Dole v. Haulaway Inc.

• Decision Date: 27 October 1989
• Docket Number: Civ. A. No. 87-2938.
• Citation: 723 F. Supp. 274
• Parties: Elizabeth DOLE, Secretary of Labor, United States Department of Labor, Plaintiff, v. HAULAWAY INCORPORATED and Joseph Scugoza, Individually, Defendants.
• Court: U.S. District Court — District of New Jersey

723 F. Supp. 274

Elizabeth DOLE, Secretary of Labor, United States Department of Labor, Plaintiff, v. HAULAWAY INCORPORATED and Joseph Scugoza, Individually, Defendants.

Civ. A. No. 87-2938.

United States District Court, D. New Jersey.

October 27, 1989.

Robert P. Davis, Sol. of Labor, Patricia M. Rodenhausen, Regional Sol., Evan R. Barouh and Jonathan Kay, Attys., U.S. Dept. of Labor, Office of Sol., New York City, for plaintiff.

John J. Pribish and Adrienne C. Rogove, North Brunswick, N.J., for defendants.

DEBEVOISE, District Judge.

The Secretary of Labor (sometimes referred to herein as the "government") filed this action on July 22, 1987 alleging that defendants had since at least July 1984 willfully violated and continued to violate the overtime and record keeping provisions of the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. (hereinafter "the Act"). The complaint seeks to enjoin the defendants prospectively from violating these statutory provisions and restrain defendants from withholding any unpaid overtime compensation found due since July 22, 1984 through the entry of judgment or compliance with the Act, and seeks an equivalent amount of liquidated damages.

Defendant, Haulaway Incorporated, (hereinafter "Haulaway") was incorporated in New Jersey in May 1970 and during the relevant period has been engaged in the trash removal business primarily in the State of New Jersey. Defendant, Joseph Scugoza, has, at all times relevant hereto, been the president of Haulaway; held 100% of the stock of Haulaway; and exercised day-to-day control over the business affairs of the corporate defendant. In this opinion when I refer to the "defendant" I shall mean the corporate defendant unless otherwise indicated.

A bench trial commenced on July 18, 1989 and (with a six day interruption) proceeded until July 27 at which time, for reasons which will be described below, it recessed. On August 21 trial resumed and was completed on August 24. This opinion sets forth my findings of fact and conclusions of law. Most of the findings are contained in the critique of the manner in which the court managed the case. It is hoped that the critique may assist other judges avoid the serious mistakes which I made administering this case.

A. Case Management Deficiencies

The most critical issue in this and probably all other FLSA overtime cases is the amount of unpaid overtime hours worked by a defendant's employees. Where, as in this case, the employer has failed to keep adequate records of hours worked, the government of necessity, must devise some reasonable method of ascertaining the overtime hours of affected employees.

At no time prior to trial did the government specify the amount of overtime pay it contended was due or its method of calculating that amount. Rather, it prevailed upon a gullible court to include the following provision in the final pretrial order:

Many employees will testify to the number of hours worked and the court will make a finding as to their hours. The amount of unpaid overtime compensation due those employees who do not testify will be based on the average number of hours worked found due by the court for the testifying employees. The Secretary's compliance officer will testify to application of the statutory formula for overtime compensation and the method for calculation of overtime due, depending on the court's finding of hours worked.

Thus, the record developed at trial will permit the court to find hours worked and plaintiff will then submit an exhibit listing the amount due each employee for incorporation into the Final Judgment.

This sounds most simple. The court merely hears employees' testimony, decides how many excess hours each worked, averages those results for non-testifying employees, and the Secretary will do all the rest.

I first sensed trouble when, immediately prior to trial, I attempted to find a basis for settlement. The government was unable to state a figure which it claimed would be due if its full claim was allowed. It had no figure derived from the evidence it had assembled which it would advance as total overtime pay due. It had no statement of the methodology it intended to apply to determine the number of overtime hours it claimed each employee worked. That ended settlement discussions.

