Opposition Brief — Samson v. Apollo Resources, Inc.

No. 00-1891

IN THE

Supreme Court of the United States

GEORGE C. SAMSON, et ai.,

Petitioners,

v.

APOLLO RESOURCES, INC.,

doing business as APOLLO SERVICES,

JEFFREY A. REDDOCH and CHIQUITA REDDOCH,

Respondents.

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

BRIEF IN OPPOSITION

TIMOTHY J. MCNAMARA

GREG GUIDRY

STEVEN C. LANZA*

MariA F. MANUEL

ONEBANE, BERNARD, TORIAN,

Diaz, MCNAMARA & ABELL

Attorneys for Respondents

Post Office Box 3507

Lafayette, LA 70502-3507

* Counsel of Record (337) 237-2660

168915 ce)

COUNSEL PRESS

(800) 274-3321 + (800) 359-6859

j

STATEMENT PURSUANT TO RULE 29.6

Respondent, Apollo Resources, Inc., has no parent

corporation and no publicly held company owns 10% or more

of its stock.

il

TABLE OF CONTENTS

Table of AppeiOt oc s.cn ewwin a sewn e ees

Summary of Cpeneeee «jo ig cies heeen sone

Statement of Ge CM ook ccs co eee eee

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B.

Procedural Background .................

Factual BACROIOURE 6.65 ds dc cciceecceess

Reasons for Denying the Writ Application .......

A.

Department of Labor Regulation Inter-

po re rr ome ere

No Considerations Exist for Granting Writ

Of CPGIOOOEE |. 55.5 3 Sec eee eee

Auer Decision Not Applicable to 29 C.F.R.

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21

22

25

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TABLE OF CITED AUTHORITIES

Page

Auer v. Robbins, 519 U.S. 452, 117 S. Ct. 905

Cheers stad cansee ben's @abdeses 22, 23, 24, 25

Bailey v. County of Georgetown, 94 F.3d 152

ee: EEN Ne ae or eee are ae 27

Cash v. Conn Appliances, Inc., 2 F. Supp. 2d 884

Rs. a ee 18, 19, 23, 24

Flood v. New Hanover County, 4 Wage and Hour

Cases 2d (BNA) 139 (4th Cir. 1997) .......... 27

Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 164,

OR a re 22

Overnight Motor Transport Co. v. Missel, 316 U.S.

Pimy OS @. CK, UZIO CIDE) 20 cc cccscesce 1, 25, 27, 28

Yourman v. Dinkins, 865 F. Supp. 154 (S.D.N.Y.

1994), aff'd, 84 F.3d 655 (2d Cir. 1996), rev'd on

other grounds, Giuliani v. Yourman, 519 U.S. 1145

Pi neon kaso ane eked wets ddadnwikne 18

Yadav v. Coleman Oldsmobile, Inc., 538 F.2d 1206

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Federal Statutes:

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Cited Authorities :

Page

Rules:

Federal Rule of Civil Procedure Rule 52(c) ...... 4

United States Supreme Court Rule 10 ......... 2, 2h, 20

United States Supreme Court Rule 15.2 ......... 16

Federal Regulations:

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TABLE OF APPENDICES

Page

Appendix A — DOL Field Operations Handbook

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Appendix B — DOL Opinion Letter Dated May 28,

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SUMMARY OF OPPOSITION

The claims of Petitioners are supported by three faulty

premises — one which relates to the law, the other which relates

to the facts and the final one which relates to Petitioners’

assertion that this Court should grant a writ of certiorari under

the facts of this case.

Petitioners’ legal premise in support of their claims is that

the established body of law finding the fluctuating workweek

pay plan under 29 C.F.R. 778.114 (“FWW”) is compliant with

the Fair Labor Standards Act (“FLSA”), going back almost 60

years to this Honorable Court’s decision in the case of Overnight

Motor Transport Co. v. Missel, 316 U.S. 572, 62 S. Ct. 1216

(1942), should be overruled. Such a suggestion is completely

without merit and without any support from applicable legal

authority.

The second premise asserted by the Petitioners relates to

the facts of what actually occurred during their employment

with Apollo Resources, Inc. (“Apollo”) and what was established

at trial. Judge Richard T. Haik, the trier of fact, reviewed

extensive documentary evidence and heard extensive testimony

from all six plaintiffs, as well as from four members of Apollo’s

management (called under cross-examination), observed their

demeanor and even personally questioned virtually every person

who testified and — after all of that - Judge Haik found the

testimony of the plaintiffs to be “contrived,” “orchestrated,”

“incredible” and uncredible.' Therefore, the second pillar

allegedly supporting Petitioners’ claims fell as a result of their

own testimony at trial. Judge Haik, a seasoned federal trial judge

(who has been on the federal bench for approximately 10 years,

1. See, for example, Judge Haik’s comments at MJML Tr. pp. 13,

47, 49, 54 and 57. NOTE: Citations to the trial transcript will

be abbreviated “TT.” Citations to the transcript of the hearing on Apollo's

Motion for Judgment as a Matter of Law will be abbreviated

“MJML Tr.” Citations to District Court Judge Richard T. Haik’s Addition

Reasons for Judgment will be abbreviated “ARJ,” a copy of which is

attached to Petitioners’ Brief as Appendix “D.”

2

and who had previously served as a state district court judge for

approximately 7 years before his federal appointment)

commented during trial that he feit that someone had “hustled

up all these cases” because the plaintiffs “didn’t like” the way

there were getting paid, and once they were no longer working

for Apollo they tried to “bite” Apollo in the “back.” Tr. p. 929

and MJML Tr. p. 48. Furthermore, Judge Haik stated that there

was no doubt in his mind that the plaintiffs had gotten together

to “contrive some kind of statement to show that they were

treated unfairly,” and also stated that the testimony of the six

plaintiffs whose cases were tried was the “best orchestrated

among plaintiffs I’ve ever seen in my life.” MJML, Tr. p. 54,

In. 9-23.

The final premise asserted by Petitioners is the suggestion

that this Court should grant a writ of certiorari in this case.

Nothing could be further from the truth — (i) there is no conflict

between federal appellate court circuits on the legal issues

presented; (ii) there is ample authority that the FLSA, the

regulations on the FWW pay plan (29 C.F.R. 778.114) and the

relevant opinion letters of the Department of Labor (“DOL”)

permit the occasional disciplinary deductions taken by Apollo

from the FWW salaries of certain of the plaintiffs when faced

with the willful absences of those plaintiffs; and (iii) the factual

and credibility findings of the trial court are not appropriate for

review by way of writ of certiorari.”

With the collapse of these three pillars, Petitioners’

argument for the issuance of a writ of certiorari also falls.

The trial judge — having the benefit of seven days of trial

testimony — properly saw no reason for the case to proceed when

plaintiffs rested and, accordingly, granted Apollo’s motion for

judgment as a matter of law.

2. Rule 10 of the Supreme Court Rules states that, “A petition for

writ of certiorari is rarely granted when the asserted error consists of

erroneous factual findings or the misapplication of a properly stated

rule of law.”

Pa ch tl illo ryt ame, oe

3

STATEMENT OF THE CASE

A. Procedural Background

On or about May 27, 1997, George Samson and Kevin

Smith filed the matter entitled “George Samson and Kevin Smith

v. Apollo Resources, Inc.” bearing Docket No. 97-1053 against

Apollo (this lawsuit shall be referred to herein as the “Samson

Suit”). In November and December of 1997, plaintiffs amended

their Complaint a total of four times in order to permit five

more plaintiffs to join the Samson Suit, as well as to name J effrey

A. Reddoch and his wife, Chiquita Reddoch, as individual

defendants. On or about January 14, 1998, William Melancon

(legal counsel for the plaintiffs in the Samson Suit) filed a lawsuit

against Apollo on behalf of Crawford Norton and Lester Weaver

encaptioned “Crawford R. Norton and Lester D. Weaver v.

