Mogilevsky v. Bally Total Fitness Corp.

• Citation: 263 F.Supp.2d 164
• Decision Date: 13 May 2003
• Docket Number: No. CIV.A.01-11240-WGY.,CIV.A.01-11240-WGY.
• Parties: Boris MOGILEVSKY, Plaintiff, v. BALLY TOTAL FITNESS CORPORATION Defendant.
• Court: United States District Courts. 1st Circuit. United States District Courts. 1st Circuit. District of Massachusetts

263 F.Supp.2d 164

Boris MOGILEVSKY, Plaintiff, v. BALLY TOTAL FITNESS CORPORATION Defendant.

No. CIV.A.01-11240-WGY.

United States District Court, D. Massachusetts.

May 13, 2003.

Harvey S. Shapiro, Boston, for Boris Mogilevsky, Plaintiff.

Brian E. Whiteley, Scibelli & Whiteley, LLP, Boston, for Bally Total Fitness Corp., Defendant.

MEMORANDUM AND ORDER

YOUNG, Chief Judge.

I. INTRODUCTION

The plaintiff, Boris Mogilevsky ("Mogilevsky"), has brought claims regarding unpaid wages against his former employer, Bally Total Fitness ("Bally"), pursuant to the Fair Labor Standards Act, 29 U.S.C. §§ 201 et. seq.; Mass. Gen. Laws ch. 151, § 1A; Mass. Gen. Laws ch. 149, § 148; and the common law. The Court held a bench trial on Mogilevsky's claims in September 2002.

On September 27, 2002, upon the conclusion of the bench trial, the Court entered certain findings of fact. Specifically, the Court found by a fair preponderance of the evidence that Mogilevsky's personal calendars constituted persuasive evidence of his work schedule and that Bally's payroll documents and coupon tracking records constituted persuasive evidence as well. 9/27/02 Tr. at 3, 7. The Court rejected, however, Mogilevsky's argument that his damages should be based on the theory that he possessed 287 coupons reflecting entirely unpaid hours for which he deserved to be paid at the overtime rate. Id. at 9. The Court directed the parties to reconstruct the hours actually worked by Mogilevsky at all material times, based on his calendars, and to inform the Court of any differences as to interpretation so that the Court could make the appropriate findings with respect to back pay owed to Mogilevsky. Id. at 4.

After receiving both parties' supplemental memoranda, as well as the parties' joint stipulation, the Court concluded that further briefing was required from the parties with respect to Mogilevsky's calendars. The Court directed the parties to confer with respect to any pay period for which they reached a different number of hours worked by Mogilevsky and then to provide a supplemental briefing to the Court, identifying all such pay periods and the specific entries within those periods that were disputed. February 13, 2002 Mem. and Order [Docket No. 52] at 3. The Court explained that, based upon these submissions, it would calculate the back pay owed to Mogilevsky by determining the difference between the number of hours it found Mogilevsky to have worked and the number of hours for which Mogilevsky was paid. Id. at 2. The parties have now provided these submissions and the Court now calculates the damages owed to Mogilevsky.

II. DISCUSSION

A. Relevant Statutes of Limitations for Mogilevsky's Claims

The Court begins by noting that the hours in question accrued between January 1998 and December 1999. Mogilevsky filed the instant action on May 18, 2001. The Fair Labor Standards Act sets forth a two-year statute of limitations, unless the employer's violation was willful, in which case the statute of limitations is extended to three years. 29 U.S.C. § 255(a). The analogous Massachusetts statute simply provides for a two-year statute of limitations for recovery. Mass. Gen. Laws ch. 151, § 20A.

The Supreme Court has stated that an employer's violation is willful within the meaning of the Fair Labor Standards Act when it can be shown that the employer knew, or recklessly disregarded, that it was acting in violation of the Act. McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133, 108 S.Ct. 1677, 100 L.Ed.2d 115 (1988). Here, the Court rules that although Bally's failure to pay Mogilevsky his proper wages may well have been negligent, that failure does not rise to the level of reckless disregard, given the lack of clarity in Mogilevsky's own records and his unorthodox approach to scheduling training sessions. Accordingly, the appropriate statute of limitations period for Mogilevsky's claims under both the Fair Labor Standards Act and Chapter 151 is two years.

The question remains, however, whether Mogilevsky can recover for the hours that accrued prior to May 18, 1999. With respect to these hours, there are two theories under which Bally can potentially be held liable: (1) Mogilevsky's claim under Mass. Gen. Laws ch. 149, § 148, which provides a three-year statute of limitations for claims involving the non-payment of wages, Id. at § 150; and (2) Mogilevsky's common law breach of contract claim, which carries a six-year statute of limitations pursuant to Mass. Gen. Laws ch. 260, § 2.

