Garcia v. Tyson Foods Inc.

• Decision Date: 31 January 2011
• Docket Number: Case No. 06–2198–JWL.
• Citation: 17 Wage & Hour Cas.2d (BNA) 811,766 F.Supp.2d 1167
• Parties: Adelina GARCIA et al., Plaintiffs,v.TYSON FOODS, INC. and Tyson Fresh Meats, Inc., Defendants.
• Court: U.S. District Court — District of Kansas

766 F.Supp.2d 1167

17 Wage & Hour Cas.2d (BNA) 811

Adelina GARCIA et al., Plaintiffs,

v.TYSON FOODS, INC. and Tyson Fresh Meats, Inc., Defendants.

Case No. 06–2198–JWL.

United States District Court, D. Kansas.

Jan. 31, 2011.

Adam T. Klein, Justin M. Swartz, Linda A. Neilan, Outten & Golden LLP, New York, NY, Eric L. Dirks, George A. Hanson, Lee R. Anderson, Stueve Siegel Hanson LLP, Kansas City, MO, Peter J. Antosh, Garcia & Antosh, LLP, Dodge City, KS, for Plaintiffs.Craig S. O'Dear, Robert J. Hoffman, Terence J. Thum, Bryan Cave LLP, Kansas City, MO, Evangeline C. Paschal, Michael J. Mueller, Emily Burkhardt Vicente, Hunton & Williams LLP, Washington, DC, for Defendants.

MEMORANDUM & ORDER

JOHN W. LUNGSTRUM, District Judge.

Plaintiffs, current and former hourly production employees at two of defendants' beef processing facilities, seek to recover unpaid wages under the Fair Labor Standards Act (FLSA), 29 U.S.C. § 201 et seq., and the Kansas Wage Payment Act, K.S.A. § 44–313 et seq. Plaintiffs also assert a Kansas common law claim for quantum meruit. Specifically, plaintiffs seek to recover unpaid wages for all time spent during the continuous workday, including time spent performing activities such as pre-shift donning and post-shift doffing of required protective clothing and gear; donning and doffing at meal periods; and pre-shift and post-shift walking time. Plaintiffs also seek to recover wages for the unpaid portion of rest breaks. This action has been certified as a collective action with respect to the FLSA claims and as a class action with respect to the state law claims.

This case is now before the court on the parties' motions for summary judgment. The parties have cross-moved for summary judgment on the compensability of the unpaid rest break and the compensability of donning and doffing at the meal period. In addition, plaintiffs seek a ruling that their donning and doffing activities, as a matter of law, are integral and indispensable to their work such that those activities mark the beginning and end of the continuous workday and that those activities, as a matter of law, are not de minimis. Tyson, in turn, seeks a ruling that it, as a matter of law, acted in good faith and without willfulness with respect to its pay practices (thereby precluding liquidated damages and preserving the two-year statute of limitations under the FLSA) and moves for summary judgment on plaintiffs' KWPA and quantum meruit claims in their entirety. As will be explained, the motions are denied in all respects except that the court grants summary judgment in favor of Tyson on plaintiffs' quantum meruit claims.

I. Pertinent Facts and Procedural History

Tyson Fresh Meats, Inc. is a wholly owned subsidiary of Tyson Foods, Inc. (collectively, “Tyson”) and is the world's largest supplier of premium beef and pork, as well as allied products, such as tanned hides used to make leather. Tyson operates beef processing facilities in Finney County and Emporia, Kansas. In addition to processing beef, the Finney County facility conducts slaughter operations and, until February 2008, the Emporia facility conducted slaughter operations. Tyson employs approximately 2500 hourly workers at the Finney County facility and, until February 2008, it employed approximately 2000 hourly workers at the Emporia facility. It now employs approximately 800 hourly workers at the Emporia facility. Plaintiffs are Tyson's current and former hourly “production” employees at the Finney County and/or Emporia facilities during the applicable class period and they work or worked in one or more “production jobs” in the slaughter and/or processing areas of these facilities.

Tyson's hourly workers cannot enter the production area unless they are wearing certain personal protective clothing and gear. All production workers, regardless of department or job code, are required to wear a hard hat, a hairnet, a beardnet (if necessary) and earplugs. Production employees in slaughter operations also wear a white uniform in lieu of street clothes (referred to by the parties as “whites”) and production employees in processing operations wear a white “frock” over their street clothes. Employees who utilize knives in connection with their specific positions are required to wear additional “unique” or “specialized” clothing and gear. In addition, certain employees, depending on the particular job, are required to wear steel-toe boots, safety glasses, cotton or rubber gloves, and rubber aprons. Some workers, based on their personal preferences, choose to wear or utilize certain clothing and gear not otherwise required for their positions.

