Brunozzi v. Cable Commc'ns, Inc.

• Decision Date: 21 March 2017
• Docket Number: No. 15-35623, No. 15-35744,15-35623
• Citation: 851 F.3d 990
• Parties: Matteo BRUNOZZI, an individual, Plaintiff-Appellant, v. CABLE COMMUNICATIONS, INC., a foreign corporation, Defendant-Appellee. Casey McCormick, an individual, Plaintiff-Appellant, v. Cable Communications, Inc., a foreign corporation, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

851 F.3d 990

Matteo BRUNOZZI, an individual, Plaintiff-Appellant,

v.CABLE COMMUNICATIONS, INC., a foreign corporation, Defendant-Appellee.

Casey McCormick, an individual, Plaintiff-Appellant,

v.Cable Communications, Inc., a foreign corporation, Defendant-Appellee.

No. 15-35623

No. 15-35744

United States Court of Appeals, Ninth Circuit.

Argued and Submitted November 10, 2016, Portland, Oregon

Filed March 21, 2017

Phil Goldsmith (argued), Law Office of Phil Goldsmith, Portland, Oregon; D. Michael Dale, Law Office of D. Michael Dale, Cornelius, Oregon; David A. Schuck, Schuck Law LLC, Vancouver, Washington; Corinna Spencer-Scheurich, Northwest Workers' Justice Project, Portland, Oregon; for Plaintiffs-Appellants.

Mitchell C. Baker (argued) and Alexander A. Wheatley, Fisher & Phillips, LLP, Portland, Oregon, for Defendant-Appellee.

Shenoa Payne, Shenoa Payne Attorney At Law PC, Portland, Oregon, for Amicus Curiae Oregon Trial Lawyers Association.

Before: M. Margaret McKeown and William A. Fletcher, Circuit Judges, and Jennifer A. Dorsey, District Judge.^*

OPINION

DORSEY, District Judge:

Matteo Brunozzi and Casey McCormick worked as technicians for Cable Communications, Inc. (CCI) installing cable television and internet services. They filed separate lawsuits against CCI alleging that the company's compensation plan violates the overtime provisions of the Fair Labor Standards Act (FLSA), 29 U.S.C. § 207, and Oregon's statutory requirement that an employer pay all wages earned and unpaid after terminating an employee, ORS 652.140. Brunozzi additionally alleges that CCI violated Oregon's laws prohibiting discrimination against a private employee who engages in whistleblowing (ORS 659A.199 ) and wage-claim discussions (ORS 652.355 ). The district court granted summary judgment in favor of CCI on those claims. The technicians appealed. We reverse.

I. Background

A. Technician work and pay

CCI employs technicians to install cable television and internet services for Comcast customers. McCormick worked for CCI as a technician for almost one year. Brunozzi was similarly employed by CCI for approximately five months. The unchallenged evidence shows that the technicians' work tasks are assigned by CCI on a daily basis. The company schedules the appointments with the customers; the technicians do not have authority to change appointment times or complete a task on a different day. These technicians' workweeks ordinarily exceeded 40 hours, and they were routinely scheduled to work six-day weeks.

CCI guarantees that its technicians will earn at least the statutory minimum wage and pays them on a piece-work basis. This means that the technician is paid a fixed rate for each piece of work (i.e., task) that he completes.¹ CCI's technicians sign a document entitled "Technician Pay Rate Program." The agreement states that the technician's gross earnings are the "[t]otal amount billed to the company by the employee for Piece Rate jobs completed in the pay period plus any bonus received...."² It does not explain CCI's method for calculating the technicians' pay, but the parties mostly agree about how that is accomplished.

CCI begins by calculating the technician's "Piece Rate Total" for the week, which is the total value of the piece-work tasks performed by him that week minus any adjustments made for incomplete work or similar reasons. If the technician worked over 40 hours, CCI divides the Piece Rate Total by the total number of hours worked to calculate his "average hourly" rate of pay for that week.³ This hourly rate is then divided by two, and the resulting quotient is multiplied by the number of overtime hours the technician worked that week to arrive at the technician's base overtime pay—his "Piece Rate OT Premium."

CCI next calculates whether the technician has earned a "Production Bonus" by dividing the Piece Rate Total by 60, multiplying the quotient by 70, and subtracting from that product his Piece Rate Total and any Piece Rate OT Premium. Finally, if the technician earned a Production Bonus and worked overtime, CCI calculates the overtime due on the bonus—the Production Bonus OT Premium—by dividing the Production Bonus by the total number of hours worked in the week, dividing the resulting quotient by two, and multiplying that quotient by the number of overtime hours worked in the week. A technician's pay each week is his Piece Rate Total plus—to the extent that they are earned—Piece Rate OT Premium, Production Bonus, and Production Bonus OT Premium.

B. Procedural history of the technicians' lawsuits

Brunozzi filed his complaint in state court alleging that CCI violated: (1) Oregon's overtime regulations⁴ ; (2) the FLSA's overtime regulations; (3) Oregon's wage-claim- and whistleblowing-discrimination regulations; and (4) Oregon's wage-payment-on-termination regulations. After CCI removed the case to federal court, the parties filed cross-motions for summary judgment: the company moved on all of Brunozzi's claims while he moved on his FLSA overtime-violation and Oregon wage-payment-on-termination claims. The district court entered judgment in favor of CCI on Brunozzi's claims; Brunozzi timely appealed.

