Petition for Writ of Certiorari — Harbert v. Healthcare Services Group, Inc.
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Supreme Court, U.S.
FILED
041647 MAY 27 2009
OFFICE OF THE CLERK —
In The
SUPREME COURT OF THE UNITED STATES
No.
NANCY E. HARBERT
Petitioner
v.
HEALTHCARE SERVICES GROUP, INC.
Respondent
On Petition for a Writ of Certiorari to the
United States Court of Appeals for the Tenth Circuit
PETITION FOR A WRIT OF CERTIORARI
E. Michael Canges*
CANGES ISASHKO BETHKE & BAILEY, P.C.
950 Seventeenth Street, Suite 1700
Denver, Colorado 80202
(303) 860-1900
Clifford L. Beem
A. Mark Isley
CLIFFORD BEEM & ASSOCIATES, P.C.
730 Seventeenth Street, Suite 850
Denver, Colorado 80202
(303) 894-8100
* Counsel of Record Attorneys for Petitioner
QUESTIONS PRESENTED
A majority of a three-judge panel of the Tenth Circuit
reversed the district court’s finding that the Department of Labor’s
(“DOL”) regulation defining “worksite,” 29 CFR. §
825.111(a)(3), is a valid and enforceable implementation of the
Family and Medical Leave Act (“FMLA” or “Act”), 29 U.S.C. §
2601 et seq., as applied to all joint employees. In so doing, the
majority struck down the regulation as arbitrary and capricious as
that regulation is applied to joint employees, such as the Petitioner,
Nancy Harbert, who work at what the majority considered to be a
“fixed” place of work.
A single question is presented
Is the DOL’s regulation defining “worksite,” 29 C.F.R.
§825.111(a)(3), a valid and enforceable implementation of the
FMLA as applied to all joint employees, including joint employees
who have “fixed” or generally “fixed” places of work?
ies Ronee ig SA GRAAL BENE) BV Bor pe
il
LIST OF PARTIES
The parties below are listed in the caption. In addition,
the United States Department of Labor appeared as amicus curiae
in support of the validity and enforceability of its regulation.
ili
TABLE OF CONTENTS
QUESTIONS PRESENTED i
LIST OF PARTIES ii
TABLE OF CONTENTS iii
TABLE OF CITED AUTHORITIES iv
TABLE OF APPENDICES
CITATIONS OF OPINIONS AND ORDERS BELOW
STATEMENT OF JURISDICTION
STATUTORY AND REGULATORY PROVISIONS INVOLVED ..
STATEMENT OF THE CASE
REASONS FOR ALLOWANCE OF THE WRIT
L THE TENTH CIRCUIT’S OPINION WAS DIVIDED.............----0++--++- 8
Il. THE MAJORITY’S OPINION FAILED TO PROPERLY DEFER TO
THE DOL’ S REASONABLE INTERPRETATION OF THE FMLA AND
CONGRESSIONAL GUIDANCE, .......2.-2----ceeeeeeeseeseeeeeeennnnnnsnnnnnseennennaneenes 9
iil. THE MAJORITY’S OPINION IS BASED ON INCONSISTENT
LOGIC AND FINDINGS AND PROMOTES GREATER UNCERTAINTY IN
DETERMINING FMLA ELIGIBILITY. ............----------e+eeeeeennnenenseeeenennnes 14
CONCLUSION 18
—_ —_ =
iv
TABLE OF CITED AUTHORITIES
CASES
Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467
U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984) 6,9
Harbert v. Healthcare Services Group, Inc., 173 F.Supp.2d 1101, 1105-
06 (D.Colo. 2001) 5
Harbert v. Healthcare Services Group, Inc., 391 F.3d 1140 (10™ Cir.
2004) passim
Ragsdale v. Wolverine World Wide, Inc., 535 U.S. 81, 122 S.Ct. 1155,
152 L.Ed.2d 167 (2002) : 7
STATUTES
20 C.F.R. § 639.3
20 C.F.R. § 639.3(i)(6)
28 U.S.C. § 1254(1)
28 U.S.C. § 1331
29 C.F.R. § 825.106
29 C.F.R. § 825.111
29 C.F.R. § 825.700(a)
29 U.S.C. § 2101(aX(3)(B)
29 U.S.C. § 2611(2)(B ii)
29 U.S.C. § 2612(aX(1)
29 U.S.C. § 2617(a)(2)
54 Fed. Reg. at 16051 1
54 Fed.Reg. 16042, 16051 (1989) l
Title 20 Code of Federal Regulations, Section 639.3(i)(6)
Title 29 Code of Federal Regulations, Section 825.1 1 1(a)(3) ------- passim
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Title 29 United States Code, Section 2601 ® &
Title 29 United States Code, Section 2611(2)(B)(ii) 2
Title 29 United States Code, Section 2654 2,7
OTHER AUTHORITIES
H. R. Rep. No. 103-8(1), at 35 (1993) 7,9, 15
S. Rep. No. 103-3, 103 Cong., 1" Sess. at 23, reprinted in 1993
U.S.C.A.A.N. 3, 25 7,9, 15
TABLE OF APPENDICES
Appendix A — Opinion Of The United States Court Of Appeals
For The Tenth Circuit Dated and Filed December 13, 2004
App. A-1
Appendix B — Findings Of Fact, Conclusions Of Law And Order
Of The United States District Court For The District of Colorado
Dated and Filed March 13, 2003.
App. B-1
Appendix C — Order, Dated March 2, 2005, Of The United States
Court Of Appeals For The Tenth Circuit And Denying Petition For
Rehearing En Banc.
App. C-1
Appendix D —- Joint Employment Under FMLA, 29 C.F.R. §
825.106.
App. D-1
Appendix E —- FMLA Eligibility Under 50/75 Provision, 29 C.F.R.
§ 825.111.
App. E-1
Appendix F — WARN Act Regulation Defining “Single Site of
Employment,” 20 C.F.R. § 639.3(i).
App. F-1
Appendix G — Senate Report No. 103-3, 103d Cong., 1* Sess., at
21-23, reprinted in 1993 U.S.C.C.A.N. 3, 23-25.
App. G-1
Appendix H — House of Representatives Report No. 103-8(D), at
33-35 (1993).
‘ App. H-1
CITATIONS OF OPINIONS AND ORDERS BELOW
The majority opinion of the United States Court of
Appeals for the Tenth Circuit is reported at Harbert v. Healthcare
Services Group, Inc., 391 F.3d 1140 (10" Cir. 2004). The original
unpublished Tenth Circuit opinion was dated and filed December
13, 2004, see Appendix A, and it reversed and remanded the
United States District Court for the District of Colorado's decision
regarding the validity and enforceability of the DOL’s regulation
defining worksite for joint employees. The district court's
decision by Judge Kane was not published but reported and filed
as “Findings of Fact, Conclusions of Law and Order,” Harbert v.
Healthcare Services Group, Inc., No. 00-K-908 (D.Colo. dated
and filed March 13, 2003). See Appendix B.
STATEMENT OF JURISDICTION
The United States Supreme Court has jurisdiction to
review this case pursuant to 28 U.S.C. § 1254(1).
The Tenth Circuit’s opinion was issued on December 13,
2004. See Appendix A. On March 2, 2005, the Tenth Circuit
denied Nancy Harbert’s petition for rehearing en banc. See
Appendix C.
STATUTORY AND REGULATORY PROVISIONS
INVOLVED
|. Title 29 Code of Federal Regulations, Section
825.111(a)(3).
How to determine whether the primary
employer of a joint employee employs 50
employees within 75 miles of the joint
employee’s worksite.
For purposes of determining that employee's
eligibility, when an employee is jointly employed
by two or more employers (see § 825.106), the
employee's worksite is the primary employer's
office from which the employee is assigned or
reports.
Title 29 United States Code, Section 2601(b)
Family and Medical Leave Act — Purposes.
It is the purpose of this Act—
(1) to balance the demands of the
workplace with the needs of families, to
the stability and economic
security of families, and to promote
national interests in preserving family
integrity;
(2) to entitle employees to take
reasonable leave for medical reasons, . . .;
(3) to accomplish the purposes
described in paragraphs (1) and (2) in a
manner that accommodates the legitimate
interests of employers; . . . .
Title 29 United States Code, Section
2611(2)(B){ii).
Exclusions from FMLA eligibility.
The term “eligible employee” does not include—
any employee of an employer who is employed at
a worksite at which such employer employs less
than 50 employees if the total number of
employees employed by that employer within 75
miles of that worksite is less than 50.
6.
Title 29 United States Code, Section 2654.
Family and Medical Leave Act - Regulations.
The Secretary of Labor shall prescribe such
regulations as are mecessary to carry out
subchapter I of this chapter and this subchapter
not later than 120 days after February 5, 1993.
Title 20 Code of Federal Regulations, Section
639.3(i)(6)
A definition of “single site of employment.”
Fer workers whose primary duties require travel
from point to point, who are outstationed, or
whose primary duties involve work outside any of
the employer’s regular employment sites (e.g.,
railroad workers, bus drivers, salespersons), the
single site of employment to which they are
assigned as their home base, from which their
work is assigned, or to which they report will be
the single site in which they are covered for
WARN purposes.
The provisions of 29 C.F.R. § 825.106 that define
and discuss joint employment are rather lengthy and, thus, set forth
in Appendix D, pursuant to Supreme Court Rule 14.1(f). The full
text of 29 C.F.R. § 825.111 (determining FMLA eligibility under
the 50 employee/75-mile radius provision) and that of 20 C.F.R. §
639.3(i) (WARN Act regulations defining “single site of
employment”) are set forth in Appendices E and F, respectively,
pursuant to Supreme Court Rules 14.1(f) and 14.1(i)(vi). Relevant
excerpts of the FMLA’s legislative history are set forth in
Appendices G and H, pursuant to Supreme Court Rule 14.1(i)(vi).
STATEMENT OF THE CASE
1. Petitioner Nancy Harbert brought her original
action against Respondent Healthcare Services Group, Inc.
(“HSG”) in the United States District Court for the District of
Colorado for violating federal law under the FMLA. Federal
jurisdiction was not contested, and such jurisdiction was founded
upon 28 U.S.C. § 1331 and 29 U.S.C. § 2617(a)(2).
2. Nancy Harbert was employed by HSG as an
account manager to manage and supervise the housekeeping and
laundry services at Sunset Manor—a nursing home located in
Brush, Colorado. During her employment by HSG, Ms. Harbert
sustained injuries that required a medical leave of absence from
her job. Ms. Harbert requested FMLA leave, but HSG asserted
that Ms. Harbert was not eligible for such leave and denied her
request. HSG based its denial of eligibility on the 50
employee/75-mile radius provision of the FMLA. See 29 U.S.C. §
261 1(2)(B)(ii).' HSG then terminated Ms. Harbert when she was
unable to obtain authorization from her doctor for a return to full-
duty work. HSG terminated Ms. Harbert after providing her with
less than 12 weeks of leave.” Ms. Harbert brought a civil action
against HSG for violating the FMLA.
' For the exact text of the 50/75 provision of the FMLA, see supra pp.
2-3. This provision acts as an exception to FMLA eligibility for
employees who are employed by a small business or a business with
smaller, scattered operations such that the business employs less than 50
employees within a 75-mile radius of the employer's worksite. See
Harbert v. Healthcare Services Group, Inc., 391 F.3d 1140, 1148 (10"
Cir. 2004) (discussing the legislative intent of the 50/75 provision).
HSG employed less than 50 employees within a 75-mile radius of
Sunset Manor in rural Brush, Colorado. HSG, however, employed many
more than 50 employees within a 75-mile radius of its regional office in
Golden, Colorado. See Harbert, 391 F.3d at 1144.
2 Under the FMLA, an eligible employee is entitled to take up to a
maximum of 12 weeks of leave within a 12-month period. See 29 U.S.C.
§ 2612(a)(1).
a HSG’s primary defense was that it did not
employ 50 or more employees within a 75-mile radius of Sunset
Manor in Brush, Colorado. After a bench trial, the district court
found that Nancy Harbert was a joint employee of both HSG and
Sunset Manor and that HSG was Ms. Harbert’s primary
employer. See “Findings of Fact, Conclusions of Law and
Order,” Appendix B at B-6 — B-7; see also Harbert v. Healthcare
Services Group, Inc., 173 F.Supp.2d 1101, 1105-06 (D.Colo.
2001) (published memorandum opinion of the district court.
discussing joint employment and the economic realities test in
connection with both parties’ motions for summary judgment on
the joint employment question). In addition, the district court
upheld as valid and enforceable the DOL’s regulation that defined
“worksite” for joint employees as the “primary employer’s office
from which the employee is assigned or reports.”* See Appendix
B at B-7; see also Harbert, 173 F.Supp.2d at 1106 (upholding the
validity of the DOL’s construction of the term “worksite” for joint
employees in regulation 825.111(a)(3)). Ms. Harbert was assigned
from and reported to HSG’s regional office in Golden, Colorado;
and HSG employed many more than 50 employees within a 75-
mile radius of its regional office. See Appendix B at B-2.
Accordingly, the district court found that Ms. Harbert was eligible
for FMLA leave and awarded her damages. See Appendix B at B-
2, B-7 - B-8.
4. The sole question on HSG’s appeal to the Tenth
Circuit was the validity and enforceability of the DOL’s regulation
defining “worksite” for joint employees. See Harbert v.
Healthcare Services Group, Inc., 391 F.3d 1140, 1146 cio" Cir.
2004). The Secretary of Labor filed an amicus curiae brief in
support of its regulation and the district court’s decision upholding
the validity and enforceability of the regulation. Two of the three
Tenth Circuit judges who reviewed the case found that the
regulation was arbitrary, capricious, and contrary to the FMLA as
* The terms “joint employment” and “primary employer” are defined and
discussed in the DOL’s regulations implementing the FMLA at 29 C.F.R.
§ 825.106. See Appendix D.
* 29 C.F.R. § 825.111(a)(3).
applied to Nancy Harbert and other joint employees who have a
“fixed” place of work. See id. at 1154. The third judge, however,
dissented on that issue finding that the regulation was indeed
permissible as applied. See id. at 1155 (Kelly, J., dissenting).
Nancy Harbert petitioned the Tenth Circuit for a rehearing
of the matter en banc. Her request was denied by order of the
court dated March 2, 2005. Judge Kelly, however, again dissented
in the denial of Ms. Harbert’s petition. See Appendix C.
REASONS FOR ALLOWANCE OF THE WRIT
Whether the DOL’s regulation defining “worksite,” 29
C.F.R. § 825.111(a)(3), is a valid and enforceable implementation
of the FMLA as applied to all joint employees, including joint
employees who have “fixed” places of work, warrants this Court’s
attention and review. This question is one of first impression.
