Keeley v. Loomis Fargo & Co.
| Decision Date | 15 October 1998 |
| Docket Number | No. Civ. 97-6207(DRD).,Civ. 97-6207(DRD). |
| Citation | 42 F.Supp.2d 442 |
| Court | U.S. District Court — District of New Jersey |
| Parties | John KEELEY, Timmie Orange, Ariel Kilpatrick and Charles Werdann, on behalf of themselves and all others similarly situated, Plaintiffs, v. LOOMIS FARGO & CO., Defendant. |
Paul Schachter, Mary P. Gallagher, Reinhardt & Schachter, P.C., Newark, New Jersey, for plaintiffs.
Patricia L. Hardaway, Gay & Hardaway, New York City, Robert L. Thompson, David M. Vaughan, Richard M. Escoffery, Elarbee, Thompson & Trapnell, Atlanta, Georgia, for defendant.
In this action for overtime pay the plaintiffs and defendant, Loomis Fargo & Co. ("Loomis Fargo"), cross-move for summary judgment pursuant to Fed.R.Civ.P. 56. For the reasons set forth below, Loomis Fargo's motion will be granted and the plaintiffs' motion will be denied.
The plaintiffs are four New Jersey residents presently or formerly employed by Loomis Fargo or its predecessor, Wells Fargo Armored Services Corp. ("Wells Fargo") at its Lyndhurst, New Jersey facility. The plaintiffs are and have been employed by Loomis Fargo in various positions, including guard, driver-guard, messenger-guard and ATM technician. Since April 1997 plaintiff Keeley has worked full-time for the United Armed Guards of America union (the "Union").
Loomis Fargo is a trucking industry employer subject to the jurisdiction of the United States Secretary of Transportation pursuant to the Motor Carrier Act, 49 U.S.C. § 31501 et seq., and is thereby exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act ("FLSA"). 29 U.S.C. § 213(b)(1). The State of New Jersey has its own minimum wage and overtime statute, N.J.S.A. 34:11-56a4, which establishes a minimum wage rate of $5.05 per hour and requires payment of wages at one and one-half times an "employee's regular hourly wage for each hour of working time in excess of 40 hours in any week."
In July 1996 the New Jersey Department of Labor promulgated N.J.A.C. 12:56-19.1 to 19.3, which became effective on August 5, 1996. Loomis Fargo falls within the definition of a "trucking industry employer" set forth in N.J.A.C. 12:56-19.1. The regulation provides that trucking industry employees will be paid the New Jersey minimum wage. N.J.A.C. 12:56-19.2. It also provides for payment of overtime at a rate not less than one and one-half times the New Jersey minimum wage. N.J.A.C. 12:56-19.3.1
In the course of employment by Loomis Fargo, the plaintiffs have consistently worked in excess of 40 hours per week. They have been compensated for their overtime hours at their regular hourly rate of pay pursuant to a renewal collective bargaining agreement between Wells Fargo and the Union effective November 1, 1995.2 Plaintiff Keeley was the Union's chief negotiator and the plaintiffs' counsel in this action represented the Union during contract negotiations with Wells Fargo. Vaughan Decl. ¶ 2.
The plaintiffs commenced this lawsuit in the Superior Court of New Jersey, Law Division, Union County on November 13, 1997, to i) recover for themselves and for the class of similarly situated employees payment for their overtime labor at the rate required by the New Jersey Wage and Hour Law and ii) obtain injunctive relief mandating future compliance with the law. The plaintiffs seek certification of a class consisting of all persons employed by Loomis Fargo as guards, driver-guards, messenger-guards and ATM technicians who have earned but have not received overtime pay at the rate prescribed by New Jersey law. Loomis Fargo removed the action to this Court pursuant to 28 U.S.C. § 1441 on the basis of the complete diversity of the parties.3 Loomis Fargo's December 19, 1997 Answer to the Complaint alleged, inter alia, that the plaintiffs' claims were preempted by federal law.
By order dated February 25, 1998 Magistrate Judge Ronald J. Hedges directed Loomis Fargo to file a motion to dismiss based on its preemption defense. Certification of the plaintiff class and discovery by the parties were stayed pending the outcome of the motion. On June 12, 1998 this Court denied Loomis Fargo's motion, finding that New Jersey's overtime law was not preempted by the FLSA. Keeley v. Loomis Fargo & Co., 11 F.Supp.2d 517 (D.N.J.1998).
In their brief opposing Loomis Fargo's motion to dismiss, the plaintiffs had argued that New Jersey's overtime law should require overtime compensation to trucking industry employees based not on the state minimum wage as required by N.J.A.C. 12:56-19.3 but based instead on their regular hourly rate. However, their argument for striking down this regulation went beyond the scope of Loomis Fargo's motion to dismiss on preemption grounds and was not addressed at that time. Id. at 519 n. 2.
