ccchicicesisiitiinniinnicineiihoniniigbicitioes 4

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ES SE GPIIIT nctsisssisnsnsennsslecsichnibeiaieneliaidisetbaniniaabilia +

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Se Ms ST tisinianssinicinsiseshininnticibtinstincionsininicniesigig 5

Se Pe Dl eicccnscccscescsccsnntsinsenianeinniensenniinen 6, 14

ens OF SU snicttntevciinevininiicaneicclasinniiatiannitiiio 4

Ss Ui stichaisniicssialisiiesitalneionianiiebshiahelsbidensiibiiaiiginiipin 2

i NTI iieiienlasthnsnepeiiidaieseanainastiaidiii 7

ie I dnisihininstibiniiesincienbhsnniiinentispnsienmpinnianibediicitineaiio’ passim

Se ET scccisacnnniniinaniiineitcniteinpaiicvmmiaiitinitiaiin passim

Vill

TABLE OF AUTHORITIES—Continued

Page

EE TEIN: Ree ae REE 4

_*_ SCESE ELENA Seana eens nO oN 5, 22

I I nica iataceii atlanta ldaiaa passim

ra UIITscasiushiieniieiieiitainiiaseiaiitiaiaiaaiagiiaiaiiininien 18

Department of Labor’s Wage and Hour Advisory

Memorandum No. 2005-1 (December 1,

2005).” 126 S. Ct. 1189 (2006)... eee 9

H.R. Rep. No. 93-913, 93rd Cong., 2d Sess. 2845

STITT cciscceaninsdeatoesidehideicitiahiabesiaiaimannsidhdiniatnaeiigaieaatiee 3, 26

Fair Labor Standards Act of 1974, Amendments

Pub. L. 93-259, 88 Stat. 55 § 29(b), 88 Stat.

Web seihiniediiaseniiiiibianielaiittaminstien sdiisedbibeishtlaiandeaasaditiunanida 4, 18,21

IN THE

Supreme Court of the Anited States

No. 06-__

LONG ISLAND CARE AT HOME, LTD. AND

MARYANN OSBORNE,

Petitioners,

Vv.

EVELYN COKE,

Respondent.

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Second Circuit

PETITION FOR A WRIT OF CERTIORARI

Petitioners Long Island Care at Home, Ltd. and Maryann

Osborne respectfully request that this Court issue a writ of

certiorari to review the judgment of the United States Court

of Appeals for the Second Circuit in this case.

OPINIONS BELOW

The opinion of the court of appeals on remand (Pet. App.

la-6a) is reported at 462 F.3d 48. The initial opinion of the

court of appeals (Pet. App. 7a-32a) is reported at 376 F.3d

118. The opinion of the United States District Court for the

Eastern District of New York (Pet. App. 33a-48a) is reported

at 267 F. Supp. 2d 332.

2

JURISDICTION

The judgment of the court of appeals on remand was

entered on August 31, 2006. The jurisdiction of this Court is

invoked under 28 U.S.C. § 1254(1).

STATUTORY AND REGULATORY

PROVISIONS INVOLVED

The relevant provisions of the Fair Labor Standards Act, 29

U.S.C. § 201 ef seqg., and the relevant regulations of the

Department of Labor promulgated thereunder, 29 C.F.R.

§ 552.2 et seq., are set forth at Pet. App. 65a-83a.

STATEMENT

This case involves a challenge to the validity of 29 C.F.R.

§ 552.109(a)—a regulation promulgated by the Department

of Labor in 1975 after full notice-and-comment rulemaking—

which declares that workers providing companionship ser-

vices to the elderly and infirm are exempt from the minimum

wage and overtime provisions of the Fair Labor Standards

Act, see 29 U.S.C. § 213(a)(15) (providing exemption), even

if they are employed by third parties rather than by the home-

owner receiving care. Granting deference to the Department

under the principles of Chevron, U.S.A., Inc. v. Natural Res.

Def. Council, Inc., 467 U.S. 837 (1984), the district court

upheld the regulation. Pet. App. 33a-48a. The Second Cir-

cuit reversed, refusing to accord deference to the Department

under either Chevron or Skidmore v. Swift & Co., 323 US.

134 (1944). Pet. App. 7a-32a. After this Court vacated that

decision, and remanded the case for consideration of further

guidance provided by the Department, the Second Circuit

adhered to its prior ruling and again held Section 552.109(a)

to be unenforceable. Pet. App. la-6a.

A. The Statutory and Regulatory Framework

The issues in this case arise under certain provisions of the

1974 Amendments to the Fair Labor Standards Act (the

3

“Act”). See Pub. L. 93-259, 88 Stat. 55. Prior to the Amend-

ments, workers were typically entitled to receive a specified

minimum wage and enhanced pay for overtime only if they

were employed by an “enterprise engaged in commerce or

in the production of goods for commerce.” See 29 U.S.C.

§§ 206(a), 207(a). See generally National League of Cities v.

Usery, 426 U.S. 833, 837-38 (1976); Tony and Susan Alamo

Foundation v. Secretary of Labor, 471 U.S. 290, 295 n.8

(1985). At that time, the Act defined such an enterprise as

an enterprise that, among other things, had annual gross sales

of at least $250,000. See 29 U.S.C. § 203(s)(1) (1976). The

annual limit has since been doubled to $500,000. See 29

U.S.C. § 203(s)(1)(A)(ii).

In 1974 Congress broadened the Act to provide coverage

for a particular class of workers: “Employees in domestic

service.” Unlike earlier provisions of the Act, the new

Amendments defined the scope of coverage for domestic

service workers primaiily on the basis of the kind of work

that they performed. Thus, Section 206(f) required payment

of a minimum wage to “[a]jny employee—(1) who in any

workweek is employed in domestic service in a household [if

the employee’s compensation constituted wages under Title II

of the Social Security Act] or (2) who in any workweek—(A)

is employed in domestic service in one or more households,

and (B) is so employed for more than 8 hours in the aggregate

.. 29 U.S.C. § 206(f). Similarly, Section 207(/) man-

dated enhanced overtime pay for “any employee in domestic

service in one or more households [who is employed] for a

workweek longer than forty hours... .” 29 U.S.C. § 207()).

See also H.R. Rep. No. 93-913, 93rd Cong., 2d Sess. (1974),

reprinted in 1974 U.S.C.C.A.N. 2811, 2845 (“i]t is the intent

of the committee to include within the coverage of the Act all

employees whose vocation is domestic service’’).

Congress provided exemptions from coverage, however,

for domestic service workers performing two specified jobs:

4

casual babysitting and companionship for the elderly and

infirm. Section 213(a)(15) of the Act provides that the mini-

mum wage and overtime provisions will not apply to “any

employee employed on a casual basis in domestic service

employment to provide babysitting services or any employee

employed in domestic service employment to provide com-

panionship services for individuals who (because of age or

infirmity) are unable to care for themselves (as such terms are

defined and delimited by regulations of the Secretary).” 29

U.S.C. § 213(a)(15). The Act thus gave to the Department, in

express terms, the authority to promulgate legislative rules

to define and delimit the exemption provided by Section

213(a)(15). In addition, Congress conferred a general grant

of rulemaking authority in the 1974 Amendments, stating that

“the Secretary is authorized to prescribe necessary rules,

regulations, and orders with respect to the amendments made

by this Act.” 1974 Amendments, § 29(b), 88 Stat. 76.

Pursuant to both of these express delegations of authority,

see 40 Fed. Reg. 7405 (1975), the Department initiated a

notice-and-comment rulemaking, which resulted in regula-

tions subsequently published in the Code of Federal Regu-

lations. See 29 C.F.R. §§ 516.34, 552.1-552.7, 552.101-

552.110. The critical regulation for present purposes is

Section 552.109(a), contained in a subpart headed “Interpre-

tations,” which declares that “[e]mployees who are engaged

in providing companionship services, as defined in § 552.6,

and who are employed by an employer or agency other than

the family or household using their services, are exempt from

the Act’s minimum wage and overtime pay requirements by

virtue of section 13(a)(15).” 40 Fed. Reg. 7407. Although

the original proposed regulation had not exempted workers

providing companionship services “if the third party em-

ployer is a covered enterprise,” 39 Fed. Reg. 35,385 (1974)—

based on the premise that the Amendments did not intend to

exempt “previously covered domestic service employees” (id.

at 35,395)—the Department altered its course upon further

5

consideration. Explaining the change, the Department noted

that the language of the exemption in the Act did not exclude

third party employers but applied “to ‘any employee’ engaged

‘in’ the enumerated services.” 40 Fed. Reg. 7405. The De-

partment concluded that the final regulation was “more

consistent with the statutory language and prior practices

concerning similarly worded exemptions.” /d.

At the same time that the Department promulgated Section

552.109(a), it promulgated another regulation, 29 -C.F.R.

§ 552.3, which purported to define the term “domestic service

employment.” That regulation, contained in a subpart entitled

“General Regulations,” states that “[a]s used in section

13(a)(15) of the Act, the term ‘domestic service employment’

refers to services of a household nature performed by an

employee in or about a private home (permanent or tempo-

rary) of the person by whom he or she is employed.” The

regulation then goes on to provide an “illustrative and not

exhaustive” list of the kinds of work considered to be “do-

mestic service employment.” 40 Fed. Reg. 7405. As ex-

plained in the regulation, that work includes services by

employees such as “cooks, waiters, butlers, valets, maids,

housekeepers, governesses, nurses, janitors, laundresses, care-

takers, handymen, gardeners, footmen, grooms, and chauf-

feurs of automobiles for family use.” /d.

Section 552.109(a) has remained in force for more than 30

years. The Department has periodically proposed eliminating

the exemption for employees of third party employers, see 58

Fed. Reg. 69,310, 69,312 (1993); 60 Fed. Reg. 46,798 (1995);

66 Fed. Reg. 5485, 5488 (2001), but, following various peri-

ods of comment, has invariably chosen not to do so. The

most recent of these efforts took place five years ago when

the Department, positing “an internal inconsistency” between

Sections 552.109(a) and 552.3, sought to resolve it by limiting

the exemption to workers employed by the person receiving

care. See 66 Fed. Reg. 5485-86. The Department ultimately

6

withdrew the proposed change, however, after numerous

commentators stressed the severe economic impact that

would result. See 67 Fed. Reg. 16,668 (2002).

B. This Litigation

1. Respondent, a worker employed by petitioner Long

Island Care at Home, Ltd. to provide companionship services,

brought this “test case” (Pet. App. 9a) challenging the

application of Section 552.109(a) to workers employed by

persons or entities other than the homeowners receiving

care.’ Finding that the regulation was entitled to “strong

deference” under Chevron, 467 U.S. at 844, see Pet. App.

46a, and pointing to the “explicit grant of authority to the

[Department of Labor] to define and delimit Section

213(a)(15),” as well as “the fact that these regulations have

' been in effect for over twenty-eight years,” Pet. App. 46a, the

district court held that Section 552.109(a) was a legitimate

exercise of the Depart-ment’s authority. Pet. App. 46a.

The Second Circuit reversed. Proceeding on the basis that

“(b}jecause the [Fair Labor Standards Act] is a remedial act, its

exemptions are to be narrowly construed,” Pet. App. 10a

(citing Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392

(1960); Mitchell v. Lublin, McGaughy & Assocs., 358 U.S.

207, 211 (1959)), the court refused to accord Chevron defer-

ence to Section 552.109(a), deeming it “an interpretive rather

than a legislative regulation.” Pet. App. 26a. Although the

court of appeals acknowledged that “the rule ‘grants rights,

imposes obligations, or produces other significant effects on

private interests,’ as legislative regulations do,” Pet. App. 26a

(quoting White v. Shalala, 7 F.3d 296, 303 (2d Cir. 1993)), it

held that the regulation did not merit Chevron deference under

the test set out in United States v. Mead Corp., 533 U.S. 218,

' Respondent also challenged the validity of 29 C.F.R. § 552.6, which

defines the term “companionship services.” The Second Circuit upheld

Section 552.6, see Pet. App. 1Sa-22a, and it is not at issue in this petition.

7

226-27 (2001), because the Department “did not intend to use

the legislative power delegated in [29 U.S.C.] § 213(a)(15)

when it promulgated § 552.109(a).” Pet. App. 26a.” It found

that iack of intention to be “most apparent from its inclusion of

the regulation under ‘Subpart B-Interpretations’ as opposed to

‘Subpart A-General Regulations.” Pet. App. 26a.° It thus

concluded that Ҥ 552.109(a) does not qualify for Chevron

deference because, by the DOL’s own account, it was self-

consciously not promulgated in exercise of Congress’s

delegated authority pursuant to § 213(a)(15).” Pet. App. 26a.

The Second Circuit then went on to reject the argument,

made by the Department of Labor in an amicus brief, that

Section 552.109(a) warranted deference as a legislative rule

under Chevron because it had been “promulgated after notice

and comment... .” Pet. App. 27a. Although the court recog-

nized that “Mead explicitly instructs us to consider whether a

rule was the product of notice and comment in assessing

whether.to accord it Chevron deference,” Pet. App. 27a (cit-

ing Mead, 533 U.S. at 230-31), it found no need to do so for a

regulation that it had already classified as an “interpretive

rule.” Based on that characterization of Section 552.109(a),

the Second Circuit dismissed the importance of the notice-

and-comment procedure by saying that “the agency under-

took a notice and comment procedure for an interpretive

* The Court in Mead held that “administrative implementation of a

particular statutory provision qualifies for Chevron deference when it ap-

pears that Congress delegated authority to the agency generally to make

rules carrying the force of law, and that the agency interpretation claiming

deference was promulgated in the exercise of that authority.” 533 U.S. at

226-27.

* The Second Circuit found additional support in the Secretary’s state-

ment that “[t}he definitions required by section 213(a){15) are contained

in §§ 552.3, $52.4, 552.5 and 552.6.” 29 C.F.R. § 552.2(c); see Pet. App.

26a.

8

regulation despite the fact that the procedure was not re-

quired.” Pet. App. 27a.*

The Second Circuit also declined to give deference to Sec-

tion 552.109(a) under Skidmore v. Swift & Co., 323 U.S. 134

(1944). Addressing “Congressional purpose,” the court, with-

out reviewing any statutory language, took the view that

“persons who were employed by a third party were outside the

category of ‘domestic service employees’ and were protected

by the [Act] before the 1974 amendments,” Pet. App. 29a

(citations omitted), and that “[i]t is implausible, to say the least,

that Congress, in wishing to expand FLSA coverage, would

have wanted the DOL to eliminate coverage for employees of

third party employers who had previously been covered.” Pet.

App. 30a. The court of appeals also placed considerable

weight on what it regarded as a “stark internal inconsistency”

between Section 552.3 (the regulation defining “domestic

service employment’) and Section 552.109(a), Pet. App. 30a,

finding that “[p]lainly, under § 552.3, employees employed by

third parties do not qualify for the exemption” that Section

552.109(a) grants to them. Pet. App. 30a. Finally, the court

pointed to the fact that the Department had proposed elim-

ination of the exemption for third party employees on several

occasions, deeming its position “hardly . . . a model of

consistency,” Pet. App. 30a, and questioning both the Depart-

ment’s reasoning and procedural regularity in adopting Section

$52.109(a) in the first place. See Pet. App. 30a-3 la.

2. Petitioners filed a petition for certiorari, raising, among

other issues, the failure of the Second Circuit to accord

Chevron deference to the regulation, and emphasizing the

* The Second Circuit recognized that the Tenth Circuit, affording

Chevron deference, had upheld the validity of Section 552.109(a). See

Pet. App. 25a (citing Johnston v. Volunteers of America, Inc., 213 F.2d

559, 562 (2000), cert. denied, 532 U.S. 1072 (2001)). Saying that Johnston

had been decided before Mead, the Second Circuit declined to follow it.

See Pet. App. 25a.

9

substantial harm likely to be caused by its invalidation. See

Petition for A Writ of Certiorari, No. 04-1315. Submitting a

brief by invitation, the United States stated that the decision

of the Second Circuit was contrary to several decisions of this

Court (including Mead and Auer v. Robbins, 519 U.S. 452

(1997)) and conflicted with decisions of the Tenth Circuit

(Johnston and Welding v. Bios Corp., 353 F.3d 1214 (10th

Cir. 2004)). U.S. Br. at 9, 15. The United States also argued

that the decision was “inconsistent with the plain terms of the

FLSA, which strongly support the construction adopted by

DOL in Section 552.109(a),” and, as evidenced by the amicus

briefs filed in support of the petition, “will have a significant

and disruptive impact on the provision of government-funded

home care to elderly and disabled individuals.” /d. It in-

formed the Court that “[flor those reasons, and because of the

important and recurring nature of the questions raised in the

case, it would be appropriate for this Court to grant the peti-

tion for a writ of certiorari to review the [deference ques-

tion].” /d. However, noting that the Department of Labor

had recently offered “authoritative agency guidance” making

clear that it intended “Section 552.109(a) to be an exercise of

its expressly delegated legislative authority,” id. (citing Wage

and Hour Advisory Memorandum No. 2005-1), the Solicitor

General recommended that the Court vacate the judgment and

remand the case to the Second Circuit for consideration of the

Department’s position. See U.S. Br. at 9-10.° The Court then

granted the petition, vacated the judgment, and remanded the

case “for further consideration in light of the Department of

Labor’s Wage and Hour Advisory Memorandum No. 2005-1

(December 1, 2005).” 1265S. Ct. 1189 (2006).