Neither this Court nor any other federal circuit has addressed the
validity of the regulation at issue, and the question will certainly
arise again. The decision to invalidate the regulation as applied
was not unanimous. In fact, dissenting Judge Kelly specifically
found that § 825.111(a)(3) was a “permissible exercise of agency
rulemaking.” Harbert, 391 F.3d at 1155. By declaring §
825.111(a)(3) invalid as applied to joint employees with “fixed”
worksites, the two-judge majority of the Tenth Circuit panel
seriously departed from the deference owed to an administrative
agency’s construction of a statute under the rule announced by this
Court in Chevron, U.S.A. Inc. v. Natural Resources Defense
Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694
(1984). “Declaring invalid a regulation that an agency has been
charged with developing is strong medicine and only appropriate
when the regulation is ‘arbitrary, capricious, or manifestly
contrary to the statute.” Harbert, 391 F.3d at 1154 (Kelly, J.,
dissenting). The majority’s ruling not only stripped countless
employees, like Nancy Harbert, from FMLA eligibility, but it also
created greater uncertainty as to whether and what type of joint
employees are eligible for FMLA leave. In particular, the majority
judges added a new variable that will require defining —namely,
what it means to have a “fixed” worksite. There must be certainty
in the requirements of the FMLA in order for it to be fairly and
efficiently applied and in order to achieve its purposes. This Court
has reviewed the validity of another FMLA regulation, 29 C.F.R. §
825.700(a), in Ragsdale v. Wolverine World Wide, Inc., 535 U.S.
81, 122 S.Ct. 1155, 152 L.Ed.2d 167 (2002). Likewise, this Court
should grant certiorari in the case at issue to fully resolve the
question of joint employees’ worksites so that employees and
employers alike will understand their respective rights and
responsibilities under this very important employment statute.
Congress enacted the FMLA “to balance the demands of
the workplace with the needs of families” by entitling employees
to a reasonable minimum leave of absence for such reasons as
medical and health conditions that affect the employee or a
member of the employee’s family. See 29 U.S.C. § 2601(b)(1)
and (2). Congress also directed the Secretary of Labor to
promulgate regulations necessary to implement the FMLA. See 29
U.S.C. § 2654. Pursuant to this Congressional mandate, the
Department of Labor promulgated such regulations, including the
regulations that filled important definitional and logistical gaps left
in the Act by Congress. The definition of “worksite” and the
definition and handling of various types of employment
relationships under the FMLA, such as joint employment, are
examples of the DOL’s gap-filling regulations. While Congress
used the term “worksite” in the text of the Act—in particular as a
physical point of reference in determining employee eligibility
under the 50 employee/75-mile radius (“50/75”) provision, see 29
U.S.C. § 2611(2)(B)(ii),° —Congress did not define the term
anywhere within the text of the FMLA. Congress did, however,
provide guidance as to how the term “worksite” should be defined
in House and Senate reports that accompanied the FMLA.
Specifically, these reports state that the term “worksite” should be
interpreted in the same manner as “single site of employment”
under the Worker Adjustment and Retraining Notification
(“WARN”) Act, 29 U.S.C. § 2101(a)(3)(B), and its implementing
regulations. See S. Rep. No. 103-3, 103 Cong., 1 Sess. at 23,
reprinted in 1993 U.S.C.A.A.N. 3, 25; see also H. R. Rep. No.
103-8(1), at 35 (1993) (virtually identical). Following Congress’
guidance, the DOL looked to the WARN Act for the definition of
“single site of employment,” and a comprehensive definition of
> See supra note 1.
that term was found in the WARN Act regulations at 20 C.F.R. §
639.3(i). The definition relevant here provides as follows:
For workers whose primary duties
require travel from point to point,
who are outstationed, or whose
primary duties involve work
outside any of the employer's
regular employment sites (e.g.,
railroad workers, bus drivers,
salespersons), the single site of
employment to which they are
assigned as their home base, from
which their work is assigned, or
to which they report will be the
single site in which they are
covered for WARN purposes.
20 C.E.R. § 639.3(i)(6) (emphasis added). This definition of
“single site of employment” for “outstationed” employees or
employees “whose primary duties involve work outside any of the
employer’s regular employment sites,” formed the basis for the
DOL’s definition of “worksite” with respect to joint employees at
29 C.F.R. § 825.111(a)(3).
I. The Tenth Circuit’s opinion was divided.
The majority found that § 825.111(a)(3) is not valid as
applied to Mrs. Harbert and others like her who are essentially
outstationed employees “with a fixed place of work,” Harbert v.
Healthcare Services Group, Inc., 391 F.3d 1140, 1149 (10™ Cir.
2004), and thus reversed the district court below. Judge Kelly,
however, dissented, holding that § 825.111(a)(3) is a permissible
and reasonable construction of the term “worksite,” even for joint
employees with “largely fixed” worksites, given Congress’
delegation of authority to the Secretary of Labor to implement the
FMLA, legislative history reflecting Congressional awareness of
variations in joint employment relationships, and the regulation’s
promotion ef certainty with respect to determining a joint
employee’s worksite. See Harbert, 391 F.3d 1154-55.
With respect to the validity of § 825.111(a)(3), all three
Tenth Circuit judges analyzed the same legislative history, see
S.R. Doc. No. 103-3; H.R. Doc. No. 103-8 (I), and applied the
same legal standard under Chevron, 647 U.S. 837, 104 S.Ct. 2778,
81 L.Ed.2d 694. Nevertheless, the decision was split. While both
factions acknowledged that “worksite” is not defined in the statute,
the majority focused on its interpretation of the term’s common
meaning and its bright-line distinction between “fixed” and “non-
fixed” worksites. Judge Kelly, however, focused more properly
on the agency’s authority to implement the FMLA by filling
statutory gaps with reasonable regulations. As Judge Kelly noted,
the majority’s “ipse dixit that the Secretary’s definition of the term
“worksite” is contrary to common meaning fails to account for the
many variations in joint employment relationships, from forever
fixed to forever mobile.” Harbert, 391 F.3d at 1155. The
regulation, however, does account for such variations, and it
provides a certain and uniform definition of “worksite” for more
complex joint employment situations.
IL. The majority’s opinion failed to properly defer
to the DOL’ s reasonable interpretation of the
FMLA and Congressional guidance.
Given the deference owed to an agency’s construction of a
statute, the majority admitted that this case “presents a very close
question.” Jd. at 1149. Nevertheless, the majority engaged in a
common-meaning analysis of “worksite” to conclude that the
DOL’s definition of the term as applied to joint employment
relationships ran contrary to the legislative purpose of the 50/75
provision restricting FMLA eligibility. See id. at 1149-50. The
majority also found that the DOL’s regulation created an arbitrary
distinction between sole employers and joint employers. See id. at
1150-51. The majority’s opinion is not only too narrowly focused
and fails to appreciate the realities and variation of modern
employment relationships, but the rationale behind the opinion
also contradicts the majority’s holdings in dicta regarding related
regulations and certain applications of the challenged regulation.
Additionally, the majority’s holding will create greater uncertainty
as to the definition of “worksite” by injecting an arbitrary and
further undefined distinction between “fixed” and “non-fixed”
places of work.
4
Ce I
10
The majority stated that the common meaning of the term
“worksite” is “the site where the employee works.” Id. at 1149.
This “common meaning,” however, is much too simplistic given
modern employment realities. For employees who work out of
their homes, the majority conceded that their worksite is not the
site where they regularly work (i.e., their home), but “the site to
which they are assigned as their home base, from which their work
is assigned, or to which they report.” 29 C.F.R. § 825.111(a)(2);
see Harbert, 391 F.3d at 1150 n. 1. The majority even conceded
that employees of temporary help agencies, joint employees as
defined by the DOL at 29 CFR. § 825.106(b), have as their
worksite “the primary employer’s office from which the employee
is assigned or reports.” 29 C.F.R. § 825.111(a)(3); see Harbert
391 F.3d at 1153. Yet for joint employees like Ms. Harbert, the
majority believed the “common meaning” of “worksite” should
apply instead of the consistent, simply-applied and certain
definition fashioned under Congressional authority by the DOL.
The majority deemed Ms. Harbert’s assignment to Sunset
Manor to be “fixed” as compared to an employee of a temporary
help agency who, according to the majority, “does not have a
permanent, fixed worksite.” Harbert, 391 F.3d 1153. What then
is a “fixed” worksite as compared to a non-fixed worksite? Can a
non-fixed worksite become “fixed” if the employee works at that
worksite long enough? What about an employee of a temporary
help agency who receives a long-term assignment? Would that
employee’s place of work be considered “fixed;” or does the mere
fact that the employee was employed by a temporary help agency
make her worksite “non-fixed?” Is the “fixed” or “non-fixed”
nature of the joint employee’s assignment determined by the joint
employer’s type of business?® The distinction is anything but
clear.
6 These questions concerning temporary help agencies or placement
agencies are particularly significant because in defining “joint
employment,” the DOL stated that “joint employment will ordinarily be
found to exist when a temporary or leasing agency supplies employees to
a second employer.” 29 C.F.R. § 825.106(b). Moreover, in discussing
the factors used to determine a joint employee’s “primary employer,” that
(Cont'd)
11
(Cont’d)
is, the employer with the “authority/responsibility to hire and fire,
assign/place the employee, make payroll, and provide employment
benefits,” § 825.106(c), the DOL also stated that the placement agency
would usually be the primary employer for employees of temporary or
leasing agencies. See id.
With respect to joint employees whose primary employer is a
temporary help agency, the majority stated the following:
[W]e do not question the validity of
the joint employment provision . . .
insofar as it applies to employees of
temporary help agencies. An
employee of a temporary help
agency does not have a permanent,
fixed worksite. It is therefore
appropriate that the joint
employment provision defines the
“worksite” of a temporary employee
as the temporary help office, rather
than the various changing locations
at which the temporary employee
performs his or her work.
Harbert, 391 F.3d at 1153. The problem with the majority’s
pronouncement in this regard is that temporary help agencies or
placement agencies often place their employees in long-term
assignments. The assignment may range from a few weeks to a few
months to a few years. In fact, some placements are indefinite in
duration depending on the nature of the service provided and the needs of
the secondary employer that is requesting employees from a placement
service.
Even though Ms. Harbert’s placement at Sunset Manor was not
considered to be a temporary placement, her primary employer, HSG,
still had the authority and the power to reassign her to another one of its
client accounts. Whether HSG would have done that is a matter of
speculation at this point, but it is well within the realm of real possibility
that other similar businesses reassign some or all of their outstationed
employees regularly enough to raise the question: do those employees
have a “fixed” worksite?
12
Judge Kelly touched on this issue when he noted that the
majority “fails to account for the many variations in joint
employment relationships, from forever fixed to forever mobile.”
Id. at 1155. Congress was aware of such variations in employment
relationships and thus directed the Secretary of Labor to define
“worksite” in the same manner as “single site of employment”
under the WARN Act. Jd. The definition of “single site of
employment” in the WARN Act regulation included employees
who are “outstationed.” See 20 C.F.R. § 639.3(i)(6). On appeal,
the Secretary of Labor argued that joint employees, such as Nancy
Harbert, are “outstationed” employees and thus properly treated in _
§ 825.111(a)(3) pursuant to Congress’ directive that “worksite” be
defined in the same way as “single site of employment.” See
Harbert, 391 F.3d at 1152. The majority, however, simply
declared that “outstationed” referred only to employees without a
fixed place of work. See id. The majority provided three reasons
for its interpretation: (1) a parenthetical in WARN Act regulation
§ 639.3(i)(6); (2) a reference made by the DOL to the subject
WARN Act regulation in the course of promulgating the
regulation; and (3) ambiguity in the definition of “single site of
employment” for “outstationed” employees. See Harbert, 391
F.3d at 1152-53.
Judge Kelly was not persuaded. See id. at 1155. First, the
parenthetical found in §639.3(i)(6) of the WARN Act regulation
clearly follows the third category of workers in a disjunctive list.
The parenthetical does not directly follow the term “outstationed”
and thus does not modify that term. Therefore, at most, the
parenthetical should only be interpreted to modify workers “whose
primary duties involve work outside any of the employer’s regular
employment sites.” In addition, the examples in the parenthetical
are just that—examples. While “bus drivers” may arguably denote
workers without a fixed employment site, there is nothing about
“railroad workers” and “salespersons” to indicate that all such
workers have no fixed place of work. Therefore, the definition of
“single site of employment” found in WARN Act regulation §
639.3(i)(6) is certainly broad enough to include outstationed
workers whose place of work is largely fixed.
Second, the majority discussed a reference made by the
DOL in the Federal Register during the enactment of the WARN
13
Act regulations. See Harbert, 391 F.3d at 1152. The full text of
the relevant passage was set forth in the majority’s opinion. See
id. at 1152 n. 4 (Appendix A at A-18 — A-19, n. 4). The passage
discussed how to handle maintenance crews in the railroad
industry who have no home base to which they are assigned.
Therefore, the agency determined that there must be some central
or regional office from which they receive their orders and/or
assignments. The agency stated as follows:
In order to cover this situation
and the situation of outstationed
workers and traveling workers
who report to but do not work out
of a particular office, that part of
the regulation relating to mobile
workers has been revised to
clarify that such workers should
be treated as assigned to their
home base or to the single site
from which their work is assigned
or to which they report.
54 Fed.Reg. 16042, 16051 (1989) (emphasis added). Reading the
entire passage in context and not just the reference made to “that
part of the regulation relating to mobile workers,” id., it becomes
clear that the DOL was adding additional categories of workers,
including “outstationed workers” to that particular regulation.
Those additional categories were in fact added to WARN Act
regulation § 639.3(i)(6), and Congress, aware of the WARN Act
and its regulations defining “single site of employment,” directed
the Secretary of Labor to implement the FMLA by defining
“worksite” in the same way.
Third, the majority found ambiguity in the definition of
“single site of employment” for “outstationed” workers.
According to the majority, there were three different possible
locations for the “single site of employment” of an outstationed
employee: (1) “the single site of employment to which they are
assigned as their home base,” (2) the site “from which their work
is assigned,” or (3) the site to which they report.” See Harbert,
391 F.3d at 1152-53. Despite acknowledging that any such
es ia
14
ambiguity would normally result in deference to the agency’s
construction and interpretation of the statute, see id. at 1153, the
majority still invalidated the DOL’s regulation as applied to Ms.
Harbert. See id.