Apollo Resources, Inc.” bearing Docket No. 98-0062 (referred

to herein as the “Norton Suit’).

In early March of 1998, the parties agreed to consolidate

for trial the Samson Suit and the Norton Suit (referred to herein

as the “Collective Action”). The parties agreed to continue the

trial date until January of 1999 (later moved to March 1, 1999),

in light of Petitioners’ desire to make the consolidated action a

“collective action” under Section 216(b) of the FLSA. 29 U.S.C.

§ 216(b). Of the over 180 people to whom notification letters

were mailed, only 25 additional people decided to join in as

collective action members of the Collective Action.

The trial of the Collective Action was conducted from

March 1, 1999, through March 9, 1999 (seven days of trial).

At the end of the fourth day of trial, Judge Richard T. Haik

3. In Petitioners’ case-in-chief, they called the following persons

to testify: the six plaintiffs (1) George Samson, III, (2) Jackie D. Hays,

(3) Brent C. Manuel, (4) Kevin D. Smith, (5) Norman Landry, and

(6) Melvin Kyle Smith, as well as (7) Don Strobel, a fact and expert

witness listed by Apollo, and the following members of Apollo’s

management (8) Jeffrey A. Reddoch (President), (9) Johnnie Daughdrill

(Operations Manager), (10) Ben Stonecipher (Administrative Manager),

and (11) Charles E. Reeves (Controller), all under cross-examination.

a ETE RES aE CEES ET IAT SEDO RI

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suggested, in the interest of time, that the parties complete the

trial for the claims of the six plaintiffs cases who had already

testified and then sever the remaining 24 plaintiffs from the

trial. The parties agreed.

At the close of Petitioners’ case on March 9, 1999 (with

respect to the six plaintiffs), Apollo moved the court for a

judgment as a matter of law under Federal Rule of Civil

Procedure Rule 52(c). After a two hour hearing on the motion,

wherein the trial judge heard arguments and made detailed

factual findings as to each individual plaintiff, Judge Haik

granted Apollo’s motion. Judge Haik followed up with “

Additional Reasons for Judgment, dated April 27, 1999,

primarily discussing the legal basis for his ruling on the

Rule 52(c) motion (see copy attached as Appendix “D” to

Petitioners’ Brief). A judgment was signed on April 27, 1999.

Petitioners filed an appeal with the Fifth Circuit Court of

Appeals, which rendered its opinion on February 20, 2001,

resoundingly affirming the decision of the trial court in all

respects. Petitioners ’petition for panel rehearing was denied on

March 20, 2001.

B. Factual Background

Apollo is a Louisiana corporation which has its registered

office in Lafayette, Louisiana. Apollo is in the business of

providing environmental-related services to the oilfield industry.

Jeffrey A. Reddoch is the president and sole shareholder of

Apollo.

In 1991, upon being approached by an employee who

questioned the way said employee was being paid, Mr. Reddoch

immediately contacted the Wage and Hour Division of the

Department of Labor (“DOL”) to obtain assistance in

implementing a pay plan which fit the needs of Apollo as well

as complied with the FLSA. TT p. 9 and p. 14.

At that time, Don H. Strobel was the Assistant District

Director for the United States Department of Labor in the

Enforcement Section (New Orleans). TT p. 85-86. Mr. Strobel

went over the pay plan options and suggested the FWW pay

plan. TT p. 14-15. Mr. Strobel forwarded a packet of materials

to Mr. Reddoch regarding the FLSA, the FWW (including a

copy of 29 C.F.R. 778.114) and related matters. TT p. 15 and

p. 88. Mr. Reddoch read the materials and called Mr. Strobel

several times over the next several months to discuss

issues related to the FWW and its operation. TT p. 88 and

p. 98. Mr. Strobel’s instructions and explanations to

Mr. Reddoch addressed, among other things, when the employer

could legitimately take disciplinary deductions from the FWW

salary, the fact that only a pro rata portion of the salary had to

be paid in the initial and terminal weeks of employment and

other such issues. TT p. 88-89.

Mr. Strobel remembered Mr. Reddoch particularly well

because of his “good attitude” and the fact that he followed up

with a “lot of telephone calls over the publications that we sent

him.” TT p. 119. Mr. Strobel stated that in his 32 years of

experience, he has only encountered “very few” — “probably

less than one percent” — of employers who behaved the way

Mr. Reddoch did and showed such an attention to detail and

interest. TT p. 119.

With regard to the issue of permissible deductions

from the FWW salary, Mr. Strobel specifically instructed

Mr. Reddoch in 1991 and 1992 that occasional deductions could

be made as a disciplinary measure for willful absences or

tardiness of the employee, in accordance with: (i) the DOL’s

Field Operations Handbook (Section 32b04b), a reprint of which

is attached hereto as Appendix “A,” and (ii) the 1982 opinion

letter by DOL Administrator, William Otter (the “Otter Letter’),

attached to Petitioners’ Brief as Appendix “F.” TT p. 49-50, 55-

57, 74-75, 88-89 and 1140-1141.

The only person at Apollo authorized to make deductions

from an employee’s FWW salary is Mr. Reddoch. TT p. 1142

and p. 1165. A decision to make a disciplinary deduction for a

willful absence is made by Mr. Reddoch only after securing the

facts of the matter and enough information to feel “comfortable”

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with the decision. TT p. 1198 and p. 1274. Disciplinary

deductions are made infrequently because Apollo wants to try

to retain its employees, but, on the other hand, there is a need to

have an effective way to discipline employees who “play hooky”;

otherwise, the message would go out that Apollo has an

“open door policy” on playing hooky and getting paid for it.

TT p. 1154 and p. 1273.

Apollo does not dock its employees’ FWW salaries when

they are truly sick; rather, it is Apollo’s policy to continue to

pay the salary of any employee under the FWW who is truly

sick. TT p. 1144 and p. 1228. Apollo has paid the full salary of

employees who were out for “over a month” when they were

truly sick. TT p. 1144 and p. 1228.

Apollo has a policy requiring employees to bring in a

doctor’s excuse when they return to work after being absent

from work due to sickness. TT p. 1151, p. 1155 and p. 1228.

Lead plaintiff, George Samson, admitted that this policy was

“generally known” by his coworkers at Apollo. TT p. 246.

Although Apollo is generally “pretty lenient” with the doctor’s

excuse policy, adherence to this policy is particularly required

when an employee (who alleges sickness as the reason for the

absence): (i) does not call in and personally speak to the manager

on duty on the day in question, but instead simply leaves word

of the alleged sickness with the answering service; and (11) that

employee is not home to answer the manager’s call either during

the morning of the day in question or later that afternoon, which

gives Apollo a “very good suspicion” regarding the employee’s

allegation of sickness. TT p. 1153-1156, p. 1252-1253, p. 1261-

1262 and p. 1285-1287. In such an event, Mr. Daughdrill,

Apollo’s Operations Manager, “flags” the day in question on

Apollo’s attendance records for further investigation and the

ultimate presentation of the matter to Mr. Reddoch for review.

TT p. 1253 and p. 1287. Mr. Daughdrill is the one who personally

makes these two calls (once in the morning and

once again in the afternoon) to employees who fall into the

suspicious absence category. TT p. 1254-1255 and p. 12835.

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If Mr. Daughdrill does not have any reason to disbelieve the

employee’s allegation that the absence was because of sickness,

he does not pursue the matter any further. TT p. 1286-1287.

According to Mr. Strobel, who worked for the DOL for over

32 years, the “most common excuse” given by employees who

“play hooky” is that they are “sick.” TT p. 86 and 115.

