# Opposition Brief — Pierce v. Reich

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 1995
- **Citation:** 516 U.S. 807

## Text

WILLIAM G. PIERCE, PETITIONER
v. 3

ROBERT B. REICH,
SECRETARY OF LABOR

ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

BRIEF FOR THE RESPONDENT IN OPPOSITION

Drew S. Days, III
Department of Justice
Washington, D.C. 20530
(202) 514-2217
THOMAS S. WILLIAMSON, JR.
Solicitor of Labor
ALLEN H. FELDMAN
STEVEN J. MANDEL
MARK 8S. FLYNN
Senior Appellate Attorney
Department of Labor
Washington, D.C. 20210

Atte _-—— ——-—

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QUESTIONS PRESENTED

1. Whether petitioner’s employees were properly
held to be non-“professionals” and hence subject to the
overtime-compensation requirements of Section 7(a)(1)
of the Fair Labor Standards Act of 1938 (FLSA), 29
U.S.C. 207(a)(1).

2. Whether regulations of the Department of Labor
that employ different tests for determining whether
an employee is a “professional” exempted from the
FLSA’s overtime-compensation requirements, depend-
ing on whether the employer is a public or private
entity, comport with the equal protection component of
the Due Process Clause of the Fifth Amendment.

3. Whether the Portal-to-Portal Act of 1947, 29
U.S.C. 251 et seq., provided a defense to petitioner
against liability under the FLSA for not paying over-
time compensation.

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A...

TABLE OF CONTENTS

Opinions below
Jurisdiction

TABLE OF AUTHORITIES
Cases:

Abshire v. County of Kern, 908 F.2d 483 (9th Cir.
1990), cert. denied, 498 U.S. 1068 (1991)

Atlanta Professional Firefighters Union v. City of
Atlanta, 920 F.2d 800 (11th Cir. 1991)

Batterton v. Francis, 432 U.S. 416 (1977)

Donovan vy. Carls Drug Co., 703 F.2d 650
(2d Cir. 1983)

Garcia v. San Antonio Metropolitan Transit
Authority, 469 U.S. 528 (1985)

Kinney v. District of Columbia, 994 F.2d 6
(D.C. Cir. 1993)

Klein v. Rush-Presbyterian-St. Luke’s Medical Ctr.,
990 F.2d 279 (7th Cir. 1993)

McGowan v. Maryland, 366 U.S. 420 (1961)

Michigan Ass’n of Governmental Employees v. Michigan
Dep't of Corrections, 992 F.2d 82 (6th Cir. 1993)

Mueller v. Reich, Nos. 94-3262 & 94-3263
(7th Cir. May 15, 1995)

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

Sisson v. Ruby, 497 U.S. 358 (1990)
Tony & Susan Alamo Found. v. Secretary of Labor,
471 U.S. 290 (1985)

Sonstitution, statutes, regulations and rules:
U.S. Const. Amend. V (Due Process Clause)

IV

Statutes, regulations and rules—Continued: Page
Fair Labor Standards Act of 1938, 29 U.S.C. 201 et seq.:
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Miscellaneous—Continued: Page

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In the Supreme Court of the Gnited States

OCTOBER TERM, 1995

No. 94-1823
WILLIAM G. PIERCE, PETITIONER
v.

ROBERT B. REICH,
SECRETARY OF LABOR

ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

BRIEF FOR THE RESPONDENT IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. A1-A8)
is unpublished, but the decision is noted at 45 F.3d 431
(Table). The opinions of the district court (Pet. App.
B1-B3, C1-C9) are unreported.

JURISDICTION

The judgment of the court of appeals was filed on
December 20, 1994. A petition for rehearing was

(1)

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Dee Mth. cen Mmnchads Oh 0 a i certs a eae we ee

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2

denied on February 7, 1995.' The petition for a writ of
certiorari was filed on May 5, 1995. The jurisdiction of
this Court is invoked under 28 U.S.C. 1254(1).