Contrary to the majority’s rationale, the WARN Act
regulation is simply not ambiguous. The three “different”
locations found in § 639.3(i)(6) are simply three different ways of
referring to the same conceptual place—namely, an employer’s
office from which assignments are made or to which the employee
reports. A traveling salesperson or an employee who works from
her home would typically have an office to which she is assigned
which is also considered her “home base.” That office would also
be the site from which she is assigned or to which she reports. See
29 C.E.R. § 825.111(a)(2). An outstationed worker, such as a
railroad maintenance crew employee, however, may not be
directly assigned to an office of his employer or have an office that
is considered his “home base.” See 54 Fed. Reg. at 16051; see
also discussion supra at p. 13. Therefore, the agency used
additional terms to refer to the operative employer site—the site
from which the employee is assigned or to which the employee
reports—in the event that such office or site is not considered the
employee’s home base. Using Ms. Harbert as an example, HSG
was her primary employer. She was assigned from HSG’s
regional office in Golden, Colorado, to work at Sunset Manor in
Brush, Colorado. Sunset Manor was not her “home base” because
Sunset Manor was not an HSG facility. In addition, even if HSG’s
regional office in Golden was not considered Ms. Harbert’s home
base, it was, nevertheless, the office from which she was assigned
and to which she reported. Therefore, the DOL’s rule defining
“worksite” for joint employees, like Ms. Harbert, is not only an
easily applied and logical rule, it also provides certainty among
joint employees and their employers as to worksite when
determining FMLA eligibility.
Ii. The majority’s opinion is based on inconsistent
logic and __ findings and promotes greater
uncertainty in determining FMLA eligibility.
The parts of the WARN Act regulation the majority
considers ambiguous are also the very parts that form the basis of
ale EN RS 1 ig a Mat see
Rae ite a trae A SAE SCs Bia To ile coe A
15
the DOL’s regulations defining workplace for employees who
work out of their homes, employees of temporary help agencies,
and employees who have no fixed work place. This is significant
because the majority held that the DOL’s regulations defining
“worksite” for those employment relationships are valid and
enforceable. See Harbert, 391 F.3d at 1150 n. 1 (“We do not
intend this statement to cast doubt on the portion of the agency’s
regulation defining the ‘worksite’ of employees whose regular
workplace is his or her home.”); see id. at 1153 (“[WJe do not
question the validity of the agency’s regulation pertaining to
employees with ‘no fixed worksite’ . . . [or] . . . the validity of the
joint employment provision . . . insofar as it applies to employees
of temporary help agencies.”). Thus, the majority's rationale is
wholly inconsistent with its validation of the same regulation as
applied to employees of temporary help agencies and other related
regulations which are based on the same definition that the
majority declared ambiguous.
The majority also focused on House and Senate
Committee Reports in which employees having no fixed worksite
were specifically used as an example of employment relationships
in which the worksite should be the place from which work is
assigned or to which the employees report. Those reports,
however, did not limit the Secretary of Labor’s authority to define
“worksite” only for workers with no fixed place of work.
Moreover, Congress specifically directed that “worksite” be
defined as “single site of employment” in the WARN Act; and as
discussed above and noted by the dissenting judge, WARN Act
regulation § 639.3(i)(6) provides a completely reasonable basis for
the DOL’s regulation that defines “worksite” for all joint
employment relationships—regardless of whether the worksite is
“fixed” or not. See Harbert, 391 F.3d at 1155. Finally, the House
and Senate Reports do not specifically address or use examples of
employees who work out of their homes or employees of
temporary help agencies; see generally, S.R. Doc. No. 103-3; H.R.
Doc. No. 103-8(1; yet the majority considered the agency's
regulations defining “worksite” permissible for those employment
relationships. See Harbert, 391 F.3d at 1150 n. 1, 1153. Again,
the majority’s rationale for invalidating regulation § 825.11 1(a)(3)
as applied to Ms. Harbert is inconsistent and fails to properly defer
16
to the agency’s reasonable interpretation of the FMLA and
Congressional directives.
Another example of the majority's inconsistent logic and
rationale is its assertion that the DOL made an arbitrary distinction
between sole and joint employers. Dissenting Judge Kelly was,
again, not persuaded. In fact, Judge Kelly found that “this
distinction favors the validity of the regulation” because “[b]Jasing
FMLA eligibility on primary employers prevents confusion and
provides certainty ....” Harbert, 391 F.3d at 1155. Furthermore,
the majority compared two hypothetical employees—one, a sole
employee of a convenience store chain, and the other, a joint
employee employed by a placement company and assigned to
work at the same convenience store—in order to show how the
convenience store employee might be ineligible for FMLA leave
while the placement employee might be eligible. Using this
hypothetical, the majority argued that the purpose of the 50/75
provision was not achieved with respect to the joint employer.
The argument, however, is overly simplified for a variety of
reasons. One is that sole employment and joint employment are
quite different. As the dissenting judge argued, the ability of a
sole employer, such as a convenience store owner, and a joint
employer, such as a placement agency, to find abundant nearby
replacements is doubtfully identical. “[A}fter all, the placement
agency specializes in hiring and placing employees within the
area.” Id. Joint employers are also likely to have a much larger
employee base because they are not.as limited by the physical
constraints of an office or factory as a sole employer might be.
Thus, it would likely be easier for joint employers to find a —
replacement for an employee on leave.
The majority also entirely failed to consider the very real
fact that a joint employer is usually a sole employer as well. For
example, a temporary help or placement agency has a main office
where its management and administrative employees report on a
regular daily basis. These employees are unquestionably solely
employed by the placement agency. Its joint employees, however,
comprise the pool of employees that the placement agency assigns
to other businesses in off-site locations. Where a joint employer
outstations some of its employees to more fixed secondary
worksites, the majority’s holding would potentially bestow FMLA
17
eligibility to the joint employer’s sole employees but deny such
eligibility to its joint employees. Furthermore, applying §
825.111(a)(3) to joint employees with both “fixed” and “non-
fixed” worksites does not defeat the purpose or operation of the
50/75 provision. For example, a placement agency or any other
joint employer with a large number of employees would still find
itself exempt from FMLA leave requirements if the office from
where its joint employees are assigned (to fixed or non-fixed
sites), employs less than 50 employees (joint or sole) within a 75
mile radius of that office. Finally, the majority’s criticism of the
distinction between sole and joint employment is completely
inconsistent with its dictum that the DOL’s definition of
“worksite” is valid for temporary help agencies, see id. at 1153,
because recognizing the definition of “worksite” in §
825.111(a)(3) as applied to temporary help agencies necessarily
requires that such a distinction between sole and joint employment
be made.
Also, the majority’s distinction between temporary help
agencies and other joint employers creates an arbitrary and
illogical exception for a particular subset of joint employers. A
temporary help agency and a joint employer, like HSG, essentially
operate identically. Both contract with other businesses to provide
necessary employees. Both hire employees for the express
purpose of assigning them to other businesses at off-site locations.
Both are responsible for hiring, firing, paying, providing benefits,
assigning, placing, and transferring their employees. The only
difference between a temporary help agency and an employer like
HSG is that the temporary help agency places specialized
employees who can perform a specific job for a secondary
contracting employer. HSG and other employers with similar
business models provide an entire service (e.g., housekeeping,
security, food service, etc.) and the employees to perform the
service on the site of the secondary contracting business. While
the employees of a temporary help agency are placed in
“temporary” job assignments, those assignments may be either
short- or long-term. Similarly, while the employees of joint
employers like HSG may be hired for a more “permanent”
position, their assignments at any particular contracting business
may be either long- or short-term. Both temporary help agencies
and employers like HSG have the authority to re-assign their
—
18
employees to other job locations, either at the primary employer’s
pleasure or at the request of the secondary contracting employer.
There simply is no difference profound enough between temporary
help agencies and other joint employers to justify validating
§825.111(a)(3) as to one type of joint employer and not others.
Furthermore, the distinction between “fixed” versus “non-fixed”
worksites with respect to jointly employed employees is too
murky to make that the basis for determining the regulation’s
applicability.’
The Tenth Circuit majority has invalidated, as applied, a
wholly reasonable, consistent, and certain definition of “worksite”
for joint employees, and this Court’s review of that decision is
warranted.
CONCLUSION
In this split-decision case-of-first-impression, a majority
of a Tenth Circuit three-judge panel invalidated a DOL regulation
defining “worksite” as the regulation applied to joint employees
with largely “fixed” places of work. The majority’s rationale for
its decision, however, fails to show how the regulation, as applied,
is an arbitrary and unreasonable interpretation of the FMLA—
especially considering the authority given by Congress to the DOL
to implement the statute and Congressional reports expressly
directing that “worksite” be defined as “single site of
employment” under the WARN Act. The WARN Act regulations
defined “single site of employment” for a wide variety of
employment relationships, including employees who are
“outstationed.” The DOL accordingly patterned its regulation
defining “worksite” in the context of joint employment after the
WARN Act regulation relating to outstationed employees. The
majority’s distinction between “fixed” and “non-fixed” worksites
has no basis in the legislative history, and it creates more
uncertainty as the parameters of those terms remain unclear. The
DOL’s regulation § 825.111(a}(3) is a reasonable and permissible
interpretation of the FMLA that provides certainty and consistency
in determining FMLA eligibility for all jointly employed
employees.
” See supra note 6.
19
Given that this question is one of first impression, that the
Tenth Circuit panel was divided, that a regulation authorized by
Congress has been invalidated as applied, and that the invalidation
creates more uncertainty and inconsistency in the area of FMLA
leave for certain types of employment relationships, the United
States Supreme Court should grant certiorari to review the Tenth
Circuit’s decision and the merits supporting the full validation and
enforceability of DOL regulation § 825.111(a)(3).
WHEREFORE, Petitioner, Nancy Harbert, respectfully
requests that the Supreme Court grant review of this matter.
Respectfully submitted,
E. Michael Canges*
CANGES IWASHKO BETHKE
& BAILEY, P.C.
950 Seventeenth Street, Ste 1700
Denver, Colorado 80202
(303) 860-1900
Clifford L. Beem
A. Mark Isley
CLIFFORD BEEM &
ASSOCIATES, P.C.
730 Seventeenth Street, Ste 850
Denver, Colorado 80202
(303) 894-8100
* Counsel of Record Attorneys for Petitioner
App. A - I
APPENDIX A
PUBLISH
UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
NANCY E. HARBERT,
Plaintiff-Appellee,
v. No. 03-1156
HEALTHCARE SERVICES GROUP,
INC., a Pennsylvania Corporation,
Defendant — Appellant,
ELAINE CHAO, Secretary of Labor,
Amicus Curiae.
Appeal from the United States District Court
for the District of Colorado
(D.C. No. 00-K-908 (MJW))
Jeffrey L. Braff, Cozen O’Connor, Philadelphia, Pennsylvania, for
Defendant-Appellant.
Clifford L. Beem, Clifford Beem & Associates, P.C., Denver,
Colorado (A. Mark Isley, Clifford Beem & Associates, P.C.,
Denver, Colorado, with him on the brief), for Plaintiff-Appellee.
App. A - 2
Roger Wilkinson, Attorney, United States Department of Labor,
Washington, DC (Howard M. Radzely, Solicitor of Labor, Steven
J. Mandel, Associate Solicitor, and Anne P. Fugett, Senior
Attorney, United States Department of Labor, Washington, DC,
with him on the brief), for Amicus Curiae.
Before EBEL, KELLY, and McCONNELL, Circuit Judges.
EBEL, Circuit Judge.
Nancy Harbert (“Plaintiff”) brought this action against her
former employer, Healthcare Services Group, Inc. (“Defendant”),
alleging that Defendant wrongfully denied her request for medical
leave under the Family and Medical Leave Act (“FMLA”).
Defendant had denied her request based on a provision of the
FMLA which excludes from FMLA eligibility any employee who
is employed at a particular “worksite” if the employer employs
less than 50 employees within 75 miles of that worksite.
Applying a Department of Labor (“DOL”) regulation, the
district court defined Plaintiff's “worksite” as Defendant’s
regional office in Golden, Colorado. Because Defendant
employed more than 50 employees within 75 miles of its Golden
- office, the district court denied Defendant’s motion for summary
judgment and, after a bench trial, found in Plaintiff's favor.
Defendant filed this appeal, arguing that the relevant portion of the
DOL regulation defining the statutory term “worksite” is invalid.
We exercise jurisdiction pursuant to 28 U.S.C. § 1291, and we
REVERSE the judgment of the district court and REMAND for
further proceedings consistent with this opinion.
BACKGROUND
Defendant contracts out housekeeping and _ laundry
services to long-term care institutions. Defendant employs
approximately 17,000 employees and has contracts with about
1,300 long-term care facilities in 42 states. Organizationally,
Defendant is divided into regions, which are composed of multiple
Yee I A RE NE ATI OHE * emo ae
App. A - 3
districts. Each district is made up of individual accounts, which
are the long-term care institutions. Account managers work at the
account to which they are assigned and report to district managers.
District managers report to regional managers. In Colorado, all
district managers and the regional manager have their offices at
the same location in Golden, Colorado.
Sunset Manor is a convalescent/nursing facility located in
Brush, Colorado, which is more than 75 miles from Golden. In
1994, Plaintiff was hired by Sunset Manor as the Housekeeper
Supervisor, and in 1995 her responsibilities were expanded to
include the position of Laundry Department Supervisor. In 1997,
Defendant entered into an agreement to provide housekeeping and
laundry services to Sunset Manor. Plaintiff's employment with
Sunset Manor was transferred to Defendant, and Plaintiff became
the account manager for Defendant’s Sunset Manor account.
Defendant assumed all responsibility for retaining, transferring, or
firing Plaintiff and also paid her salary and provided her benefits.
Plaintiff’s duties, however, remained essentially the same as when
she was employed directly by Sunset Manor.
Plaintiff worked out of an office at Sunset Manor in
Brush. When Plaintiff reported to her district manager, she
reported to him at Defendant’s regional office in Golden. Such
reports were almost always by telephone or through the
submission of written reports; Plaintiff went to the Golden office
only for an occasional district meeting of account managers.
Sunset Manor’s administrator exercised supervision and control
over Plaintiff when Plaintiff was employed by Sunset Manor, and
this did not change after Plaintiff became an employee of
Defendant. Plaintiff believed that she had a long-term job at
Sunset Manor and planned to work there until her retirement at
age OS.
On November 6, 1998, Plaintiff injured her right hip in a
non-work related automobile accident. Plaintiff got permission
from Defendant to take two 30-day periods of leave, and Plaintiff
began the first 30-day period of leave on December 8, 1998. On
February 20, when Plaintiff failed to report to work after the
expiration of the second 30-day period of leave, Defendant
terminated Plaintiff's employment.