There are only four of the six plaintiffs whose cases were

tried in this matter who had any deductions made from their

salary as disciplinary deductions for willful absences.‘

Judge Haik found, as a matter of fact, that all of these deductions

were made because of willful absences by the employees in

question, to-wit: “Apollo deducted from an employee’s weekly

salary when the employee willfully absenced himself from

work.” See ARJ (Section E), attached as Appendix “D” to

Petitioners’ Brief.

With regard to the near simultaneous unexplained absences

of George Samson, Kevin Smith and Melvin Smith (the latter

two plaintiffs who are brothers) — immediately before and after

the same weekend’ ~ Mr. Reddoch explained that other Apollo

employees (as well as Mr. Daughdrill) had informed him that

Mr. Samson and two other people (i.e., the Smith brothers) had

missed days around the same weekend and had gone on a hunting

or fishing trip and that none of these employees could produce

a doctor’s excuse.° TT p. 1158 and 1162. Mr. Daughdrill heard

4. To-wit: George Samson, III — one workweek involving 10.25

hours; (2) Kevin D. Smith — one workweek involving a total of 12.25

hours; (3) Melvin K. Smith — one workweek involving a total of 1.5

hours; and (4) Norman Landry — three workweeks involving a total of

17 hours.

5. l.e., the days involved were Thursday, October 19, Friday,

October 20, Monday, October 23 and Tuesday, October 24, 1995.

6. Mr. Daughdrill explained, by way of example (regarding

Melvin Smith’s situation), that a notation of “sick” on Apollo’s absentee

roster is what he puts if “someone said they were sick” (TT p. 1259) —

in essence, the notation is only reflective of what the employee claims

was the reason for the absence, not in any way a determination by Apollo

(Cont'd)

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“lots of people” talking in the shop that George Samson, Melvin

Smith and Kevin Smith had missed work because they were

going on some sort of fishing or hunting trip.’ TT p. 1258.

Mr. Daughdrill told Mr. Reddoch of the information that he had

received in this regard. TT p. 1258. Mr. Daughdrill testified

that the story he heard about the three employees’ absence was

a “common rumor” throughout the shop. TT p. 1258. When

this information started circulating, Mr. Daughdrill flagged the

dates for Mr. Reddoch and Apollo started the investigation.

TT p. 1259.

Mr. Reddoch testified that these three employees could

not be located when Apollo tried to get in touch with them.

TT p. 1166-1167. Mr. Daughdrill and Mr. Reddoch testified

that Mr. Daughdrill asked all three of these employees to bring

in a doctor’s excuse upon their return to work, but that no such

excuse was ever produced.®* TT p. 1160, p. 1164, p. 1167,

p. 1183-1185 and p. 1271-1272. Mr. Reddoch explained that

the three employees (George Samson, Kevin Smith and Melvin

Smith) left on days that Apollo needed them to work and that

Apollo could not find these employees on the days in question.

TT p. 1163.

With respect to the deductions from Norman Landry’s

salary, the first date in question was on April 10, 1995.

TT p. 888. Mr. Landry admitted at trial that on the day in question

he was “moving.” TT p. 888. Mr. Landry conceded that: (i) this

was not a day that he showed up for work, (ii) that he was willing

(Cont'd)

of the truth of that alleged reason. In fact, Apollo, with good reason,

questioned the legitimacy of the alleged reason of “sick” for the

employees at issue. TT p. 1158, 1162-1167 and p. 1258.

7. Mr. Reddoch explained that the Smith brothers and Mr. Samson

are “very close” to each other. TT p. 1166.

8. Judge Haik stated that he was: (i) “very impressed” with the

testimony of Mr. Reddoch; and (ii) “very, very impressed” with the

testimony of Mr. Daughdrill, as well as “impressed with his demeanor.”

MJML Tr. p. 21 and p. 64.

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to give up that day’s pay to go move, (iii) that he did not ask his

supervisor, Mr. Daughdrill, if he was going to get paid for the

day in question that he moved; (iv) that he knew that there was

work for him at Apollo on the date in question; (v) that

Mr. Daughdrill never told him that the day in question

would be an excused absence; and (vi) that he did not ask

Mr. Daughdrill if he was going to get paid for the day that he

moved. TT p. 888-891 and p. 909-910.

The second date in question where Mr. Landry’s salary

was subject to a disciplinary deduction was on July 5, 1995.

TT p. 892. Although Mr. Landry alleged at trial that he had

gone to the doctor on that date, Mr. Landry admitted that he did

not show up for work on that date, which just so happened to be

the day following the July 4th holiday. TT p. 892. Mr. Landry

conceded that: (i) there was work for him at Apollo on that date

in question; (ii) no one from Apollo told him that the date in

question would be an excused absence; (iii) not even after he

saw that his salary had a deduction against it for that week did

he bring any type of doctor’s excuse or independent verification

of his claim that he was at the doctor on that date; and (iv)

nothing prevented him from going to get some type of doctor’s

slip to show Apollo that he was, in fact, at the doctor on that

date. TT p. 892-893.

The final date involving a deduction from Mr. Landry’s

salary was August 11, 1995. Mr. Landry conceded that

this was the day in which he took a “personal day off’ —

“a little vacation day” where he took his family to New Orleans.

TT p. 871 and p. 895. Mr. Landry conceded that: (i) he had only

worked for Apollo for less than six months at this time; (ii) he

did not have any vacation time to be used for this personal day

off; (i11) he would not dispute that Apollo did, in fact, have

work for him to do; and (iv) no one in Apollo’s management

told him that the dates in question were excused or that he was

going to be paid for any of the days that he decided to take off.

TT p. 895-896 and p. 912. Judge Haik did not believe that even

Mr. Landry really thought he would get paid for the absence

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when he took his family on vacation.” MJML Tr. p. 49. Other

than his own unbelievable testimony, Mr. Landry offered no

evidence at trial to support his allegations.

Mr. Daughdrill testified that he never told either George

Samson, Kevin Smith, Melvin Smith or Norman Landry that

the days they were willfully absent were “excused.” TT p. 1271

and p. 1281. Additionally, Mr. Daughdrill confirmed that there

was work at Apollo for all of these men on the dates of their

willful absences. TT p. 1281.

In connection with this subject matter, Judge Haik offered

the following comments and factual findings:

I find it incredible to believe that Mr. Landry or any

of the plaintiffs who felt that they should have gotten

paid because they were sick did not try to have that

situation corrected at that time, or at least at the time

of their next paycheck. These are not babies. They’re

not children. They’ re not infants. If in fact and indeed

they could have gotten or they did get doctor’s

excuses some two and a half years later, how much

easier could it have been to make the phone call and

get it then when they saw that their salaries were

deducted when in fact they and others knew that

when they brought in sick slips or doctor’s excuses,

they got paid for that time? But to come back years

later and say, wait a minute, no one ever told me is

just incredible to me. Even a child, when they don’t

go to school, when they check back in has to bring

some type of slip from a mom or dad or a doctor to

9. To show the extent of Mr. Landry’s lack of credibility, a review

of pages 896 through 900 of the trial transcript would be quite

illuminating, since this is where Mr. Landry was repeatedly impeached

with his deposition (which was taken just two months prior to trial).

He testified, either live or in his deposition, that he expected to be paid

by Apollo if he took days off from work to go shopping, to wash his

car, to paint his house or even to go bird watching! For good reason,

Judge Haik disbelieved Mr. Landry’s testimony.

j

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show that that child was not playing hooky. What

they were concerned about here is playing hooky

from work, and when you play hooky from work

and you can’t back it up, the company has a right to

deduct. It’s not fair to play hooky and get paid, just

like it’s not fair to play hooky and go to school and

not be disciplined in such a manner. It’s just not fair.