On remand, the Second Circuit adhered to its original rul-

ings. With respect to Chevron deference, it again concluded,

* The Advisory Memorandum, reprinted at Pet. App. 50a-64a, also set

forth guidance regarding the proper reading of Section 552.3. See Pet.

App. 54a-63a.

10

“for substantially the same reasons,” that “§ 552.109(a) was

not intended, at the time of its promulgation, to be a legisla-

tive rule; rather, it was meant to be an interpretive rule.” Pet.

App. 3a. Finding “arguments to the contrary presented in the

DOL Memo” to be “not persuasive,” Pet. App. 3a, it said that,

even if the Department regarded Section 552.109(a) as “le-

gally binding,” Pet. App. 3a, the regulation “could have been

simply intended to provide guidance to DOL employees as to

how the agency planned to interpret ‘domestic service em-

ployment’ in the third-party employer context.” Pet. App. 4a.

The court of appeals also declined, once again, to give

Skidmore deference to the regulation, relying in particular on

its view about the inconsistency between Section 552.109(a).

and Section 552.3. In doing so, the Second Circuit rejected

the Department’s explanation of why the two provisions

could be read harmoniously, saying that it “need not defer to

an agency’s interpretation of its own regulations when those

regulations, like § 552.109({a) and §552.3, are unambiguous.”

Pet. App. 5a (citing Christensen v. Harris County, 529 U.S.

576, 588 (2000)). It thus declared Section 552.109(a) unen-

forceable. Pet. App. 6a.°

REASONS FOR GRANTING THE WRIT

The Second Circuit has twice struck down a Department of

Labor regulation—promulgated more than 30 years ago after-

notice-and-comment rulemaking and adhered to ever since—

that exempts certain third party employees from cover-

age under the Fair Labor Standards Act, see 29 U.S.C.

§ 213(a)(15), holding that the regulation is merely a nonbind-

ing interpretation lacking the force of law and that it is

unpersuasive. See Pet. App. 23a-32a (invalidating 29 C.F.R.

§ 552.109(a)); id. at la-6a (same). Following the initial deci-

sion, petitioners sought review in this Court on the grounds,

* As it had done after its initial decision, the Second Circuit stayed the

mandate pending the filing of a Petition for a Wnt of Certiorari in this

Court. See Pet. App. 49a .

1]

among others, that the Second Circuit had failed to accord the

regulation proper deference under the principles of Chevron,

U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837

(1984); that the decision was in conflict with a decision of the

Tenth Circuit, Johnston v. Volunteers of America, Inc., 213

F.3d 559 (10th Cir. 2000); that the Second Circuit had mis-

read the statute and other relevant regulations; and that the

invalidation of Section 522.109(a) would cause extraordinary

and unjustified harm. The United States informed the Court

that “it would be appropriate for the Court to grant the

petition for certiorari,” U.S. Br. at 9, but, noting that the

Department of Labor had recently issued new “authoritative

agency guidance” (id.), urged the Court to vacate and remand

so that the Second Circuit could consider that guidance. The

Court followed that course. See Long Island Care at Home,

Lid. v. Coke, 126 S. Ct. 1189 (2006). On remand, however,

the Second Circuit again declared Section 552.109(a) to be

unenforceable.

The decisions below now merit full review by this Court.

To begin with, the result alone—overturning a thirty-year-old

regulation twice upheld by another Circuit (see Johnston and

Welding v. Bios Corp., 353 F.3d 1214 (10th Cir. 2004))—is

sufficient to justify this Court’s attention. Not only does the

Second Circuit’s disregard of agency authority disrupt long-

standing wage-and-hour practices, it threatens to do so at

potentially enormous cost. Only last Term numerous amici

curiae informed the Court that the increased expense result-

ing from invalidation of Section 552.109(a) would erode their

ability to provide appropriate care for the elderly and infirm,

a problem that the United States specifically noted in its brief

supporting review. See U.S. Br. at 9. Those concerns are no

less compelling today.

The Second Circuit decisions are troubling for other rea-

sons as well. The court of appeals’ principal rationale for

withholding Chevron deference—that Section 552.109(a) was

in a subpart entitled “Interpretations’—not only wrongly

12

assumes that an agency interpretation can never have the

force of law, see United States v. Mead Corp., 533 U.S. 218,

227 (2001), but is flatly inconsistent with this Court’s deci-

sion in Auer v. Robbins, 519 U.S. 452 (1997), giving Chevron

deference to a different Department of Labor regulation con-

tained in an identically labeled subsection. Moreover, by

refusing to give Chevron deference to a regulation that was

issued after notice-and-comment rulemaking and that bears

other significant indicia of deliberate lawmaking, the court of

appeals has seriously diminished the proper respect due to

“relatively formal” agency action. See Mead, 533 U.S. at

230. While this Court has not finally resolved whether resort

to notice-and-comment rulemaking is sufficient in and of

itself to earn Chevron deference—compare National Cable &

Telecomm. Ass'n v. Brand X Internet Services, 545 U.S. 967,

125 S. Ct. 2688, 2712-13 (2005) (Breyer, J., concurring) with

id. at 2717-18 (Scalia, J., dissenting)—the federal courts

of appeals, following the standard set forth in Mead, 530 U.S.

at 226-27, have repeatedly emphasized the importance of

notice-and-comment rulemaking in affording deference under

Chevron. See, e.g., Whitaker v. Thompson, 353 F.3d 947, 950

(D.C. Cir. 2004); White v. Scibana, 390 F.3d 997, 1000 (7th

Cir. 2004); Shotz v. City of Plantation, Fla., 344 F.3d 1161,

1179 (11th Cir. 2003). |

The Second Circuit also went astray in failing to accord

even the lesser deference warranted by the doctrine of

Skidmore v. Swift & Co., 323 U.S. 134 (1944). See Mead,

533 U.S. at 234-35. Although the court of appeals, relying

primarily on another regulation promulgated by the Depart-

ment, 29 C.F.R. § 552.3, ultimately found that domestic

workers employed by third parties are not “employees

employed in domestic service employment,” 29 U.S.C.

§ 213(a)(15), and thus cannot be exempted under that section,

a proper reading of the Act as a whole shows that reading to

be incorrect. In fact, Congress used the critical coverage term

“employee[s] in domestic service” to broadly encompass

13

workers performing domestic jobs regardless of the workers’

employer—assuring that the coverage provisions of the Act

would apply to domestic service employees across the board—

and the exemption for those particular domestic service em-

ployees providing “companionship services” also applies re-

gardless of the workers’ employer, just as the Department has

determined. Moreover, insofar as the Second Circuit sup-

ported its contrary view with a reading of Section 552.3 that

is at odds with the Department’s own reading of that regula-

tion, the court flouted the well-established principle that an

agency interpretation of its own regulation “must be given

‘controlling weight unless it is plainly erroneous or inconsist-

ent with the regulation.”” Stinson v. United States, 508 U.S.

36, 45 (1993) (quoting Bowles v. Seminole Rock & Sand Co.,

325 U.S. 410, 414 (1945)). Thus, at each possible step, the

court of appeals wrongly substituted its view for the judgment

of the agency charged with implementing the governing stat-

ute. That judicial usurpation should not be allowed to stand.

I. THE SECOND CIRCUIT DECISIONS, BY

INVALIDATING A REGULATION TWICE

UPHELD BY THE TENTH CIRCUIT, DIS-

RUPT LONGSTANDING PRACTICES AND

THREATEN A SERIOUS DISLOCATION OF

CARE

The Second Circuit, in declaring Section 552.109(a) to be

nothing more than an unenforceable “interpretation,” rather

than a rule of law, Pet. App. 26a, has ordered a dramatic

reversal in wage-and-hour practices that have been in effect,

without change, for more than 30 years. Ever since prom-

ulgation of the regulation in 1975, the governing rule has

been that, in kecping with the congressional intent to make

companionship services affordable for the elderly and infirm,

see Pet. App. 46a-47a, employers of workers providing those

services are not required to pay the minimum wage or time-

and-a-half wages for overtime. Importantly for present pur-

14

poses, that rule has applied regardless of whether the em-

ployee was hired directly by the person receiving care or was

employed by a third party such as a family member or an

independent agency. Indeed, the exemption for employees of

third parties has become so firmly established that, when the

Department recently proposed eliminating it, it was forced to

pull back because of concerns about the potential adverse

economic effects. See 67 Fed. Reg. 16,668 (2002). By judi-

cial fiat, however, the Second Circuit has done precisely what

the agency, only a few years before, ultimately found it

inadvisable to do.

Quite apart from its overriding of the Department of Labor,

the Second Circuit has also put itself into direct conflict with

the Tenth Circuit, see Johnston, 213 F.3d at 561-62; Welding,

353 F.3d at 1217 n.3, creating a checkered regulatory scheme

in which Section 552.109(a) is controlling in some states but

not others. in Johnston, decided just six years ago, the Tenth

Circuit expressly reyected the argument that Section 552.109(a)

was merely an “interpretation which does not have the effect

of law... .” 213 F.3d at 561. Applying Chevron, see 213

F.3d at 562, the court of appeals determined “that the secre-

tary’s interpretation is not arbitrary, capricious, or manifestly

contrary to § 213(a)(15).” 213 F.3d at 562. Unlike the

Second Circuit, therefore, the Tenth Circuit held that “the fact

that domestic service employees are not employed by the

individual receiving care, does not alone exclude them from

the exemption.” 213 F.3d at 562.

This disagreement between the Second and Tenth Circuits

shows no signs of abating. In its initial decision below, the

Second Circuit openly declined to follow Johnston, pointing

out that the Tenth Circuit had decided that case before this

Court’s decision in Mead. See Pet. App. 25a. However, the

Tent’: Circuit also handed down a decision after Mead, see

Welding, 353 F.3d 1214, specifically relying on Johnston and

reiterating that “(t]he domestic service employee need not be

15

employed directly by the person receiving the services or by

that person’s family for the exemption to apply.” 353 F.3d at

1217 n.3; see also id. (“[t}he exemption can apply even when

the domestic service employee is actually employed by a ser-

vice agency ....”). The views of the Tenth Circuit thus are

solidly behind the validity of Section 552.109(a). By con-

trast, given an opportunity to reconsider its views upon

remand from this Court, the Second Circuit firmly held to its

earlier position, again declaring that Section 552.109(a) was

unenforceable.

The practical consequences of. the Second Circuit’s deci-

sions are potentially enormous. At the petition stage last

Term, the City of New York told the Court that invalidation

of Section 552.109(a) would add nearly $300 million annu-

ally to its costs of providing home care to the elderly and

infirm. See City of New York, et al. Amici Br. at 2, 5-8.

Other home care providers declared that they would simply

be unable to bear the sharply increased costs resulting from

the decision below. See, e.g., Home Care Ass’n of New York

State, Inc. Amicus Br. at 2, 9-10. Faced with this new bur-

den, therefore, many providers may be forced to significantly

reduce their employees’ workweeks in order to avoid incur-

ring ruinous time-and-a-half overtime obligations. See Pet.

App. 85a (Declaration of Maryann Osborne).

These measures will almost certainly cause severe disrup-

tions for clients needing care. Most seriously, the clients will

face a sharp drop in the continuity and stability of their care,

with more caregivers being required in order to provide

clients with the same or even fewer services. Given the

highly personal nature of companionship services, “clients

often are very unwilling to enter into such a relationship with

more thar: one or two such individuals.” Pet. App. 100a

(Declaration of Susan Choi-Hausman). Moreover, a shifting

array of personal caregivers “assaults the dignity of patients,

undermines the quality of care that they receive, and is there-

16

fore detrimental to their well being.” Pet. App. 86a (Declara-

tion of Maryann Osborne). This problem will only get worse

as the number of elderly needing care continues to grow.

Yet, it is precisely those people likely to be harmed by the

new judicially imposed regime—“individuals who (because

of age or infirmity) are unable to care for themselves” (29

U.S.C. § 213(a)(15))—that Congress specifically meant to

help by exempting personal companions from the coverage

provisions of the Act. See id.

This upheaval is as unnecessary as it is problematic. The

Secretary correctly determined thirty years ago that the

minimum wage and overtime provisions should not apply to

caregivers employed by third parties. The Second Circuit’s

decisions to the contrary warrant review.

Il. THE DECISIONS BELOW WRONGLY FAIL TO

GIVE CHEVRON DEFERENCE TO A REGULA-

TION PROMULGATED UNDER EXPRESS

DELEGATIONS OF LAWMAKING AUTHOR-

ITY AND AFTER NOTICE-AND-COMMENT

RULEMAKING

The reasoning used by the Second Circuit to invalidate

Section 552.109(a) also raises serious concerns. While the

court was wrong not to give even Skidmore deference to the

regulation, see pages 23-30 infra, it committed its first, and

most striking, error by holding that Section 552.109(a)—a

regulation promulgated by the Department of Labor under

express grants of lawmaking authority and after full notice-

and-comment rulemaking—did not have the “force of law”

required for deference under Chevron. See Mead, 533 U.S. at

226-27 (agency implementation “qualifies for Chevron defer-

ence when it appears that Congress delegated authority to the

agency generally to make rules carrying the force of law, and

that the agency interpretation claiming deference was promul-

gated in the exercise of that authority”); Gonzales v. Oregon,

546US. __, 1268S. Ct. 904, 914-15 (2006) (same). Accord-

17

ing to the Second Circuit, the regulation did not merit Chevron

deference because the Department had put the regulation

“under ‘Subpart B-Interpretations’ as opposed to ‘Subpart A-

General Regulations,’” Pet. App. 26a, and had stated that

“*the definitions required by § 213(a)(15) [of Title 29] are

contained in [29 C.F.R.] §§ 552.3, 552.4, 552.5 and 552.6 [of

Subpart A].’” Pet. App. 26a. It thus concluded that the De-

partment had failed to satisfy the second part of the Mead

standard “because, by the DOL’s own account, [the regula-

tion] was self-consciously not promulgated in exercise of

Congress’s delegated authority pursuant to § 213(a)(15).”

Pet. App. 26a .

There are several notable flaws in this analysis. First of all,

the Second Circuit is simply mistaken in supposing that a rule

labeled an “interpretation” is not, and never can be, a rule

with the force of law. On the contrary, numerous regulations

“with the force of law effectively “interpret” the governing

statute in the sense that they supply additional legal content to

Statutory provisions that require further detail. See generally

Chevron, 467 U.S. at 843 (discussing agency authority “to

elucidate a specific provision of the statute by regulation”).

Indeed, the Court in Mead acknowledged that interpretations

can have the force of law, expressly declaring that Chevron

deference is warranted when “the agency interpretation

claiming deference was promulgated in the exercise of

{delegated lawmaking] authority.” Mead, 533 U.S. at 227

(emphasis added); see also Gonzales, 126 S. Ct. at 914 (“[A]n

interpretation of an ambiguous statute may also receive sub-

stantial deference”) (citing Chevron); Christensen v. Harris

County, 529 U.S. 576, 587 (2000). The proper question, then,

is not whether an agency regulation “interprets” a statute, but

whether the regulation does so only as a matter of agency

guidance or whether it is meant to declare enforceable legal

rights and responsibilities. Although the task of distinuishing

between the two is not always easy, see Lincoln v. Vigil,

508 U.S. 182, 196 (1993), the labeling of a regulation as

18

an “interpretation” does not, by itself, consign it to the former

category.

The Second Circuit’s decision to the contrary, in fact, is

directly at odds with this Court’s decision in Auer v. Robbins,

519 U.S. 542 (1997). In Auer, the Court upheld a Department

of Labor regulation interpreting the term “bona fide executive,

administrative, or professional capacity” for purposes of

implementing a different exemption under the Fair Labor

Standards Act. See 29 U.S.C. § 213(a)(1). At that time, the

regulation at issue in Aver, like Section 552.109(a) here, was

set forth in a Subpart B headed “Interpretations” instead of in

Subpart A. See 29 C.F.R. 541.118(a) (1996). This Court held

that it was entitled to full deference under Chevron. See 519

U.S. at 455-56.

Rather than focusing almost exclusively on the label at-

tached to the regulation, the Second Circuit should have paid

more attention to affirmative evidence that the Department

was exercising its lawmaking authority, in-particular the fact

that the agency engaged in notice-and-comment rulemaking.

This Court has indicated that congressional authorization of

notice-and-comment rulemaking typically satisfies the first

part of the Mead formulation, saying that “[i]t is fair to as-

sume generally that Congress contemplates administrative

action with the effect of law when it provides for a relatively

formal administrative procedure tending to foster the fairness

and deliberation that should underlie a pronouncement of

such force.” 533 U.S. at 230; see also id. at 229 (authoriza-

tion of rulemaking is “a very good indicator of delegation

meriting Chevron treatment”); Yellow Transportation, Inc. v.