App. A -4
Although Defendant had granted Plaintiff two 30-day
periods of leave, Defendant denied Plaintiff’s request for leave
under the Family and Medical Leave Act (“FMLA”), 29 U.S.C. §
2601 et seq. The FMLA requires covered employers to provide
eligible employees with up to 12 weeks of medical eave per year
for, inter alia, a serious health condition that renders the employee
unable to work. Id. § 2612(a)(1)(D). Only those employees
whose employer employs at least 50 employees within 75 miles of
that employee’s “worksite” are eligible for leave under the Act.
Id. § 2611(2)(B)(ii). The statutory term “worksite” is defined in a
DOL regulation. See 29 C.F.R. § 825.111(a)(3).
Defendant denied Plaintiff's request for FMLA leave
based on Defendant’s conclusion that Plaintiff was not employed
at a “worksite” at which Defendant employed 50 or more
employees within 75 miles, and that she was therefore ineligible
for FMLA leave. This conclusion was based on the premise that
Plaintiff's “worksite” was Sunset Manor in Brush, rather than
Defendant’s regional office in Golden. During the relevant time
period, Defendant employed fewer than 50 employees within 75
miles of Sunset Manor but employed more than 50 employees
within 75 miles of its regional office in Golden.
Plaintiff filed this lawsuit, alleging that Defendant
wrongfully denied her request for medical leave under the FMLA
and wrongfully terminated her. Defendant moved for summary
judgment in part on the ground that the relevant portion of the
DOL regulation defining the statutory term “worksite” was
invalid. See Harbert v. Healthcare Servs. Group, Inc., 173
F.Supp.2d 1101, 1006 (D.Colo. 2001). The district court upheld
the regulation and denied Defendant’s motion for summary
judgment. See id.
After a bench trial, the district court concluded that
Plaintiff's “worksite” under the applicable regulation was
Defendant’s regional office in Golden, Colorado. Because
Defendant employed more than 50 employees within 75 miles of
its Golden office, the court held that Defendant wrongfully denied
Plaintiff benefits under the FMLA. The district court awarded
Pammannenecie iiss ten J AUS ih SLSR R OREN
App. A - 5
Plaintiff back pay, front pay, liquidated damages, interest, costs,
and attorneys fees.
In this appeal, Defendant concedes that the applicable
DOL regulation identifies Plaintiff's “worksite” as its regional
office in Golden. Defendant argues only that this regulation is
invalid, contending that the agency exceeded its authority to
implement the FMLA.
DISCUSSION
i Appellate Jurisdiction
We first address whether we have jurisdiction to consider
the merits of this appeal. On March 13, 2003, the district court
entered an order resolving the issue of liability in Plaintiff’s favor
and setting forth a formula for the calculation of damages. The
court instructed the parties to meet to determine the precise
amount of damages and prepare a judgment in accordance with
that determination. Defendant filed a notice of appeal on April 11.
The district court later entered judgment, fixing damages in the
amount agreed upon by the parties and disposing of the case. No
new notice of appeal was taken from the subsequent judgment.
Defendant now wishes to appeal only the issue of liability resolved
in the March 13 decision, not the subsequent calculation of
damages.
Under 28 U.S.C. § 1291, we have jurisdiction only over
“final” decisions of the district court. Albright v. UNUM Life Ins.
Co. of Am., 59 F.3d 1089, 1092 (10" Cir. 1995). Accordingly, we
must determine whether the March 13 Order — the only order from
which a notice of appeal was taken — was a final decision and, if
not, whether it became final when the district court subsequently
fixed damages and disposed of the case.
A. Whether the March 13 Order was a “final”
decision
For a ruling to be final, “it must end the litigation on the
merits, and the judge must clearly declare his intention in this
respect.” FirsTier Mortgage Co. v. Investors Mortgage Ins. Co.,
App. A - 6
498 U.S. 269, 273-74 (1991) (internal quotations and citations
omitted). A final order is one that “leave[s] nothing for the court
to do but execute the judgment.” Albright, 59 F.2d at 1092
(internal quotations omitted). As a general rule, “the touchstone of
a final order is a decision by the court that a party shall recover
only a sum certain.” Id. (citing Fed. R. Civ. P. 58) (internal
quotations omitted) (emphasis in original). Accordingly, an order
that determines liability but leaves damages to be calculated is not
final. Id. However, pursuant to an exception to the general rule,
“an order is final even if it does not reduce the damages to a sum
certain if the order sufficiently disposes of the factual and legal
issues and any unresolved issues are sufficiently ministerial that
there would be no likelihood of further appeal.” Id. At 1093
(quotations omitted).
For example, in Albright v. UNUM Life Insurance Co. of
America, the plaintiff had requested in his motion for summary
judgment the “monthly benefit of 66 2/3 % of his preinjury basic
monthly earnings less other income benefits such as workers’
compensation and Social Security Disability.” Id. At 1092
(quotation omitted). The district court granted his motion but did
not address the issue of benefits. Id. We stated that “both
determining the correct amount of monthly benefits and the proper
deductions for other income benefits may prove to be complicated
and disputed calculations” and were not likely to be simply
ministerial. Id. at 1093. Accordingly, we held that the district
court’s order was not final, and we dismissed the defendant’s
appeal. Id. at 1094.
In this case, the district court awarded Plaintiff back pay,
front pay, liquidated damages, interest, costs, and attorneys fees.
Specifically, the district court set total back pay in the amount of
$84,778.80, to be reduced by “the amount [Plaintiff] has earned
[since her termination] through other employment together with
interest oi: the net amount at the legal rate.” The district court set
total front pay in the amount of $102,374.40, to be reduced by “the
amount of compensation [Plaintiff] would earn from Conoco [until
her 65" birthday}, calculated at her present rate of earnings per
week plus any guaranteed raises or cost of living increases.”
App. A -7
The district court then ordered the parties “to meet and
confer within {] 20 days from the date hereof to determine the
precise amounts to be set forth in the judgment in accordance with
the above stated findings and conclusions.” The district further
directed, “If counsel can agree, they shall prepare a judgment in
accordance herewith. If counsel are unable to agree, they shall
notify the court within the following ten days and the matters not
agreed upon will be set for hearing.”
The various components of the damages award were not
sufficiently fixed to satisfy the standard we set forth in Albright.
The amount of Plaintiff's past and future earnings was not
determined, and calculation of those amounts could have proven
complicated and disputed. For example, nothing in the order
indicates whether Plaintiff's weekly compensation at Conoco is
fixed or varies, and nothing in the order defines a “guaranteed”
raise or cost of living increase. As such, the process of calculating
damages in this case was no more “ministerial” than it was in
Albright itself.
Moreover, the district court must have contemplated the
possibility of a contentious process because it provided in its order
that if the parties could not agree on the amount of the award, the
disputed issues would be set for hearing. By so providing, the
district court did not “clearly declare{e] his intention” to “end the
litigation on the merits” in the March 13 Order. FirsTier, 498 U.S.
at 273-74. For these reasons, we hold that the court’s March 13
decision was not a final decision.
B. Whether the March 13 Order became “final”
when the district court disposed of the remainder of the case.
In Lewis v. B.F. Goodrich Co., we held that an otherwise
nonfinal decision becomes final and appealable if the district court
adjudicates all remaining claims against all remaining parties
before the appellate court acts to dismiss the appeal on the merits
for lack of jurisdiction. 850 F.2d 641, 645 (10" Cir. 1988) (en
banc); see also Old Republic Ins. Co. v. Durango Air Serv., Inc.,
283 F.3d 1222, 1225 (10" Cir. 2002); Dodd Ins. Servs., Inc. v.
Royal Ins. Co. of Am., 935 F.2d 1152, 1154 n.1 (10" Cir. 1991);
Fed. Sav. & Loan Ins. Corp. v. Huff, 851 F.2d 316, 317-18 (10"
App. A - 8
Cir. 1988) (en banc); Moore’s Federal Practice, § 54.25[3], at 54-
87 (“If an order is not certified under Rule 54(b), but a notice of
appeal is nevertheless filed, any subsequent order of the district
court that completely adjudicates the remaining claims is sufficient
to validate the otherwise premature notice of appeal.”).
Accordingly, a decision that is otherwise nonfinal because it
leaves damages unresolved becomes final and appealable if post-
appeal adjudications in the district court precisely fix damages and
dispose of the case. Gen. Motors Corp. v. New A.C. Chevrolet,
Inc., 263 F.3d 296, 311 n.3 (3™ Cir. 2001).
Here, subsequent to the notice of appeal, the district court
entered a judgment fixing damages. All claims against all parties
are now resolved. The district court’s nonfinal decision therefore
became final as a result of the post-appeal proceedings in the
district court. We hold that the notice of appeal filed in this case
was effective to confer appellate jurisdiction over the district
court’s March 13 Order. See Lewis, 850 F.2d at 645; Gen. Motors
Corp., 263 F.3d at 311 n.3.
Il. MERITS
Defendant challenges only the validity of 29 C.F.R. §
825.111(a)(3), the Department of Labor regulation defining the
“worksite” of jointly-employed employees. Both parties agree
that this joint employment provision, if valid, governs this case
and that it would lead to a conclusion that Plaintiff was a covered
employee. We review a district court’s decision regarding the
validity of an agency regulation de novo. See Pub. Lands Council
v. Babbitt, 167 F.3d 1287, 1293 (10" Cir. 1999).
The framework we use to analyze an agency’s
construction of a statute it administers was set forth by the
Supreme Court in Chevron, U.S.A., Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837, 842-44 (1984). Chevron
mandates a two-step inquiry. “First, always, is the question
whether Congress has directly spoken to the precise question at
issue. 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.
Because the judiciary is the final authority on issues of statutory
App. A -9
construction, it “must reject administrative constructions which are
contrary to clear congressional intent.” Id. at 843 n.9. To
ascertain whether Congress had an intent on the precise question at
issue, courts should “employ[] traditional tools of statutory
construction.” Id. These tools include examination of the statute’s
text, structure, purpose, history, and relationship to other statutes.
See Gen. Dynamics Land Sys., Inc. v. Cline, 540 U.S. 581, 124
S.Ct. 1236, 1248-49 (2004).
Second,
[i]f...the court determines Congress has
not directly addressed the precise
question at issue, the court does not
simply impose its own construction on
the statute, as would be necessary in the
absence of aan administrative
interpretation. Rather, if the statute is
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.
Chevron, 467 U.S. at 843 (footnote omitted). The Court explained
that an agency’s answer is permissible unless arbitrary, capricious,
or manifestly contrary to the statute:
The power of an administrative agency
to administer a congressionally created
program necessarily requires the
formulation of policy and the making of
rules to fill any gap left, implicitly or
explicitly, by Congress. If Congress has
explicitly left a gap for the agency to
fill, there is an express delegation of
authority to the agency to elucidate a
specific provision of the statute by
regulation. Such legislative regulations
are given controlling weight unless they
are arbitrary, capricious, or manifestly
App. A - 10
contrary to the statute. Sometimes the
legislative delegation to an agency on a
particular question is implicit rather than
explicit. In such a case, a court may not
substitute its own construction of a
statutory provision for a reasonable
interpretation made by the administrator
of an agency.
Id. at 843-44 (internal quotations and citations omitted) (footnotes
omitted).
A. The Family and Medical Leave Act (“FMLA”’)
The FMLA was enacted, in part, “to balance the demands
of the workplace with the needs of families...[and] to entitle
employees to take reasonable leave for medical reasons...in a
manner that accommodates the legitimate interests of employers.”
29 U.S.C. § 2601(b). The Act entitles eligible employees of
covered employers to take up to 12 weeks of unpaid, job-protected
leave each year because of, among other things, “a serious health
condition that makes the employee unable to perform the functions
of the position of such employee.” Id. § 2612(a)(1)(D).
As part of the balance that was struck between the
interests of employers and the interests of employees, Congress
included a small employer exception that excludes from the Act’s
coverage employers with fewer than 50 employees. Id. §
2611(4)(A)(i). A separate exception was granted for small
operations — that is, a potentially large company with a relatively
small satellite office in a particular area. Specifically, the statute
excludes from coverage any employee whose employer employs
less than 50 employees within 75 miles of that employee’s
“worksite” (“the 50/75 provision”). Id. § 2611(2)(B)(ii).
According to the House Committee Report, the 50/75 provision
“recognizes the difficulties an employer may have in reassigning
workers to geographically separate facilities.” H.R. Rep. No. 102-
135(1), at 37 (1991).
With these eligibility restrictions, Congress recognized
that only about 40 to 50 percent of all employees would be
————— —“i—™O
App. A- 11
covered by the Act. S. Rep. No. 102-68, at 24 (1991); H.R. Rep.
No. 102-135(1), at 37 (1991).
B. The FMLA regulation defining “worksite”
Congress granted the Secretary of Labor the authority to
prescribe such regulations as are necessary to carry out the FMLA.
29 U.S.C. § 2654. The regulation at issue in this case, 29 C.F.R. §
825.111(a)(3), defines the “worksite” of an employee who is
jointly employed by two or more employers as follows:
For purposes of determining that
employee’s eligibility, when an
employee is jointly employed by two or
more employers (see § 825.106), the
employee’s worksite is the primary
employer’s office from which the
employee is assigned or reports. The
employee is alsc counted by the
secondary employer to determine
eligibility for the secondary employer’s
full-time or permanent employees.
Id. § 825.111(a)(3). Section 825.106(a) states that two entities
may be considered “joint employers” where they both exercise
some control over the work or working conditions of the
employee. Id. § 825.106(a). For example, joint employment will
ordinarily be found to exist when a temporary agency supplies
employees to a second employer. Id. § 825.106(b). In joint
employment relationships, the “primary employer” is the only
employer responsible for providing FMLA leave. Id. §
825.106(c). The “primary employer” is determined by considering
such factors as the authority to hire and fire, assign/place the
employee, make payroll, and provide employment benefits. Id.
In this case, the district court identified Plaintiff as jointly
employed by both Defendant and Sunset Manor, applied §
825.111(a)(3), and defined Defendant as Plaintiff's “primary
employer.” None of this is at issue in this appeal. What is at issue
is whether § 825.111(a)(3) is a valid regulation implementing the
FMLA.
App. A - 12
C. The Chevron analysis
Pursuant to Chevron’s mandate, we must first consider
whether Congress expressed a clear intent with respect to the
meaning of “worksite” for an employee who is jointly employed.