STATEMENT

1. Section 7(a)(1) of the Fair Labor Standards Act of
1938 (FLSA), 29 U.S.C. 207(a)(1), requires an employer
to pay each of its employees “at a rate not less than
one and one-half times the regular rate at which he is
employed” for all hours worked in excess of 40 hours a
week. Section 13(a)(1) of the Act, 29 U.S.C. 213(a)(1),
provides an exemption from the requirement of
overtime pay for “any employee employed in a bona fide
executive, administrative, or professional capacity
* * * (as such terms are defined and delimited from
time to time by regulations of the Secretary [of
Labor]).”

Regulations promulgated by the Secretary provide
that, in order to be a “bona fide * * * professional,” an
employee must both be paid on a “salary basis,” 29
C.F.R. 541.3(e), and have primarily professional duties,
29 C.F.R. 541.3(a)-(d) (defining “professional” em-
ployees). See also 29 C.F.R. 541.1 (defining “execu-
tive” employees), 541.2 (defining “administrative”
employees). Subject to several exclusions, an em-
ployee is not paid on a “salary basis,” and thus is not a
“bona fide * * * professional,” if he is paid hourly or
piecework wages rather than a salary. 29 C.F.R.

| Although petitioner filed a document denominated
“motion for rehearing en banc,” the local rules of the Sixth
Circuit provide that a suggestion of rehearing en banc will also
be treated as a petition for panel rehearing. See Local R. 14(a).
Accordingly, the period for filing a petition for a writ of
certiorari in this Court did not begin to run until the court of
appeals denied petitioner’s motion. See Sup. Ct. R. 13.1, 13.4.

541.3(e) (bona fide professional employee must be
“compensated for services on a salary * * * basis” at
no less than a specified weekly rate), 541.2(e)(1)
(administrative employee), 541.1(f) (executive
employee).”

An employee is, however, paid on a “salary basis” if
he regularly receives a predetermined amount of
compensation that “is not subject to reduction because
of variations in the quality or quantity of the work
performed.” 29 C.F.R. 541.118(a). As a general rule, a
“salary basis” employee must also receive “his full
salary for any week in which he performs any work
without regard to the number of days or hours
worked.” Ibid.’ An employer may, however, make
deductions from a salaried employee’s predetermined
compensation to reflect absences of “a day or more” for
personal reasons other than sickness or accident (29
C.F.R. 541.118(a)(2)) and to reflect absences for “a day
or more” due to sickness or disability if “made in
accordance with a bona fide plan, policy or practice of
providing compensation for loss of salary occasioned
by both sickness and disability” (29 C.F.R. 541.118(a)
(3)). But under no circumstances is an employee from
whom pay is deducted to reflect partial-day absences
paid on a “salary basis.”

The regulations further provide, in a subsection
commonly referred to as the “window of correction,”
that an employer who has improperly deducted pay

* Professional and administrative employees may also be
paid on a fee basis. See 29 C.F.R. 541.2(e)(1), 541.3(e).

% An employee need not be paid for any workweek in which
he performs no work. 29 C.F.R. 541.118(a).

* As explained, p. 10, infra, special provisions apply in the
case of public employers. 29 C.F.R. 541.5d.

from an employee to reflect partial-day absences may
be given an opportunity to repay the deducted amount
in order to restore retroactively the employee’s
professional status. See 29 C.F.R. 541.118(a)(6) (effect
of an impermissible deduction for an absence of less
than a day “will depend upon the facts in the particular
ease”). The regulation states in pertinent part (2bid.):

Where deductions are generally made when there
is no work available, it indicates that there was no
intention to pay the employee on a salary basis. In
such a case the exemption would not be applicable
to him during the entire period when such
deductions were being made. On the other hand,
where a deduction not permitted by these inter-
pretations is inadvertent, or is made for reasons
other than lack of work, the exemption will not be
considered to have been lost if the employer
reimburses the employee for such deductions and
promises to comply in the future.