Michigan, 537 U.S. 36, 45 (2002). Given that assumption,

it is reasonable also to assume that an agency regulation

actually resulting from that “process of rulemaking” will

satisfy the second part of the Mead formulation, demonstrat-

ing that the agency was indeed making law. To date, this

Court has not directly addressed whether agency resort to

19

notice-and-comment rulemaking is itself sufficient, or at least

presumptively sufficient, to establish that a regulation has the

force of law, although individual Justices have expressed

preliminary views on this question. See National Cable &

Telecomm. Ass'n, 125 S. Ct. at 2712-13 (Breyer, J., concur-

ring) (formal proceeding not always “a sufficient condition

[for use of Chevron]”); id. at 2717-18 (Scalia, J., dissenting)

(under Mead “some unspecified degree of formal process was

required—or was at least the only safe harbor”).’

For their part, however, numerous federal courts of appeals

have emphasized that use of notice-and-comment rulemaking

is a strong, even dispositive, indication that an agency is

exercising its delegated lawmaking power. See Whitaker, 353

F.3d at 950; White, 390 F.3d at .000; Shotz, 344 F.3d at

1179; Perez-Olivo v. Chavez, 394 F.3d 45, 53 n.6 (ist Cir.

2005); Koyo Seiko Co., Ltd. v. United States, 258 F.3d 1340,

1347 (Fed. Cir. 2001); Alaska Dept. of Health and Social

Services v. Centers for Medicare and Medicaid Services, 424

F.3d 931, 939 (9th Cir. 2005). In Whitaker, for example, the

D.C. Circuit stated that “[b]ecause we are reviewing an

agency’s interpretation of the statute it is entrusted to admin-

ister, and the agency reached its interpretation after a rela-

tively formal process with public notice and comment... ,

we review under the familiar framework established by

[Chevron}.” 353 F.3d at 950. Similarly, the Federal Circuit,

reviewing an agency rule, noted that the methodology set

forth in the rule “was adopted after notice-and-comment

rulemaking, and thus is entitled to maximum deference.”

Koyo Seiko, 258 F.3d at 1347. And, the First Circuit rejected

an argument that a Bureau of Prisons rule was entitled to

nothing more than Skidmore deference, remarking that, be-

cause the interpretation was embodied in a regulation “which

’ The Court has made clear that notice-and-comment rulemaking is not

necessary for a regulation to receive Chevron deference. See Barnhart v.

Walton, 535 U.S. 212, 221-22 (2002); Mead, 533 U.S. at 231.

20

was adopted pursuant to the notice-and-comment proce-

dure of the Administrative Procedure Act,” Perez-Olivo, 394

F.3d at 53 n.6, it was “[t]hus . . . entitled to full deference

under Chevron.” Id.; see 5 U.S.C. § 553(b)(A) (notice-and-

comment rulemaking not required for “interpretive rules,

general statements of policy, or rules of agency organization,

procedure, or practice”).

The court df-appeals below dismissed the fact that the

Department had promulgated the regulation after relatively

formal rulemaking, saying that “the agency undertook a

notice and comment procedure for an interpretive regulation

despite the fact that the procedure was not required.” Pet.

App. 27a; see also Pet. App. 27a (“following the notice and

comment procedure, at most, buttresses a claim that the

agency gave consideration to what it did; it does not alter the

fact that the agency did not act pursuant to legislative

authority”). But that approach gets things backwards. Rather

than looking to the notice-and-comment procedure as a com-

pelling indication that the Department had invoked its law-

making authority, as other Circuits have done, the Second

Circuit simply ignored it in deciding the critical issue—

whether the regulation had the force of law or was merely

interpretive—and then, once it finally turned to it, gave the

procedure short shrift by treating it as unnecessary for what

the Court had already deemed an interpretive rule. This cart-

before-the-horse analysis necessarily undervalues the force of

a promulgated regulation because, contrary to what the Sec-

ond Circuit apparently believed, use of the notice-and-com-

ment procedure does demonstrate that an agency meant to

“act pursuant to legislative authority.” Pet. App. 27a. It thus

can be an integral part of the inquiry into whether a rule has

the force of law, not just an afterthought once the essential

analysis has been completed. *

* A rule promulgated following notice and comment may still be inva-

lid, of course, if it fails the first part of the Mead test. See, e.g., Motion

21

To compound its error, the court then mostly ignored other

strong indications that Section 552.109(a) is a legislative rule.

Thus, it gave no weight to the fact that the Department, in

promulgating the 1975 regulations, expressly relied on both the

delegation of authority in 29 U.S.C. § 213(a)(15) to “define

and delimit” the. terms of that provision and the general

rulemaking authority conferred by Section 29(b) of the 1974

Amendments, granting the Department the power “to prescribe

necessary rules, regulations, and orders with regard to the

amendments made by this Act.” 1974 Amendments, § 29(b),

88 Stat. 76. Yet, the explicit reliance on those grants of

authority, coupled with publication of the regulation in the

Code of Federal Regulations, is itself telling evidence that the

Department intended Section 552.109(a) to have the force of

law. See American Mining Congress v. Mine Safety & Health

Admin., 995 F.2d 1106, 1112 (D.C. Cir. 1993).? And the very

nature of the rule supports that view: by dictating who is

required to pay, and who is entitled to receive, minimum wage

and overtime pay, Section 552.109(a) directly “affects indi-

vidual rights and obligations,” Chrysler Corp. v. Brown, 441

U.S. 281, 302 (1979), as legislative rules do. See id.

Finally, the court of appeals erred by refusing to credit the

Department’s own representation that, in promulgating Sec-

Picture Ass'n of America, Inc. v. FCC, 309 F.3d 796 (D.C. Cir. 2002). An

agency cannot claim authority that Congress did not delegate just by en-

gaging in notice-and-comment rulemaking. In this case, however, the Act

unmistakably grants the Department the authority to promulgate legisla-

tive rules. See 29 U.S.C. § 213(a)(15); 1974 Amendments, § 29(b), 88

Stat. 76.

* This evidence is not undercut by the statement that “(t]he definitions

required by Section 213(a)(15) are contained in §§ 552.3, 552.4, 552.5,

and $52.6.” 29 C.F.R. § 552.2(c). Even leaving aside that the Depart-

ment was exercising its general Section 29(b) rulemaking authority as

well as the more specific Section 213(a)(15) authority, the statement in

Section 552.2(c) simply reflects that the regulations, as a whole, embody

not just “definitions,” but additional substantive provisions specifying

how the Act, including the “definitions,” is to operate.

22

tion 552.109(a), it had intended to, and did, exercise its

lawmaking power. See Pet. App. 3a-4a. The December 2005

Advisory Memorandum, directly contradicting the Second

Circuit, stated in plain terms that “the Department considers

the third party -employment regulations at 29 C.F.R. §

552.109 to be authoritative and legally binding.” Pet. App.

63a. The Department pointed to specific language in the final

1975 notice to demonstrate that “at the time the final rule was

promulgated, the Department believed that the availability of

the companionship exemption to third party employers turned

decisively on its pronouncement in the regulations—some-

thing that could be true only of a legislative rule.” Pet. App.

63a-64a. It thus reiterated that “the Department has always

treated the third party employment regulations as legally

binding legislative rules... .” Pet. App. 64a.

The Second Circuit should have paid more heed to these

views. Although an agency’s characterization of its own

actions is not dispositive, see, e.g., Columbia Broadcasting

System, Inc. v. United States, 316 U.S. 407, 416 (1942), several

federal courts of appeals have held that the agency char-

acterization carries at least some force, even when the agency

is arguing that its rule was merely a matter of internal policy

and thus not subject to formal rulemaking. See, e.g., American

Airlines, Inc. v. Dept. of Transportation, 202 F.3d 788, 797

(Sth Cir. 2000) (“significant deference to an agency’s char-

acterization of its own action”’); Splane v. West, 216 F.3d 1058,

1063 (Fed. Cir. 2000) (“a factor [to] consider’) (internal

quotation marks omitted). The case for deference is stronger

still when, as here, the agency has actually gone through the

process of notice-and-comment rulemaking and seeks only to

have its rule treated as law. See generally Thomas Jefferson

Univ. v. Shalala, 512 U.S. 504, 517 (1994) (“Secretary was

well within her discretion to interpret this language as

imposing a substantive limitation ... .”) Here, the agency

characterization is consistent with other historical evidence,

and it accords with the agency’s application of the regulation

23

over a long period of time. See generally Barnhart, 535 U.S.

at 220 (“this Court will normally accord particular deference to

an agency interpretation of ‘longstanding’ duration”). There

was no good reason for the Second Circuit to disregard it.

Ill. THE DECISIONS BELOW, IN REFUSING TO

ACCORD EVEN SKIDMORE DEFERENCE,

CONTRAVENE THE PROVISIONS OF THE

ACT AND IMPROPERLY DISREGARD THE

DEPARTMENT’S INTERPRETATION OF ITS

OWN REGULATIONS

Having found Chevron inapplicable, the Second Circuit

went on to hold that the Department’s interpretation did not

merit any deference at all, even under Skidmore. See Pet.

App. 29a-32a; 4a-6a. But this Court has observed that “an

agency’s interpretation may merit some deference whatever

its form, given the ‘specialized experience and broader inves-

tigations and information’ available to the agency .. . , and

given the value of uniformity in its administrative and judicial

understandings of what a national law requires... .” 533

U.S. at 234 (quoting Skidmore, 323 U.S. at 139) (internal

citations omitted). Although it is not entirely clear what the

limits of that deference might be, the Court in Mead sug-

gested that reasonable agency views are entitled to ““‘at least

some added persuasive force,’” 533 U.S. at 235 (quoting

Metropolitan Stevedore Co. v. Rambo, 521 U.S. 121, 136

(1997)), or “some weight,” 533 U.S. at 235 (quoting Martin

v. Occupational Safety and Health Review Comm'n, 499 US.

144, 157 (1991)), or a “respect proportional to [their] ‘power

to persuade,” 533 U.S. at 235 (quoting Skidmore, 323 U.S.

at 140). Thus, unless Skidmore deference is reduced to an

empty circularity—that is, an agency interpretation warrants

deference only to the extent that the court would adopt the

same interpretation without giving deference—the views of

an expert agency charged with administering a governing

statute should at least tilt the balance with respect to unsettled

24

questions about the scope of proper implementation. Had

the Second Circuit extended that deference here, it would

have been required to uphold Section 552.109(a) as a well-

grounded application of the 1974 Amendments.

The Second Circuit declined to-do so, however, largely

because it regarded Section 552.109(a) as inconsistent with

another regulation promulgated by the Department to imple-

ment the 1974 Amendments: Section 552.3. As the court of

appeals saw it, Section 552.3 had defined the term “domestic

service employment” in a way that excluded domestic service

performed by third party employees. See Pet. App. 30a; 29

C.F.R. § 552.3 (referring to “services of a household nature

performed by an employee in or about a private home .. . of

the person by whom he or she is employed”). Using this as a

starting point, the Second Circuit reasoned that, because the

statutory exemption for “companionship services” applied, by

its terms, only to those services provided by “employee[s]}

employed in domestic service employment,” 29 U.S.C.

§ 213(a)(15), the Department was barred by its own regu-

lation from exempting workers employed by third parties.

See Pet. App. 30a.

The most obvious shortcoming in this analysis is its lack of

attention to the Act itself. Although any serious consideration

of an interpretation’s “persuasiveness” must look to the lan-

guage of the governing statute—it is, after all, the statute that

the agency is interpreting—the Second Circuit’s discussion of

the Act is both cursory and inaccurate. See Pet. App. 29a-

30a; 4a-Sa. Insofar as the Act is concerned, the court of

appeals relies almost exclusively on the premise that domestic

workers employed by third parties were already covered by

the Act before 1974 and the idea that it is “implausible” to

think that Congress would have intended to eliminate cover-

age for previously covered employees. See Pet. App. 29a-

30a. But this off-hand treatment reflects a basic misunder-

standing both of the Act’s history and of the changes brought

about by the 1974 Amendments.

25 .

Before the 1974 Amendments, workers in domestic service

were subject to the minimum wage and overtime provisions

of the Act only if they were employed by an “enterprise

engaged in commerce or in the production of goods for com-

merce.” See 29 U.S.C. §§ 206(a)(1); 207(); see generally

National League of Cities, 426 U.S. at 837-38; Tony and

Susan Alamo Foundation, 471 U.S. at 295 n.8. As the law

then stood, an employer did not fall within that definition

unless it had annual gross sales of at least $250,000 (since

raised to $500,000). 29 U.S.C. § 203(s)(1) (1976). Thus,

contrary to the Second Circuit’s understanding, domestic ser-

vice workers employed by third parties were nof routinely

covered by the Act before 1974: they were covered if, but

only if, they worked for an employer of a certain minimum

size. And, of course, domestic service workers were not

covered at all if they were employed by individual home-

owners or by their families.

The 1974 Amendments significantly altered the Act with

respect to domestic service workers, bringing them as a class

within the scope of the minimum wage and overtime provi-

sions. See 29 U.S.C. §§ 206(f); 207(/). Nothing in the lan-

guage of the Amendments indicates that Congress meant the

relevant provisions to apply only to workers employed by

individual homeowners, rather than to all workers providing

domestic services including those employed by third parties.

Section 206(f), headed “Employees in domestic service,”

directs that the minimum wage be paid to “[a]ny employee—

(1) who in any workweek is employed in domestic service in

a household [if the employee’s cash compensation constituted

wages under Title II of the Social Security Act] or (2) who in

any workweek—(A) is employed in domestic service in one

or more households; and (B) is so employed for more than 8

hours in the aggregate.” That language is broad and inclu-

sive, and the explicit mention of employees “employed .. . in

one or more households,” see 29 U.S.C. § 206(f) (emphasis

added), naturally tends to bring within the category of

26

“fe]Jmployees in domestic service” those domestic service

workers most likely to be employed by third parties such as

employment agencies. That reading is reinforced by the lan-

guage of the new overtime subsection, 29 U.S.C. § 207(),

which declares that “[njo employer shall employ any

employee in domestic service in one or more households,” id.

(emphasis added), without paying the required compensation.

That terminology, too, strongly suggests that the provision

extends to third party employers, which would commonly be

the employer for domestic workers employed in more than

one household.

This reading of Sections 206(f) and 207(/) not only fits

with the text of those provisions, it eliminates inexplicable

gaps in coverage that would result from an interpretation that

treats “[e]mployees in domestic service” as excluding third

party employees. As we have explained, the Act before 1974

did not cover domestic service workers—an open-ended

category of workers that includes not just companions but

cooks, chauffeurs, maids, nurses, housekeepers, and so forth

—unless the worker was employed by a covered “enterprise.”

If the only workers regarded as “[e}mployees in domestic

service” under the Amendments were workers employed by

the individual homeowners receiving services, it would leave

entirely outside the Act any worker employed by agencies too

small to qualify as an “enterprise” and, seemingly, any

worker employed by other third parties such as relatives of

the homeowner. That would be a startling omission for a

series of provisions that, subject to the prescribed exemptions,

were meant “to include within the coverage of the Act all

employees whose vocation is domestic service.” H.R. Rep.

No. 93-913, 1974 U.S.C.C.A.N. 2845.

If the coverage provisions of the Act apply to all domestic

service workers including third party employees, it makes

sense to think that the statutory exemption for domestic ser-

vice workers providing “companionship services,” 29 U.S.C.

§ 213(a)(15), applies to them as well. Again, there is nothing

27

in the language of the Act to show that Congress intended the

availability of the exemption to tum on who employed the

worker. The focus of the provision is not on the nature of the

employer, but on the type of work that the employees per-

form: the exemption extends to “any employee employed in

domestic service employment to provide companionship ser-

vices for individuals who (because of age or infirmity) are

unable to care for themselves (as such terms are defined

and delimited by regulations of the Secretary).” 29 U.S.C.

§ 213(a)(15). That language (“any employee employed in

domestic service employment”) is once again broad and

inclusive.

This straightforward reading of the exemption also fits with

its self-evident purpose. As the district court below pointed

out, Congress included the exemption “to allow those in need

of [companionship] services to be able to find such assistance

at a price they can afford.” Pet. App. 46a. See also Welding,

353 F.3d at 1217 (“Congress created the ‘companionship

services’ exemption to enable guardians of the elderly and

disabled to financially afford to have their wards cared for in

their own private homes as opposed to institutionalizing

them”). This concern about affordable companionship ser-

vices does not fluctuate depending upon whether the workers

are employed directly by the homeowner or by a third party

employer, or upon whether the workers were or were not

previously covered by the Act. See Pet. App. 46a-47a.

Indeed, the need to restrain costs in the case of third party

employees has only become more acute as agencies provide

an increasing amount of the needed care.'”

'° The Second Circuit relied on the principle that exemptions to the Act

“are to be narrowly construed.” Pet. App. 10a. But that principle is

largely inapposite here. While a narrow definition of “employee in do-

mestic service” would have the effect of limiting the Section 213(a)(15)

exemption for workers providing companionship, it would have the much

greater threshold effect of limiting the coverage of Sections 206(f) and

207(/), which apply to the full range of domestic service workers. That

28

Having paid little heed to the Act, the Second Circuit rested

much of its decision to invalidate the exemption for third party

workers on its belief that the exemption was incompatible with

the Department’s regulatory definition of “domestic service

employment” in Section 552.3. See Pet. App. 30a. The De-

partment, however, has explained why this is not so. See Pet.