MJML Tr. p. 47-48. [Emphasis added].

There is no doubt in my mind that Mr. Norman

Landry, as well as the other plaintiffs in this case,

were treated fairly. I find it astonishing that they

don’t realize — or that they can take the stand and

say I didn’t realize I had to get a slip, a work slip.

The testimony was if someone called and talked to

Mr. Daughdrill or someone else of some authority

besides the answering service, they would call.

And if they verified that person was home sick, they

didn’t have to get a work slip. But if they called

and no one was there, they got docked in pay.

That’s not unreasonable. That’s not an unreasonable

thing to do. MJML Tr. p. 49. [Emphasis added].

So I think it is incumbent upon the employee when

they see that they’re docked — I think it is incumbent

upon them to show some reason why they shouldn’t

be at that point. And all they had to do was bring in

a doctor’s excuse. And they’re going to get it two

years later? That’s incredible to me. That’s

incredible. MJML Tr. p. 50. [Emphasis added].

And to have to believe that the company has to go

chase them down and say please bring in your sick

slip, you know, you do that to third graders.

You don’t do it to ninth graders or high school kids.

You don’t do it to a high school graduate. You don’t

do it to grown men who have worked before. You

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don’t do it. You expect grown men if they have a

complaint and they say I didn’t get paid and I was

sick, to check it out. MJML Tr. p. 60-61.

It should be noted that all of the plaintiffs claiming

any disciplinary deductions from their salary signed a sheet in

connection with their initial employment orientation which

was captioned, “DISREGARD OF ANY OF THE

FOLLOWING RULES MAY SUBJECT YOU TO

DISCIPLINARY ACTION OR DISCHARGE.” TT p. 240-242

(George Samson), p. 966-967 (Kevin Smith), p. 901 (Norman

Landry) and p. 811 (Melvin Smith). Item number 12 of the

reasons for discipline that were printed on that sheet read as

follows, “Unexcused or excessive absences or tardiness.”

See Defendants’ Exhibits Samson No. 1, Kevin Smith No. 29,

Landry No. 23 and Melvin Smith No. 17A. Therefore, these

employees had notice from the start of their employment that,

in certain circumstances, disciplinary action could potentially

be taken against them by Apollo for unexcused absences.

It is undisputed that Apollo does not make a deduction every

time an employee is absent from work. TT p. 1140-1141.

Petitioners’ counsel even admitted on the record that they had

no evidence of same to present at tial. TT p. 1140-1141.

The evidence at trial, in fact, showed that of the total hours

worked by all of the original 30 plaintiffs while they were employed

by Apollo (38,258.75 hours), only about half of them (16) had

any disciplinary deductions at all, said deductions (involving 306.25

equivalent hours'®) which involved less than 1% of the total number

of hours worked by these 30 plaintiffs. Disciplinary deductions

were only present in 33 workweeks of the total of

798 weeks (including initial and terminal weeks) worked by the

original 30 plaintiffs. There were 20 weeks (involving 800

10. The term “equivalent hours” is used merely to indicate how

many hours for which the employee was not paid during that workweek

(i.e., deducted for disciplinary reasons) and is calculated by subtracting

the actual number of hours worked by the employee during that

workweek from the sum of 40 hours.

a

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equivalent hours) in which the original 30 plaintiffs did not

perform any work at all, but in which Apollo paid their fu//

FWW salary. Further evidence at trial established that the value

of the equivalent hours deducted from any of the original

30 plaintiffs’ salaries ($3,839.81), when compared against the

value of the time that the original 30 plaintiffs did not perform

40 hours of work during a workweek but, in fact, received their

entire FWW salary ($29,814.87), benefitted the original

30 plaintiffs in the amount of $25,975.06 in the aggregate.

TT. p. 1401-1403; Defendants’ Exhibit Reeves No. 71."

This pay system was obviously a good one as these numbers

clearly show.

With regard to the six plaintiffs whose cases were tried, the

evidence showed that only 41 equivalent hours were involved

in deductions which occurred in a total of just six workweeks

(from a total of 183 total workweeks during the six plaintiffs’

employment with Apollo), amounting to just 3.3% of the total

workweeks in question for said plaintiffs. Additionally, the

equivalent hours involved (41 hours) in the disciplinary

deductions made to the FWW salary of any of these six plaintiffs

amounted to an incredibly low 0.45% (less than 1%) of the total

hours worked (9,094.50) by these plaintiffs while employed by

Apollo. TT p. 1394-1396 and p. 1426; Defendants’ Exhibit

Reeves No. 70.

Mr. Strobel, the wage and hour expert who was called to

testify by Petitioners during their case-in-chief, testified that

the disciplinary deductions made by Apollo with regard to

the 30 plaintiffs were unquestionably “occasional” under

applicable DOL authority, and were only made for “disciplinary”

11. Judge Haik took notice of the fact that the plaintiffs did

not “complain” when they received their full salary but did not work

40 hours during that workweek — which is the other side of the equation,

i.e., the trade off. MJML Tr. p. 30-31. All of the six plaintiffs (except

Mr. Manuel) had weeks where they did not work 40 hours but were paid

their full salary. See MJML Tr. pp. 14, 21, 38-39, 46-47 and 57-58.

14

reasons — certainly not based on any desire on Apollo’s part to

“save money.” TT p. 108-111.

Mr. Strobel also testified that he performed a review of

Apollo’s pay policy and found that it complied with applicable

statutes and regulations — in fact, Mr. Strobel testified that Apollo

was “over generous, over and above what the law required.”

Ti Pp 830."

Judge Haik, after the presentation of the entirety of the six

plaintiffs’ cases, found, as a matter of fact, that Apollo did

everything it could to comply with applicable law, to-wit:

Number one, there has been no showing at all in

this case thus far that Apollo’s actions were willful

and, in fact, all of the testimony except for — I can’t

even say that — even the plaintiffs themselves,

although they would like to paint it in the light of

willfulness, all of the testimony is clear to me that

there was no willfulness, that the company tried

to do everything they could to follow the law, and

it went over and above. MJML Tr. p. 12, L 1-10.

[Emphasis added].

This company dotted their Is and crossed their

Ts. MJML Tr. p. 22, L 2-3. [Emphasis added].

And I have to say, Mr. Reddoch, I was impressed

with your testimony. I think you are trying to run

a good shop, and I think you’ve done everything

that you can do to keep it on the up and up. MJML

Tr. p. 64, L 16-19. [Emphasis added].

12. Mr. Strobel informed the court that, while he was with the

DOL, he was involved in a case where some other employer was not

using the FWW pay plan properly and that he required the employer to

pay. TT p. 140. Therefore, Mr. Strobel’s credibility — as the only expert

on wage and hour regulations who testified during the trial and whose

expert status Petitioners’ counsel stipulated to on the record (TT p. 40)

— cannot be validly challenged. Petitioners’ lawyer conceded on the

record that Mr. Strobel’s testimony “hurt” Petitioners’ case. TT p. 1303.

15

I’m a firm believer of receiving what you contract

for, and I think these gentlemen received every

penny they contracted for. And some of them even

more than they thought they contracted for.”

MJML Tr. p. 65. [Emphasis added].

None of the plaintiffs whose cases were tried contended

that their overtime premium was not properly calculated and

paid by Apollo pursuant to 29 C.F.R. 778.114; rather, these

plaintiffs wanted the entire pay plan thrown out.

Petitioners’ solitary offering to the trial court to try to cast

Apollo in a bad light with regard to its pay plan was the botched

DOL investigation occurring in 1994-1995, which the DOL

aborted and did not legally pursue. The only wage and hour

expert to testify at trial (Mr. Strobel) disagreed “big time” with

the DOL’s suggestions that Apollo did anything wrong, since

his review of the records showed that Apollo was not

in violation of the FLSA. Mr. Strobel agreed with the

characterization of the DOL investigation at issue as “poor,”

“bogus,” “seriously flawed,” “terrible,” and a “rotten job.”