2. Petitioner is the founder, owner and president of
Pierce Processing, Inc. (PPI), an engineering con-
sulting firm. Pet. App. Al, C2. PPI employed en-
gineers, design managers and designers and paid them
a set amount that, under company policy, was reduced
when, for personal reasons, the employees worked less
than aday. Jd. at A2, C3. PPI calculated an hourly
rate for each employee by dividing the employee’s
compensation by 2080 hours (40 hours per week times
52 weeks), and PPI deducted pay for hours not worke
based on this calculation. Jbid. PPI also paid em-
ployees overtime based on this straight hourly rate; it
did not pay employees tle FLSA-mandated overtime
premium of one and one-half times their regular rate of
pay. Id. at A2.

3. The Secretary of Labor brought this action
against petitioner and PPI alleging that PPI had
violated the FLSA by failing to pay employees at the
overtime rate required by the Act. Pet. App. A2. Peti-
tioner and PPI denied that overtime compensation had
been due, on the ground that the employees in question
were “professionals” within the meaning of Section
13(a)(1) of the Act. Pet. App. C1-C2. The parties
agreed that the employees in question carried out
“professional” duties as defined by the Secretary.
They disagreed, however, as to whether, as petitioner
and PPI claimed, the employees had been paid on a
“salary basis” within the meaning of the regulations,
or whether, as the Secretary alleged, deductions had
been made to reflect partial-day absences. /d. at C4,
C7.

Following a trial, the district court found that, prior
to January 1, 1989 — at which point petitioner and PPI
agreed to comply prospectively with the FLSA — “{iJt
was [petitioner’s and PPI’s] practice to take
deductions from an employee’s salary when the
employee was absent for personal reasons for less than
a day.” Pet. App. C7. The court initially held that it
was unnecessary to decide whether, as a result of
those deductions, the pertinent employees failed the
“salary basis” test, because, in the court’s view,
petitioner and PPI were entitled to eliminate their
liability retroactively by taking advantage of the
“window of correction” provided by 29 C.F.R.
541.118(a)(6). That recourse was available, the court
held, based on a combination of factors: deductions had
not been made when work was lacking, but only when
employees voluntarily had been absent for personal
reasons; petitioner and PPI had promised to reimburse
employees for the deductions PPI had made; PPI was

presently in compliance with the FLSA; and petitioner
and PPI had promised to remain in compliance. Pet.
App. C7-C8. The court accordingly ruled that,
provided that petitioner and PPI repaid the improper
deductions, it would enter an order to the effect that
petitioner and PPI were exempt from the Act under
the “window of correction.” Jd. at C8. That decision
was issued on March 25, 1992. Five months later, the
district court was notified that petitioner and PPI had
not complied with its order requiring them to
compensate employees for the improper deductions.
The district court thereupon, in September 1992,
issued an order requiring petitioner to show cause
why the court’s earlier order should not be rescinded
and judgment entered in favor of the Secretary. /d. at
A3, B2. On November 30, 1992, the district court
ordered PPI and petitioner to reimburse the em-
ployees within 30 days. On February 9, 1993, with
petitioner and PPI having still failed to repay the
deducted income, the court entered judgment in favor
of the Secretary. It held that “[djefendants’ employees
were not exempt from the overtime provisions of the
Act[,j [slee 29 U.S.C. §207(a)(1), 29 C.F.R. §541.3(e),
541.118(a), (a)(2) and (a)(6),” and ordered petitioner and
PPI to pay $10,842 in back overtime wages plus
interest. Jd. at B2-B3.

4. The court of appeals affirmed. Pet. App. A1-A8.°
It held that because petitioner’s employees were

5 Both petitioner and PPI appealed, but the court of appeals
dismissed PPI’s appeal because PPI was not represented by
counsel. See Pet. App. A3 n.1. The Secretary also filed a cross-
appeal challenging the district court’s refusal to grant a
permanent injunction prohibiting petitioner and PPI from
engaging in future violations of the FLSA. The court of appeals