App. 54a-63a. In its December 2005 Advisory Memorandum,

the Department said that neither Section 552.3 nor Section

552.101(a)—a second regulation containing similar language

—was intended to address the question of who employed the

employee. See Pet. App. 55a-57a, 62a-63a. Rather, the

purpose of those sections was only to specify what kind of

work was required and where the work was to be performed:.

that is, domestic services in a private home (as opposed to, say,

a boarding house). See Pet. App. 58a. The Department also

carefully reviewed the origin of the “person by whom he or she

is employed” language, Pet. App. 57a-59a, stressing that its use

was not meant to exclude third party employees from the

category of workers covered by the domestic service provi-

sions of the Act. See Pet. App. 63a.

The Second Circuit, however, declined to give deference to

the Department’s reading of its regulations, see Pet. App. Sa,

again committing a critical error. This Court has long

recognized that an agency’s interpretation of its own regula-

tions “must be given ‘controlling weight unless it is plainly

erroneous or inconsistent with the regulation.’” Stinson, 508

U.S. at 45 (quoting Bowles, 325 U.S. at 414). See also

Robertson v. Methow Valley Citizens Council, 490 U.S. 332,

359 (1989). As the Court has stated, the role of the judiciary

is “not to decide which among several Competing interpre-

tations best serves the regulatory purpose.” Thomas Jefferson

Univ., 512 U.S. at 512. Rather, a court must abide by any

narrow reading, in turn, would offend the basic principle that a remedial

act should be construed broadly. See Sutton v. United Air Lines, Inc., 527

U.S. 471, 504 (1999).

29

reasonable agency reading. See id.; United States v. Cleve-

land Indians Baseball Co., 532 U.S. 200, 219 (2001).

To justify its lack of deference, the Second Circuit invoked

the principle that a court “need not defer to an agency’s

interpretation of its own regulations when those regulations,

like § 552.109(a) and § 552.3, are unambiguous ... .” Pet.

App. Sa (citing Christensen, 529 U.S. at 588). But, while the

principle is sound—it prevents an agency, “under the guise of

interpreting a regulation, [from] creat[ing] de facto a new

regulation” (Christensen, 529 U.S. at 588)— its use here is not.

The problem is that the Second Circuit made no effort to read

the Department’s regulations as a whole. See Jay v. Boyd, 351

U.S. 345, 360 (1956) (“[w]e must read the body of regulations

. . . 80 as to give effect, if possible, to all of its provisions”’).

Instead, the tourt of appeals first read Section 552.3 in

isolation and then, having ascertained its “unambiguous”

meaning, decided that it prohibited the exemption granted by

Section 552.109(a). As a result, the Second Circuit wound up

attributing to the Department the extraordinarily improbable

intention of, on the one hand, effectively declaring third party

employees ineligible for the “companionship services” exemp-

tion in Section 552.3 (by excluding them from “domestic

service employment”) and then, em the other hand, simul-

taneously proclaiming in Section 552.109(a) that it was going

to exempt them anyway. It is hard to imagine that the Depart-

ment actually meant to do that, and any reading that leads to

such an absurd outcome is itself proof that the regulations

contain an ambiguity and demand a more coherent cunstruc-

tion. The Department has provided a reasonable one and,

under traditional principles of deference, that is enough. See

Stinson, 508 U.S. at 45; Martin, 499 U.S. at 150-51."

'' Judicial deference does not disappear merely because the Depart-

ment has explored the possibility of other interpretations over time. See

Pet. App. 30a-31a; Sa. Agencies are regularly faced with a choice among

competing interpretations of a statute that they are charged with admin-

30

In the end, therefore, the Second Circuit should have

granted Skidmore deference to Section 552.109(a), even if the

regulation were deemed merely “interpretive.” The decision

to apply the Section 213(a)(15) companionship services

exemption to third party employees, as well as homeowner-

employed employees, is not just a reasonable, but in fact the

better, interpretation of the critical statutory provisions. ~The

Second Circuit should have given it more respect.

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted,

DANIEL S. ALTER H. BARTOW FARR, III

ALTER & ALTER (Counsel of Record)

300 East 42nd Street RICHARD G. TARANTO

10th Floor FARR & TARANTO

New York, NY 10017 1220 19th Street, NW

(212).867-7777 Suite 800

Washington, DC 20036

(202) 775-0184

istering. See Chevron, 467 U.S. at 844. It would introduce intolerable

rigidity into this process if the choice made by an agency were regarded as

undeserving of deference simply because the agency had expressed a

tentative contrary view and sought public comment on the various possi-

ble interpretations.

APPENDIX

oH. ino ae ia heels (poppe! wer

la

APPENDIX A

UNITED STATES COURT OF APPEALS

SECOND CIRCUIT

Docket No. 03-7666-CV

EVELYN COKE,

Plaintiff-Appellant,

V.

LONG ISLAND CARE AT HOME, LTD.,

and MARYANN OSBORNE,

Defendants-Appellees.

Argued: March 4, 2004

Decided: July 22, 2004

Remanded: Jan. 23, 2006

Decided: Aug. 31, 2006

Before WALKER, Chief Judge, KATZMANN, Circuit

Judge, and GLEESON, District Judge.

Remand from the United States Supreme Court for recon-

- sideration of a March 4, 2004, decision by this court (John M.

Walker, Jr., Chief Judge) affirming in part and vacating in

part a judgment of the United States District Court for the

Eastern District of New York. Upon further consideration we

adere to the disposition of our original decision.

AFFIRMED in part, VACATED in part, and REMANDED.

* The Honorable John Gleeson, of the United States District Court for

the Eastern District of New York, sitting by designation.

2a

PER CURIAM.

A detailed discussion of the facts of this case and the regu-

latory scheme at issue is set forth in Coke v. Long Island Care

at Home, Ltd., 376 F.3d 118, 121-25 (2d Cir.2004) (“Coke

I’). The procedural history is this: Plaintiff-Appellant Evelyn

Coke appealed from a final judgment entered in the United

States District Court for the Eastern District of New York

(Thomas C. Platt, Judge) granting Defendants-Appellees

Long Island Care at Home and Maryann Osborne judgment

on the pleadings pursuant to Federal Rule of Civil Procedure

12(c). See Coke v. Long Island Care at Home, Ltd., 267

F.Supp.2d 332 (E.D.N.Y.2003). On appeal, this court af-

firmed in part and vacated in part the district court’s judg-

ment, holding that 29 C.F.R. § 552.6 is enforceable on its face

but that 29 C.F.R. § 552.109(a) (“§ 552.109(a)”) is unen-

forceable. See Coke J, 376 F.3d at 135. By an order dated

January 23, 2006, the United States Supreme Court granted

Defendants-Appellees’ petition for a writ of certiorari, va-

cated this court’s 2004 judgment, and remanded the case to

“the Second Circuit for further consideration in light of the

Department of Labor’s Wage and Hour Advisory Memoran-

dum No.2005-1 (December 1, 2005).” Long Island Care at

Home, Ltd. v. Coke, --- U.S. ----, 126 S.Ct. 1189 (2006). For

the reasons that follow, upon reconsideration in light of the

Department of Labor’s Wage and Hour Advisory Memoran-

dum (“DOL Memo”), we adhere to our original position.

An administrative agency’s rule implementing a statutory

provision is entitled to the deference described in Chevron

U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S.

837 (1984), “when it appears that Congress delegated author-

ity to the agency generally to make rules carrying the force of

law, and that the agency imterpretation claiming deference

was promulgated in the exercise of that authority.” United

States v. Mead Corp., 533 U.S. 218, 226-27 (2001). There

is no dispute that Congress delegated to the Department of

3a

Labor (“DOL” or “the Department”) the authority to promul-

gate legislative rules, which carry the force of law. But for

substantially the same reasons set forth in our 2004 decision,

we conclude that § 552.109(a) was not intended, at the time

of its promulgation, to be a legislative rule; rather, it was

meant to be an interpretive rule. While the original notice of

proposed rulemaking indicates that the entirety of Part 552 of

the Code of Federal Regulations was adopted pursuant to the

authority delegated by 29 U.S.C. § 213(a)(15), it also indi-

cates that the DOL proposes to add Part 552

defining and delimiting, in Subpart A, the terms “domes-

tic service employee,” [and other terms undefined in the

Statute] and setting forth, in Subpart B, a statement of

general policy and interpretation concerning the applica-

tion of the Fair Labor Standards Act to domestic service

employees.

Employment of Domestic Services Employees, Recordkeep-

ing, Definitions and General Interpretations, 39 Fed.Reg.

35,382, 35, 382 (Oct. 1, 1974). This statement acknowledges

that Part 552 is divided into two subparts, each of which has a

different purpose. That statement, in combination with the

facts that Subpart B is labeled “Interpretations” and that 29

C.F.R. § 552.2(c) indicates that “[t}he definitions required by

section 13(a)(15) [of the FLSA] are contained in §§ 552.3,

552.4, 552.5, and 552.6,” convinces us that our original con-

clusion that § 552.109(a) is an interpretive rule was correct.

As such, it is entitled only to the level of déference described

in Skidmore v. Swift & Co., 323 U.S. 134 (1944) (courts should

defer to non-legislative agency rules according to their power

to persuade). See also Christensen v. Harris County, 529

U.S. 576, 587 (2000).

The arguments to the contrary presented in the DOL Memo

are not persuasive. The memo indicates that the DOL con-

siders § 552.109(a) legally binding, and points out that, when

it promulgated the final rule,yt explained that the original

4a

version would not have “allowed” the exemption for employ-

ees of third parties and that the DOL concluded that the

exemptions “can be available” to such employees. The memo

asserts that the quoted language indicates that DOL must

have believed, at the time the rule was promulgated, that the

availability of the exception to employees of third parties

turned definitively on its pronouncement in § 552.109(a).

But even if all other regulatory provisions were silent on the

issue of third-party employees, § 552.109(a) could have been

simply intended to provide guidance to DOL employees as

to how the agency planned to interpret “domestic service

employment” in the third-party employer context. This is,

after all, the function that interpretive rules, opinion letters, ©

agency manuals, enforcement guidelines, and other non-legis-

- lative agency rules that have been denied Chevron deference

perform. See Christensen, 529 U.S. at 587. So even if the

agency’s determination of whether employees of third parties

qualify for the companionship services exemption has always

been dependent on § 552.109(a), that does not mean that

regulation was promulgated as a legislative regulation in-

tended to have the force of law outside of the agency.

Applying Skidmore deference to § 552.109(a), we see noth-

ing in the DOL Memo to persuade us that our original con-

clusion was in error. We rested that conclusion on our: deter-

minations that the regulation is (1) inconsistent with Con-

gress’s likely purpose in enacting the 1974 amendments;

(2) inconsistent with other regulations; (3) inconsistent with

other DOL positions over time; and (4) insufficiently ex-

plained by DOL, evidencing a lack of thorough consideration.

Coke 1, 376 F.3d at 133.

_ After consideration of the DOL Memo, we acknowledge

that, like most complex statutes, the FLSA has multiple

purposes, some of which are in tension with one another.

Among these purposes are a desire to expand the coverage of

the FLSA to domestics, S.Rep. No. 93-690, 93d Cong., 2d

Sa

Sess., at 16, 18-20 (1974), to exempt companionship services

from that coverage, id. at 20, to ensure that companionship

and babysitting services remain affordable for working fami-

lies, 18 Cong. Rec. 24,715 (1972), and to ensure minimum

wage and overtime compensation for domestic workers who

were regular bread-winners, responsible for supporting their

families, S.Rep. No. 93-690, at 20. The third-party employer

~ regulation as currently written would be consistent with some

of these purposes and inconsistent with others. Consideration

of congressional intent therefore does not lead to any defini-

tive conclusion regarding the enforceability of § 552.109(a).

Our previously expressed concerns about the regulation

remain valid. To the extent that the DOL Memo invites us to

reconcile § 552.109(a) and 29 C.F.R. § 552.3 (“§ 552.3”) with

one another by ignoring the “extraneous vestige of the lan-

guage’s origin” included in the text of § 552.3, we decline to

accept the invitation. While we agree that we must make

every effort to interpret regulations in such a way as to give

each of them meaning and effect, an effort that requires us to

ignore the plain language of a regulation with the force of law

places more weight on that rule of construction than it can

bear. Moreover, we need not defer to an agency’s interpreta-

tions of its own regulations when those regulations, like

§ 552.109(a) and § 552.3, are unambiguous. Christensen,

529 U.S. at 588, 120 S.Ct. 1655.

With respect to the agency’s inconsistent positions regard-

ing § 552.109(a), we acknowledge DOL’s statement in the

DOL Memo withdrawing and repudiating all previous state-

ments questioning the validity of that regulation. But a cur-

rent repudiation of those past positions does not mean that

they were never advanced. As firm as DOL’s conviction is

now that the current form of § 552.109(a) is the appropriate

one, it cannot change tke fact that, at multiple times in the

past, the Department’s position has been otherwise.

6a

Finally, in our original opinion, we were specifically con-

cerned with DOL’s failure to explain both the inconsistency

between § 552.109(a) and § 552.3 and the Department’s deci-

sion in 1975 to promulgate a rule that was contrary to the one

originally proposed. Coke J, 376 F.3d at 134. We acknowl-

edge that the DOL Memo is evidence that the agency has

spent some time considering its position with respect to

§ 552.109(a). We also recognize that the agency has con-

sidered and decided against amending the regulation on sev-

eral occasions. But these facts do not address our concerns

regarding the thoroughness of the original consideration and

reasoning that went into the promulgation of § 552.109(a).

To be sure, the DOL Memo attempts to explain the inconsis-

tency between § 552.109(a) and § 552.3, but, as noted above,

we find this explanation unpersuasive. And with respect to

the “about-face,” Coke /, 376 F.3d at 134, which the Depart-

ment performed between the initial notice of proposed rule-

making and the adoption of the regulation in its current form,

the DOL Memo is silent. As we pointed out in our March

2004 opinion, the explanation proffered in the Federal Regis-

ter, see 40 Fed.Reg. 7404, 7405 (Feb. 20, 1975), ignored the

plain language of the statute. Coke /, 376 F.3d at 134. The

DOL Memo not only fails to acknowledge this faulty reason-

ing, it actually advances it once more as an argument that the

current form of § 552.109(a) is consistent with the statutory

text of 29 U.S.C. § 213(a)(15).

After reconsidering our 2004 decision in light of the DOL

Memo, we find no reason to abandon the reasoning or the

results reached in that decision. For the reasons set forth

above and in our 2004 opinion, we AFFIRM the district

court’s ruling that 29 C.F.R. § 552.6 is enforceable on its

face; VACATE the district court’s ruling that 29 C.F.R.

§ 552.109(a) is enforceable; and REMAND the case for

further proceedings.

Ta

APPENDIX B

UNITED STATES COURT OF APPEALS

SECOND CIRCUIT

Docket No. 03-7666

EVELYN COKE,

Plaintiff-Appellant,

Vv.

LONG ISLAND CARE AT HOME, LTD.,

and MARYANN OSBORNE,

Defendants-Appellees.

Argued March 4, 2004

Decided July 22, 2004

Before: WALKER, Chief Judge, KATZMANN, Circuit

Judge, and GLEESON, District Judge. '

JOHN M. WALKER, JR., Chief Judge:

At issue in this appeal is the enforceability of two reg-

ulations promulgated by the Department of Labor (“DOL”)

that define and interpret the “companionship services” ex-

emption in the Fair Labor Standards Act (“FLSA” or “the

Act”), 29 U.S.C. § 213(a){15). The Act generally requires

minimum wage and overtime compensation; the “companion-

ship services” exemption relieves employers from paying

such compensation to those employees who work in domestic

service as babysitters and companions to the elderly and

' The Honorable John Gleeson, of the United States District Court for

the Eastern District of New York, sitting by designation.

8a

infirm. The regulations at issue implement the exemption

with respect to companions.

The first regulation we consider is a regulation that defines

the exemption. It includes within the exemption (1) those

who perform household work related to the care of the elderly

or infirm and (2) those who also perform housework inci-

dental to their “companionship services” as long as the

housework accounts for less than twenty percent of the

weekly hours worked. See 29 C.F.R. § 552.6. The second

regulation we consider applies the exemption to “[e]mployees

who are engaged in providing companionship services, as

defined in § 552.6, and who are employed by an employer or

agency other than the family or household using their ser-

vices.” See 29 C.F.R. § 552.109(a). The district court found

both of these regulations to be entitled to the highest form of

deference available to agency regulations and, accordingly,

found them legally enforceable. See Coke v. Long Island

Care at Home, Ltd., 267 F.Supp.2d 332 (E.D.N.Y. 2003).

We affirm the enforceability of the first regulation, § 552.6,

according it the highest level of deference available to agen-

cies pursuant to Chevron, U.S.A., Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984). But we conclude

that the second regulation, § 552.109(a), is neither entitled to

Chevron deference nor enforceable; we find it to be entitled

only to the more limited level of deference announced in

Skidmore v. Swift & Co., 323 U.S. 134 (1944), and reaffirmed

in United States v. Mead Corp., 533-U.S. 218 (2001). Be-

cause the second regulation is unpersuasive in the context of

the entire statutory and regulatory scheme, it fails Skidmore’s

test and cannot be enforced. Accordingly, we AFFIRM in

part, VACATE in part, and REMAND for further proceed-

ings.