TT p. 84, p. 98 and p. 107. In connection with his interaction

with the DOL in 1995 on behalf of Apollo (during the time

when he had a private consulting practice), he tried to get the

DOL to come back in and conduct a more complete

investigation, in part by sending them memorandum after

memorandum “begging ~ literally begging them to come back

in.” TT p. 32-33. Mr. Strobel did not want the DOL to take his

word for it, but to come back in and look at the records, re-

interview witnesses and confirm that errors had been made in

their investigation. TT p. 32-33. The DOL refused to come back

to Apollo for more information and the DOL’s lead investigator,

Frank McGriggs, “blew off” Mr. Strobel’s request. TT p. 104.

Mr. Strobel informed the court that the DOL felt its

allegations against Apollo were so “shaky” that the DOL

13. Transcript pages 98 through 104 shows a partial list of reasons

for Mr. Strobel’s substantial disagreement with the botched investigation

of Apollo by the DOL.

16

“walked away” from the matter without even presenting the

case to its own attorney (Solicitor of Labor) for further

consideration, which, Mr. Strobel — in his 32 years of experience

with the DOL — had only seen happen in about 12 cases of the

1,500 or so of which he had come into with contact during his

DOL tenure. TT p. 28 and p. 123-124. The DOL never sent

Apollo a letter demanding payment of the over $300,000

which its botched investigation claimed was allegedly owed.

TT p. 104.'* Nonetheless, the New Orleans office of the DOL

took “‘statistical credit” for the big numbers it claimed to have

found for employees in order to get “brownie points” with its

superiors in Washington, D.C. TT p. 86-87 and p. 104-105.

Mr. Strobel explained to the district court that the DOL even

prepared a “correction” sheet for its file that showed that Apollo

owed “zero.” TT p. 105.

All of Mr. Strobel’s testimony regarding the facts and nature

of the referenced DOL investigation was uncontroverted at trial.

Other than Mr. Strobel (who “hurt” Petitioners’ case), Petitioners

did not even bother to call any past or present DOL employees

to testify at trial, presumably because Petitioners realized these

witnesses would not help their case. Apollo contests any of

Petitioners’ factual representations in their Brief in contradiction

of the evidence and facts set forth above.'°

14. The “standard” letters were not even mailed to the employees

— but, rather, “modified 16(b)” letters were sent which did not state that

monies were owed to the employee (rather, “may” was used),

TT p. 26-27.

15. Pursuant to Supreme Court Rule 15.2, Apollo’s legal counsel

hereby points out the following additional perceived misstatements in

the petition for writ of certiorari: (1) contrary to the assertion made in

footnote 7, there was no testimony at trial to support any allegation of

“safety problems” with respect to the issue addressed therein;

(2) contrary to the assertion on page 5, Norman Landry was not “granted

a vacation day”; (3) contrary to the assertion on page 6, Apollo never

told its employees at the time of hiring that they would “average only

40 hours per week” — the trial judge did not find that any such

(Cont'd)

17

REASONS FOR DENYING THE WRIT APPLICATION

A. Department of Labor Regulation Interpretation

Petitioners argue that the trial court and the court of appeals

substituted their own interpretation for the interpretation of

the DOL with regard to 29 C.F.R. 778.114. This argument is

completely without merit, since these courts did not substitute

their interpretation but rather merely followed an interpretation

by the DOL of the FWW.

Section 778.114 provides that an employee paid a salary

under the fluctuating workweek method must receive a fixed

salary “for whatever hours he is called upon to work, whether

few or many.” Petitioners ignore the wording of the regulation

and argue that employees can choose not to work when called

upon to work and still receive a full salary for the workweek.

Petitioners base this argument on Wage & Hour Opinion Letter

No. 479, issued by the DOL in 1966 (attached to Petitioners’

Brief as Appendix “E”), which stated that no deductions can be

made from the salary of employees paid using the FWW pay

plan. Petitioners suggest in their Brief that two district court

opinions have cited to Letter No. 479 as “being good law.” This

statement is incorrect. Although one of these courts, the Southern

(Cont’d)

misrepresentations existed; (4) contrary to the assertion on page 6, these

plaintiffs did not “typically” earn “$500 per week” — the beginning base

salaries of the six plaintiffs (not even considering their overtime

premiums) averaged $2,316 per month; (5) contrary to the statement

made in footnote 12, Apollo never admitted at trial that the DOL was

following the dictates of DOL opinion letter No. 479; (6) contrary to

the assertion on page 8, the courts did not fail to “acknowledge” that

the DOL investigated Apollo, rather the courts disbelieved the alleged

results of the botched investigation; (7) contrary to the assertion made

in footnote 16, Apollo’s expert did not testify that Apollo was “wanting

its cake and eating it too,” rather he testified that Apollo was properly

paying its employees under the FWW; (8) contrary to the assertion on

page 16, these employees were certainly not held “hostage in

their employment by Apollo;” and (9) contrary to the assertion on pages

17-18, Melvin Smith did not testify that Safeguard Disposal Systems

was his “current” employer.

18

District of New York, did cite to Letter No. 479, the other court

specifically cited to Letter No. 479 and categorically refused to

follow it, noting that disciplinary deductions are permissible.

Yourman y. Dinkins, 865 F. Supp. 154, 164-65 (S.D.N.Y. 1994),

aff'd, 84 F.3d 655 (2d Cir. 1996), rev'd on other grounds,

Giuliani v. Yourman, 519 U.S. 1145 (1997); Cash v. Conn

Appliances, Inc., 2 F. Supp. 2d 884, 895 n.24, 25 (E.D. Tex.

1997).

Petitioners suggest that both the district court and the court

of appeals incorrectly followed the more recent opinion letter

issued in 1982, referred to throughout this litigation as the “Otter

Letter,” which was drafted by former DOL Administrator

William Otter (a reprint of which is attached to Petitioners’ Brief

as Appendix “F’’). The “Otter Letter” provides that, although

generally the full salary must be paid as long as an employee

performs any work in a workweek, “[o]ecasional deductions

may be made as a disciplinary measure for willful absences

or tardiness.” Thus, Petitioners do not argue that the district

court failed to follow an interpretation of the DOL which should

be given persuasive authority; rather, Petitioners simply argue

that the district court should have chosen a Jess recent

interpretation issued by the DOL.

The district court correctly decided to follow the more recent

opinion letter as to the permissibility of disciplinary deductions.

Importantly, consistent with-the “Otter Letter,” the DOL’s Field

Operations Handbook — used by agency employees in enforcing

compliance with the FLSA - provides that occasional

disciplinary deductions for willful absence or tardiness may be

made. See Field Operations Handbook, 932b04b, a reprint of

which 1s attached hereto as Appendix “A.” Mr. Strobel, the wage

and hour expert, testified at trial that the DOL opinion letter

relied upon by Petitioners (No. 479) was superceded by the 1967

change in the DOL’s Field Operations Handbook, as well as by

the 1982 “Otter Letter.” TT p. 93.