The trial commenced on July 18, 1989 and the government called a number of employees to the stand to present evidence on the basis of which overtime hours were to be computed. I shall list some of the factors which, it developed, affected the determination of overtime hours:

1. During most or all of the 1984-1989 period defendant, a trash remover, served the communities of Upper Saddle River, Belleville, Butler and Parsippany-Troy Hills and it also had commercial routes identified as Paterson, Hackensack, Hoboken 1 and Hoboken 2. Each route takes a different time to complete; different days on the same route require different times to complete. Most of defendant's employees were assigned to the same route each day, but some worked on different routes in any given week or in different weeks. This was particularly true with respect to employees who worked in Butler, which had collection service only four days each week, and the employees assigned there had to be assigned to other routes on the remaining two days in each week.

2. Most employees, both drivers and helpers, usually worked the full six day week — Saturday through the following Friday, with Sundays off. However, some employees worked less than a six day week and, of course, all employees had absences from time to time.

3. Depending on which route was being served, employees reported at defendant's Hoboken yard at different times in the morning. The reporting times for the various crews was generally testified to as follows: Upper Saddle River — 4:30-5:30 a.m.; Belleville — 4:00-4:30 a.m.; Butler — 4:30-5:00 a.m.; Parsippany-Troy Hills — 4:45-5:00 a.m.; the commercial routes — 5:00 a.m.

4. After collecting all the trash on a given route, it was necessary to take the trash to a landfill, or during later periods to a transfer station. The landfills or transfer stations serving the residential communities were: Upper Saddle River-Bergen County Landfill; Belleville-North Arlington or Kearny Landfill/Newark Transfer Station; Butler-Edgeboro Landfill; Parsippany-Troy Hills-Edgeboro Landfill. Each of the landfills and transfer stations was at a different distance from the communities served and from Hoboken, where the employees returned with the trucks at the end of their work day. There were different waiting times at different landfills and transfer stations; there were different waiting times at the same landfills and transfer stations on different days.

5. On some occasions after all the trash on a route was collected a truck and its crew did not go to the landfill or transfer station but took the load to the Hoboken yard where it remained overnight.

6. Belleville was served by three trucks with their drivers and helpers for a part of the period in question. Thereafter the same territory was served by four trucks and their helpers, thus reducing the time required to complete collections.

7. Prior to 1987 each driver and helper had to wash his truck after returning to defendant's Hoboken yard at the end of the day. The job took 15-20 minutes but there were often lengthy waits while other trucks were being washed. In 1987 defendant hired other persons to do the washing, and thereafter the drivers and helpers were able to leave immediately after returning to the yard.

8. Occasionally defendant gave a driver or helper extra pay for an unusually long trip or unusual circumstance.

9. Some helpers did not return to the defendant's Hoboken yard in the evening, but were dropped off nearer their own homes. On occasion some helpers did not go into the Hoboken yard in the morning but were picked up as their truck proceeded to its assigned route.

A number of employees testified about various of the above factors which affected the hours of their work and there was stipulated testimony of an even greater number of employees about these factors. There was some variation in the employees' testimony about the same matters. During the first three days of trial the mass of undigested data referred to above was introduced into evidence by way of testimony and stipulated testimony. By July 20, the third day of trial, it dawned upon me that the government had no intention of using its expertise in this field to pull together the vast array of data and by means of expert testimony or otherwise compute and present what it had concluded was the total overtime for which compensation had not been paid. As government counsel stated "after the Court makes a finding on ... how many hours did people work ... the government would then go back and present a schedule of the specific dollar amount due for each individual." (Tr. at 420, 421). The government correctly pointed out that such a procedure was contemplated by the pretrial order. However, awakening at last, I concluded that the procedure was "totally unacceptable" (Tr. at 421) and required the government to be prepared to present through a qualified witness or witnesses a schedule admissible in evidence showing exactly what it was that the government claimed was owing with respect to each employee.

The Court: I'm directing you to have a witness who will give the bottom line and the reasons for the bottom line and a schedule to back it up so that if, theoretically, if I mastered the testimony I could say thank you at the end of the defendants' case and end of your rebuttal case and give you a judgment.

Pretend I'm a jury. You are sending me out to the jury room.

Mr. Kay: I didn't pretend that you are a jury in preparing this case.

The Court: I'm directing you to treat me as if I'm a 12 or six person jury who will have the responsibility, when you finish your closing argument, of

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