FACTUAL BACKGROUND

Plaintiff-appellant Evelyn Coke appeals from the judgment

on the pleadings, entered pursuant to Federal Rule of Civil

9a °

Procedure 12(c), in favor of defendants-appeliees Long Island

Care at Home, Ltd. and owner Maryann Osborne, by the

United States District Court for the Eastern District of New

York (Thomas C. Platt, District Judge). See Coke, 267

F.Supp.2d at 332-41. The Secretary of Labor submitted an

amicus brief arguing on behalf of defendants-appellees that

the district court’s ruling should be affirmed.

Unlike most, if not all, of the other courts that have consid-

ered the issues in this appeal,” we review Coke’s case before

the summary judgment stage and, thus, without any factual

development. All we know is that Coke filed this action

under the FLSA, alleging that she was employed as a “home

healthcare attendant” by defendants, who did not pay her

minimum wage or overtime compensation. While such com-

pensation is generally required under the FLSA, Coke ac-

knowledges that the “companionship services” exemption to

the FLSA, as defined and interpreted by the DOL regulations,

applies to her employment and that if the regulations at issue

are enforceable, she cannot prevail. Her arguments are purely

legal.

Coke contends that the two regulations defining and inter-

preting “companionship services” are unreasonable and imper-

missible in light of the statute’s clear language and statutory

purpose. Coke candidly calls her action a test case, “chal-

lenging the regulation{s] on [their] face.” She does not allege

? We collect the full citations to such cases here in chronological order

for ease of reference: McCune v. Or. Senior Servs. Div., 894 F.2d 1107

(9th Cir.1990); Cox v. Acme Health Servs., Inc., 5S F.3d 1304 (7th Cir.

1995); Salyer v. Ohio Bureau of Workers’ Comp., 83 F.3d 784 (6th Cir.

1996); Terwilliger v. Home of Hope, Inc., 21 F Supp.2d 1294 (N.D.Okla.

1998); Johnston v. Volunteers of Am., Inc., 213 F.3d 559 (10th Cir.2000);

Madison v. Res. for Human Dev., Inc., 233 F.3d 175 (3d Cir.2000); Harris

v. Dorothy L. Sims Registry, No. 00 C 3028, 2001 WL 78448, 2001 U.S.

Dist. LEXIS 23263 (N.D.III. Jan.29, 2001); Welding v. Bios Corp., 353

F.3d 1214 (10th Cir.2004).

10a

that the regulations are being improperly applied to a subclass

of employees but, rather, that they contravene legislative will

and are therefore unenforceable. After the district court ac-

corded the two regulations Chevron deference and found

them to be permissible under the statute, it granted defen-

dants’ motion for judgment on the pleadings. This appeal

followed.

DISCUSSION

1. Standards of Review

We review the decision of the district court de novo both

because the judgment below was entered on the pleadings on

a matter of statutory construction, Levy v. Southbrook Int'l

Invs., Ltd., 263 F.3d 10, 14 (2d Cir.2001); Davidson v. Flynn,

32 F.3d 27, 29 (2d Cir.1994), and, more specifically, because

the decision as to whether an FLSA exemption may be

applied to a class of claimants is a question of law, Freeman

v. NBC, 80 F.3d 78, 82 (2d Cir.1996). Moreover, the ques-

~ tion of the appropriate level of deference to accord agency

regulations is one purely of law, subject to de novo review.

See Ossen v. Dep't of Soc. Servs. (In re Charter Oak Assocs.),

361 F.3d 760, 764 (2d Cir.2004) (pure questions of law are

reviewed de novo). See generally 5 U.S.C. § 706 (“[T]he re-

viewing court shall decide all relevant questions of law. . . .”).

At this stage of the litigation, it is conceded by both parties

that there are no disputed issues of material fact.

Our review in the FLSA context is guided by a few special-

ized principles. Because the FLSA is a remedial act, its ex-

emptions are to be narrowly construed. See Arnold v. Ben

Kanowsky, Inc., 361 U.S. 388, 392 (1960); Mitchell v. Lublin,

McGaughy & Assocs., 358 U.S. 207, 211 (1959). And an em-

ployer bears the burden of proving that its employees fall

within an exemption in the FLSA. See Corning Glass Works

v. Brennan, 417 U.S. 188, 196-97 (1974); Arnold, 361 U.S. at

392; Donovan v. Carls Drug Co., 703 F.2d 650, 652 (2d

Cir.1983). In sum, “[t]o extend an exemption to other than

a

'

lla

those plainly and unmistakably within its terms and spit 't is to

abuse the interpretative process and to frustrate the an-

nounced will of the people.” A.H. Phillips, Inc. v. Walling,

324 U.S. 490, 493 (1945). Bearing these guiding principles

in mind, we undertake our de novo review of the district

court’s decision upholding the two regulations at issue here.

II. Statutory Scheme

The FLSA, enacted by Congress in 1938, requires that

most workers receive minimum wage and overtime com-

pensation for hours worked in excess of forty per week. See

generally 29 U.S.C. § 201 et seq. In 1974, Congress amended

the FLSA to broaden its coverage to a new set of workers,

previously unprotected by the Act: employees performing

“domestic services.” While the statute itself did not define

“domestic service employment,” the Senate Committee Re-

port confirms the commonly understood meaning of the term

to include those employed within the home as cooks, butlers,

valets, maids, housekeepers, governesses, jaiiitors, laundresses,

caretakers, handymen, gardeners, footmen, grooms, chauf-

feurs, and the like. See S.Rep. No. 93-690, at 20 (1974); see

also H.R.Rep. No. 93-913, at 35-36 (1974), U.S.Code Cong.

& Admin.News at 2811, 2845. However, while extending

FLSA protections to employees in domestic service, Congress —

carved out an exemption for employees engaged in “baby-

sitting services” and “companionship services.” The exemp-

tion withholds FLSA benefits from:

any employee employed on a casual basis in domestic

service employment to provide babysitting services or

any employee employed in domestic service employ-

ment to provide companionship services for individuals

who (because of age or infirmity) are unable to care for

themselves (as such terms are defined and delimited by

regulations of the Secretary [of Labor])....

29 U.S.C. § 213{a)(15). In order to more clearly delineate

those who are subject to the exemption, the Secretary of

12a

Labor, soon after the adoption of the 1974 amendments,

promulgated a series of regulations, including the two that

Coke challenges here.

Ill. Regulatory Scheme

The first regulation Coke challenges was promulgated in

exercise of the authority delegat@&#by ¥ 21 3(a)(15) to define

“companionship services.” It defines “companionship ser-

vices” as

those services which provide fellowship, care, and

protection for a person who, because of advanced age or

physical or mental infirmity, cannot care for his or her

own needs. Such services may include household work

related to the care of the aged or infirm person such as

meal preparation, bed making, washing of clothes, and

other similar services. They may also include the

performance of general household work: Provided,

however, [t}hat such work is incidental, i.e., does not

exceed 20 percent of the total weekly hours worked.

29 C.F.R. § 552.6.

A related regulation (not challenged here), also prom-

ulgated in clear exercise of the authority delegated by

§ 213(a)(15), adopts the House Committee Report’s defini-

tion of “domestic service employment.” That regulation.

states that domestic service “refers to services of a household

nature performed by an employee in or about a private home

.... Of the person by whom he or she is-employed.” 29 C.F.R.

§ 552.3 (emphasis added); cf H.R.Rep. No. 93-913, at 35,

U.S.Code Cong. & Admin.News at 2845 (defining “domestic

service employment” to be “services of a household nature

performed by an employee in or about a private home of the

person by whom he or she is employed”); see also S.Rep.

No. 93-690, at 20 (stating that the House’s construction

of “domestic service employment” to exclude third party

employment is “generally accepted”).

13a

The second regulation Coke challenges, 29 C.F.R.

§ 552.109(a), also promulgated soon after the 1974 amend-

ments, expressly extends the exemption by including employ-

ees “who are employed by an employer or agency other

than the family or household using their services.” Section

552.109(a) appears under the “Subpart B” heading, “Inter-

pretations,” as opposed to the “Subpart A” heading, “General

Regulations,” under which §§ 552.3 and 552.6 are listea.

This regulation exempted employees who the DOL concedes

were not exempt prior to the 1974 amendments. See Employ-

ment of Domestic Service Employees, 39 Fed.Reg. 35, 382,

35, 385 (proposed Oct. 1, 1974) (finding that “[e]mployees

who are engaged in providing . . . companionship services

and who are employed by an employer other than the families

or households using such services” were “subject to the

[FLSA] prior to the 1974 Amendments”). Prior to the

promulgation of § 552.109(a), the DOL put out a different

proposed rule for notice and comment: one that specifically

declined to apply the “companionship services” exemption to

employees of third party employers. See id. Following

notice and comment on that proposed regulation, the agency

reversed its position and offered the following explanation:

“On further consideration, [the Secretary of Labor] ha[s] con-

cluded that these exemptions can be available to such third

party employers since they apply to ‘any employee’ engaged

‘in’ the enumerated services.” Application of the Fair Labor

Siandards Act to Domestic Service, 40 Fed.Reg. 7404, 7405

(Feb. 20, 1975) (codified at 29 C.F.R. pts. 516, 552). The

statement accompanying the regulation did not explain how

bringing these previously sovered employees of third party

employers within the exemption furthered the congressional

purpose of expanding, and not narrowing, FLSA coverage

from what it had been prior to 1974. The DOL did not extend

the exemption to apply to those employees employed by third

parties that provide “babysitting services.” See 29 C.F.R.

§ 552.109(b).

l4a

The DOL has enforced the two regulations at issue since

their promulgation in 1974 and Congress has not disturbed

the details of the scheme recounted here in the nearly thirty

years they have been in force. In early 2001, however, the

agency proposed amendments to the regulations pertaining to

the “companionship services” exemption, which were subse-

quently abandoned. In proposing the amendments, the DOL

Stated:

Due to significant changes in the home care industry

over the last 25 years, workers who today provide in-

home care to individuals needing assistance with activi-

ties of daily living are performing types of duties and

working in situations that were not envisioned when the

companionship services regulations were promulgated.

The number of workers providing these services has also

greatly increased, and most of these workers are being

excluded from the FLSA under the companionship ser-

vices exemption. The Department has reevaluated the

regulations and determined that—as currently written—

they exempt types of employees far beyond those whom

Congress intended to exempt when it enacted section

[2]13(a)(15). Therefore, the Department proposes to

amend the regulations to revise the definition of “com-

panionship services,” which sets out the duties that a

companion must be employed to perform in order to

qualify for the exemption, to more closely mirror Con-

gressional intent.

See Application of Fair Labor Standards Act to Domestic

Service, 66 Fed.Reg. 5481, 5482 (proposed Jan. 19, 2001).

The DOL further explained what it undérstood to have been

the congressional intent in 1974:

[I]t clearly was Congress’ intent under the 1974 FLSA

Amendments to cover all workers who performed do-

mestic services as a vocation, excluding casual baby-

sitters and providers of companionship services who

lSa

were not regular bread winners or responsible for their

[own] families’ support, . . . Personal and home care

aides perform a variety of tasks in the home, including

household work and assistance with nutrition and cleanli-

ness. Employers have generally treated workers em-

ployed as home health aides and personal and home care

aides as exempt companions, based upon the Depart-

ment’s current regulations. . . . As a result, the Depart-

ment believes it is necessary to amend the regulations to

focus them on fellowship and protection duties that Con-

gress originally intended the companion exemption to

cover.

Id. at 5483. The 2001 proposed amendments to the regu-

lations would have extended FLSA protection to employees

who are hired by “someone other than a member of the

family in whose home he or she works.” /d. at 5482. The

DOL expressly acknowledged that there exists an internal

inconsistency between § 552.109(a) and § 552.3 and that

§ 552.3 is more consistent with the congressional purpose as

it existed in 1974. /d. at 5485. Nonetheless, without further

addressing the inconsistency, the DOL withdrew the proposed

amendments in April 2002 because “numerous comments]

on the proposed rule, including [comments offered by] multi-

ple government agencies . . . seriously called into question the

Department’s conclusion that there would be little economic

impact.” Application of the Fair Labor Standards Act to

Domestic Service, 67 Fed.Reg. 16,668 (Apr. 8, 2002). Upon

withdrawing the proposed amendments, the DOL did not

question or otherwise comment upon its 2001 conclusion

about what congressional intent had been in 1974.

IV. The Enforceability of 29 C.F.R. § 552.6

A. Degree of deference to accord to the DOL

The district court accorded Chevron deference to § 552.6’s

definition of “companionship services.” Neither party in

l6a

this case objects to this because the statute directed the DOL

to promulgate legislative regulations to define the term “com-

panionship services” as it appears in 29 U.S.C. § 213(a)(15),

and the regulations are plainly an exercise of that authority.

See Mead, 533 U.S. at 226-27, 121 S.Ct. 2164 (clarifying that

' Chevron deference is appropriate when a statute clearly dele-

gates authority to an agency and the agency acts purporting

to exercise that authority); Chao v. Russell P. Le Frois

Builder, Inc., 291 F.3d 219, 226 (2d Cir.2002); 29 C.F.R.

§ $52.2(c) (expressly stating that “[t]he definitions required

by § [2]13(a)(15) are contained in §§ 552.3, 552.4, 552.5 and

552.6”). Accordingly, § 552.6 is binding on the courts unless

procedurally defective, “arbitrary, capricious, or manifestly

contrary to the statute.” Chevron, 467 U.S. at 844. Here,

Coke argues that § 552.6 is unenforceable as being manifestly

contrary to the statute.

In applying Chevron deference, we follow a two-step

analysis: “If the intent of Congress is clear, that is the end of

the matter; for the court, as well as the agency, must give

effect to the unambiguously expressed intent of Congress.”

Id. at 842-43. When the terms of a statute are unambiguous,

the judicial inquiry is complete. However, if there is ambigu-

ity in the statute, we proceed to step two and inquire whether

the agency’s legislative regulation is a reasonable and per-

missible construction of the statute. /d. at 843-44. “If the

agency’s reading fills a gap or defines a term in a reasonable

way in light of the Legislature’s design, we give that reading

controlling weight, even if it is not the answer the court

would have reached if the question initially had arisen in a

judicial proceeding.” Regions Hosp. v. Shalala, 522 U.S.

448, 457 (1998) (internal quotation marks omitted) (citing

Chevron, 467 U.S. at 843 n. 11). We are also mindful that “‘a

long-standing, contemporaneous construction of a statute by

the administering agenc[y] is entitled to great weight.” Leary

v. United States, 395 U.S. 6, 25 (1969) (internal quotation

marks and citations omitted).

YY

17a

B. Application of Chevron

Coke argues that we needn’t arrive at step two of the

Chevron inquiry and that we should find that the statute

plainly and on its face prohibits the agency’s definition of

“companionship services.” In particular, she contends that

the regulation’s inclusion within the definition of both house-

work related to the care of the elderly or infirm and house-

work incidental to that care are violative of the statute’s

command to fashion an exemption only for “companionship

services.” Coke suggests that the large amount of incidental

housework permitted by the current regulation (twenty per-

cent of the work) is an abuse of the delegation under the

statute. Indeed, she argues, under a particular reading of the

regulation’s second sentence (the one that allows work “re-

lated to” the care of the elderly or infirm), “household work”

would be exempt even if no companionship were provided at

all: “Under the regulation, an elderly person unable to care

for him or herself could hire a full-time companion and a full-

time cook, pay the cook less than the minimum wage, and

successfully assert that cooking is a companionship service

.... Appellant’s Br. at 16. Thus, because Congress clearly

indicated that “companionship services” were meant to be a

subset of domestic services, and the regulation can be read to

exempt pure domestic service without companionship, Coke

argues that the regulation was drawn too broadly on its face.

Since Congress wanted to make sure domestic service em-

ployees got FLSA protection, she argues that § 552.6’s exten-

sion of the exemption to “meal preparation, bed making,

[and] washing of clothes” places too many domestic service

employees within the exemption, a result that Congress could

not have intended. The district court properly rejected these

arguments.

~The statute plainly gives the DOL authority to define

“companionship services,” a vague term with no obvious

plain meaning; and the DOL did so very soon after the

18a

passage of the amendments to the FLSA. On the face of the

statute, we discern no unambiguous congressional intent to

keep all “incidental” services and domestic services “related

to” the care of the elderly and infirm outside the exemption,

especially when such services would naturally follow from or

be part of a reasonable job description of a companion to the

elderly or infirm.

Although the Supreme Court has issued mixed messages as

to whether a court may consider legislative history at this

stage of the analysis (step one of Chevron),’ that history

plainly presupposes that some incidental or other related

housework would accompany “companionship.” For exam-

ple, Senator Quentin Burdick wanted to extend FLSA cov-

erage for “professional domestic[s]” but was concerned about

the potential burden on household employers where “people

who might have an aged father, an aged mother, an infirm

father, an infirm mother, and a neighbor comes in and sits

with them. This, of course, entails some work, such as

perhaps making lunch . . . . This would be incidental to the

main purpose of the employment.” 119 Cong. Rec. 24,773,

> Compare FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,

133, 137, 120 S.Ct. 1291, 146 L.Ed.2d 121 (2000) (effectively consid-

ering legislative history at step one of Chevron analysis), Pauley v.

BethEnergy Mines, Inc., 50\ U.S. 680, 697-99, 111 S.Ct. 2524, 115 L.Ed.2d

604 (1991) (same), Pension Benefit Guar. Corp. v. LTV Corp., 496 U.S.

