Lanzetta v. Florio's Enters., Inc.
| Decision Date | 27 July 2011 |
| Docket Number | 08 Civ. 6181 (DC) |
| Parties | CARMELA LANZETTA, Plaintiff, v. FLORIO'S ENTERPRISES, INC., d/b/a FLORIO'S RESTAURANT, RALPH AMORUSO, LAWRENCE AMORUSO, Defendants. |
| Court | U.S. District Court — Southern District of New York |
APPEARANCES:
JOSEPH, HERZFELD, HESTER & KIRSCHENBAUM, LLP
Attorneys for Plaintiff
By: Daniel Maimon Kirschenbaum, Esq.
Matthew David Kadushin, Esq.
757 Third Avenue
New York, NY 10017
DEVEREAUX & ASSOCIATES, P.C.
Attorneys for Defendants
By: Sidney Baumgarten, Esq.
John W. Russell, Esq.
39 Broadway, Suite 910
New York, NY 10006
Following a two-day bench trial, the Court issued an opinion on January 25, 2011, finding defendants Florio's Restaurant and Ralph and Lawrence Amoruso ("defendants")1 jointly and severally liable to plaintiff Carmela Lanzetta for violations of the Fair Labor Standards Act (the "FLSA") and the New York State Labor Law (the "Labor Law"). The Court awarded plaintiff $127,938.31 in damages. See Lanzetta v. Florio's Enters., Inc., 763 F. Supp. 2d 615, 628 (S.D.N.Y. 2011).
On February 8, 2011, plaintiff submitted (1) an application for fees and costs; and (2) a motion for reconsideration pursuant to Federal Rule of Civil Procedure 59(e) and Local Civil Rule 6.3, based on purported errors she identifies in the Court's damages award. On April 25, 2011, defendants submitted an affirmation in opposition to the amount of fees requested but did not oppose the motion for reconsideration. Plaintiff replied on May 2, 2011.
As discussed more fully below, the application for fees and costs is granted. The motion for reconsideration is grantedin part and denied in part. Judgment will be entered in the amount of $231,554.38, which reflects $70,097.70 in fees and costs, and $161,456.68 in damages.
The decision to grant or deny a motion for reconsideration is committed to the discretion of the court. See Griffin Ins., Inc. v. Petrojam, Ltd., 72 F. Supp. 2d 365, 368 (S.D.N.Y. 1999). The primary grounds justifying reconsideration are: (1) an intervening change in controlling law; (2) the availability of new evidence; or (3) the need to correct a clear error or prevent manifest injustice. Virgin Atl. Airways, Ltd. v. Nat'l Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992).
The present motion for reconsideration concerns the proper approach to calculating damages where liability is established under both the FLSA and the Labor Law. Here, defendants were liable under both statutes at all relevant times after July 7, 2005. Plaintiff argues that the back pay and FLSA liquidated damages awarded for the period of overlapping liability were erroneously calculated using the federal minimum wage-rate, 29 U.S.C. § 206(a)(1), as opposed to New York State's higher minimum wage-rate, N.Y. Lab. Law § 652(1). She also argues that for this period she is entitled to an award ofliquidated damages under both the FLSA and the Labor Law, not just the FLSA. She seeks an additional $41,187.87 in connection with these claims.
Defendants violated the Labor Law and the FLSA by failing to pay plaintiff lawful wages while she was in their employ. Both federal and state law require certain employers to pay employees a minimum wage for the employees' first 40 hours of work each week, 29 U.S.C. § 206(a)(1); N.Y. Lab. Law § 652(1), and to pay an overtime premium of one-and-a-half times the employees' regular rate of pay for every hour worked thereafter, 29 U.S.C. § 207(a)(1); N.Y. Comp. Codes R. & Regs. tit. 12, § 137-1.3. Plaintiff contends that the Court erred in awarding back pay based on the minimum wage-rate in the FLSA, 29 U.S.C. § 206(a)(1), rather than the higher rate applicable under state law, N.Y. Lab. Law § 652(1). (Pl.'s Mem. 3). I agree that the calculation was incorrect.
The FLSA contains a savings clause that provides, in relevant part, that compliance with federal wage laws does not excuse an employer's "noncompliance with any . . . State law . . . establishing a minimum wage higher than the minimum wage established under [the FLSA]." 29 U.S.C. § 218(a). Thisprovision "made clear [Congress's] intent not to disturb the traditional exercise of the states' police powers with respect to wages and hours more generous than the federal standards." Pac. Merch. Shipping Ass'n v. Aubry, 918 F.2d 1409, 1421 (9th Cir. 1990). In other words, § 218(a) "specifically mandates that state law, rather than federal law, applies where the state law provides for . . . a higher minimum wage." Soler v. G & U, Inc., 768 F. Supp. 452, 462 n.16 (S.D.N.Y. 1991); accord Ervin v. OS Rest. Servs. Inc., 632 F.3d 971, 977 (7th Cir. 2011) (); Overnite Transp. Co. v. Tianti, 926 F.2d 220, 222 (2d Cir. 1991); Estanislau v. Manchester Developers, LLC, 316 F. Supp. 2d 104, 112 n.2 (D. Conn. 2004) ().