docked pay for missing a fraction of a day, they could
not be considered salaried employees, but rather were
hourly workers entitled to overtime pay at the one-
and-one-half-time premium mandated by the FLSA. I/d.
at A5-A6. In so ruling, the court first rejected
petitioner’s argument that the Secretary’s regulation
defining “salary basis” was inconsistent with what
petitioner claimed was Congress’s intent, as revealed
in “subsequent legislation,” to require compensation
of employees “only when they perform work and
flexible unpaid leave.” Jd. at A5. The court held that
the enactments identified by petitioner do “not dismiss
[sic] the regulatory exemption for salaried workers
and [petitioner’s] argument must fail.” Jbid.® It also
rejected petitioner’s claim that the term “day” as used
in 29 C.F.R. 541.118(a)(2) in fact includes partial days
and that he was therefore entitled to deduct employees’
wages for partial-day absences, because such absences
were not “less thana * * * day.” Pet. App. A5. The
court held that the term “day” refers to “the standard,
eight-hour day.” Ibid.

The court of appeals also rejected petitioner’s claim
that the district court improperly denied him the
opportunity to take advantage of the “window of
correction.” It held that the district court had acted
properly and consistent with the Secretary’s regula-

held that the district court did not abuse its discretion in
refusing to enter such an injunction. Jd. at A7-A8.

6 We assume that in the quoted passage the court meant
“discuss,” rather than “dismiss.” The legislation upon which
petitioner relied was the Portal-to-Portal Act of 1947, 29 U.S.C.
251 et seq., and the Family and Medical Leave Act of 1993
(FMLA), 29 U.S.C. 2601 et seg. See Pet. App. A5 n.2. Peti-
tioner does not rely on the FMLA in his petition.

tion when it conditioned its finding of exempt status on
petitioner’s reimbursement of the deductions he had
improperly taken, and on petitioner’s promise to
comply with the FLSA in the future. Pet. App. A6-A7.
The court also rejected petitioner’s claim that his
alleged “financial inability excuse[d] his failure to
reimburse the past deductions,” noting that the
regulation establishing a “window of correction” does
not provide for an extension of exempt status due to
inability to pay and that, in any event, petitioner
“provided no evidence [regarding] his ability to repay
the deductions.” Jbid. The court of appeals thus held
that the district court correctly “removed the window
of correction” and ordered PPI and petitioner to pay
the overtime compensation due. Jd. at A7.

ARGUMENT

The decision below is correct, and it conflicts with
no decision of this Court or of any court of appeals.
Moreover, the judgment that has been entered in this
case against PPI, petitioner’s wholly owned cor-
poration, is now res judicata. See n.5, supra. Review
is therefore not warranted.

1. Petitioner argues (Pet. 8-17) that he was denied
the equal protection of the laws because the
Secretary’s regulations presently define “salary
basis” more restrictively in the context of private
employers than in that of public employers. That
claim was neither raised nor ruled upon below, and has
therefore been waived. See Sisson v. Ruby, 497 U.S.
358, 359 n.1 (1990). Moreover, petitioner’s conduct

7 In a paragraph in the second of his two briefs to the court
of appeals, petitioner argued that the more lenient definition of
“salary basis” used in the public-employee context made

9

occurred prior to the Secretary’s adoption of a
different “salary basis” test governing public em-
ployers. As we explain below, the Secretary has
promulgated a regulation, 29 C.F.R. 541.5d, that
generally permits public employers to make de-
ductions based on partial-day absences from the
salaries of professional employees, without losing
their exempt status. That regulation, however, was
not adopted until August 1992, see 57 Fed. Reg. 37,666,
37,677 (1992), more than three years after the
violations at issue in this case, and it does not apply
retroactively. See id. at 37,678; Kinney v. District of
Columbia, 994 F.2d 6, 10 (D.C. Cir. 1993). Petitioner
thus has no standing to challenge in this lawsuit the
distinction presently drawn by the Secretary between
employees of public and private employers.*

“common sense,” and argued that the same standard should
apply to employees of private employers. See C.A. Br. 9-10.
Petitioner, however, nowhere asserted that the differing
standards utilized by the Secretary constituted a violation of the
equal protection component of the Due Process Clause of the
Fifth Amendment.