633, 649-50, 110 S.Ct. 2668, 110 L.Ed.2d 579 (1990) (same), and Japan

Whaling Ass'n v. Am. Cetacean Soc'y, 478 U.S. 221, 233-41, 106 S.Ct.

2860, 92 L.Ed.2d 166 (1986) (same), with K Mart Corp. v. Cartier, Inc.,

486 U.S. 281, 293 n. 4, 108 S.Ct. 1811, 100 L.Ed.2d 313 (1988) (opinion

of Kennedy, J.) (noting in the first step of a Chevron inquiry that “any

reference to legislative history [ ] is in the first instance irrelevant”),

Sutton v. United Air Lines, Inc., 527 U.S. 471, 482, 119 S.Ct. 2139, 144

L.Ed.2d 450 (1999) (finding statutory text clear enough to ignore any

arguments from legislative history), and Nat'l R.R. Passenger Corp. v.

Boston & Me. Corp., 503 U.S. 407, 417, 112 S.Ct. 1394, 118 L.Ed.2d 52

(1992) (finding only statutory text to be relevant for first-step Chevron

“analysis).

19a

24,801 (1973). Senator Harrison Williams explained the

purpose of the “companionship services” exemption through

an analogy to the “babysitting” exemption:

We use the situation in which people are in a household

not to do household work but are there, first, as baby-

sitters. I think we all have the full meaning in mind of

what a babysitter is th ere for-to watch the youngsters.

“Companion,” as we mean it, is in the same role-to be

there and to watch an older person, in 2 sense.

{Household work] which is purely incidental would not

change the category of the person being there in the

household.

Id. Without attaching primacy to using legislative history at

_step one, it seems to us more likely than not that Congress

understood that when employees are in the home “first” to be

companions or babysitters, they may engage in “incidental”

housework without falling outside the exemption. The DOL’s

regulatory choice of the twenty percent allowance for inci-

dental work is not clearly contravened by either the text of the

statute or the intent of Congress to the extent it is discernable.

More troubling is the second sentence of the regulation,

which is not delimited by the twenty percent rule. It does

seem to allow, as Coke argues, virtually unlimited household

work as long as it is “related to the care of the aged or infirm

person.” The DOL, however, in its amicus brief explains:

Under section 552.6, an employee must “provide fel-

lowship, care, and protection” for a person unable to

care for himself in order to meet the requirements of the

“companionship services” exemption. While the regu-

lation allows for the performance of some household

work, it must be either “related to” or “incidental” to

the “care of the aged or infirm person. See 29 C.F.R.

20a

552.6.” Thus, contrary to [Coke’s] suggestion, an em-

ployee hired only to perform household work or as a

“full-time cook” would not meet the requirements of the

regulation. An employee who has not been hired pri-

marily to provide “fellowship, care, and protection” will

not be considered exempt under the Act or the

regulations.

Br. of Amicus Curiae DOL at 19 (citations omitted). The

‘DOL’s explanation is adequate. At best, the regulation is

ambiguous on the question of whether the first sentence of the

regulation must be satisfied—that an employee must first

provide “fellowship, care, and protection” —before proceed-

ing to the inquiry about whether to exempt the. “related”

household work.

We note, however, that we have no occasion to limit the

. enforcement of § 552.6 to the DOL’s litigation position here

because Coke concedes that her challenge is:to the regulation

“on its face,” that is, in all its applications. Coke has

specifically refused to challenge the regulation “as applied” to

any particular class of employees. We do not rule out the

possibility of an application that would contravene the plain

statutory mandate, but because there are many applications of

the regulation that are consistent with the statute, we cannot

declare it invalid on its face. See generally Reno v. Flores,

507 U.S. 292, 301 (1993) (extending the no-set-of-circum-

stances test for facial constitutional challenges to statutes

under United States v. Salerno, 481 U.S. 739 (1987), to

Chevron challenges). In any event, Coke presents no facts

upon which we could conclude that the agency has ever

applied the regulation in the purportedly impermissible way

she envisions.

If we refused to consider the unequivocal legislative his-

tory at step one of Chevron, the statute is at best ambiguous

on the question of whether incidental services and household

work related to the care of the individual may accompany the

x

2la

fellowship and companionship focus of the exemption.* And

step two of Chevron requires us to inquire if the DOL’s

regulation “harmonizes with the language, origins, and pur-

pose of the statute.” Bankers Life & Cas. Co. v. United

States, 142 F.3d 973, 983 (7th Cir.1998). Consideration of

legislative history is generally accepted at this stage of the

analysis. E.g., Toibb v. Radloff, 501 U.S. 157, 162 (1991);

Bankers Life, 142 F.3d at 983.

Coke also argues that § 552.6 fails step two of Chevron.

Coke repeats the arguments she makes in connection with

step one and also focuses on Senator Burdick’s statement in

the legislative history that sums up the “companionship ser-

vices” exemption as one targeted for “elder sitter[s].” See

119 Cong. Rec. at 24,801. Coke intimates that a sitter must

only sit, without lifting a hand to help the elderly or infirm

with incidental housework. But, again, we agree with the

district court that § 552.6 survives the Chevron inquiry. The

Senate Report, cited by Coke, makes clear that some inciden-

tal household work and housework related to the care of the

elderly or infirm does not contravene the purpose of the

exemption. See 119 Cong. Rec. at 24,801 (1973). The idea

that a sitter merely sits is belied by Senator Burdick’s anal-

ogy: Sitters provide care, and care entails other incidental

tasks such as food preparation, feeding, cleaning up messes,

changing diapers, and other services. Accordingly, given the

deference afforded the agency under Chevron, we are unable

* The DOL’s 2001 statements do not prove that § 552.6 is unenforce-

able. First, the DOL’s contemporaneous assessment of congressional in-

tent is more probative: Apparently, the DOL thought § 552.6 represented

congressional intent in 1974 and the enacting Congress expressed no dis-

content. Second, the DOL’s interpretation of congressional intent, whether

in 2001 or 1974, could never be dispositive for our Chevron inquiry. Of

course, the entire purpose of the Chevron inquiry is to determine congres-

sional intent quite apart from what the agency interprets that intent to be.

Only if we conclude that the enacting Congress's intent is ambiguous do

we defer to reasonable interpretations of the gap left by the ambiguity.

22a

to conclude that § 552.6 is arbitrary, capricious, or manifestly

contrary to the statute with respect to either (1) the twenty

percent allowance for incidental housework in the agency’s

legislative regulation, or (2) the agency’s allowance for

household work related to the care of the individual.

Every circuit to have considered the question of the en-

forceability of § 552.6 has found the regulation enforceable

on its face. See, e.g., Johnston, 213 F.3d at 565; Salyer, 83

F.3d at 787; McCune, 894 F.2d at 1110. Only Harris, 2001

WL 78448, at *5, 2001 U.S. Dist. LEXIS 23263, at *17, a

district court decision from the Northern District of Illinois,

found the regulation too broad. Harris, of course, in no way

binds us. Moreover, Harris was an “as applied” case and its

ultimate pronouncement was narrow. While it calls § 552.6

“unreasonably broad” in the text of the opinion, id. at *3,

2001 U.S. Dist. LEXIS 23263, at *11, it is more circumspect

when it announces its final holding: Ҥ 552.6, as currently

drafted, is invalid fo the extent it exempts homemakers from

[FLSA] coverage,” id. at *5, 2001 U.S. Dist. LEXIS 23263,

at *17 (emphasis added); only the particular case of the

regulation “as applied” to homemakers—as the plaintiffs

were in that case—was held to be outside the “companionship

services” exemption. ;

In the case before us, however, because Coke does not tell

us anything about what “home healthcare attendants” actually

do, it is impossible for us to pass on the question of whether

the particular work she did was considered by Congress to be

outside the exemption. Consistent with her facial challenge

to § 552.6, Coke refused to amend her complaint to be more

specific about what she does. For the foregoing reasons, the

regulation withstands Chevron deference on this challenge.

Accordingly, we AFFIRM the district court’s ruling with

respect to the enforceability of § 552.6.

23a

V. The Enforceability of 29 C.F.R. § 552.109(a)

We now turn to Coke’s challenge to § 552.109(a), which

applies the exemption to “companionship services” rendered

by those who are employed by third parties, rather than by the

family of the recipient of the services.

A. Degree of deference to accord to the DOL

The threshold question concerning § 552.109(a)’s enforce-

ability is the degree of deference to be afforded the DOL.

Coke argues that the district court erred by according Chevron

deference to the regulations that the DOL itself calls “inter-

pretations.” The DOL argues that such deference was

appropriate. Although the district court did not directly

consider the question, it is purely one of law, which we con-

sider de novo. See Ossen, 361 F.3d at 764.

In favor of applying Chevron deference is Chevron ‘s own

broad statement and Mead’s endorsement of that statement:

When Congress has “explicitly left a gap for an agency

to fill, there is an express delegation of authority to the

agency to elucidate a specific provision of the statute by

regulation,” and any ensuing regulation is binding in the

courts unless procedurally defective, arbitrary or Capri-

cious in substance, or manifestly contrary to the statute.

Mead, 533 U.S. at 227 (citation omitted) (quoting Chevron,

467 U.S. at 843-44). Thus, to the extent that the statute is

silent on the definition of a “domestic service employee” and

contains no reference to third party employers, such matters

might be understood to be appropriately delegated to the

DOL. An agency interpretation “qualifies for Chevron de-

ference when it appears that Congress delegated authority to

the agency generally to make rules carrying the force of law,

and that the agency interpretation claiming deference was

promulgated in the exercise of that authority.” Mead, 533

U.S. at 226-27, 121 S.Ct. 2164 (emphasis added). The

24a

statute, 29- U.S.C. § 213(a)(15), expressly delegated authority

to the DOL to define and delimit the terms “companionship

services” and “domestic service employee,” and the DOL

argues that Chevron deference follows accordingly.

Moreover, the regulation at issue is “a long-standing, con-

temporaneodus construction of a statute,” and, as such, “enti-

tled to great weight.” Leary, 395 U.S. at 25 (internal quota- -

tion marks omitted). Indeed, Congress has revisited § 213 by

amending it seven times since 1974, without expressing any

disapproval of the DOL regulation at issue, see Pub.L. No.

95-151 (1977); Pub.L. No. 96-70 (1979); Pub.L. No. 101-157

(1989); Pub.L. No. 103-329 (1994); Pub.L. No. 104-88 (1995);

Pub.L. No. 104-188 (1996); Pub.L. No. 105-78 (1997). Such

congressional acquiescence is “persuasive evidence that the

[agency] interpretation is the one intended by Congress.”

Commodity Futures Trading Comm'n v. Schor, 478 U.S. 833,

846 (1986).°

Finally, when an agency action is “‘the fruit{ } of notice-

and-comment rulemaking or formal adjudication,’” courts

generally accord the agency Chevron deference. Chao, 291

F.3d at 227 (quoting Mead, 533 U.S. at 230). Here, no one

contests that, although the agency calls § 552.109(a) an

* The argument from congressional acquiescence-affectionately known

as the “dog didn’t bark canon”-must always be qua’fied by the observa-

tion that evidence of what subsequent Congresses intend pales in compari-

son to probative evidence about what the enacttng Congress intended;

even Schor did not rely on what it called the “silence” rule. 478 U.S. at

846, 106 S.Ct. 3245. See generally William N. Eskridge, Jr. et al., Cases

and Materials on Legislation: Statutes and the Creation of Public Policy

1020-21 (3d ed.2001) (discussing the “dog didn’t bark canon”). Further-

more, because Congress, in amending § 213, never reenacted the FLSA or

the relevant provisions thereof, this is not a case that implicates the “re-

enactment rule” delineated in Lorillard v. Pons, 434 U.S. 575, 580, 98

S.Ct. 866, 55 L.Ed.2d 40 (1978), where “Congress is presumed to be

aware of an administrative . . . interpretation of a statute and to adopt that

interpretation when it re-enacts a statute without [relevant] change.”

25a

“interpretation,” it was promulgated following notice and

comment procedures. However, it is also true (and a cause of

concern) that the rule the agency adopted after comments

were received was the opposite of the rule proposed in the

original notice. There was no separate notice and comment

on the rule as ultimately adopted.

All courts that have considered § 552.109(a) have accorded

it Chevron deference. See, e.g., Johnston, 213 F.3d at 561-

62; Terwilliger v. Home of Hope Inc., 2\ F.Supp.2d at 1299

n. 2. But Coke is correct that none of these prior cases care-

fully considered the question before us now: Does Mead,

which post-dates the cases affording § 552.109(a) Chevron

deference, require a different analysis yielding a different re-

sult insofar as it holds that some agency regulations should be

accorded less than Chevron deference?

Coke argues that Mead requires us to apply a lesser degree

of deference to § 552.109(a) as an “interpretive,” rather than a

“legislative” regulation. Indeed, “interpretive rules . . . enjoy

no Chevron status as a class.” Mead, 533 U.S. at 232.

This circuit, even before the Supreme Court’s clarification

in Mead, contemplated that interpretive regulations should

not receive full Chevron deference. In Reich v. New York,3 —

F.3d 581, 587 (2d Cir.1993), we considered DOL regulations

promulgated to define and delimit the administrative exemp-

tion in the FLSA at 29 U.S.C. § 213(a)(1). We held, “In

contrast to the controlling authority given the [DOL’s] /egis-

lative rules—i.e., those promulgated pursuant to an express

grant of Congressional authority—the respect accorded the

[DOL’s] interpretive regulations depends upon their persua-

siveness ... .” /d. We foretold the precise distinction later

drawn in Mead when that Court distinguished between those

regulations that are accorded Chevron deference and those

that are not. In Reich v. New York, the interpretations from

which Chevron deference was withheld were classified as

“interpretations” by the regulations themselves. See also

26a

Freeman, 80 F.3d at 83-84 (refusing to accord Chevron defer-

ence to DOL interpretations under the FLSA despite their

promulgation with notice and comment procedures); Reich v.

Gateway Press, Inc., 13 F.3d 685, 699 n. 18 (3d Cir.1994)

(“The DOL interpretations do not have the force of law.”).

We find § 552.109(a) to be an interpretive rather than a

legislative regulation. While the rule “grants nghts, imposes

obligations, or produces other significant effects on private

interests,” as legislative regulations do, White v. Shalala,

7 F.3d 296, 303 (2d Cir.1993) (internal quotation.marks omit-

ted), a rule can only be legislative “if the agency intended to

use [the legislative power delegated to it by Congress] in

promulgating the rule at issue,” American Postal Workers

Union, AFL-CIO v. United States Postal Serv., 707 F.2d 548,

558 (D.C.Cir.1983). Here, the DOL did not intend to use the

legislative power delegated in § 213(a)(15) when it promul-

gated § 552.109(a). This is most apparent from its inclusion

of the regulation under “Subpart B—Interpretations” as op-

posed to “Subpart A—General Regulations.” This appear-

ance is supported by substance.

Congress expressly delegated to the DOL authority to de-

fine terms in § 213(a)(15), and the DOL expressly states in

29 C.F.R. § 552.2(c) that “[t]he definitions required by

§ [2]13(a)(15) are contained in §§ 552.3, 552.4, 552.5 and

552.6.” Accordingly, the regulation at issue, § 552.109(a), is

effectively conceded by the DOL not to have been prom-

ulgated pursuant to Congress’s express legislative delegation

in § 213(a)(15). Mead holds that administrative implementa-

tion of a particular statutory provision does not qualify for

Chevron deference unless “it appears that the agency inter-

pretation claiming deference was promulgated in the exercise

of that authority.” 533 U.S. at 226-27. Thus, § 552.109(a)

does not qualify for Chevron deference because, by the DOL’s

own account, it was self-consciously not promulgated in exer-

cise of Congress’s delegated authority pursuant to § 213(a)(15).

27a

The DOL places emphasis on the fact that in 1974

§ 552.109(a) was promulgated after notice and comment and, ~

indeed, Mead explicitly instructs us to consider whether a rule

was the product of notice and comment in assessing whether

to accord it Chevron deference. Mead, 533 U.S. at 230-31,

121 S.Ct. 2164. However, “while notice and comment are

required for legislative rules, they are by no means prohibited

for interpretive rules.” Mejia-Ruiz v. INS, 51 F.3d 358, 365

(2d Cir.1995). Mead does nothing to undermine this conclu-

sion. See Mead, 533 U.S. at 230-31, 121 S.Ct. 2164; Thomas

W. Merrill, The Mead Doctrine: Rules and Standards, Meta-

' Rules and Meta-Standards, 54 Admin. L.Rev. 807, 814

(2002) (“1 do not think the Court was saying [in Mead]...

that if an agency adopts notice-and-comment or trial-type

hearing procedures on its own authority, its interpretation is

presumptively entitled to Chevron deference.” (emphasis re-

moved and emphasis added; citations omitted)).

In this case, the agency undertook a notice and comment

procedure for an interpretative regulation despite the fact that

the procedure was not required. While Mead does not offer

specific guidance on wheiher putting a proposed interpre-

tation out for notice and comment has any effect on

deference, following the notice and comment procedure, at

most, buttresses a claim that the agency gave consideration to

what it did; it does not alter the fact that the agency did not

act pursuant to legislative authority.