See 467 U.S. at 842-43. We conclude that congressional intent
with respect to this issue is not sufficiently clear to render the
regulation invalid under the first step of Chevron.
“A fundamental canon of statutory construction is that,
unless otherwise defined, words will be interpreted as taking their
ordinary, contemporary, common meaning.” Perrin v. United
States, 444 U.S. 37, 42 (1979); CBC, Inc. v. Bd. Of Governors of
the Fed. Reserve Sys., 855 F.2d 688 690 (10" Cir. 1988).
Congress did not define the term “worksite” in the FMLA.
However, the common understanding of the term “worksite” is the
site where the employee works. Here, the parties do not dispute
that Plaintiff worked at Sunset Manor in Brush, Colorado. Under
the ordinary meaning of the term, her “worksite” would be Sunset
Manor in Brush. However, under the joint employment
regulation, § 825.111(a)(3), Plaintiff’s “worksite” is Defendant’s
regional office in Golden, a place where Plaintiff went only for
occasional meetings or account managers. Nonetheless, Congress
did not expressly define the term “worksite” in the FMLA, and
because Congress has not directly spoken to the question at issue,
we proceed to a step-two analysis under Chevron.
Under the second step of Chevron, we must “give[]
controlling weight [to the agency’s regulations] unless they are
arbitrary, capricious, or manifestly contrary to the statute.”
Chevron, 467 U.S. at 844. In light of the deference we owe an
agency’s construction of the statute, this case presents a very close
question. However, we conclude that § 825.111(a)(3), as applied
to the situation of an employee with a fixed place of work, is
arbitrary, capricious, and manifestly contrary to the FMLA. We
first address the three indicia of congressional intent that lead us to
this conclusion, and then consider the counter-arguments made by
Plaintiff and the Secretary of Labor.
1. Common meaning of the term “worksite”
App. A - 13
We concluded above that the agency’s definition of
“worksite,” as applied to Plaintiff, runs contrary to the common
meaning of that term. See discussion supra. That the agency’s
definition of Plaintiff's worksite contravenes the plain meaning of
the term “worksite” is one indicia of congressional intent that
militates against deference to the agency’s construction of the
statute under the second step of Chevron.
2. Legislative Purpose
“Courts must guard against interpretations that might
defeat a statute’s purpose[.]” United States v. Soto-Ornelas, 312
F.3d 1167, 1172 (10" Cir. 2002) (quotations and alterations
omitted). The agency’s definition of worksite, as applied to
Plaintiff, is contrary to the purpose underlying the 50/75 provision.
As discussed above, Congress included a provision in the
FMLA excluding from the Act’s coverage employers with fewer
than 50 employees. 29 U.S.C. § 2611(4)(A)(i). However,
Congress also recognized that even potentially large employers
(i.e., those with more than 50 employees) may have difficulty
finding temporary replacements for employees who work at
geographically scattered locations. Congress therefore determined
that if any employer (large or small) has no significant pool of
employees nearby to cover for an absent employee, that employer
should not be required to provide FMLA leave to that employee.
Specifically, Congress determined that an employer must employ
at least 50 employees within 75 miles of the employee’s worksite.
Id. § 2611(2)(B)(ii).
The House Report confirms that the congressional purpose
underlying the 50/75 provision was to remove the burden of
providing FMLA leave from employers who do not have an
abundant supply of temporary replacements in close geographic
proximity to the employee requesting leave:
For purposes of determining the size of
an employer, there is a geographic
limitation of a 75-mile radius that
applies to the aggregation of employees
App. A - 14
at different facilities. This provision
recognizes the difficulties an employer
may have in reassigning workers to
geographically separate facilities.
H.R. Rep. No. 102-135(I), at 37 (1991).
An employer’s ability to replace a particular employee
during his or her period of leave will depend on where that
employee must perform his or her work. In general, therefore, the
congressional purpose underlying the 50/75 provision :« not
effected if the “worksite” of an employee who has a regular piace
of work is defined as any site other than that place.’
For example, if Defendant were to grant leave to Plaintiff,
Defendant would have been required to find an employee to cover
for Plaintiff at Sunset Manor in Brush, Colorado. It is undisputed
that Defendant employed fewer than 50 employees within 75
miles of Brush. Defendant therefore had no abundant supply of
employees who could have covered for Plaintiff during her period
of leave. Defendant, a large employer with geographically
dispersed employees, is precisely the type of employer Congress
intended to protect with its enactment of the 50/75 provision.
Accordingly, a regulatory provision that defines Plaintiff’s
“worksite” as Defendant’s regional office in Golden does not
effect the congressional purpose underlying the 50/75 provision.
3. Arbitrary distinction between sole and joint
employers
The challenged regulation also creates an arbitrary
distinction between sole employers and joint employers. For
example, if the employer is a company that operates a chain of
convenience stores, the “worksite” of an employee hired to work
at one of those convenience stores is that particular convenience
store. See 58 Fed. Reg. 31794, 31798 (1993). If, on the other
' We do not intend this statement to cast doubt on the portion of the
agency’s regulation defining the “worksite” of employees whose regular
workplace is his or her home. See 29 C.F.R. § 825.111(a)(2).
ee eee meee
App. A - 15
hand, the employer is a placement company that hires certain
specialized employees to work at convenience stores owned by
another entity (and therefore is considered a joint employer), the
“worksite” of that same employee hired to work at that same
convenience store is the office of the placement company. See 29
C.F.R. § 825.111(1)(3).
Assuming both employers employ more than 50
employees within 75 miles of their central office but fewer than 50
employees within 75 miles of the convenience store, the employee
is ineligible for FMLA leave if the employer is a sole employer
(e.g., the company that owns the convenience store chain) but
eligible for FMLA leave if the employer is a joint employer (e.g.,
the placement company).
Accordingly, the joint employment provision creates the
possibility that an employer’s responsibility to provide FMLA
leave to an employee will depend exclusively on whether that
employer is a sole employer or a joint employer. This is true
despite the fact that neither employer has an abundant supply of
nearby employees to replace temporarily an employee taking leave
and, consequently, are both subject to the burden Congress tried to
alleviate by enacting the 50/75 provision. See discussion supra
Section II.C.2. The effect of the joint employment provision is to
require the joint employer to bear that burden even though the sole
employer is relieved of that burden. Because both types of
employ8ers bear the burden the 50/75 provision was designed to
alleviate, there is simply no basis in the statute or in logic for such
a distinction.” We owe no deference to an agency’s arbitrary
construction of a statute. See Chevron, 467 U.S. at 844.
* The Secretary insists that the distinction between sole employers and
joint employers is not arbitrary because the agency could reasonably
have concluded that joint employers are better equipped to find
replacements for remotely-stationed employees. We disagree. While
some joint employers may have employees who are willing to change job
locations regularly (e.g., temporary employees), there is not reason to
believe that these employees are any more likely than any other
employee to do so if changing job locations requires moving to a new
location more than 75 miles away.
App. A - 16
In sum, the ordinary meaning of the term “worksite,” the
congressional purpose underlying the 50/75 provision, and the
arbitrary distinction the regulation creates between sole and joint
employers all militate strongly against deference to the agency’s
construction of the statute as applied to Plaintiff. At bottom,
Congress intended the term “worksite” to be construed as the
employee’s regular place of work, and we see no reason to apply a
different definition to Plaintiff simply because she is jointly-
employed. We turn next to the counter-arguments offered by the
Secretary and Plaintiff.
4. Counter-arguments
a. The legislative history’s reference to the
WARN Act
The Secretary insists that the joint employment provision
is valid because the agency, as directed by the legislative history,
patterned the definition of “worksite” after the definition of
“single site of employment” in the Worker Adjustment and
Retraining Notification (“WARN”) Act, 29 U.S.C. § 2101 et seq.
The Secretary correctly points out that the House and
Senate Committee Reports both indicate that the term “worksite”
is to be construed consistent with the term “single site of
employment” under the WARN Act and regulations under that
Act:
The term “worksite” intended to be
construed in the same manner as the
term “single site of employment” under
the Worker Adjustment and Retraining
Notification Act (“WARN”), 29 U.S.C.
2101(a)(3)(B), and regulations under
that Act (20 CFR Part 639). Where
employees have no fixed worksite, as is
the case for many construction workers,
transportation workers, and
salespersons, such employee’s
“worksite” should be construed to mean
the single site of employment to which
POR ee ee Sens Sa a nee Se a ET
OPE Pe SIE Oe ee
ieee A we.
wo iiete ts
App. A - 17
they are assigned as their home base,
from which their work is assigned, or to
which they report.
S. Rep. No. 103-3, at 23 (1993); see also H.R. Rep. No. 103-8(1),
at 35 (1993) (substantially the same).
The WARN Act requires covered employers to provide
written notice to affected employees sixty days before a “mass
layoff.” 29 U.S.C. § 2102(a); see also Frymire v. Ampex Corp.,
61 F.2d 757, 761 (10" Cir. 1995). Congress defined “mass layoff”
as “a reduction in force which...results in an employment loss at
the single site of employment during any 30-day period for...at
least 50 employee[.]” 29 U.S.C. § 2101(a)(3) (emphasis added).
The WARN Act itself does not define “single site of
employment.”
The Secretary of Labor has promulgated a regulation
defining the term “single site of employment” for purposes of the
WARN Act.’ 20 C.F.R. § 639.3(i); see also 29 U.S.C. § 2107.
The focus of the regulation is in explaining when two or more
different employment sites can be counted together as a “single
site” for the purpose of aggregating employees to reach the 50-
employee minimum. See 20 C.F.R. § 639.3(i). The regulation
also recognizes that the employment sites of certain groups of
employees will be difficult to identify. Accordingly, it provides:
For workers whose primary duties
require travel from point to point, who
are outstationed, or whose primary
duties involve work outside any of the
employer’s regular employment sites
(e.g., railroad workers, bus drivers,
salespersons), the single site of
employment to which they are assigned
as their home base, from which their
work is assigned, or to which they
* This regulation was promulgated in 1989 (see 54 Fed. Reg. 16042
(1989)), prior to enactment of the FMLA.
App. A - 18
report will be the single site in which
they are covered for WARN purposes.
Id. § 639.3(i)(6).
The Secretary argues that its FMLA joint employment
regulation, 29 C.F.R. § 825.111(a)(3), is consistent with this
WARN regulation defining “single site of employment” for
purposes of the WARN Act. Specifically, the Secretary argues
that jointly-employed employees are essentially “outstationed”
workers and are properly treated in the joint employment
provision of the FMLA in the same manner that outstationed
workers are treated under this WARN Act regulation. For several
reasons, we disagree.
First, we believe that this provision of the WARN Act
governs only employees without a fixed place of work, not
employees who, like Plaintiff, do have a fixed place of work. All
three examples listed in the parenthetical in the WARN Act
regulation are employees who do not have a fixed place of work.
See 20 C.F.R. 639.3(i)(6) (listing railroad workers, bus drivers,
and salespersons). Furthermore, the agency, in enacting the
WARN Act regulation, referred to § 639.3(i)(6) as “that part of the
regulation relating to mobile workers[.]” 54 Fed. Reg. 16042,
16051 (1989).* Finally, for employees who do not have a fixed
* The passage provides in full:
Another commenter suggested that in the railroad industry certain
maintenance crews have no home base and should be treated as separate
operating units. While such workers may well be considered as a
separate operating unit, their status must be determined in terms of the
single site of employment to which they are assigned. These workers
may not have an assigned home base, but they must get their orders or
assignments from somewhere, even if that place changes from time to
time. In order to cover this situation and the situation of outstationed
workers and traveling workers who report to but do not work out of a
particular office, that part of the regulation relating to mobile workers has
been revised to clarify that such workers should be treated as assigned to
their home base or to the single site from which their work is assigned or
(cont'd)
App. A - 19
place of work, there is no reason to believe the agency for
purposes of the WARN Act would have named any different place
as the employee’s employment site. Accordingly, we conclude
that the applicable WARN Acct regulation, 20 C.F.R. § 639.3(i)(6),
applies only to employees without a fixed place of work and is not
relevant to employees who, like Plaintiff, do have a fixed place of
work.
Further, even if the term “outstationed” in the WARN Act
regulation could reasonably be interpreted more broadly to
encompass employees who do have a fixed place of work, the
definition of “single site of employment” for outstationed
employees under the WARN Act is ambiguous. Under the
WARN Act regulation, there are three potentially different
locations that could be the “single site of employment” of an
outstationed employee — namely, “the “site...to which they are
assigned as their home base, from which their work is assigned, or
to which they report.” 20 C.F.R. § 639.3(i)(6). Accordingly, even
if Plaintiff, who does have a fixed place of work, could be
considered “outstationed” under the WARN Act regulation, it is
entirely unclear from the regulation whether her “single site of
employment” would be Brush (the site to which she is assigned) or
Golden (the place to which she reports and from which she is
assigned). As such, the WARN Act regulation provides little, if
any, guidance to the agency with respect to the proper definition of
“worksite” for an employee who, although arguably
“outstationed,” does have a fixed place of work.
Absent guidance from Congress, such ambiguity might
militate in favor of deference to the agency’s construction of the
statute. As discussed above, however, the plain meaning of the
term “worksite” in the FMLA, the congressional purpose
underlying the 50/75 provision in the FMLA, and the arbitrary
distinction the regulation creates between sole and joint employers
(cont'd)
to which they report. This part of the definition has been moved, for
reasons of organizational clarity, to be a part of the definition of “single
site of employment” in § 639.3(i).
54 Fed. Reg. at 16051 (emphasis added).
App. A - 20
under the FMLA are all factors that militate strongly against
deference to the agency’s construction of that statute. We
therefore find no merit in the Secretary’s argument that an
ambiguous regulation implementing the WARN Act renders the
agency’s construction of the FMLA reasonable.
b. Congressional recognition that the “worksite” of
some employees may not be their regular workplace
The Secretary also argues that because the legislative
history suggests that the “worksite” of some employees may be
some place other than their regular place of work, it was
permissible for the agency to define the “worksite” of jointly-
employed employees as some other location. We disagree.
The House and Senate Committee Reports both provide a
definition of “worksite” for employees with “no fixed worksite.”
Specifically:
Where employees have no _ fixed
worksite, as is the case for many
construction workers, transportation
workers, and_ salespersons, such
employees’ “worksite” should be
construed to mean the single site of
employment to which they are assigned
as their home base, from which their
work is assigned, or to which they
report.
S. Rep. No. 103-3, at 23 (1993); see also H.R. Rep. No. 103-8(D),
at 35 (1993) (substantially the same). As such, both Committee
Reports recognized that all employees, even those without a fixed
worksite, must have a definable “worksite” so that their eligibility
under the Act can be determined. For employees without a fixed
worksite, it was necessary to identify some fixed location that
could serve as a “worksite” for purposes of the Act. See, e.g., S.