8 A precursor of 29 C.F.R. 541.5d was adopted on an interim
basis in September 1991, but adoption of that interim regulation
also postdated the violations in this case. See 56 Fed. Reg.
45,824 (1991). Before that interim regulation was adopted, the
Secretary had in 1987 announced that the Department of Labor
would not enforce the “no partial-day deduction” rule against
state and local governments in discrete circumstances. The
Secretary’s policy, however, did not alter the substantive
standards of the “salary basis” test for public employers as set
forth in the regulations, and the Department specifically
advised public employers that “[(t]his nonenforcement policy is
not intended to affect any employee’s rights under section 16(b)
of [the] FLSA.” See Letter Ruling, Department of Labor, Wage
& Hour Division (Jan. 9, 1987), reprinted at 57 Fed. Reg. 37,668

10

In any event, the Secretary’s differing definitions of
“salary basis,” depending on whether the employer is a
public or private concern, comport with equal pro-
tection principles. A classification that treats some
groups differently from others, but is not based on
suspect classifications and does not affect fundamental
rights, is valid if it has a rational basis. McGowan v.
Maryland, 366 U.S. 420, 425 (1961); see also Tony &
Susan Alamo Found. v. Secretary of Labor, 471 U.S.
290, 306 n.32 (1985). The Secretary’s regulation, 29
C.F.R. 541.5d, which amended the generally applicable
“salary basis” test to provide greater latitude for
public employers in making deductions from the pay of
otherwise FLSA-exempted employees, has a rational
basis.

The regulation provides, in pertinent part, that a
public employee who otherwise qualifies as an
executive, professional, or administrative employee
will not lose that status if the employee

is paid according to a pay system established by
statute, ordinance, or regulation, or by a policy or
practice established pursuant to principles of
public accountability, under which the employee
accrues personal leave and sick leave and which
requires the public agency employee’s pay to be
reduced or such employee to be placed on leave
without pay for absences for personal reasons or
because of illness or injury of less than one work-
day.

(1992); see also Kinney, 994 F.2d at 9 (despite nonenforcement
policy, holding public employer liable based on its violations of
pre-1992 regulatory scheme).

11

29 C.F.R. 541.5d. As the Secretary has explained, the
Department of Labor modified the “no partial-day
deductions” rule in the public-employee context based
on its evaluation of the unique nature of public
employment. That evaluation was occasioned by this
Court’s decision in Garcia v. San Antonio Metro-
politan Transit Authority, 469 U.S. 528 (1985), which
held that the FLSA could constitutionally be applied to
state and local government employees performing
traditional governmental functions.2 The Secretary
noted that the general “salary basis” regulations—
first promulgated in 1940—had been based on evidence
that professional, executive, and administrative
employees in the private sector were nearly always
paid on a salary basis. 57 Fed. Reg. 37,666-37,668
(1992). By contrast, the Secretary noted, public
employers are normally subject to “principles of public
accountability” that prohibit paying employees for
time not worked. See id. at 37,667.

Applying to public employers the traditional “salary
basis” rule regarding the deduction of pay for partial-
day absences, the Secretary recognized, would prevent
state and local governments from availing themselves
of the exemption to the requirement of overtime pay
for professional, administrative, and executive
employees. 57 Fed. Reg. 37,667 (1992). That result,
however, would be inconsistent with Congress’s intent
in extending the FLSA to state and public employers,

* The FLSA had been amended in 1966 and 1974 to cover
governmental employers. However, it was not until the 1985
decision in Garcia, in which this Court overruled National
League of Cities v. Usery, 426 U.S. 833 (1976), that the FLSA’s
provisions could constitutionally extend to state and local public
employees engaged in traditional governmental functions.

12

because it was clear that Congress had intended that
such employees be exempt in the public-sector context.
Id. at 37,672. Indeed, the Secretary noted that, since
the decision in Garcia, public employers had been
exposed to “potentially enormous and generally
unexpected back wage liabilities” for wages owed to
employees who would have been considered exempt
“professionals” were it not for their employers’
adherence to a “public accountability” pay system that
required partial-davy deductions. Jd. at 37,663, 37,670.
Thus, the Secretary concluded, “the regulatory
requirements adopted before Congress extended
FLSA coverage to State and local governments simply
could not operate in a manner that effectively
distinguished exempt from non-exempt public
employees.” Jd. at 37,672.”