Production workers at both facilities are paid primarily based on “gang time” or “line time”—that is, they are paid for the time that product is moving on the line. Gang time is approximately 8 hours per shift.¹ The production line “stops” twice during each shift, once for a meal period and once for a “rest” period of shorter duration.² The line does not actually cease moving during these breaks, but no product is placed on the line during these breaks such that a production worker is free to leave the production area when he or she is finished working on the last piece of product that passes through his or her workstation.

Gang time, then, does not capture any time spent on activities outside the movement of the line, such as donning and doffing clothing and equipment. To compensate hourly production workers for some of the time they spend on such activities, Tyson pays additional minutes of time (known as “K code” time) beyond gang time pay. “K code” time is not the actual time hourly production workers spend performing such activities and Tyson does not record the actual time workers spend performing such activities. Moreover, not all hourly production employees have always been eligible for “K code” time and the specific amount of “K code” time provided to eligible employees has changed over the years.

Tyson's practice of paying “K code” time stems from litigation initiated by the Department of Labor against Tyson's predecessor, Iowa Beef Processors, Inc. (IBP). In 1988, the Secretary of Labor brought an action against IBP at all of its non-union facilities nationwide (including the Finney County facility) alleging that pre- and post-shift time spent donning and doffing protective clothing and gear was compensable under the FLSA. See Reich v. IBP, Inc., 820 F.Supp. 1315 (D.Kan.1993). The Reich trial was bifurcated. During the first phase, the trial court determined only the compensability issue and concluded that the donning and doffing of unique or specialized protective clothing and gear worn by knife-wielding employees was compensable. See id. at 1326–27.³ The second phase of the Reich trial concerned the amount of IBP's backpay liability and whether the court should permanently enjoin IBP from future violations. See Reich v. IBP, Inc., 1996 WL 137817, at *1 (D.Kan. Mar.21, 1996). For purposes of calculating backpay, the trial court utilized the “reasonable time” that knife-wielding employees spent donning and doffing specialized protective clothing and gear rather than the actual time employees spent performing these activities. The court also permanently enjoined IBP from future violations of the FLSA and, more specifically, ordered IBP to “implement recordkeeping practices sufficient to record the time spent by each employee in performing the pre-shift and post-shift activities found to be compensable under the Act.” On appeal, the Tenth Circuit affirmed the trial court's issuance of the permanent injunction and affirmed the trial court's estimate concerning the reasonable time required for donning and doffing required protective clothing and gear. See Metzler v. IBP, Inc., 127 F.3d 959 (10th Cir.1997).

At the conclusion of the Reich litigation, IBP and the DOL attempted to reach an agreement on the amount of IBP's backpay liability and, arguably, IBP's future compliance with the Reich injunction. When settlement discussions failed, the Secretary, in April 1998, filed an enforcement action concerning IBP's backpay liability. See Herman v. IBP, Inc., No. 98–2163–JWL (D.Kan. Apr. 10, 1998). At that time, IBP, based on a series of time studies it had conducted, began paying 4 minutes of “K code” time not only to knife-wielding employees but also to those employees in a department where knives were used by at least one employee in the department. Because the payment of this “K code” time was effectuated by shutting down the line 4 minutes early each shift without reducing the amount of gang time, nearly all hourly production workers received the 4 minutes of “K code” time. In July 1999, the parties stipulated to the dismissal of the enforcement action with prejudice, based in part on their agreement that defendants could satisfy their backpay obligations under Reich (and, arguably, satisfy their future obligations under the Reich injunction) by compensating knife-wielding employees an additional four minutes per shift for time spent donning and doffing specialized protective clothing and gear worn by those employees.

After the Supreme Court's decision in IBP, Inc. v. Alvarez, 546 U.S. 21, 126 S.Ct. 514, 163 L.Ed.2d 288 (2005), in which the court held that walking time is compensable if it follows or precedes a principal working activity, Tyson conducted a time study to determine the number of minutes required for certain pre- and post-shift walking time within the two facilities. After that time study, Tyson changed its pay practices. Beginning in January 2007, Tyson went back to paying additional minutes only to those employees in knife-wielding positions. These minutes ranged from 4 to 7 minutes at Finney County and 4 to 9 minutes in Emporia depending on the employee's specific job position and the requisite walking associated with that position. Employees who were not in knife-wielding positions were paid...