Rep. No. 103-3, at 23. That location could not be the employee’s
regular workplace, because the employee has no _ regular
workplace. Accordingly, we do not question the validity of the
App. A - 21
agency’s regulation pertaining to employees with “no fixed
worksite.” See 29 C.F.R. § 825.111(a)(2).
Furthermore, we do not question the validity of the joint
employment provision, id. § 825.111(a)(3), insofar as it applies to
employees of temporary help agencies. An employee of a
temporary help agency does not have a permanent, fixed worksite.
It is therefore appropriate that the joint employment provision
defines the “worksite” of a temporary employee as the temporary
help office, rather than the various changing locations at which the
temporary employee performs his or her work. See 60 Fed. Reg.
2180, 2187 (1995) (explaining that under joint employment
provision, “worksite” of temporary employee is temporary help
office).
On the contrary, if an employee does have a fixed
_ worksite, there is no similar need to identify a constructive
“worksite” for purposes of the FMLA. The Secretary’s argument
that an employee with a fixed worksite should be treated
comparably to an employee without a fixed worksite is therefore
without merit.
In sum, we find the counter-arguments offered by Plaintiff
and the Secretary unavailing, and we conclude that 29 C.F.R. §
825.111(a)(3), as applied to an employee like Plaintiff with a fixed
worksite yet subject to joint employers, is arbitrary, capricious,
and manifestly contrary to the FMLA.°
* We also note that we find no merit in Plaintiff's argument that
congressional silence since the Secretary promulgated the regulation
militates in favor of the regulation’s validity. Plaintiff relies primarily on
Walker v. United Parcel Service, Inc., 240 F.3d 1268 (10" Cir. 2001). In
Walker, Congress had amended Title VII without taking issue with the
agency regulation in question, even though the validity of the regulation
had been the subject of debate within the courts. Id. at 1276. We held
that congressional silence under these circumstances lent support to a
conclusion that the regulation is valid, emphasizing that “[p]lainly
EEOC’s regulation has not escaped public or legislative notice over what
has been nearly a quarter century.” Id. Here, the subject regulation had
not been the subject of debate until this case.
App. A - 22
CONCLUSION
We appreciate the deference we owe to an agency’s
construction of the statute it is charged with administering when
the agency’s construction is not contrary to the clearly expressed
intent of Congress. As the Supreme Court recently recognized,
however, “[o]ur deference to the Secretary...has important limits:
A regulation cannot stand if it is arbitrary, capricious, or
manifestly contrary to the statute.” Ragsdale v. Wolverine World
Wide, Inc., 535 U.S. 81, 87 (2002) (quotation omitted)
(invalidating different FMLA Regulation under second step of
Chevron). We hold the 29 C.F.R. § 825.111(a)(3), as applied in
this case to a jointly employed employee with a fixed worksite, is
not a valid exercise of agency authority, and we REVERSE the
judgment of the district court and REMAND for further
proceedings consistent with this opinion.
App. A - 23
03-1156, Nancy E. Harbert v. Healthcare Services, Inc.
KELLY, Circuit Judge, concurring in part and dissenting in part.
While I concur in the court’s conclusion that we have
appellate jurisdiction, I dissent from its holding that 29 C.F.R. §
825.111(a)(3) defining the statutory term “worksite” is invalid, as
applied to a jointly employed employee with a largely fixed
worksite. Declaring invalid a regulation that an agency has been
charged with developing is strong medicine and only appropriate
when the regulation is “arbitrary, capricious, or manifestly
contrary to the statute.” Chevron U.S.A., Inc. v. NRDC, 467 U.S.
837, 844 (1984). Here, the statute never defines “worksite” and
the Secretary of Labor is empowered to prescribe rules to
implement the FMLA. 29 U.S.C. § 2654. We must defer to the
agency’s interpretation if it “is based on a permissible construction
of the statute.” Chevron, 467 U.S. at 843.
The court invalidates the regulation as applied to jointly
employed employees with largely fixed worksites as inconsistent
with the purpose of the 50/75 provision. Healthcare does not
appeal the district court’s decision that Ms. Harbert was jointly
employed, but instead contends that the “worksite” definition is
invalid. Aplt. Br. at 9-10. The 50/75 provision excludes an
employee from FMLA coverage if the employee “is employed at a
worksite at which [the] employer employs less than 50 employees
if the total number of employees employed by the employer within
75 miles of that worksite is less than 50.” 29 U.S.C. §
2611(2)(B)(ii).
Joint employment comes in many forms. But the primary
employer generally has control over the reassignment, placement,
and hiring and firing of joint employees, not the secondary
employer. See 29 C.F.R. § 825.106(c). Thus, an employee’s
“worksite” is defined with reference to the employer retaining the
most control over the employee, and the employer responsible for
providing FMLA leave. Id. The court’s ipse dixit that the
Secretary’s definition of the term “worksite” is contrary to
common meaning fails to account for the many variations in joint
employment relationships, from forever fixed to forever mobile.
See Moreau _v. Air Fr., 356 F.2d 942, 946 (9" Cir. 2004); 29
C.F.R. 825.106.
App. A - 24
The legislative history reflects that the Senate and House
obviously were aware of variations in joint employment
relationships and directed the Secretary to construe “worksite” in
the same manner as the term “single site of employment” under
the WARN Act. S.R. Doc. No. 103-3, at 25 (1993); see also H.R.
Doc. No. 103-8, pt. 1, at 35 (1993). Though both the legislative
history and a WARN Act regulation, 20 C.F.R. § 639.3(i), discuss
workers that lack a fixed site of employment, the Secretary’s
interpretation that other arrangements are encompassed within the
directive to the WARN Act is a permissible and reasonable
interpretation. Holding that the WARN Act regulation only
applies to employees without a regularly fixed site of employment
would seem to contravene the express language of the provision
which mentions other categories, including employees who “travel
from point to point, who are outstationed, or whose primary duties
involve work outside any of the employer’s regular employment
site.” Id.
The court’s contrast between sole and joint employers (a
convenience store chain and a temporary placement agency) as an
example resulting arbitrary differences in treatment is hardly
persuasive. Ct. Op. at 20; but see id. at 28. The court contends
that these two employers would be treated differently even though
neither has abundant replacements nearby. Unlike the court, I find
this distinction favors the validity of the regulation. Basing
FMLA eligibility on primary employers prevents confusion and
provides certainty, because a temporary placement employee’s
coverage could vary daily were he placed in different convenience
stores on a rotating basis. Further, contrary to the court’s
assertion, the ability of a convenience store and a placement
agency to find abundant nearby replacements probably is not
identical, after all, the placement agency specializes in hiring and
placing employees within the area.
Though the regulation might be more precise were we
crafting it, that is not our function. It is a permissible exercise of
agency rulemaking. I respectfully dissent.
App. B - I
APPENDIX B
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 00-K-908
NANCY E. HARBERT,
Plaintiff,
v.
HEALTHCARE SERVICES GROUP, INC.,
Defendant.
FINDINGS OF FACT, CONCLUSIONS OF LAW AND
: ORDER
KANE, J.
This is an action brought pursuant to the Family Medical
Leave Act of 1993 (FMLA), 29 U.S.C. § 2601 et seq. Jurisdiction
is uncontested and exists pursuant to 28 U.S.C. Section 1331 and
29 U.S.C. §2617 (a)(2). Trial to the court was held on October 16
and 17, 2002. At the request of the parties, post-trial briefs and
proposed findings of fact and conclusions of law were tendered.
The following constitutes my findings of fact, conclusions of law
and order for entry of judgment. I am guided in my conclusions
regarding joint employment by my previous written decision in
this case, published as Harbert v. Healthcare Servs. Group, Inc.,
173 F. Supp.2d 1101 (D. Colo. 2001), and related bench rulings
denying Defendants’ Motion for Reconsideration.
Nancy E. Harbert, an employee of Healthcare Services
Group, Inc. (“Healthcare”), was born on February 12, 1943. Mrs.
Harbert was denied medical leave under the FMLA on the
App. B - 2
assertion that she was not eligible. I denied a motion for summary
judgment on this issue because of factual disputes.
Under the FMLA only “eligible employees” are entitled to
the benefits of the FMLA. One of the eligibility requirements is
that an individual be employed at a worksite at which the
employer keeps at least 50 employees within a radius of 75 miles.
Mrs. Harbert worked at the Sunset manor convalescent and
nursing facility at Brush, Colorado. She admits that Healthcare
did not employ 50 or more employees within the required radius.
Eligibility, however, is based on her assertions that under the
regulations issued by the United States Department of Labor, she
was jointly employed by both Healthcare and Sunset Manor; that
Healthcare was her primary employer; and her official “worksite”
per the regulation was Healthcare’s Regional Office located in
Golden, Colorado. It is undisputed that Healthcare employs more
than 50 people within a 75 mile radius of its Golden office.
Therefore, if the regulation applies and if Mrs. Harbert was jointly
employed as stated, she was indeed eligible for the FMLA leave
requested by her and denied by Healthcare.
The regulations of the United States Department of Labor
provide that when an employee performs work which
simultaneously benefits two or more employers, a joint
employment relationship will be considered to exist in such
situations as:
(1) Where there is an arrangement between employers
to share an employee’s services or to interchange employees;
(2) Where on employer acts directly or indirectly in
the interest of the other employer in relations to the employee; or,
(3) Where the employers are not completely
disassociated with respect to the employee’s employment and may
be deemed to share control of the employee, directly or indirectly,
because one employer controls, is controlled by, or is under
common control with the other employer.
The third regulatory provision is not germane to this case.
Healthcare, moreover, maintains none is germane because Mrs.
App. B -3
Harbert was incapable of returning to work by the expiration of
the twelve weeks permitted under the FMLA in any event. Mrs.
Harbert contends she was indeed eligible because Healthcare and
Sunset Manor shared control of her employment, both directly and
indirectly, and she was under their common control and she was
able to return to work. She also notes she was terminated before
the twelve week FMLA leave period ran, rendering Healthcare’s
assertion that she was incapable of returning to work at the end of
that period speculative and unpersuasive.
Commendably, the parties made 42 stipulations which are
set forth in the pre-trial order dated August 5, 2002 and are
incorporated herein by this reference. As succinctly as possible,
the following chronology sets forth the essential facts of Mrs.
Harbert’s employment.
On November 4, 1994, Mrs. Harbert was employed by
Sunset Manor as the Housekeeper Supervisor. In January 1995,
her responsibilities were increased to include the position of
Laundry Department Supervisor. On November 25, 1997, Sunset
Manor entered into a service agreement with Healthcare by which
the latter would provide housekeeping and laundry services to the
former. In the transition, Mrs. Harbert’s employment with Sunset
Manor was transferred to Healthcare. Her duties remained
essentially the same, but she was required to report to a district
manager at Healthcare’s regional office in Golden, Colorado.
In addition to managerial and supervisory responsibilities,
Mrs. Harbert performed many of the physical tasks involved in
both housekeeping and laundry. She operated a number of heavy
machines and worked an average of 50-55 hours per week,
Monday through Friday. She was paid on the basis of a 40 hour
week and did not receive overtime pay.
On November 6, 1998, Mrs. Harbert was involved in a
non-work related automobile accident and suffered an injury to her
hip. She attempted to return to work on November 16, 1998, but
was unable to do so because of intense pain. On November 23,
1998 she called her district manager at Healthcare and asked for
permission to take immediate leave of absence. The district
manager deferred, promising to look into the situation.
App. B - 4
On November 30, Mrs. Harbert’s physician, Dr. Clise,
examined her and gave her a note stating that because of her injury
she should not stand for more that two hours per day. Mrs.
Harbert called her district manager and advised him of the
restriction and asked about her earlier request for leave. The
district manager advised that as soon as she arranged for someone
to replace her, she could go on leave. Oa December 7, Dr. Cline
executed Healthcare’s form for certification pursuant to the FMLA
and Mrs. Harbert gave training instructions to a replacement she
had found. The next day she began a 30-day medical leave.
On January 7, 1999, Healthcare received Mrs. Harbert’s
request for leave pursuant to the FMLA and on January 14 she
received a response advising her that she did not qualify for
FMLA, but granting her an additional 30-day leave. On February
10, 1999 Dr. Cline released Mrs. Harbert to work half-time and on
February 20, Healthcare terminated Mrs. Harbert for failing to
comply with the requirements of her 30-day leave. On March 9,
1999 Dr. Cline gave Mrs. Harbert a note stating she could return to
full-time work without restriction. Having received her
termination letter of February 20, Mrs. Harbert did not deliver or
advise Healthcare of the note from Dr. Cline or her ability to
return to work without restriction.
At the time of her termination, Mrs. Harbert was paid
$330.00 per week plus health, life, and dental insurance benefits
worth an additional $69.90 per week. Following her termination,
Mrs. Harbert sought other employment. In August 2001, she took
the first job she was offered by Conoco. This job was at less pay
than she had received from Healthcare. She was still employed by
Conoco at the time of this trial. She has not missed a day of work
at Conoco and her duties are at least and frequently more
strenuous and physically demanding than those she performed
while employed by Healthcare.
After signing the service agreement with Sunset Manor,
Healthcare was entirely responsible for setting Mrs. Harbert’s rate
of pay, salary and benefits and had ultimate authority for hiring,
transferring and terminating her. Mrs. Harbert was required to
submit a variety of monthly reports to her district manager. The
EERE OSES ie Ae AB ER ib A a
LI. SO FOL I IPE NERS iS 63, Urbane! SAS a bP STEN DAs
App. B - 5
disirict manager visited Sunset Manor once or twice each month
and as his supervisor, the regional manager, visited the location an
estimated three to six times during the entire time the agreement
was in effect. Mrs. Harbert attended some of the monthly account
manager meetings held by her district manager at the Golden
offices.
Mrs. Harbert’s supervisors at Healthcare were aware of,
and directed her to comply with, the supervisory control and
authority exercised over her by Sunset Manor’s administrator,
Kathy Mecklenburg. Healthcare approved of Ms. Mecklenburg’s
requiring Mrs. Harbert to attend Sunset Manor department head
meetings. The regional manager testified that Healthcare
preferred “that their account managers meet the expectations of
the administrator of the facility.” Both the district manager and
the regional manager were aware that Mrs. Harbert regularly
ordered supplies for and at the request of Sunset Manor that were
outside stated obligations of the service agreement and neither
objected.