Under the FLSA, an employer is clearly permitted to make

certain deductions, or pay less than the full salary, in connection

19

with occasional disciplinary deductions for willful absences or

tardiness. See Cash v. Conn Appliances, Inc., 2 F. Supp. 2d 884

(E.D. Tx. 1997), (holding that numerous deductions made at

“irregular intervals of time” as to five plaintiffs was insufficient

to prove that the use of the FWW method of paying overtime

was invalid); see also Field Operations Handbook,

132b04b (attached as Appendix “A” to this Brief); DOL, Wage

and Hour Opinion Letter, May 26, 1982 (Otter Letter), attached

as Appendix “F” to Petitioners’ Brief; and DOL, Wage and Hour

Opinion Letter, No. 988, 1969-73 Wages & Hours (CCH)

130,531 (May 1, 1969). The evidence at trial conclusively

showed that disciplinary deductions were occasional under any

definition and that each disciplinary deduction by Apollo was

made for a willful absence or tardy.'°

Quite surprisingly, Petitioners failed to cite to this Court

the most recent Wage & Hour Opinion Letter on the subject of

disciplinary deductions from the FWW pay plan salary. This

DOL opinion letter, issued on May 28, 1999, sets forth the same

interpretation as that set forth in the Otter letter and in the Field

Operations Handbook -— 1.e., that occasional disciplinary

deductions may be made for willful absences or tardiness.

See 5/28/99, DOL Opinion Letter, 1999 WL 10024 15, a reprint

of which is attached to this Brief as Appendix “B.” Thus, the

most recent pronouncement of the DOL on the referenced issue

supports the district court’s and the court of appeals’ holding

that occasional disciplinary deductions may be made from the

salary of FWW employees.

Both the district court and the court of appeals applied an

interpretation of the subject regulation that has received DOL

16. As correctly noted by the Fifth Circuit Court of Appeals in its

opinion in this case, even though 29 C.F.R. 778.114 provides for a fixed

salary as “straight time pay for whatever hours [the employee] is called

upon to work in a workweek,” this does not mean that the employer

must pay the full salary even though the employee decides not to work

all the hours he is called upon to work. To hold otherwise, warned the

Fifth Circuit, “would allow fora tremendous abuse of the FWW method

by employees.”

20 :

and judicial approval. Given that this interpretation is

permissible and given the lack of other appellate court decisions

weighing in on this issue, this matter is not ripe for decision by

this Court.'’

With regard to Petitioners’ argument that the district court

and the court of appeals should have asked the DOL to file an

amicus brief in order to set forth its interpretation of the relevant

regulation and opinion letters, it should be noted that Petitioners

never requested the Fifth Circuit Court of Appeals to do so.

Moreover, undersigned counsel does not recall such a request

being made by Petitioners to the district court.

Nevertheless, why should the DOL have been asked to file

an amicus brief when the district court and the court of appeals

are undoubtedly authorized and empowered to read and interpret

regulations and opinion letters issued by federal agencies,

and do so every day of the week in cases across the country.

It is not practical to suggest that each such federal court would

be required to ask the particular federal agency that promulgated

the regulation or opinion letter at issue in the matter to file an

amicus brief. Such a paper intensive standard would

unnecessarily drain precious resources from both the referenced

federal agency, as well as from the federal judiciary. Moreover,

Petitioners’ protestation that an amicus brief should have been

requested of the DOL on the subject issue is rendered moot by

the most recent DOL opinion letter, which expressly permits an

employer’s occasional disciplinary deduction from the salary

of workers paid under the FWW pay plan (see copy of said

opinion letter attached to this Brief as Appendix “B”).

17. It is interesting to note that the DOL opinion letters attached

to Petitioners’ Brief as Appendix G, Appendix H, Appendix I and

Appendix J, were never cited to or presented by Petitioners to the district

court or to the court of appeals. Thus, to suggest in their Brief that these

referenced courts simply “ignored” such DOL opinion letters is

misleading; rather, it was Petitioners who apparently ignored these DOL

opinion letters until the time they filed their Petition for Writ of Certiorari

with this Court. Nevertheless, the most recent DOL opinion letter

supports Apollo’s position in this case.

21

B. No Considerations Exist for Granting Writ of Certiorari

On page 11 of their Brief, Petitioners state that the Fifth

Circuit Court of Appeals’ opinion in the case at bar is the only

decision by any federal court of appeals with regard to

disciplinary deductions from the salary of workers paid pursuant

to 29 C.F.R. 778.114. Petitioners argue that this fact justifies

this Court’s grant of a writ of certiorari. Apollo submits that

exactly the opposite is true.

Under Rule 10 of the Supreme Court Rules, the primary

focus of the considerations governing review of a petition for

writ of certiorari is the presence of conflicts between or among

the federal appellate circuits (which is not present in this case)

and/or between or among the state courts of last resort when

involving important federal questions (which is also not present

in this case). The only basis left, therefore, for Petitioners to

argue for a writ of certiorari is under subpart (c) of Rule 10,

which requires a finding that a federal (or state) appellate court

has decided an important question of federal law that has not

been, but should be, settled by this Court. Unfortunately for

Petitioners, such a situation does not exist in the present matter.

This Court should allow the federal courts of appeals

adequate time to reach conclusions and resolve the issues

complained of by Petitioners, instead of stepping in to write on

a relatively clean judicial slate. For this Court to step in and

decide matters of substantially first judicial impression would

deviate from the standard set forth in Rule 10 of the Supreme

Court Rules (which states that writs of certiorari should be

granted “only for compelling reasons”). Moreover, there is no

reason for this Court to grant a writ of certiorari when the only

federal appellate court decision on the issue of disciplinary

deductions from salaries of employees paid under the FWW

play plan (i.e., the Fifth Circuit’s decision in the case at bar) is

entirely consistent with the DOL’s most recent opinion letter

on the subject matter, as well as with the DOL’s Field Operations

Handbook (see Appendix “B” and Appendix “A” to this Brief,

respectively).

22

Petitioners’ argument that “‘it is rarely economically feasible

for attorneys to take these cases on a contingency fee basis” is

belied by the fact that Petitioners’ counsel has contingency

fee contracts with all of the Petitioners in the present matter.

In the past decade, undersigned counsel has defended at least

than two other clients in FLSA collective actions where the

plaintiffs were represented by legal counsel on a contingency

fee basis.

Petitioners’ statement that “wage and hour cases do not

qualify for class action status” is misleading, since, as this Court

is well aware, the FLSA authorizes “collective actions” for such

claims under § 216(b). In collective actions, potential plaintiffs

are permitted to “opt in” to the litigation after mailing

of notification letters regarding the pending litigation.

See Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 164, 110

S. Ct. 482 (1989).

C. Auer Decision Not Applicable to 29 C.F.R. 778.114 Pay

Plans

Petitioners next argue that the reasoning of this Court’s

decision in Auer v. Robbins, 519 U.S. 452, 117 S. Ct. 905 (1997),

should be found applicable to those workers who are paid

pursuant to the FWW pay plan under 29 C.F.R. 778.114.

This argument lacks merit.

In Auer, this Court addressed the issue of deductions from

the salary of employees who are completely exempt from

overtime requirements under the “white collar exemption” of

the FLSA pursuant to 29 U.S.C. § 213(a)(4). See also 29 C.F.R.

541.118. The situation of salaried, exempt employees (who are

paid no overtime at all, regardless of the number of hours

worked) is completely different from the situation of employees

paid using the FWW who are, in fact, paid overtime calculated

in accordance with 29 C.F.R. 778.114. In Auer, this Court

validated regulations promulgated by the Secretary of Labor

that provide that employees who are exempt from the overtime

requirements cannot have disciplinary deductions made from

23

their salary, except for infractions of safety rules of major

significance.'* The Court further held that for these salaried,

exempt employees who receive no overtime, either making

improper deductions or having a policy creating a significant

likelihood that these deductions can be made can cause the

overtime exemption to be lost.

In its opinion in Aver, this Court interpreted 29 C.F.R.

541.118 of the regulations, which explains the term “salary

basis” for the white collar exemption. The FLSA, under the

provision providing for the white collar exemption, requires

that employees completely exempt from the overtime

requirements be paid on a “salary basis.” 29 U.S.C. § 213(a)(1).