In any event, here we cannot ignore that the notice and

comment procedure for § 552.109(a) was at best idiosyncratic

and at worst insufficient. The original notice informed the

public that employees of third party employers were not .

going to be exempt from the FLSA (consistent with § 552.3),

see 39 Fed.Reg. 35,385 (proposed Oct. 1, 1974); but the final

rule provided exactly the opposite without a detailed explana-

tion, see 40 Fed.Reg. 7405 (Feb. 20, 1975). Because we

conclude that § 552.109(a) is interpretative, and thus need not

28a

have conformed with notice and comment procedures, we

have no occasion to decide whether this regulation is in-

valid under the Administrative Procedure Act, 5 U.S.C.

§ $53(b)(3)(A). Cf Nat'l Black Media Coalition v. FCC, 791

F.2d 1016, 1022 (2d Cir.1986) (“[I]f the final rule deviates

too sharply from the proposal, affected parties will be de-

prived of notice and an opportunity to respond to the pro-

posal.”) (internal quotation marks omitted). Nevertheless, we

decline the DOL’s invitation to bootstrap an entitlement to

Chevron deference for an interpretative regulation from this

substandard notice and comment procedure.°

While we agree with Coke that § 552.109(a) does not com-

mand Chevron deference, Mead nevertheless requires us to

afford the agency some level of deference with the vague

prescription to “tailor deference to variety,” 533 U.S. at 236,

121 S.Ct. 2164. We believe that Skidmore deference based

upon the regulation’s “power to persuade” is the appropriate

level of deference to be applied where, as here, “the agency

has some special claim to expertise under the statute.” Merrill,

supra, at 812. To the extent that the regulation represents

“more specialized experience and broader investigations and

information” available to the agency, we will defer to reason-

able regulations. Skidmore, 323 U.S. at 139-40; see also

Metro. Stevedore Co. v. Rambo, 521 U.S. 121, 136 (1997)

(reasonable agency interpretations carry “at least some added

persuasive force” where Chevron is inapplicable). In deter-

° Merrill finds “interpretive regulations adopted after notice-and-com-

ment procedures” to be within an “area of uncertainty” after Mead for

lower courts trying to determine whether to apply Chevron deference.

Mermill, supra, at 821. But see Adrian Vermcule, /ntroduction: Mead in

the Trenches, 71 Geo. Wash. L.Rev. 347, 350 (2003) (treating notice and

comment procedures as affording the agency a “safe harbor” entitlement

to Chevron deference). We needn’t choose between Mermill and Vermeule

here because even if Vermeule is nght, special circumstances surrounding

the notice and comment procedures here militate against furnishing the

agency with a safe harbor.

29a

mining its “power to persuade,” we look to § 552.109(a)’s

“consisten[cy] with the congressional purpose,” Morton v.

Ruiz, 415 U.S. 199, 237 (1974); its consistency with other

regulations, see Skidmore, 323 U.S. at 140; the “consistency

of the agency’s position” over time, Batterton v. Francis, 432

U.S. 416, 425 n. 9 (1977); the “thoroughness evident in [the

agency’s] consideration”; and the “validity of its reasoning,”

Skidmore, 323 U.S. at 140.

B. Application of Skidmore

Considering the regulation’s persuasiveness under Skid-

more‘s less deferential standard, we agree with Coke that

§ 552.109(a) is unenforceable. The regulation is inconsistent

with Congress’s likely purpose in enacting the 1974 amend-

ments; inconsistent with other regulations (which themselves

deserve Chevron deference); and inconsistent with other

agency positions over time. Moreover, the agency does not

proffer valid reasoning for § 552.109(a)’s enforceability, evi-

dencing a lack of thorough consideration.

(1) Congressional purpose

When Congvess sought to amend the FLSA in 1974, it

desired to expand FLSA coverage to “domestic service em-

ployees,” and to exempt from coverage only those “domestic

service employees” engaged in “companionship services.” At

the time, persons who were employed by a third party were

outside the category of “domestic service employees” and

were protected by the FLSA before the 1974 amendments.

See Homemakers Home & Health Care Servs., Inc. v. Carden,

538 F.2d 98 (6th Cir.1976); 39 Fed.Reg. 35,385 (Oct. 1,

1974) (DOL finding that “[e]mployees who are engaged in

providing . ... companionship services and who are employed

by an employer other than the families or households using

such services . . . [were] subject to the [FLSA] prior to the

1974 Amendments’); 66 Fed.Reg. 5485 (Jan. 19, 2001). See

generally Molly Biklen, Note, Healthcare in the Home:

30a

Reexamining the Companionship Services Exemption to the

Fair Labor Standards Act, 35 Colum. Hum. Rts. L.Rev. 113,

117 (2003). It is implausible, to say the least, that Congress,

in wishing to expand FLSA coverage, would have wanted the

DOL to eliminate coverage for employees of third party

employers who had previously been covered.

(2) Consistency with other regulations and through time

Section 552.109(a) is also jarringly inconsistent with other

regulations the DOL itself promulgated under the FLSA

immediately following the 1974 amendments. In 29 C.F.R.

§ 552.3, the DOL defined the term “domestic service employ-

ment” to refer “to services of a household nature performed

by an employee in or about a private home {permanent or

temporary) of the person by whom he or she is employed.” 29

C.F.R. § 552.3 (emphasis added). Unlike § 552.109(a), this

regulation was legislative, issued pursuant to § 213(a)(15)

and, thus, entitled to Chevron deference. See 29 C.F.R.

§ 552.2(c) (“[t]he definitions required by [§ 213(a)(15)] are

contained in [ } § 552.3”). Plainly, under § 552.3, employees

employed by third parties do not qualify for the exemption.

Indeed, § 552.3 tracks the relevant legislative history that the

DOL would have reasonably taken as its guidance. See

H.R.Rep. No. 93-913, at 35 (“the generally accepted meaning

of domestic service relates to services of a household nature

performed by an employee in or about a private home of the

person by whom he or she is employed” (emphasis added)).

Thus, the stark internal inconsistency between § 552.109(a)

and § $52.3, when coupled with the latter’s entitlement to

greater deference and its greater consistency with congres-

sional purpose, strongly counsels against enforcement of

§ $52.109(a).

Moreover, the agency’s position with regard to FLSA cov-

erage through time has hardly been a model of consistency.

We have recounted above how, in 1974, the agency proposed

a regulation that would have afforded FLSA coverage to

3la

employees of third party employers only to reverse itself with

the promulgation of § 552.109(a). In 2001, the DOL again

proposed that employees of third party employers get FLSA

coverage (contrary to the view it endorses in this litigation),

only to withdraw the proposal shortly thereafter based on

economic considerations that have no bearing on the more

relevant question of what Congress intended in 1974.

(3) Validity of the DOL’s reasoning

Finally, the DOL’s inadequate reasoning in support of the

regulation is matched by its failure to exhibit thoroughness in

its consideration. .Two omissions are particularly notable.

First, the DOL offered virtually no explanation for the direct

inconsistency between § 552.109(a) and § 552.3. Second, the

DOL has not adequately explained-either in the Federal

Register or in its submissions to this court-what accounted for

the about-face after putting the regulations out for notice and

comment in 1974, resulting in third party employers, for the

first time, being entitled to claim the exemption. Compare 39

Fed.Reg. 35,385 (proposing a regulation on October |, 1974

that retained the FLSA coverage of employees of third party

employers), with 40 Fed.Reg. 7405 (adopting a regulation on .

Feb. 20, 1975 allowing such employees to be subject to the

exemption). While the Federai Register recited that “[o]n fur-

ther consideration, [the Secretary of Labor] ha[s] concluded

that the [“companionship services’] exemption can be avail-

able to such third party employers since they apply to ‘any

employee’ engaged ‘in’ the enumerated services,” 40 Fed.

Reg. 7404, the DOL ignored the plain language of the statute,

which precluded an interpretation that the exemption could

apply to “any” employee; on its face, it may apply only to

employees in “domestic service employment.” 29 U.S.C.

§ 213(a)(15); see also 29 C.F.R. § 552.3 (defining “domestic

service employment” to preclude employees of third party

employers).

32a

The agency’s reasoning has not improved with time. Ac-

knowledging the internal contradiction between § 552.109(a)

and § 552.3 in its brief, the DOL today is reduced to asserting

that we should uphold the regulation because other courts

have done so. This is hardly an argument. As we have ex-

plained, the decisions relied upon by the DOL were all prior

to the Supreme Court’s Mead decision, based on which we

- hold that Chevron deference is inapplicable to § 552.109(a).

Thus, no other court has considered § 552.109(a) under the

proper Skidmore level of deference and carefully analyzed the

regulation’s “power to persuade” in accordance with the

factors appropriate to Skidmore ‘s inquiry.

Accordingly, finding that § 552.109(a) cannot survive Skid-

more analysis, we decline to enforce it. We hereby Vacate

the judgment of the district court upholding it, and Remand

the case for further consideration consistent with this opinion.

CONCLUSION

For all the foregoing reasons, we Affirm the district court’s

ruling that 29 C.F.R. § 552.6 is enforceable on its face;

Vacate the district court’s ruling that 29 C.F.R. § 552.109(a)

is enforceable; and Remand the case for further proceedings.

33a

APPENDIX C

UNITED STATES DISTRICT COURT, E.D. NEW YORK

No. 02-CV-2010(TCP)(ARL)

EVELYN COKE, individually and

on behalf of others similarly situated,

Plaintiff,

v.

\ LONG ISLAND CARE AT HOME, LTD. and

MARYANN OSBORNE,

Defendants.

May 23, 2003

MEMORANDUM AND ORDER ©

PLATT, District Judge.

Defendants Long Island Care At Home, Ltd. (“LIC”) and

Maryann Osborne (“Osborne”)(collectively “Defendants”)

move for judgment on the pleadings pursuant to Rule 12(c) of

the Federal Rules of Civil Procedure. Plaintiff Evelyn Coke

(“Coke” or “Plaintiff’) opposes the motion and also moves

for the circulation of a Notice of Pendency and a Consent

to Joinder to similarly situated persons pursuant to 29 U.S.C.

§ 216(b). This Court heard oral arguments on April 2, 2003.

At issue is whether certain regulations promulgated by the

Department of Labor (“DOL”) pursuant to the Federal Fair

Labor Standards Act, 29 U.S.C. § 201 ef. seg. (the “FLSA”)

are legally enforceable. At oral argument Plaintiff's counsel

clarified that Plaintiff could not meet the requirements of the

_—

34a

relevant regulations as written and that the purpose of this

action was to determine the validity of such regulations.’ (Tr.

at 2-5.) As set forth below, because the Court finds that

the DOL’s regulations are proper Defendants’ Motion is

GRANTED.

BACKGROUND

A. Factual Background

Plaintiff is a resident of the State of New York, County of

Queens, and a former employee of Defendants. LIC is a

corporation formed pursuant to the laws of New York State.

Osborne is the owner and sole shareholder, as well as a direc-

tor and officer of LIC.

The pleadings provide little factual background.* Accord-

» 5 to the Complaint, Plaintiff has been employed by Defen-

dant since 1997 and that “her occupations include, but are not

limited to, work as a home healthcare attendant.” (Compl. at

10.) Plaintiff contends that despite working more than 40

hours a week she never received overtime payments and that

her hourly wage was less the minimum wage outlined in the

FLSA.

B. Plaintiff's Claims

Plaintiff has asserted two claims in her Complaint. The

First Claim is brought under the FLSA on behalf of Plaintiff

and any other persons who consent in writing to join this

action pursuant to 29 U.S.C. § 216(b). Plaintiff contends that

she was entitled to, but was not paid, minimum wages and an

overtime hourly wage of time and one-half for all hours

worked in excess of forty hours per week. Plaintiff's Second

' References to the transcript of the Apri! 2, 2003 are cited as Tr. at_.

* While the Plaintiff has provided more details of her employment in an

affidavit, the Court may not consider such statements when deciding a Rule

12(c) motion.

35a

Claim is brought under the Labor Law of the State of New

York and the New York Minimum Wage Act (“NYMWA”),

on behalf of Plaintiff and all persons similarly situated. The

nature of the claims are identical to those under the First

Claim. As relief, Plaintiff requests a judgement for unpaid

overtime wages and minimum wages, liquidated damages,

attorney’s fees, interest and costs as provided for by the FLSA.

Defendant has asserted nine affirmative defenses, including

that, workers such as Plaintiff are exempt from eligibility for

minimum wage and overtime compensation under the FLSA

and the FLSA’s implementing regulations.

At oral argument, the Court inquired of Plaintiffs counsel

whether he could amend the Complaint to sufficiently allege

a cause of action under the FLSA and the regulations promul-

gated thereunder. Counsel indicated that he could not. (Tr. at

2-5.)

DISCUSSION

A. Rule 12(c) Standard

Rule 12(c) provides that,

[a]fter the pleadings are closed but within such time as

not to delay the trial, any party may move for judgment

on the pleadings. If, on a motion for judgment on the

pleadings, matters outside the pleadings are presented

to and not excluded by the court, the motion shall be

treated as one for summary judgment and disposed of as

provided by Rule 56, and all parties shall be given

reasonable opportunity to present all material made per-

tinent to such a motion by Rule 56.

Judgement on the pleadings, pursuant to Fed.R.Civ.P. 12(c)

is appropriate where material facts are undisputed and a judg-

ment on the merits is possible merely by considering the con-

tents of the pleadings. See Mennella v. Office of Court

Admin., 938 F.Supp. 128, 131 (E.D.N.Y.1996) (Spatt, J.)

(citing Sellers v. M.C. Floor Crafters, Inc., 842 F.2d 639, 642

36a

(2d Cir.1988)). “In considering a motion for a judgment on

the pleadings, the Court must accept as true all of the non-

movant’s well pleaded factual allegations, and draw all rea-

sonable inferences in favor of the non-movant.” /d. (citing

Davidson v. Flynn, 32 F.3d 27, 29 (2d Cir.1994)).

B. The FLSA Generally

The FLSA of 1938 was enacted for the purpose of regulat-

ing minimum wages, *335 maximum working hours, and

child labor in industries within interstate commerce. While

the FLSA sought to protect some of the nation’s lowest paid

workers, it did not apply to all employees. Since 1938, Con-

gress has extended the FLSA’s coverage to many other low-

paying occupations through periodic amendments.

Among these extensions of coverage were the amendments

of 1974, in which Congress extended coverage to employees

in “domestic service.” Through the 1974 amendments Con-

gress intended to “not only raise the wages of these workers

but [to] improve the sorry image of household employment.”

H.R.Rep. No. 913, 93rd Cong., 2nd Sess., reprinted in, 1974

U.S.Code Cong. & Admin. News 2811, 2843. The 1974

amendments made domestic service employees subject to the

minimum wage and maximum working hours requirements of

the FLSA. 2s

The 1974 amendments Congress do provide for a limited

exemption from the FLSA for certain domestic service em-

ployees, as set forth in 29 U.S.C. § 213(a)(15) (“Section

213(a)(15)"). Section 213(a)(15) provides, in pertinent part,

that the provisions minimum wage and maximum hour re-

quirements of Sections 206 and 207 of the FLSA shall not

apply to,

(15) any employee employed on a casual basis in domes-

tic service employment to provide babysitting services

or any employee employed in domestic service employ-

ment to provide companionship services for individuals

37a

who (because of age or infirmity) are unable to care for

themselves (as such terms are defined and delimited in

the regulations of the Secretary ) (emphasis added).

Pursuant to this Congressional delegation of authority, the

DOL promulgated 29 C.F.R. § 552.6 (“Section 552.6”) which

defines “companionship services.” It states, in pertinent part,

the term companionship services shall mean those ser-

vices which provide fellowship, care and protection for a

person who, because of advanced age or physical or

mental infirmity, cannot care for his or her own needs.

Such services may include household work related to the

care of the aged or infirm person such as meal prepara-

tion, bed making, washing of clothes, and other similar

services. They may also include the performance of

general housework: Provided however, that such work

is incidental, i.e., does not exceed 20 percent of the total

weekly hours worked.

In discussing the policy reasons for the “companionship

services” exemption the Ninth Circuit has stated, “[wJe are

informed that these critical services reach more elderly or

infirm individuals than they otherwise would precisely be-

cause the care-providers are exempt from the FLSA”. McCune

v. Oregon Senior Services Division, 894 F.2d 1107, 1110

(1990).

“Domestic service” itself is not defined in the FLSA. How-

ever, the legislative history of the 1974 amendments state,

the generally accepted meaning of domestic service re-

lates to services of a household nature performed by an

employee in or about a private home of the person by

whom he or she is employed. The domestic service

must be performed in a private home which is a fixed

place of abode of the individual or family . . . [g]ener-

ally, domestic service in and about a private home in-

cludes services performed by persons employed as cooks,

butlers, valets, maids, housekeepers, governesses, jani-

38a

tors, laundresses, caretakers, handymen, gardeners, foot-

men, grooms, and chauffeurs of automobiles for family

use. H.R.Rep. No.93-913, 93rd Cong., 2d Sess., re-

printed in (1974) U.S.Code Cong. & Ad.News 2811,

2845.

The legislative history also “reveals that Congress used the

term ‘domestic service employment’ interchangeably with the

terms ‘domestic service in households,’ ‘private household

workers,” and ‘household empleyment.’” Lott v. Rigby, 746

F.Supp. 1084, 1088 (N.D.Ga.1990)(citing H.R.Rep. No. 913,

93rd Cong., 2nd Sess., reprinted in, 1974 U.S.Code Cong. &

Admin. News 2811, 2842-2843).