The monthly report forms Mrs. Harbert used to report to
the district manager did not include a place to describe
assignments that might have been performed at the request of
Sunset Manor but that were not included in the services
agreement. Moreover, neither the district manager nor the
regional manager ever inquired of Mrs. Harbert of the Sunset
Manor administrator about such assignments. Thus, the district
manager and the regional manager were unaware that Kathy
Mecklenburg required Mrs. Harbert to clean facilities not included
in the agreement, or other ultra-contractual assignments to drive
the Sunset Manor shuttle van on a regular basis to Denver and
back to Brush, to participate in the pick up of trash along an
interstate highway along with Sunset Manor employees, to sell
tickets for Sunset Manor and attend fund raising events or train,
schedule and supervise Sunset Manor employees who were not
subject to the Healthcare service agreement.
Both before and after Mrs. Harbert’s nominal employer
was changed from Sunset manor to Healthcare, Kathy
Mecklenburg exercised direct, immediate and hands-on
supervisory control over her. This control included setting Mrs.
App. B - 6
Harbert’s work schedule and hours, directing the manner of
performance of her duties and the daily assignments of those
working under Mrs. Harbert and requiring her to work nights and
weekends.
Healthcare and Sunset Manor are entirely separate
organizations. Neither has an ownership in the other nor have
there ever been common officers or directors between the two.
Sometime during the first two weeks of February, 1999, however,
Kathy Mecklenburg told the district manager that she was very
pleased with the account manager whim Mrs. Harbert had found to
replace her during her leave and that she, Kathy Mecklenburg,
would prefer that Mrs. Harbert not return to Sunset Manor.
Healthcare denies Meckleburg’s preference had anything
to do with Mrs. Harbert’s termination and asserts that such a
finding would be pure speculation. I need not make such a
finding, but it would not be entirely speculative. Rather, it would
be fair inference drawn from the proximity of the statement to the
decision to terminate to conclude that, when coupled with her
supervisory contacts with Mrs. MHarbert, Mecklenburg’s
declaration influenced the decision.
I conclude Mrs. Harbert performed substantial services for
both Healthcare and Sunset Manor. Mrs. Harbert was primarily
employed by Healthcare to supervise and perform housekeeping
and laundry services. At the direction and under the supervision
and discipline of Sunset Manor’s administrator, Mrs. Harbert was
required to perform additional duties beyond those specified in the
service agreement.
Some of these additional duties were known to Healthcare
supervisors of Mrs. Harbert, and others, which were unknown to
those supervisors were plainly recognizable and discoverable by
even the slightest observation or enquiry. Moreover, Sunset
Manor provided daily supervision, work scheduling and
employment evaluation for Healthcare.
In determining the existence of a joint employer
relationship under FMLA, I must use the economic realities test
and focus on the employee rather than the legal relationship
App. B - 7
between the employers. See Harbert, 173 F. Supp.2d at 1105-06.
Given the totality of Mrs. Harbert’s job circumstances, it is
obvious that she could not work at Sunset Manor without the
approval, direct supervision and coordinated control of that
institution. }
Healthcare argues that it had no knowledge of other
activities that Mecklenburg directed Mrs. Harbert to perform.
First, Mrs. Harbert had such knowledge and she was an employee
of Healthcare. Second, Healthcare supervisors made site visits to
Sunset Manor and such information was readily available to them.
That they did not see what was plainly visible and failed to inquire
is not a defense.
The predictable issue for appeal in this case is my
previous ruling that the Department of Labor’s regulation 29
C.F.R. Section 825.111(a)(3) is valid and enforceable. In my
memorandum opinion, I held that the regulation providing that
when a joint employment relationship exists, the employer’s
worksite is the primary employer’s office from which the
employee is assigned or reports to, is based on a permissible
construction of the word “worksite” and therefore does not
contradict the express terms of the FMLA. 173 F. Supp.2d at
1106. I continue to adhere to that ruling.
The decision by Healthcare that Mrs. Harbert was not
covered by the FMLA was not made at the regional or district
level of the company, but by the Benefits Administrator at the
company’s headquarters. That conclusion was based on the
Benefits Administrator’s determination that Mrs. Harbert was not
employed at a worksite at which Healthcare employee 50 or more
employees within a 75 mile radius. There is no evidence or
argument to suggest that the Benefits Administrator even
considered the subject regulation.
Mrs. Harbert is entitled to liquidated damages under 29
U.S.C. § 216(b). Defendants invoke the good faith defense at 29
U.S.C. § 260 to object that Mrs. Harbert should not be awarded
liquidated damages because Healthcare denied coverage of the
FMLA in good faith. The contention, however, is rejected.
Section 260 provides that liquidated damages are recoverable
App. B -8
unless the employer shows that it acted in good faith and had
reasonable grounds for believing that it did not violate the Act.
Generally, Renfro v. City of Emporia, 948 F.2d i529, 1540 (10"
Cir.1991). There can be no reasonable grounds for believing
Healthcare did not violate the Act when it paid no attention at all
to the regulation. The second half of the equation is missing. A
post hoc challenge to the validity of the regulation will not obviate
consideration of it at the time benefits are denied.
It is therefore ORDERED that the plaintiff shall have
judgment as follows: $399.00 dollars per week from the date of
termination, February 16, 1999 to the date of this order, March 12,
2003 or $84,778.80 less the amount Mrs. Harbert has earned
during the same period of time through other employment together
with interest on the net amount at the legal rate, liquidated
damages in the same amount and front pay in an amount equal to
$399.90 per week from March 12, 2003 to February 12, 2008, her
65" birthday and the day she admittedly intended to retire or
$102,374.40, reduced by the amount of compensation she would
earn from Conoco during that time, calculated at her present rate
of earnings per week plus any guaranteed raises or cost of living
increases. I am specifically not ordering reinstatement rather than
front pay because it would not be practicable under the
circumstances of this case, the fact that Mrs. Harbert was replaced
and the position she held involved personal concord which is not
realistically obtainable.
In addition, Mrs. Harbert is awarded the cost of her
reasonable attorney fees herein expended, expert witness fees, and
other court costs pursuant to 29 U.S.C. § 2617 (a)(3). Counsel for
both parties are hereby ORDERED to meet and confer withing 20
days from the date hereof to determine the precise amounts to be
set forth in the judgment in accordance with the above stated
findings and conclusions. If counsel can agree they shall prepare a
judgment in accordance herewith. If counsel are unable to agree,
they shall notify the court within the following ten days and the
matters not agreed upon will be set for hearing. If attorney fees
are not agreed upon, each party shall present expert testimony and
the court will take evidence on determining a reasonable amount
therefore. The cost of such hearing, including expert witness fess
CLT a RS Peedi CREB oer dai,
App. B - 9
shall be borne by the party whose amount differs most from the
amount fixed by the court.
Dated this 13" day of March, 2003, at Denver, Colorado.
John L. Kane
U.S. Senior District Court Judge
4
|
App. C - 1
APPENDIX C
UNITED STATES COURT OF APPEALS
FOR THE TENTH CIRCUIT
NANCY E. HARBERT,
Plaintiff-Appellee,
v. No. 03-1156
HEALTHCARE SERVICES GROUP,
INC., a Pennsylvania Corporation,
Defendant — Appellant,
ELAINE CHAO, Secretary oi Labor,
Amicus Curiae.
ORDER
Filed March 2, 2005
Before EBEL, KELLY, and McCONNELL, Circuit Judges.
Appellee’s petition for rehearing, is denied. Judge Kelly
has dissented.
The petition for rehearing en banc was transmitted to all of
the judges of the court who are in reguliar active service. As no
member of the panel and no judge in reg:ular active service on the
App. C -2
court requested that the court be polled, that petition is also
denied.
Entered for the Court
PATRICK FISHER, Clerk of Court
(signed)
By:
Deputy Clerk
App. D - I
APPENDIX D
Joint Employment Under FMLA, 29 C.F.R. § 825.106.
§ 825.106 How is “joint employment” treated under
FMLA?
(a) Where two or more businesses exercise some
control over the work or working conditions of the employee, the
businesses may be joint employers under FMLA. Joint employers
may be separate and distinct entities with separate owners,
managers and facilities. Where the employee performs work
which simultaneously benefits two or more employers, or works
for two or more employers at different times during the workweek,
a joint employment relationship generally will be considered to
exist in situations such as:
(1) Where there is an arrangement between
employers to share an employee’s services or to
interchange employees;
(2) Where one employer acts directly or
indirectly in the interest of the other employer in relation
to the employee; or
(3) Where the employers are not completely
disassociated with respect to the employee’s employment
and may be deemed to share control of the employee,
directly or indirectly, because one employer controls, is
controlled by, or is under common control with the other
employer.
(b) A determination of whether or not a joint
employment relationship exists is not determined by the
application of any single criterion, but rather the entire relationship
is to be viewed in its totality. For example, joint employment will
ordinarily be found to exist when a temporary or leasing agency
supplies employees to a second employer.
(c) In joint employment relationships, only the
primary employer is responsible for giving required notices to its
a ee ee eee ee Te +o ik
App. D - 2
employees, providing FMLA leave, and maintenance of health
benefits. Factors considered in determining which is the
“primary” employer include authority/responsibility to hire and
fire, assign/place the employee, make payroll, and provide
employment benefits. For employees of temporary help or leasing
agencies, for example, the placement agency most commonly
would be the primary employer.
(d) Employees jointly employed by two employers
must be counted by both employers, whether or not maintained on
one of the employer’s payroll, in determining employer coverage
and employee eligibility. For example, an employer who jointly
employs 15 workers from a leasing or temporary help agency and
40 permanent workers is covered by FMLA. An employee on
leave who is working for a secondary employer is considered
employed by the secondary employer, and must be counted for
coverage and eligibility purposes, as long as the employer has a
reasonable expectation that that employee will return to
employment with that employer.
(e) Job restoration is the primary responsibility of the
primary employer. The second employer is responsible for
accepting the employee returning from FMLA leave in place of
the replacement employee if the secondary employer continues to
utilize an employee from the temporary or leasing agency, and the
agency chooses to place the employee with the secondary
employer. A secondary employer is also responsible for
compliance with the prohibited acts provisions with respect to its
temporary/leased employees, whether or not the secondary
employer is covered by FMLA (see § 825.220(a)). The prohibited
acts include prohibitions against interfering with an employee’s
attempt to exercise rights under the Act, or discharging or
discriminating against an employee for Opposing a practice which
is unlawful under FMLA. A covered secondary employer will be
responsible for compliance with all the provisions of the FMLA
with respect to its regular, permanent workforce.
App. E-1
APPENDIX E
FMLA Eligibility Under 50/75 Provision, 29 C.F.R. § 825.111.
§825.111 In determining if an employee
“eligible” under FMLA, how is the determination made
whether the employer employs 50 employees within 75 miles of
the worksite where the employee needing leave is employed?
(a) Generally, a worksite can refer to either a single
location or a group of contiguous locations. Structures which
form a campus or industrial park, or separate facilities in
proximity with one another, may be considered a single site of
employment. On the other hand, there may be several single sites
of employment within a single building, such as an office building,
if separate employers conduct activities within the building. For
example, an office building with 50 different businesses as tenants
will contain 50 sites of employment. The offices of each employer
will be considered separate sites of employment for purposes of
FMLA. An employee’s worksite under FMLA will ordinarily be
the site the employee reports to or, if none, from which the
employee's work is assigned.
(1) Separate buildings or areas which are not
directly connected or in immediate proximity are a single
worksite if they are in reasonable geographic proximity,
are used for the same purpose, and share the same staff
and equipment. For example, if an employer manages a
number of warehouses in a metropolitan area but regularly
shifts or rotates the same employees from one building to
another, the multiple warehouses would be a single
worksite.
(2) For employees with no fixed worksite,
e.g., Construction workers, transportation workers (e.g.,
truck drivers, seamen, pilots), salespersons, etc., the
“worksite” is the site to which they are assigned as their
home base, from which their work is assigned, or to which
they report. For example, if a construction company
headquartered in New Jersey opened a construction site in
Ohio, and set up a mobile trailer on the construction site as
App. E -2
the company’s on-site office, the construction site in Ohio
would be the worksite for any employees hired locally
who report to the mobile trailer/company office daily for
work assignments, etc. If that construction company also
sent personnel such as job superintendents, foremen,
engineers, an office manager, etc., from New Jersey to the
job site in Ohio, those workers sent fro New Jersey
continue to have the headquarters in New Jersey as their
“worksite.” The workers who have New Jersey as their
worksite would not be counted in determining eligibility
of employees whose home base is the Ohio worksite, but
would be counted in determining eligibility of employees
whose home base is New Jersey. For transportation
employees, their worksite is the terminal to which they are
assigned, report for work, depart, and return after
completion of a work assignment. For example, an airline
pilot may work for an airline with headquarters in New
York, but the pilot regularly reports for duty and
originates or begins flights from the company’s facilities
located in an airport in Chicago and returns to Chicago at
the completion of one or more flights to go off duty. The
pilot’s worksite is the facility in Chicago. An employee’s
personal residence is not a worksite in the case of
employees such as salespersons who travel a sales
territory and who generally leave to work and return from
work to their personal residence, or employees who work
at home, as under the new concept of flexiplace. Rather,
their worksite is the office to which the report and fro
which assignments are made.
(3) For purposes of determining _ that
employee’s eligibility, when an employee is jointly
employed by two or more employers (see § 825.106), the
employee’s worksite is the primary employer’s office
from which the employee is assigned or reports. The
employee is also counted by the secondary employer to
determine eligibility for the secondary employer’s full-
time or permanent employees.
(b) The 75-mile distance is measured by surface
miles, using surface transportation over public streets, roads,
App. E - 3
highways and waterways, by the shortest route from the facility
where the eligible employee needing leave is employed. Absent
available surface transportation between worksites, the distance is
measured by using the most frequently utilized mode of
transportation (e.g., airline miles).
(c) The determination of how many employees are
employed within 75 miles of the worksite of an employee is based
on the number of employees maintained on the payroll.
Employees of educational institutions who are employed
permanently or who are under contract are “maintained on the
payroll” during any portion of the year when school is not in
session. See § 825.105(c).
App. F - 1
APPENDIX F
Warn Act Regulation Defining “Single Site of Employment,”
20 C.F.R. § 639.3(i)
(i) Single site of employment. (1) A single site of
employment can refer to either a single location or a group of
contiguous locations. Groups of structures which form a campus
or industrial park, or separate facilities across the street from one
another, may be considered a single site of employment.
(2) There may be several single sites of employment
within a single building, such as an office building, if separate
employers conduct activities within such a building. For example,
an office building housing 50 different businesses will contain 50
single sites of employment. The offices of each employer will be
its single site of employment.