The distinction presently drawn between the
“salary basis” test applicable to private employers and
that applicable to public employers therefore plainly
has a rational basis. In the judgment of the Secretary,
the “public accountability” pay systems under which
public employees are paid make the “no partial-day
deductions” rule an ill-suited and unrealistic measure
of whether particular employees are exempt pro-
fessionals. By contrast, the Secretary reasoned, the
traditional “salary basis” test remains a_ useful

1 In light of the Secretary’s detailed explanation of his
reasons for adopting Section 541.5d, petitioner’s suggestion (Pet.
11-12) that the Secretary has not supplied an adequate
explanation for his change of policy is without merit. See 57
Fed. Reg. 37,667-37,673 (1992). Moreover, the regulation is
clearly a valid exercise of the broad rulemaking authority
granted to the Secretary to define and delimit the Section
13(a)(1) exemptions. Compare Batterton v. Francis, 482 U.S.
416, 424-426 (1977).

13

criterion in the private sector. See Mueller v. Reich,
Nos. 94-3262 & 94-3263 (7th Cir. May 15, 1995), slip op.
6-7 (to be reported at 54 F.3d 438) (holding, based on the
need for public employees to be subject to principles of
“public accountability,” that 29 C.F.R. 541.5d is
rationally related to the objectives of the FLSA).

2. Petitioner next argues (Pet. 17) that the
Secretary has misinterpreted his own regulations in
determining that a private-sector employee who has
been subject to deductions reflecting partial-day
absences is not an exempted “professional.” Peti-
tioner contends that those regulations should be
interpreted to bar employers only from making
deductions for hours not worked due to the un-
availability of work, and that employees should not lose
their exempt status where pay has been deducted for
hours that the employee has not worked due to
personal unavailability. Petitioner’s claim is defeated
by 29 C.F.R. 541.118(a)(2), which makes an exception
from the general rule that salaried employees are paid
“without regard to the number of days or hours
worked,” but only “if an employee is absent for a day
or longer to handle personal affairs.” Ibid. (emphasis
added). No such exception applies for deductions
reflecting partial-day absences. See Michigan Ass’n
of Governmental Employees v. Michigan Dep't of
Corrections, 992 F.2d 82, 84 (6th Cir. 1993); Klein v.
Rush-Presbyterian-St. Luke’s Medical Ctr., 990 F.2d
279, 283 (7th Cir. 1993); Donovan v. Carls Drug Co.,
703 F.2d 650, 652 (2d Cir. 1983).

Also unavailing is petitioner’s claim (Pet. 17-24) that
there is “confusion” about what constitutes a day
within the meaning of the regulation. The Secretary
has interpreted that term, consistent with its ordinary
usage, to mean the employee’s customary work day,

14

see Gov't C.A. Br. 24-26, and the court of appeals
likewise recognized that term to connote “the
standard eight-hour day,” Pet. App. A5. The decisions
on which petitioner relies (Pet. 18 nn.10, 12) do not
discuss the proper interpretation of the term “day.”
There is some tension in those decisions on a separate
question: whether an employer loses the Section
13(a)(1) exemption when employees are merely
“subject to” a policy of partial-day deduction, or
whether the employer must have made an actual
deduction from employees’ compensation to reflect a
partial-day absence. Compare Atlanta Professional
Firefighters Union v. City of Atlanta, 920 F.2d 800,
805 (lith Cir. 1991) (actual deductions required in
order for employer to lose exemption) with Abshire v.
County of Kern, 908 F.2d 483 (9th Cir. 1990)
(exemption lost where employees are “subject to”
policy under which such deductions would be
mandated), cert. denied, 498 U.S. 1068 (1991). That
issue is not presented in this case, however, because it
is clear that petitioner and PPI actually deducted
compensation from employees based on partial-day
absences. See Pet. App. C7. Moreover, petitioner has
not argued that relief in this case should have been
awarded only to those employees who experienced
actual deductions and only to the extent of those
deductions.