The DOL has incorporated the legislative history into 29

C.F.R. § 552.3 (“Section 552.3”) which states that domestic

service “refers to services of a household nature performed by

an employee in or about a private home (permanent or tempo-

rary) of the person by whom he or she is employed.” 29

C.F.R. § 552.3. Importantly however, through 29 C.F.R. §

552.109(a) (“Section 552.109(a)”) the DOL extends the ex-

emption to “[e]mployees who are engaged in providing com-

panionship services, as defined by § 552.6, and who are

employed by an employer or agency other than the family

or household using their services.” 29 C.F.R. § 552.109(a)

(emphasis added.)

C. Validity of Sections 552.6 and 552.109(a)

Plaintiff argues that both of these regulations are inconsis-

tent with Congress’s intent of extending coverage of the

FLSA to domestic service employees. Specifically, Plaintiff

argues that the definition of “companionship services” in

Section 552.6 is overbroad and that Section 552.109(a) im- -

properly extends the exemption to employees who are em-

ployed by an agency.”

* Subsequent to oral argument, the Court invited the parties to submit

additional materials related to the legislative history of the 1974 amend-

39a

In regards to Section 552.109(a), Plaintiff asserts that prior

to the 1974 amendments home healthcare employees em-

ployed by certain agencies would have been covered by

“enterprise coverage” as set forth in 29 U.S.C. §§ 203(r),

203(s), 206(a), 207(a), which extends FLSA coverage to all

employees of businesses that exceed a certain gross revenue.

Plaintiff cites Homemakers Home and Health Care v. Carden,

538 F.2d 98 (6th Cir.1976) to support her position. In that

case the Sixth Circuit upheld a stipulated finding of fact that

the plaintiff, who was a home health care services company,

was subject to FLSA enterprise coverage. Plaintiff reasons

that in enacting the 1974 amendments Congress intended to

extend coverage to domestic services employees, and not to

remove coverage already provided to employees employed by

FLSA “enterprises.” (Pl. Suppl. Mem. at 8.)

Nearly all courts, however, have upheld both of these regu-

lations. See e.g., McCune v. Oregon Senior Services Division,

894 F.2d 1107 (1990)(upholding Section 552.6); Salyer v.

Ohio Bureau of Workers’ Compensation, 83 F.3d 784 (6th

Cir.1996)(same); Johnston v. Volunteers of America, Inc.,

213 F.3d 559 (10th Cir.2000)(upholding Section 552.109).

One recent district court decision is to the contrary. See

Harris v. Dorothy L. Sims Registry, 2001 WL 78448, 2001

U.S. Dist. LEXIS 23263 (N.D.111.2001). The Second Circuit

has never expressly ruled on these.issues.

The Supreme Court has “long recognized that considerable

weight should be accorded to an executive department’s con-

struction of a statutory scheme it is entrusted to administer,

ments. Plaintiff's supplemental materials, in part, raised for the first time

the issue of whether 552.109 was procedurally invalid due to an alleged

failure to comply with the Administrative Procedures Act, 5 U.S.C. § 553.

Because this argument was not raised until several weeks after oral argu-

ment, does not appear in the Complaint or Plaintiff's initial brief, and was

outside the scope of the Court’s invitation, this argument was not con-

sidered by the Court.

40a

and the principle of deference to administrative interpreta-

tions” has consistently been followed. Chevron U.S.A., Inc.

v. Natural Resources Defense Council Inc., 467 U.S. 837, 844

(1984). If there is “statutory ambiguity and the agency’s

interpretation is reasonabie, its interpretation must receive

deference.” Yellow Transp., Inc. v. Michigan, 537 U.S. 36,

123 S.Ct. 371, 378 (2002) (citing Chevron, 467 U.S. at 844).

“(Legislative regulations are given controlling weight unless

they are arbitrary, capricious, or manifestly contrary to the ©

statute.” /d.

In deciding whether a regulation is reasonable, the Supreme

Court has stated,

{w]e ask first whether ‘the intent of Congress is clear’ as

to ‘the precise question at issue.’ If, by ‘employing

traditional tools of statutory construction,’ we determine

that Congress’ intent is clear, ‘that is the end of the

matter.’ But ‘if the statute 1s silent or ambiguous with

respect to the specific issue, the question for the court is

whether the agency’s answer is based on a permissible

construction of the statute.’ If the agency’s reading fills

a gap or defines a term in a reasonable way in light of

the Legislature’s design, we give that reading controlling

weight, even if it is not the answer ‘the court would have

reached if the question initially had arisen in a judicial

proceeding.’ Regions Hospital v. Shalala, 522 U.S. 448,

457 (1998) (citing Chevron U.S.A. Inc. v. Natural Re-

sources Defense Council, Inc., 467 U.S. 837, 842-843

(1984)).

Moreover, “a long-standing, contemporaneous construction

of a statute by the administering agencies is ‘entitled to great

weight.”” Leary v. United States, 395 U.S. 6, 25 (1969) (cita-

tions omitted). Where an agency changes its interpretation,

“a revised interpretation deserves deference because ‘an ini-

tial agency interpretation is not instantly carved in stone’ and

‘the agency, to engage in informed rulemaking, must consider

4la

varying interpretations and the wisdom of its policy on a con-

tinuing basis.’” Rust v. Sullivan, 500 U.S. 173, 186 (1991)

(citing Chevron, 467 U.S. at 862-864,).*

Both Sections 552.6 and 552.109(a) were promulgated in

1975, soon after the 1974 amendments and have been in

effect for over twenty-eight years and are therefore entitled to

great weight. The DOL did propose amendments to both

regulations in January 2001, but those proposed amendments

were withdrawn in 2001. In proposing to amend Section

552.6, the DOL stated,

[t]he Department has reevaluated the regulations and

determined that-as currently written-they exempt types

of employees far beyond those whom Congress intended

to exempt when it enacted section 13(a)(15). Therefore,

the Department proposes to amend the regulations to

revise the definition of ‘companionship services,’ which

sets out the duties that a companion must be employed to

perform in order to qualify for the exemption, to more

closely mirror Congressional intent. Federal Register,

Vol. 66, No. 13 (January 19, 2001).

The DOL’s proposals emphasized that the proposed amend-

ments were proper due to the significant changes in the home

care industry since 1974 and that home care employees are

“performing types of duties and working in situations that

were not envisioned when the companionshin services regula-

* In addition, the Supreme Court has held that “[w]hen Congress re-

visits a Statute giving rise to a longstanding administrative interpretation

without pertinent change, the ‘congressional failure to revise or repeal the

agency’s interpretation is persuasive evidence that the interpretation is

the one intended by Congress.’*” CFTC v. Schor, 478 U.S. 833, 846

(1986) (quoting NLRB v. Bell Aerospace Co., 416 U.S. 267, 274-75 (1974)).

Here Congress has amended Section 213 seven times since 1974. See

Pub.L. 95-151 (1977); Pub.L. 96-70 (1979); Pub.L. 101-157 (1989);

Pub.L. 103-329 (1994); Pub.L. 104-88 (1995); Pub.L. 104-188 (1996);

Pub.L. 105-78 (1997). |

42a

tions were promulgated.” /d. After reviewing the legislative

history, the DOL stated that the 1974 amendments were in-

tended “to include all employees whose vocation was domes-

tic service, but to exempt from the coverage babysitters and

companions who were not regular bread winners or responsi-

ble for their families’ support.” /d.

In proposing to amend Section 552.6, the DOL stated that,

“companionship services cannot be so broad as to include

someone who essentially is serving as a maid or household

worker.” /d. The DOL then proposed three possible changes

of the definition of “companionship services.” All three of

the proposals increased the emphasis on fellowship as a

“critical component of a companion’s duties.” /d.

In proposing to alter Section 552.109(a), the DOL intended

to make the exemptions of Section 213(a)(15) applicable

“only with respect to the family or household using the

worker’s services.” /d. Under the proposal, if an employee

was hired by someone other than a member of the family in

whose home he or she works, the employee would be covered

by FLSA. /d. In this proposed amendment, the DOL noted

that there was an internal consistency between Section

552.109(a), which allows employees of agencies to be ex-

empt, and Section 552.3, fashioned from the legislative his-

tory, which states that domestic service employment must be

“in or about” the private home of the employer. /d. More-

over, evidently in reference to “enterprise coverage”, the DOL

stated that since “[a]nyone who prior to 1974 had worked for

a covered placement agency, for example, but who was as-

signed to work in someone’s home, would have been covered

previously by the FLSA,” it was unlikely that Congress

would have sought to change the status of employees who

were already covered. /d.

In April 2002, the DOL withdrew the proposed amend-

ments because “numerous commenters on the proposed rule,

including multiple federal agencies . . . seriously called into

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question the Department’s conclusion that there would be

little economic impact.” Federal Register, Vol. 67, No. 67

(April 8, 2002). After reviewing the “rulemaking record as a

whole,” the DOL terminated the proposal. /d.

After the proposed amendments were issued, but before

they were withdrawn, one district court did find that the defi-

nition of “companionship services” set forth in Section 552.6

was unreasonably broad. In Harris v. Dorothy L. Sims

Registry, 2001 WL 78448, 200! U.S. Dist. LEXIS 23263

(N.D.111.2001), the court found that although an agency’s

interpretation of a statute is presumptively valid, “courts may

not follow agency regulations that are inconsistent with con-

gressional intent.” /d., 2001 WL 78448, *2, 2001 U.S. Dist.

LEXIS 23263 at *8 (citing Chevron, 467 U.S. at 845, 104

S.Ct. 2778). In coming to its conclusion, the court relied

heavily on the proposed amendments.

Applying the standard set forth in Chevron U.S.A., Inc. v.

Natural Resources Defense Council Inc., 467 U.S. 837 (1984),

the Harris court first found that Section 213(a)(15) of the

FLSA was ambiguous, since there was more than one reason-

able interpretation of “companionship services.” The plain-

tiffs in Harris argued that the term “referred to employees

hired primarily to act as a companion for the elderly.”

Harris, 2001 WL 78448, *3, 2001 U.S. Dist. LEXIS 23263 at

*9-*10. Defendants contended that the term meant “being

with someone to help them with their extreme needs.” /d.

After finding Section 213(a)(15) ambiguous, the Harris

court then considered whether Section 552.6 was consistent

with the language, origins and purpose of the statute. In this

stage of the analysis, the court first considered the legislative

history, from which it found, “[i]t is clear the senators did not

intend to exempt employees whose primary job responsibili-

ties went beyond fellowship and protection.” /d, 2001 WL

78448, *4, 2001 U.S. Dist. LEXIS 23263 at *12. After a

review of the DOL’s proposed amendments the court found

Ada

“it 18 obvious from the proposed amendments that the DOL

agrees that the current definition of ‘companionship services’ -

under § 552.6 is unreasonable” and that this “alone is suffi-

cient reason to disregard the current version of § 552.6.” /d.,

2001 WL 78448, *5, 2001 U.S. Dist. LEXIS 23263, at *17.

Based on the legislative history and the proposed amend-

ments, the court in Harris held that Section 552.6 was inva-

lid, “to the extent it exempts homemakers from [FLSA] cov-

erage.” Id.

Prior to Harris, all other courts had upheld the validity of

the regulations. In McCune v. Oregon Senior Services Divi-

sion, 894 F.2d 1107 (1990) the Ninth Circuit held that the

DOL’s definition of “companionship services” in Section

552.6 was not contrary to the FLSA and affirmed the district

court’s granting of summary judgment in favor of defendants.

The plaintiffs in McCune were live-in attendants for elderly

and infirm individuals unable to care for themselves. The

Ninth Circuit, noting the strong deference which is accorded

to agencies entrusted to define a specific provision of a stat-

ute, held that the 20% limit on general household work was

reasonable and upheld the district’s courts finding that any

household work “related” to the care of the individual would

not be counted towards the 20% threshold. In coming to this

conclusion, the court quoted parts of the legislative history of

the FLSA, which stated:

The fact that a person performing casual services as

baby-sitters or services as companions do some incident

of household work does not keep them from begin

casual baby-sitters or companions for purposes of this

exclusion.

* In Harris, although the finding that § 552.6 was invalid mooted the

argument that domestic employees hired by agencies should not be ex-

empt, the court did note that Section 552.109(a) was also proposed to be

amended for similar reasons Section 552.6 was proposed to be amended.

Id., 2001 WL 78448, *5, n. 8, 2001 U.S. Dist. LEXIS 23263, at *17,n. 8.

45a

McCune, 894 F.2d 1107, 1111 (quoting H.R.Rep. No. 913,

1974 U.S.Code Cong. and Ad. News at 2845).

In dissent in McCune, Judge Pregerson did “not propose

challenging the agency’s interpretation of its mandate when it

promulgated section 552.6,” but argued that the majority had

improperly applied the regulation to the plaintiffs in that case.

McCune, 894 F.2d at 1114. Judge Pregerson felt that the

court should analyze whether the work performed by plain-

tiffs was actually “incidental” or whether it was only related

to the care of their clients. As Judge Pregerson stated,

“[t]hough simple laundry work might be ‘incidental’, what of

bed-pan duty, catheterization, and soiled garments for bed-

ridden invalids? These duties are certainly related to the care

of the attendant’s clients, but are by no means incidental.” /d.

Courts have similarly upheld Section 552.109(a). Most

recently, in Johnston v. Volunteers of America, Inc., 213 F.3d

559 (10th Cir.2000), the Tenth Circuit rejected plaintiffs’

claims that they were entitled to overtime pay under the

FLSA because they were not employed by the individual

receiving the care. Finding that Section 552.109(a) was not

“arbitrary, capricious, or manifestly contrary to § 213(a)(15)”,

the Court held that “the fact that domestic service employees

are not employed by the individual receiving care, does not

alone exclude them from the exemption.” /d. at 562. In

refuting a similar claim, another court has stated, “[p]laintiff

has identified no authority, and the Court is unable to locate

any, that supports this view of the companionship services

exemption. In fact, the Court is not aware of any cases where

the subject employees were employed by the individual

client, rather than by an agency.” Terwilliger v. Home of

Hope, Inc., 21 F.Supp.2d 1294, 1299, n. 2 (N.D.Ok.1998).

In regard to Plaintiff's argument that Congress did not

intend to remove “enterprise coverage” to those employees

who worked for covered agencies, the wording of the Section

213(a)(15) and the statements of the Administrator of the

46a

Wage and Hour Division of the DOL (the “Administrator’’)

support the conclusions of the Johnston and Terwilliger

courts that Section 552.109(a) is valid. Section 213(a)(15),

describes who is covered by the companionship exemption as

“any employee employed on a casual basis in domestic ser-

vice employment.” (emphasis added.) The Administrator, in

adopting 552.109(a) explicitly noted this language and stated

“[t]his interpretation is more consistent with the statutory lan-

guage and prior practices concerning other similarly worded

exemptions”. 40 Fed.Reg. 7404 (1975). It may be that Con-:

gress did not intend to exempt employees hired by a third- |

party. However, based on the wording of the statute and the

lack of any clear legislative history discussing this specific

issue, this Court may not say that the Administrator’s inter-

- pretation is arbitrary or unreasonable.

This Court does find the reasoning of Harris and the DOL’s

statements in the proposed amendments somewhat compel-

ling. However, other factors counsel against holding the

regulations unenforceable. The strong deference courts must

afford to federal agencies regulations, the explicit grant of au-

thority to the DOL to define and delimit Section 213(a)(15),

the withdrawal of the proposed amendments, and the fact that

these regulations have been in effect for over twenty-eight

years, strongly cautions against a finding that these regula-

tions are unenforceable.

Section 213(a)(15) of the FLSA explicitly gives the DOL

the right to define the terms “companionship services” and

_ “domestic service.” The 20% requirement seemingly at-

tempts to keep the exemption limited to those who predomi-

nately provide companionship, which is consistent with the

legislative history. In regards to Section 552.109(a), the

Court notes that the reasoning behind the companionship

services exemption 1s arguably to allow those in need of such

services to be able to find such assistance at a price they can

afford. Whether that service is provided by the direct hiring

47a

of an employee or through the use of an agency, the objective

is still the same; to allow for the procurement of companion-

ship services without being required to meet the minimum

wage and overtime provisions of the FLSA.

The DOL’s interpretation,of Section 213(a)(15) in 1975

evidence that it believed the regulations were proper at the

time the 1974 amendments were enacted. The DOL’s with-

drawal of the proposed amendments shows that it still be-

lieves that these long-standing regulations are appropriate in

the current home healthcare envyonment. Despite amending

Section 213(a)(15) seven times since 1074, Congress has

chosen not to act. While this Court is sympathetic to home

care workers who perform such laborious work under diffi-

cult circumstances, the judiciary is not in a position to strike a

regulation which is reasonable in light of the DOL’s explicit

Congressional mandate. Accordingly, the Court finds that

Sections 552.6 and 552.109(a) are not arbitrary, capricious or

manifestly contrary to the FLSA.

D. The Sufficiency of the Complaint

1. The FLSA Claim

Having found the regulations proper, Plaintiff must prop-

erly allege a claim under them. The Court is a». are that all of

the case

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