(3) Separate buildings or areas which are not directly
connected or in immediate proximity may be considered a single
site of employment if they are in reasonable geographic proximity,
used for the same purpose, and share the same staff and
equipment. An example is an employer who manages a number of
warehouses in an area but who regularly shifts or rotates the same
employees from one building to another.
(4) Non-contiguous sites in the same geographic area
which do not share the same staff or operational purpose should
not be considered a single site. For example, assembly plants
which are located on opposite sides of a town and which are
managed by a single employer are separate sites if they employ
different workers.
(5) Contiguous buildings owned by the same
employer which have separate management, produce different
products, and have separate workforces are considered separate
single sites of employment.
App. F - 2
(6) For workers whose primary duties require travel
from point to point, who are outstationed, or whose primary duties
involve work outside any of the employer’s regular employment
sites (e.g., railroad workers, bus drivers, salespersons), the single
site of employment to which they are assigned as their home base,
from which their work is assigned, or to which they report will be
the single site in which they are covered for WARN purposes.
(7) Foreign sites of employment are not covered
under WARN. U.S. workers at such sites are counted to determine
whether an employer is covered as an employer under § 639.3(a).
(8) The term “single site of employment” may also
apply to truly unusual organizational situations where the above
criteria do not reasonably apply. The application of this definition
with the intent to evade the purpose of the Act to provide notice is
not acceptable.
App. G - 1
APPENDIX G
Senate Report No. 103-3, 103d Cong., 1" Sess., at 21-23,
Reprinted in 1993 U.S.C.C.A.N. 3, 23-25.
P.L. 103-3, FAMILY AND MEDICAL LEAVE ACT OF 1993
SENATE REPORT NO. 103-3
January 27, 1993
IV. COMMITTEE VIEWS
DEFINITIONS
The term “worksite” is intended to be construed in the
same manner as the term “single site of employment” under the
Worker Adjustment and Retraining Notification Act (“WARN”),
29 U.S.C. 2101(a)(3)(B), and regulations under that Act (20 CFR
Part 639). Where employees have no fixed worksite, as is the case
for many construction workers, transportation workers, and
Salespersons, such employees’ “worksite” should be construed to
mean the single site of employment to which they are assigned as
their home base, from which their work is assigned, or to which
they report.
App. H - I
APPENDIX H
House of Representatives Report No. 103-8(1), at 33-35 (1993)
P.L. 103-3, FAMILY AND MEDICAL LEAVE ACT OF 1993
HOUSE REPORT NO. 103-8(D)
February 2, 1993
EXPLANATION OF THE BILL AND SECTION ANALYSIS
Definitions
The term “worksite” is intended to be construed in the
same manner as the term “single site of employment” under
section 2(a)(3)(B) the Worker Adjustment and Retraining
Notification Act (“WARN”), 29 U.S.C. 2101(a)(3)(B), and
regulations under that Act (20 CFR Part 639). Where employees
have no fixed worksite, as is the case for many construction
workers, transportation workers, and _ salespersons, such
employees’ “worksite” should be construed to mean the single site
of employment to which they are assigned as their home base,
from which their work is assigned, or to which they report.
NOt ee a Oe
ee aE ARG ORD
Petitioner,
HEALTHCARE SERVICES GROUP, INC.,
Respondent.
¢
On Petition For A Writ Of Certiorari
To The United States Court Of Appeals
For The Tenth Circuit
-¢
RESPONDENT'S BRIEF IN OPPOSITION
*
JEFFREY L. BRAFF
Cozen O’CONNOR
1900 Market Street
Philadelphia, PA 19103
(215) 665-2048
Attorneys for Respondent
COCKLE LAW BRIEF PRINTING CO. (800) 228-6964
OR CALL COLLECT (403) 342-2831
COUNTERSTATEMENT OF
QUESTION PRESENTED
Is the Department of Labor’s regulation defining
“worksite,” 29 C.F.R. § 825.111(a)(3), a valid and enforce-
able implementation of the FMLA as applied to a joint
employee who has a fixed place of work?
ii
CORPORATE DISCLOSURE STATEMENT
There is no parent corporation or publicly held corpo-
ration that owns 10% or more of the stock of Healthcare
Services Group, Inc.
TABLE OF CONTENTS
Page
COUNTERSTATEMENT OF QUESTION PRESENTED... i
CORPORATE DISCLOSURE STATEMENT................. ii
PRR ADE COPE RTRIN 00 iiss. co seucs concecssiidbcuisosddscaodsvnedeasos ii
TABLE OF AUTHORIUIGSG iioiicsssciccetscseedscvisiscsscosticeisss iv
COUNTERSTATEMENT OF THE CASE .................... 1
REASONS FOR DENYING THE WRIT....................00 3
I. The Dissent Is Premised Upon ACritical Flaw... 4
II. The Majoritys Opinion Will Not Lead To Greater
Uncertainty Or Illogical Or Inconsistent Results... 8
GONCLIGIIOIN io sss seni dissisccpecseiteactivbntaisiobunasiecsitbibests 10
iv
TABLE OF AUTHORITIES
Page
CASE
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COUNTERSTATEMENT OF THE CASE
Petitioner’s Statement of the Case is confined largely
to setting forth the nature of the case and the proceedings
below. Healthcare does not take issue with that recitation,
except for the representation at page 6 that Judge Kelly
dissented in the denial of Harbert’s Petition for Rehearing
En Banc. As stated in the March 2, 2005 Order of the
Tenth Circuit, that Petition was denied because “no
member of the panel and no judge in regular active service
on the court requested that the court be polled.” App. C.
However, Petitioner’s Statement of the Case fails to
include numerous facts that are material to the considera-
tion of the question presented. Those facts are set forth
herein.
Healthcare provides housekeeping and laundry
services to long-term care institutions on a contract basis.
It employs approximately 17,000 employees and has
contracts with about 1,300 long-term care facilities in 42
states. Organizationally, Healthcare is divided into re-
gions, which are composed of multiple districts. Each
distri«. is made up of individual accounts, which are the
long-term care institutions. App. A-2, 3.
Healthcare’s Account Managers work at the account to
which they are assigned and report to District Managers.
District Managers report to Regional Managers. In Colorado,
all District Managers and the Regional Manager had their
offices at the same location in Golden, Colorado. App. A-3.
Sunset Manor is a convalescent/nursing facility
located in Brush, Colorado, which is more than 75 miles
from Golden. App. A-3. During all relevant times, Health-
care employed fewer than 50 employees within a 75 mile
2
radius of Sunset Manor. App. B-2. Healthcare and Sunset
Manor are entirely separate organizations. Neither has an
ownership interest in the other, nor have there ever been
common officers or directors between the two. App. B-6.
In 1994, Harbert was hired by Sunset Manor as the
Housekeeping Supervisor, and in 1995 her responsibilities
were expanded to include the position of Laundry Depart-
ment Supervisor. In 1997, Healthcare entered into an
agreement to provide housekeeping and laundry services
to Sunset Manor. Harbert’s employment with Sunset
Manor was transferred to Healthcare, and Harbert be-
came the Account Manager for Healthcare’s Sunset Manor
account. Healthcare assumed all responsibility for retain-
ing, transferring, or firing Harbert, and also paid her
salary and provided her benefits. Harbert’s duties, how-
ever, remained essentially the same as when she was
employed directly by Sunset Manor. App. A-3.
Harbert worked an average of 50 to 55 hours per week
out of an office at Sunset Manor. App. B-3. When she
reported to her District Manager, she reported to him at
Healthcare’s Regional Office in Golden. Such reports were
almost always by telephone or through the submission of
written reports; Harbert went to the Golden office only for an
occasional District meeting of Account Managers. App. A-3.
Sunset Manor’s Administrator exercised direct, immedi-
ate, and hands-on supervisory control over Harbert when
Harbert was employed by Sunset Manor, and this control did
not change after Harbert became an employee of Healthcare.
The Administrator’s control included setting Harbert’s work
schedule and hours, directing the manner of performance of
her duties and the daily assignments of those working
3
under Harbert, and requiring Harbert to work nights and
weekends. App. B-5, 6.
Harbert believed that she had a long-term job at
Sunset Manor and planned to work there until her retire-
ment at age 65. App. A-3.
rs
Vv
REASONS FOR DENYING THE WRIT
As is clear from Rule 10 of this Court’s Rules, a
petition for a writ of certiorari will be granted only for truly
compelling reasons. The validity of the regulation at issue is
a matter of first impression outside of the Tenth Circuit.
Indeed, not only is there no conflict among the Circuit Courts
of Appeal, but the only reported District Court decision on
this issue is that of the trial court in this case.
Furthermore, it is undisputed that Chevron USA, Inc.
v. Natural Resources Defense Council, Inc., 467 U.S. 837
(1984) sets forth the analysis and framework against
which the regulation at issue must be measured, and that
the Tenth Circuit did just that. In no way does the major-
itys opinion constitute “new law” with respect to the
analysis used to determine whether an agency’s construc-
tion of a statute which it administers is a permissible
construction. And Rule 10 states specifically that a peti-
tion is “rarely granted when the asserted error consists of
... the misapplication of a properly stated rule of law.”
The arguments advanced by the Petitioner in support
of the writ fall far short of justifying the exercise of this
Court’s supervisory power. They will be addressed below.
Before doing so, however, Healthcare wishes to make two
observations.
4
First, none of the parties to this litigation, nor the
majority or dissenting opinions, contest the “fixed” nature
of Harbert’s workplace, or the following facts:
¢ From 1994 until February of 1998, Harbert
worked out of an office at Sunset Manor in
Brush, Colorado.
¢ When Harbert reported to her Healthcare
District Manager, she reported to him at
Healthcare’s Regional Office in Golden, Colo-
rado. But such reports were almost always
by telephone or through the submission of
written reports; Harbert went to the Golden
office only for an occasional District meeting
of Healthcare Account Managers.
¢ Sunset Manor’s Administrator exercised di-
rect, hands-on supervision and control over
Harbert when Harbert was employed by
Sunset Manor, and this did not change after
Harbert became an employee of Healthcare.
¢ Harbert believed that she had a long-term
job at Sunset Manor and planned to work
there until her retirement at age 65.
Second, with the several eligibility restrictions con-
tained in the FMLA, the United States Senate estimated
that only 40% of all U.S. employees would be covered by
the Act (S. Rep. No. 102-68, at 24 (1991)), while the House
put the figure at 50% (H.R. Rep. No. 102-135(1, at 37
(1991)).
I. The Dissent Is Premised Upon A Critical Flaw.
Much of the Petitioner’s argument touts the wisdom of
Judge Kelly’s dissent. That dissent appears to be premised
5
upon the notion that there are “many variations in joint
employment relationships,” and that the Secretary's
definition of “worksite” reflects Congress’ instructions to
take such variations into account.
The legislative history reflects that the Senate
and House obviously were aware of variations in
joint employment relationships and directed the
Secretary to construe “worksite” in the same
manner as the term “single site of employment”
under the WARN Act. S. R. Doc. No. 103-3, at 25°
(1993); see also H. R. Doc. No. 103-8, pt. 1, at 35
(1993).
App. A-24.
The legislative history cited by the dissent is the
passage from the Senate and House Committee Reports
reproduced in the majority’s opinion at App. A-16, 17 and
in Appendices G and H.
The term “worksite” is intended to be construed
in the same manner as the term “single site of
employment” under the Worker Adjustment and
Retraining Notification Act (“WARN”), 29 U.S.C.
2101(aX(3)(B), and regulations under that Act (20
C.F.R. Part 639). Where employees have no fixed
worksite, as is the case for many construction
workers, transportation workers, and salesper-
sons, such employees’ “worksite” should be con-
strued to mean the single site of employment to
which they are assigned as their home base, from
which their work is assigned, or to which they
report.
* The reference to page 25 must be a typographical error. Page 23
is the correct citation.
6
This passage makes no mention whatsoever of joint
employment, nor is joint employment mentioned in the
“single site of employment” WARN Act regulations re-
ferred to in the passage.
Rather than accept this passage as demonstrating
Congress’ intention to distinguish between employees who
have a fixed place of work and those who do not, as the
majority has done, the dissent appears to equate the lack
of a fixed workplace with joint employment. However, such
a proposition does not withstand scrutiny. One need look
no further than the Secretary’s own definition of “joint
employment” to see that tie absence of a fixed workplace
is not a prerequisite for being jointly employed:
Where two or more businesses exercise some con-
trol over the work or working conditions of the
employee, the businesses may be joint employers
under FMLA. Joint employers may be separate
and distinct entities with separate owners, man-
agers and facilities. Where the employee per-
forms-work which simultaneously benefits two or
more employers, or works for two or more em-
ployers at different times during the workweek, a
joint employment relationship generally will be
considered to exist in situations such as:
(1) Where there is an arrangement between
employers to share an employee’s services or to
interchange employees;
(2) Where one employer acts directly or in-
directly in the interest of the other employer in
relation to the employee; or,
(3) Where the employers are not completely
disassociated with respect to the employee’s em-
ployment and may be deemed to share control of
7
the employee, directly or indirectly, because one
employer controls, is controlled by, or is under
common control with the other employer.
29 C.F.R. § 825.106(a) (emphasis added). App. D-1.
This is not to say, however, that an employee without
a fixed worksite cannot be jointly employed. Indeed, the
regulations use temporary or leasing agencies that supply
employees to a second employer as an example (the only
example) of a situation in which joint employment is likely
to exist. 29 C.F.R. § 825.106(b). Employees who work for
such agencies generally do not have a fixed worksite; they
usually float from location to location. However, it should
be obvious that not every employee who is deemed to be
jointly employed also has no fixed worksite. Harbert is a
perfect example of this.
To summarize, it simply is not accurate to state that,
in passing the FMLA, Congress was aware of variations in
joint employment relationships and intended the Secre-
tary to take those variations into account in promulgating
regulations defining “worksite.”
* There is one other passage in the dissent which is not accurate
and merits specific attention. At App. A-24, the dissent states:
Basing FMLA eligibility on primary employers prevents
confusion and provides certainty, because a temporary
placement employee’s coverage could vary daily were he
placed in different convenience stores on a rotating basis.
First, under the majority’s decision, the eligibility of an individual
who works at a fixed workplace, but who is jointly employed, is still
dependent upon the primary employer, i.e., whether the primary
employer employs 50 or more employees within 75 miles of the work-
place of the individual in question. See 29 C.F.R. § 825.106(e) which
makes it clear that job restoration is the responsibility of the primary
employer.
(Continued on following page)
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.