In this case, the minimum wage in New York was higher than the federal wage at all times beginning on January 1, 2005.2State law therefore "control[led] the employer's duty." Cranford v. City of Slidell, 25 F. Supp. 2d 727, 728 (E.D. La. 1998); accord Jin M. Cao v. Wu Liang Ye Lexington Rest., Inc., No. 08 Civ. 3725 (DC), 2010 WL 4159391, at *2 n.2 (S.D.N.Y. Sept. 30, 2010) (concluding that plaintiffs could take advantage of the higher measure of damages under New York law (citing 29 U.S.C. § 218(a)); Yi Dong v. CCW Fashion, Inc., Nos. 06 Civ. 4973, 07 Civ. 9741 (LAP) (DFE), 2009 WL 884680, at *4 (S.D.N.Y. Feb. 19, 2009) (same); Chan v. Sung Yue Tung Corp., 03 Civ. 6048 (GEL), 2007 WL 313483, at *25 (S.D.N.Y. Feb. 1, 2007) (same); see also Dancer v. Golden Coin, Ltd., 176 P.3d 271, 274-75 (Nev. 2008) (). Accordingly, plaintiff's damages for minimum wage and overtime violations shall be revised to include an additional $12,925.50.
Under the FLSA, an employer who violates the statute's minimum wage or overtime provisions, 29 U.S.C. §§ 206, 207, "shall be liable to the employee . . . affected in the amount of their unpaid minimum wages [and/or] their unpaid overtime compensation . . . in an additional equal amount as liquidateddamages." § 216(b). The Court awarded plaintiff liquidated damages under this provision for claims that were timely under the FLSA. Plaintiff argues that the state wage-rate should have been used instead. I agree, but only to the extent that the liquidated damages were for overtime violations, under § 207. Liquidated damages for minimum wage violations were properly calculated under § 206(a)(1).
a. Liquidated Damages for Overtime Violations
The FLSA provides that for all hours in a week that an employee works in excess of 40, she must be paid "at a rate not less than one and one half times the regular rate at which [s]he is employed." § 207(a)(1). The words "regular rate" "refer[] to the hourly rate actually paid the employee for the normal, non overtime workweek for which he is employed." Walling v. Youngerman Reynolds Hardwood Co., 325 U.S. 419, 424 (1945). This means that § 207(a)(1) "require[s] the fifty percent overtime premium to be added to the actual wage paid, not to the statutory minimum wage." Mumbower v. Callicott, 526 F.2d 1183, 1187 (8th Cir. 1975); accord Overnight Motor Transp. Co. v. Missel, 216 U.S. 572, 577 (1942) ().
But plaintiff was not paid any wages. Thus, the Court used the federal minimum wage as her "regular rate" for purposes of calculating overtime under § 207(a)(1). The regulations, however, clarify that "[w]here a higher minimum wage . . . is applicable to an employee by virtue of [state law], the regular rate of the employee, as the term is used in the [FLSA], cannot be lower than such applicable minimum, for the words 'regular rate at which he is employed' as used in section 7 [§ 207] must be construed to mean the regular rate at which he is lawfully employed." 29 C.F.R. § 778.5 (emphasis added). Thus, the Court should have used the New York State minimum wage as plaintiff's "regular rate." See, e.g., Pineda-Herrera v. Da-Ar-Da, Inc., No. 09-CV-5140 (RLM), 2011 WL 2133825, at *3 (). Plaintiff's liquidated damages will be adjusted to reflect a $5,265.50 increase, bringing her total recovery under 29 U.S.C. § 216(b) to $53,649.50.
ii. Liquidated Damages for Minimum Wage Violations
For several reasons, I do not agree that the portion of plaintiff's liquidated damages that is based upon minimum wage violations should also be calculated using the state rate.
The regulation that incorporated the state wage for purposes of the FLSA's overtime provision, 29 C.F.R. § 778.5, does not apply to the FLSA's minimum wage provision, 29 U.S.C. § 206. Section 778.5 appears under the heading "Overtime Compensation" and references only "section 7" -- that is, § 207; there is no similar provision for "section 6." Nor is the text of § 206 amenable to being read in conjunction with § 778.5, for unlike § 207, § 206 does not define wages by reference to a "regular rate." Rather, the rates are set forth in the text of the statute.3 Pineda-Herrera, 2011 WL 2133825, at *5 ().
Yet there are many examples of decisions citing § 778.5 as authority for incorporating the higher state wage into § 206 and then using it to calculate liquidated damages. See, e.g., Kopec v. GMG Constr., No. 09-CV-2187 (KAM) (ALC),...
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