McCormick filed his complaint in state court alleging that CCI violated: (1) Oregon's overtime regulations; (2) the FLSA's overtime regulations; (3) Oregon's wage-payment-on-termination regulations; (4) the Oregon Family Medical Leave Act; (5) Oregon's disability-discrimination regulations; and (6) wrongful termination under Oregon common law. After CCI removed the case to federal court, the parties filed cross-motions for summary judgment: the company sought judgment on all of McCormick's claims, and he sought judgment on his FLSA overtime-violation and Oregon wage-payment-on-termination claims. The district court entered judgment in favor of the company on McCormick's FLSA and Oregon wage-payment-on-termination claims. Then the district court entered final judgment under FRCP 54(b) on those claims. McCormick timely appealed.

II. Standard of Review

A district court's decision to grant summary judgment is reviewed de novo. Ctr. for Bio-Ethical Reform, Inc. v. Los Angeles Cty. Sheriff Dep't , 533 F.3d 780, 786 (9th Cir. 2008). When the parties file cross-motions for summary judgment, "we review each motion ... separately, giving the nonmoving party for each motion the benefit of all reasonable inferences." Id. "When the underlying facts are not in dispute, th[is] court's only function is to determine whether the district court correctly applied the law." Szajer v. City of Los Angeles , 632 F.3d 607, 610 (9th Cir. 2011) (citing Universal Health Servs., Inc. v. Thompson , 363 F.3d 1013, 1019 (9th Cir. 2004) ). "We review the district court's interpretation of state law, including state statutes, de novo." Wetzel v. Lou Ehlers Cadillac Group Long Term Disability Ins. Program , 222 F.3d 643, 646 (9th Cir. 2000) (en banc) (citing In re McLinn , 739 F.2d 1395, 1397–98 (9th Cir. 1984) (en banc)).

III. Discussion

A. The technicians' FLSA overtime-violation claims

1. Overtime pay requirements under the FLSA

"Congress enacted the FLSA in 1938 with the goal of ‘protect[ing] all covered workers from substandard wages and oppressive working hours.’ " Christopher v. SmithKline Beecham Corp. , 567 U.S. 142, 132 S.Ct. 2156, 2162, 183 L.Ed.2d 153 (2012) (alteration in original) (quoting Barrentine v. Arkansas-Best Freight Sys., Inc. , 450 U.S. 728, 739, 101 S.Ct. 1437, 67 L.Ed.2d 641 (1981) ). Among other things, the FLSA requires "employers to compensate employees for hours in excess of 40 per week at a rate of 1½ times the employees' regular wages." Id. (citing 29 U.S.C. § 207(a) ). "The keystone of [this requirement] is the regular rate of compensation. On that depends the amount of overtime payments [that] are necessary to effectuate the statutory purposes. The proper determination of that rate is therefore of prime importance." Walling v. Youngerman-Reynolds Hardwood Co. , 325 U.S. 419, 424, 65 S.Ct. 1242, 89 L.Ed. 1705 (1945) (" Youngerman-Reynolds ").

Although not defined in the FLSA, the Supreme Court has interpreted "regular rate" to mean "the hourly rate actually paid the employee for the normal, non-overtime workweek for which he is employed." Id. (citing Walling v. Helmerich & Payne, Inc. , 323 U.S. 37, 40, 65 S.Ct. 11, 89 L.Ed. 29 (1944) ); Parth v. Pomona Valley Hosp. Med. Ctr. , 630 F.3d 794, 799 (9th Cir. 2010). "The regular rate by its very nature must reflect all payments [that] the parties have agreed shall be received regularly during the work week, exclusive of overtime payments." Id. In determining the statutory regular rate, "[w]e must look ‘not to contract nomenclature’ but to all payments, wages, piece work rates, bonuses, or things of value" that form "part of the normal weekly income" of the employee. Walling v. Alaska Pac. Consol. Min. Co. , 152 F.2d 812, 815 (9th Cir. 1945). "The ‘regular rate’ of pay under the [FLSA] cannot be left to a declaration by the parties as to what is to be treated as the regular rate for an employee; it must be drawn from what happens under the employment contract." 29 C.F.R. § 778.108 (citing Bay Ridge Operating Co. v. Aaron , 334 U.S. 446, 464, 68 S.Ct. 1186, 92 L.Ed. 1502 (1948) ).

For employees who are paid "on a piece-rate basis, the regular hourly rate of pay is computed by adding together total earnings for the workweek from piece rates and all other sources (such as production bonuses) and any sums paid for waiting time or other hours worked (except statutory exclusions)." Id. § 778.111(a). "This sum is then divided by the number of hours worked in the week for which such compensation was paid, to yield the pieceworker's ‘regular rate’ for that week." Id. A pieceworker is entitled to be paid "the total weekly earnings at this regular rate for all hours worked" and overtime equal to "one-half this regular rate of pay multiplied by the number of hours worked in excess of 40 in the week." Id. "Only...