3. Petitioner next argues (Pet. 28-30) that the
decision below is inconsistent in two respects with the
Portal-to-Portal Act of 1947, 29 U.S.C. 251 et seq.
Petitioner claims first (Pet. 30-31) that his practice
of making deductions for partial-day absences was
justified under Section 4(a)(2) of the Act, 29 U.S.C.
254(a)(2), which relieves employers of the duty to pay
minimum wage and overtime compensation for

15

activities either preliminary or subsequent to the
principal activities that the employee is employed to
perform. The Portal-to-Portal Act, however, merely
defines certain activities for which the employer is not
required to provide compensation at all; it does not
address the question whether an employee is
“salaried” or otherwise falls within the Section
13(a)(1) exemption for professional, executive, or
administrative employees. Moreover, the Secretary’s
“salary basis” regulation does not require that
employees be compensated for absences of less than a
day. It merely provides that if deductions are made to
reflect such absences, the affected employees may not
be considered exempted professional, administrative,
or executive employees.

Petitioner also claims (Pet. 31) that he is entitled to
a defense under Section 10 of the Portal-to-Portal Act,
29 U.S.C. 259, because, he alleges, he undertook his
pay practices believing them to be lawful. Petitioner
has waived that claim by failing to raise it below. In
any event, Section 10 of the Portal-to-Portal Act does
not apply to this case. Section 10 absolves an employer
for liability for acts or omissions that he demonstrates
were in “good faith in conformity with and in reliance
on any written administrative regulation, order,
ruling, approval, or interpretation” by the Admin-
istrator of the Wage and Hour Division of the
Department of Labor. However, as we have explained,
the Department’s regulations supply no basis for a
defense of reasonable good-faith reliance here, but
instead make clear that an employer who makes
deductions from employees’ wages to reflect partial-
day absences cannot claim that those employees are
professionals paid on a “salary basis.” Petitioner does
not identify any written opinion of the Department

16

upon which he claims to have relied in making such
deductions while withholding the overtime com-
pensation required by the FLSA.

4. Finally, petitioner’s unfocused discussion (Pet.
25-26) of the Secretary’s “window of correction”
regulation presents no issue warranting review. The
district court gave petitioner the opportunity to take
advantage of the window of correction and to avoid
liability for overtime compensation by reimbursing his
employees for the partial-day deductions he had made
and by promising to comply with the FLSA in the
future. The district court imposed liability only after
petitioner failed to reimburse his employees for the
deductions, as petitioner concedes. See Pet. 6n.2. The
court of appeais affirmed on the ground that peti-
tioner’s failure to repay the wages he had deducted
supplied a valid basis for closing the window of
correction and for imposing liability for the unpaid
overtime wages. That is the only ruling below re-
lating to the window of correction that adversely
affected petitioner, and he does not seek review of it.”
Thus, no question pertaining to the window of
correction is suitable for review by this Court.

11 In the court of appeals, the Secretary argued that the
district court’s ruling could be upheld on the alternative ground
that, because petitioner had not made deductions inadvertently
and because petitioner did not otherwise pay the employees in
question on a salary basis, he was not entitled to take advantage
of the window of correction. Gov’t C.A. Br. 29. The court of
appeals did not reach that issue, however, because it held that
the district court had properly “removed” the window of
correction when petitioner failed to correct his pay practice by
reimbursing his employees for past deductions. Pet. App. A7.

17

CONCLUSION
The petition for a writ of certiorari should be denied.
Respectfully submitted.

DREw S. DAYS, III
Solicitor General

THOMAS S. WILLIAMSON, JR.
Solicitor of Labor

ALLEN H. FELDMAN
Associate Solicitor

STEVEN J. MANDEL
Deputy Associate Solicitor

MARK S. FLYNN
Senior Appellate Attorney
Department of Labor

JULY 1995

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386012_1710%3A2. Public record. Not legal advice.