The DOL regulation interpreting this provision applicable to

employees who are paid no overtime provides that

an employee will be considered paid “on a salary

basis” ... if under the employment agreement he

regularly receives each pay period on a weekly, or

less frequent basis, a predetermined amount

constituting all or part of this compensation, which

amount is not subject to reduction because of

variation in the quality or quantity of work.

Auer v. Robbins, 519 U.S. 452, 455, 117 S. Ct. 905, 909 (1997)

(emphasis added). See also 29 C.F.R. 541.118. Thus, when this

Court upheld the Secretary of the Labor’s view that merely being

“subject to” impermissible deductions could cause the loss of

an exemption, it was actually interpreting and using language

of a regulation specifically designed for and addressing the white

collar exemption. This language is not present anywhere in

the regulation addressing the FWW. See 29 C.F.R. 778.114.'9

18. Of course, as discussed above, the DOL — in opinion letters

and the Field Operations Handbook — has stated that occasional

disciplinary deductions can be made from the salaries of employees

paid using the FWW pay plan.

19. The term “salary basis” is used in 29 C..R. 778.114; however,

as explained in Cash v. Conn Appliance, Inc., 2 F. Supp. 2d 884

(Cont’d)

24

For these reasons, the Aver decision should not be expanded

beyond its original holding to apply to employees paid using

the FWW. This Court expressed no desire in the Auer decision

for such an expansion, and the language of this decision does

not call for one.

As the district court held in its well-reasoned opinion in

the present matter, the principles outlined in the Auer decision

for employees exempt from overtime requirements under

29 C.F.R. 541.118 do not apply to employees paid using the

FWW. In their Brief, Petitioners have not cited to any cases that

support a contrary conclusion.

In fact, in support of Apollo’s position, the court in Cash v.

Conn Appliance, Inc., 2 F. Supp. 2d 884, 904-05 (E.D. Tex.

1997), held that the rules for salaried, exempt employees under

the white collar exemption to the FLSA do not apply to

employees paid using the FWW, based on the structure and text

of the DOL regulations and on the legislative history of the

regulations. Specifically, the Cash court found that the legislative

history and the regulations lead to the conclusion that there was

a distinct attempt by the Administrator of the DOL in

promulgating the regulations to distinguish “salaried exempt

employees falling within the white collar exemption from other

workers who receive salaries.” Jd. at 905. The court further stated

that the text and the history of the regulations lead to the

conclusion that “[t]hey establish Section 541.118(a) as a

mechanism to separate salaried employees coming within the

white collar exemption from salaried employees falling beyond

that exclusion, such as those whose overtime compensation is

calculated using the fluctuation workweek method.” Jd.

Thus, the district court in the case at bar correctly followed

the well reasoned opinion of the federal district court for Eastern

District of Texas in finding that the regulations for employees

(Cont’d)

(E.D. Tex. 1997), the Secretary of Labor did not intend that the rules

for salaries applicable to exempt employees apply to employees paid

using the FWW.

25 A

exempt from overtime requirements do not apply to employees

paid overtime under the FWW. Nevertheless, the district court

in the present matter was never forced to reach the issue of

whether the principles laid out in the Auer case applied to the

FWW for very important reasons. Most importantly, the trial

court made the factual finding that Apollo employees were not

in fact “subject to” any improper deductions, nor were any

improper deductions made from the salaries of the six plaintiffs.

With this factual finding, the issue of whether the principles

outlined in the Auer decision applied to FWW employees did

not have to be reached; thus, they should not be considered in

connection with this application for writ of certiorari.

Despite the district court ruling that the more stringent rules

for deductions for employees who are completely exempt —

from overtime pay requirements (under 29 C.F.R. 541.118) did

not apply to employees paid using the FWW, it went a step

further and found that even if these rules did apply, Apollo’s

method of making deductions met these rules as well,

again leading to the conclusion that Apollo employees were

not, in fact, “subject to” any improper policies on deductions.

See ARJ p. 19. Thus, even under the principles outlined in the

Auer decision, the district court found that Apollo’s use of the

FWW was proper. Petitioners are therefore basically requesting

this Court to grant a writ of certiorari so that it can issue an

advisory opinion (completely mooted out by findings of fact at

the trial). Such a request by Petitioners is certainly not justified

under Rule 10 of the Supreme Court Rules.

D. No Need to Revisit Overnight Motor Decision

The Petitioners set forth an emotional plea (under the guise

of the blue-collar employee versus the powerful employer) for

this Court to revisit its decision in the case of Overnight Motor

Transportation Co. v. Missell, 316 U.S. 572 (1942), but there is

no reason to do so. The Overnight Motor case has been cited

and relied upon by countless federal courts for almost 60 years.

In effect, Petitioners are asking this Court to issue either an

advisory opinion (since the trial court made findings of fact

26

that all actions of Apollo were justified and proper) or to

promulgate a judicial amendment to long-standing law and

regulation (by adding qualifications and/or restrictions to either

the FLSA or to 29 C.F.R. 778.114).

The obvious motive for Petitioners’ referenced plea is

because they do not like the well-established case law to the

effect that FWW pay plans comply with the FLSA. Under the

FWW, an employee receives a fixed salary for all hours worked

in any workweek plus one-half times (instead of one and one-

half times) the “regular rate of pay’? for all hours worked over

40 in any workweek.”' 29 C.F.R. 778.114. The regular rate of

pay is determined by dividing all hours worked in a workweek

into all salary for that workweek. /d. Contrary to Petitioners’

statements in brief, employees paid pursuant to the FWW do,

in fact, effectively receive time and one-half for all overtime

hours — i.e., the salary covers the “time” and the overtime

premium calculated in accordance with 29 C.F.R. 778.114 covers

the “one-half.” In discussing the regular rate of pay, this Court

stated almost 60 years ago that:

[I]t is true that the longer the hours the less the rate

and the pay per hour. This is not an argument,

20. The regular rate of pay is defined by the Administrator of the

Wage and Hour Division as a “rate per hour.” See 29 C.F.R. 778.109.

Generally, the regular rate is determined “by dividing ... total

remuneration for employment (except for statutory exclusions) in any

workweek by the total number of hours actually worked by [the

employee]. . . in that workweek for which such compensation was paid.”

Id. A “workweek” is a fixed and recurring seven consecutive twenty-

four hours, as set by the employer. 29 C.F.R. 778.105.

21. For example, if an employee has a salary of $500 per week

and that employee works fifty hours in one workweek, the regular rate

of pay for that employee for that workweek would be $10 per hour. For

all hours worked over forty by that employee in that workweek (i.e., ten

hours), that employee would receive an additional one-half of the regular

rate of pay or $5. Thus, the employee’s pay for all overtime hours during

said workweek would actually be $15 per hour.

| a

however, against this method of determining the

regular rate of employment for the week in question.

Overnight Motor, supra.”

Petitioners assert on page 15 of their Brief that this Court

created a “narrow exception” to the FLSA in the Overnight

Motor case. This statement is misplaced since the FWW is not

an exception to the FLSA, but is an alternate method of

complying with the federal statute. See Yadav v. Coleman

Oldsmobile, Inc., 538 F.2d 1206 (Sth Cir. 1976), (“The

application of the ‘fluctuating workweek’ formula is not at all

dependent upon a finding that the employer is entitled to the

exception commonly known as the ‘Belo’ provision.”); Bailey

v. County of Georgetown, 94 F.3d 152, 154 atn.5 (4th Cir. 1996),

(778.114 is not an “exception” to the FLSA, but rather an

alternate means of complying); and Flood v. New Hanover

County, 4 Wage and Hour Cases 2d (BNA) 139 (4th Cir. 1997),

(“778.114 does not represent an ‘exception’ to the FLSA”).