Magistrate Judge Hedges ordered the parties to cross-move for summary judgment concerning the validity of N.J.A.C. 12:56-19.3, and these motions are now before this Court. On July 20, 1998 the parties entered into a stipulation, for purposes of these motions, that between November 1995 and November 19974 the wages paid by Loomis Fargo to the named plaintiffs were at an hourly rate that exceeds $7.575, one and one-half times the New Jersey minimum wage.5
Summary judgment is appropriate where the moving party establishes that "there is no genuine issue as to any material fact and that [it] is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party must show that if the evidentiary material of record were reduced to admissible evidence in court, it would be insufficient to permit the non-moving party to carry its burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).
Once the moving party has carried its burden under Rule 56, "its opponent must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The opposing party must set forth specific facts showing a genuine issue for trial and may not rest upon the mere allegations or denials of its pleadings. Sound Ship Bldg. Corp. v. Bethlehem Steel Co., 533 F.2d 96, 99 (3d Cir.), cert. denied, 429 U.S. 860, 97 S.Ct. 161, 50 L.Ed.2d 137 (1976).
At the summary judgment stage the court's function is not to weigh the evidence and determine the truth of the matter, but rather to determine whether there is a genuine issue for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The mere existence of some alleged factual dispute between the parties, however, will not defeat an otherwise properly supported motion for summary judgment. Id. at 247-248, 106 S.Ct. 2505.
The plaintiffs argue that N.J.A.C. 12:56-19.3 is void as an invalid exercise of regulatory authority because i) the effect of the regulation is to create a motor carrier exemption contrary to legislative intent and ii) the promulgation of the regulation was an ultra vires exercise of agency authority. Loomis Fargo contends that the plaintiffs have failed to satisfy their burden of proving that the regulation is invalid and that the claims against it must therefore be dismissed because its overtime payments to the plaintiffs comply with the requirements of N.J.A.C. 12:56-19.3.
The Appellate Division of the New Jersey Superior Court has recognized the heavy burden facing a party challenging the validity of an agency regulation:
An agency regulation is presumptively valid, and therefore the party challenging it bears the burden of proving its invalidity. The presumption of validity follows if the regulation is within the authority delegated to the agency and is not on its face beyond the agency's power. In considering the grant of authority, courts look to the fair contemplation of the delegation of the enabling statute. And while a regulation cannot alter the terms of a statute or frustrate the legislative policy, courts place great weight on the interpretation of legislation by the administrative agency enforcing it.
E.I. du Pont de Nemours and Co. v. State, Dept. of Environmental Protection and Energy, 283 N.J.Super. 331, 339-340, 661 A.2d 1314 (1995) (citations and internal quotation marks omitted). As a result, N.J.A.C. 12:56-19.3 is presumptively valid if it "is within the authority delegated to the agency and is not on its face beyond the agency's power." Id. at 339, 661 A.2d 1314. The enabling statute and regulatory history must be reviewed in order to determine if the Department of Labor's promulgation of N.J.A.C. 12:56-19.3 was an invalid exercise of agency authority.
N.J.S.A. 34:1A-3(e) gives the Commissioner of the New Jersey Department of Labor the authority to "[a]dopt, issue and promulgate, in the name of the department, such rules and regulations as may be authorized by law." The Commissioner is authorized to appoint a wage board if he "is of the opinion that a substantial number of employees in any occupation or occupations are receiving less than a fair wage," and the role of the wage board is "to report upon the establishment of minimum fair wage rates for employees in such occupation or occupations." N.J.S.A. 34:11-56a8. Wage boards are authorized to, inter alia, "recommend establishment or modification of the number of hours per week after which the overtime rate ... shall apply and may recommend the establishment or modification of said overtime rate." N.J.S.A. 34:11-56a13.
Reports containing wage board recommendations are submitted to the Commissioner, N.J.S.A. 34:11-56a14, who accepts or rejects the reports. N.J.S.A. 34:11-56a15. Those recommendations accepted by the Commissioner are then published together with other proposed administrative regulations and a public hearing is held. N.J.S.A. 34:11-56a15. If the...
To continue reading
Request your trial
-
Kelley v. Loomis Fargo & Co.
...had acted with a good-faith belief that it need not pay overtime, thereby absolving it of any liability. See Keeley v. Loomis Fargo & Co., 42 F. Supp. 2d 442, 451-52 (D.N.J. 1998). The District Court had jurisdiction over this diversity case under 28 U.S.C. S 1332, while we have jurisdictio......