Petitioners argue that the Fifth Circuit Court of Appeals

decision in the present case has “eliminated” the guaranteed

salary requirement under the FWW. Nothing could be further

from the truth, since the Fifth Circuit merely agreed with the

DOL’s Field Operations Handbook and its opinion letters which

allow occasional disciplinary deductions to be taken from the

salaries paid to employees pursuant to the FWW. If the employee

does not willfully absent himself from work (thus causing the

employer to consider an occasional disciplinary deduction), then

said employee will be paid his full FWW salary for the week in

question.

Petitioners’ arguments that Apollo’s pay plan gave it a

competitive advantage over its competitors is totally without

merit. The district court specifically found that Apollo did

nothing wrong and, in fact, paid the plaintiffs everything they

22. As noted by the district court in the case at bar, the particular

employees before this Court in the Overnight Motor case averaged

65 hours of work per week.

28

were owed — and even more. MJJL Tr. P. 65. Thus, Petitioners’

attempt to use such generalized policy arguments are misplaced

under the detailed factual findings in this case.

CONCLUSION

For the reasons set forth above, Apollo prays that

Petitioners’ application for writ of certiorari be denied.

Petitioners’ plea to either have this Court overrule its Overnight

Motor case, or to embrace their position that playing “hooky”

should have no consequences, in the work place should be

rejected.

Respectfully submitted,

TimoTuy J. MCNAMARA

Grec GUIDRY

Steven C. LANza*

Maria F. MANUEL

ONEBANE, BERNARD, TORIAN,

Diaz, MCNAMARA & ABELL

Attorneys for Respondents

Post Office Box 3507

Lafayette, LA 70502-3507

(337) 237-2660

* Counsel of Record

APPENDIX

la

APPENDIX A — DOL FIELD

OPERATIONS HANDBOOK 4 32b04(b)

32b04b Jrregular hours worked. (a) If an employee is given

a stipulated salary with the understanding that it constitutes

straight time pay for all hours he works, and if his hours of

work fluctuate from week to week, his regular rate of pay

ordinarily will vary form week to week in accordance with

the number of hours worked each week. The regular rate, of

course, cannot be less than the applicable MW. Since straight

time compensation has already been paid, such an employee

must receive additional OT compensation for each OT hour

in a particular w/w computed at not less than one-half the

regular rate obtained by dividing the weekly salary by the

number of hours worked in that w/w. If the employer to avoid

weekly computations chooses to pay extra half-time based

on the salary divided by 40 hours, such a method is

permissible.

(b) The above rule will apply where an employee works a

varying number of hours, and normally receives his full

salary regardless of how few the scheduled hours may be in

a particular week, even though occasional disciplinary

deductions for wilful absence or tardiness are made.

Disciplinary deductions, of course, may not cut into the MW

or OT pay required by the Act.

(c) Similarly, an employee employed on a fixed salary basis

for irregular hours of work may be paid a pro rata share of

his salary in the initial or terminal week of his employment,

when he is not in payroll status for the entire week.

2a

APPENDIX B — DOL OPINION LETTER

DATED MAY 28, 1999

Wage and Hour Division

United States Department of Labor

Opinion Letter

Fair Labor Standards Act (FLSA)

May 28, 1999

* * *

This is in response to your letter concerning the application

of the fluctuating workweek method of paying overtime. We

regret the delay in responding.

Under section 778.114 of Interpretative Bulletin, 29 C.F.R.

778, an employee employed on a salary basis may have hours

of work which fluctuate from week to week and the salary

may be paid pursuant to an understanding with the employer

that the employee will receive such fixed amount as straight

time pay for whatever hours the employee is called upon to

work in a workweek, whether few or many. Where there is a

clear mutual understanding of the parties that the fixed salary

is compensation (apart from overtime premiums) for the

hours worked each workweek, whatever their number, rather

than working for 40 hours or for some other fixed weekly

work period, such a salary agreement is permitted by the

Fair Labor Standards Act (FLSA) if the amount of the salary

is sufficient to provide compensation to the employee at a

rate not less than the applicable minimum wage rate for every

hour worked in those workweeks in which the number of

hours the employee works is greatest, and if the employee

receives extra compensation, in addition to such salary, for

3a

Appendix B

all overtime hours worked at a rate not less than one-half the

employee’s regular rate of pay. This is often referred to as

the fixed salary for fluctuating hours or the “fluctuating

workweek.”

Since the salary in such a situation is intended to compensate

the employee at straight time rates for whatever hours are

worked in the workweek, the regular rate of the employee

will vary from week to week, and is determined by dividing

the number of hours worked in the workweek into the amount

of the salary to obtain the applicable hourly rate for that week.

Payment for overtirne hours at one-half such rate in addition

to the salary satisfies the overtime pay requirement because

such hours have already been compensated at the straight

time regular rate, under the salary agreement.

Your client has proposed paying employees by the fluctuating

workweek method with the following conditions:

* Ifthe employer fails to provide work for the

full workweek the employee will receive their

full salary.

* Ifthe employee is absent from work for a full

day to take care of personal business, the

employer will charge one day’s vacation

against the employee’s accrued vacation, thus

there will be no reduction in pay. If the

employee has not accumulated any vacation

days, the employer may dock their salary

1/7th of their weekly salary amount.

4a

Appendix B

¢ Ifthe employee is absent from work because

of personal illness, the provisions of the Family

and Medical Leave Act (FMLA) Regulations

Part 825, Section 825.206 will apply unless the

illness does not qualify under the FMLA. If

the illness does not qualify under the FMLA,

the employer will charge the day against the

employee’s allowance for sick leave. If the

employee has no sick days, e.g., a new

employee, or if the employee has used all their

sick days allowance, the employer may dock

the employee’s salary 1/7th of the weekly

salary amount.

¢ Absences that qualify as bona fide FMLA leave

will be made in accordance with the

Regulations, Part 825.206.

You further state that this proposal for handling deductions

from the fluctuating workweek salary method of payment is

“patterned” after the “salary basis” method of payment set

forth in the Regulations, Part 541, Section 541.118.

Based on the above conditions, we do not agree that your

client may meet his overtime pay obligations by use of the

fluctuating workweek. The discussion of “salary basis of

payment” contained in 29 CFR §§541.118 refers to the salary

requirements for employees who may qualify for exemption

from the minimum wage and overtime pay requirements

under §§13(a)(1) of the FLSA, and not to the salary

requirements under the fluctuating workweek method of

compensation. Deductions for absences for personal business

5a

Appendix B

or routine sickness generally may not be made from the salary

of an employee paid on a fluctuating workweek basis.

However, disciplinary deductions, which do not cut into the

required minimum wage or overtime compensation, may be

made for willful absences or tardiness or for a situation such

as an employee being sent home from work because of

drunkenness.

Section 825.206(b) of the Regulations, Part 825 discusses

the interplay between the FMLA and the fluctuating

workweek method of payment. For an employee paid

according to the fluctuating workweek method, who is

utilizing intermittent or reduced schedule FMLA leave, the

employer may during the period of the leave compensate

the employee on an hourly basis and pay only for the hours

worked, including time and one-half the employee’s regular

rate for overtime hours. If the employer does not elect to

convert the employee’s compensation to an hourly basis, no

deduction may be made for FMLA leave absences.

This opinion is based exclusively on the facts and

circumstances described in your request and is given on the

basis of your representation, explicit or implied, that you

have provided a full and fair description of all the facts and

circumstances that would be pertinent to our consideration

of the question presented. Existence of any other factual or

historical background not contained in your request might

require a different conclusion than the one expressed herein.

Sincerely,

Daniel F. Sweeney

Office of Enforcement Policy Fair Labor Standards Team