The Court rules that a common law breach of contract claim is inapplicable here. The documents that Mogilevsky cites as giving rise to this "contract"—the Employee Information and Acknowledgment Form and the Employee Handbook, see Pl.'s Supplemental Post-Trial Mem. [Docket No. 55] at 6-7,—simply contain what are essentially promises to adhere to federal and state law regarding the payment of overtime wages. See Employee Information and Acknowledgment Form (Trial Ex. 1) ("Federal and State Wage and Hour Laws require the maintenance of accurate pay records and the payment of overtime to each `non-exempt' employee who works in excess of 40 hours in any single week." "When the total hours in a given work week exceed 40 hours worked, you will be paid time and a half for all hours in excess of 40 hours worked during that single week."); June 1999 Employee Handbook (Trial Ex. 4) at 16 ("For nonexempt employees who are eligible for overtime [time-and-a-half], overtime is generally defined as hours worked in excess of forty [40] hours in the Bally designated work week. As different states may have different definitions of this time, you should ask your supervisor what standard applies.").

The Employee Handbook further included, on the page containing a line for the employee's signature, a clear disclaimer that the handbook was not intended to form a separate contract as well as a statement that "all of the provisions of the handbook ... are only guidelines." Id. at 53. Massachusetts courts have so recognized the legal effect of employee manuals. See O'Brien v. New England Telephone & Telegraph Company, 422 Mass. 686, 693, 664 N.E.2d 843 ("Of course, the provisions of a personnel manual on analysis may grant no rights. [Jackson v. Action for Boston Cmty. Dev., Inc., 403 Mass. 8, 525 N.E.2d 411 (1988)] noted that, if the manual states that it provides only guidance as to the employer's policies ..., it may not create any enforceable rights."); cf. Ferguson v. Host Int'l, Inc., 53 Mass.App.Ct. 96, 103, 757 N.E.2d 267 (2001) (holding that where the disclaimer provisions in the employee manual "properly could be viewed by the fact finder as the functional equivalent of fine print," they did not prevent the formation of a contract). The Court thus rules that the personnel documents were not contracts and do not give rise to a cause of action apart from the federal and state causes of action arising from Bally's failure to pay Mogilevsky the wages to which he was legally entitled.

As such, the only law governing the period prior to May 18, 1999 is Mass. Gen. Laws c. 149, § 148, which provides for a three-year statute of limitations. Accordingly, Mogilevsky cannot recover for unpaid wages that accrued prior to May 18, 1998. In short, the Fair Labor Standards Act governs the period from May 18, 1999 to December 31, 1999;¹ Mass. Gen. Laws c. 149, § 148 governs the period from May 18, 1998 to May 17, 1999.

B. Mogilevsky's Damages from May 18, 1999 to December 31, 1999

The Court thus proceeds to calculate the damages owed to Mogilevsky for each of these two periods. The Court begins with the period from May 18, 1999 to December 31, 1999, that is, the period covered by the Fair Labor Standards Act. During that period, Mogilevsky alleges that he worked 235 hours of overtime.² Pl.'s Supplemental Post-Trial Mem., Ex. B. Bally presses a dispute as to only six of those hours: five hours that Mogilevsky alleges he worked on July 31 and one hour that Mogilevsky alleges he worked on August 9. Def.'s Supplemental Br. [Docket No. 54] at 2, Ex. 59K-32, 59K-34 (attached with red and blue markings to indicate disputed entries). The Court agrees with Bally that these hours should not be counted toward Mogilevsky's total, given that he drew a large "Z" over the five hours on July 31 and that the disputed entry on August 9 appears to fill up only one line, with only one letter (as well as an illegible scrawl) extending into a second line.

That leaves 229 overtime hours worked by Mogilevsky between May 18, 1999 and December 30, 1999. Mogilevsky concedes that he was fully paid for 82 of those hours.³ Pl.'s Supplemental Postr-Trial Mem. at Ex. B. As for the remaining 147 hours, it remains somewhat unclear to this Court which hours were paid at the standard (rather than overtime) rate and which, if any, were entirely unpaid. Mogilevsky's revised chalk B-3 indicates that during the period from May 18, 1999 to December 31, 1999, he was paid for 198 overtime hours at the standard rate (62 hours during the post-May 7 subpart of the second quarter, 68 hours during the third quarter, and 68 hours during the fourth quarter).⁴ Pl.'s Further Argument, Analysis, and Post-Trial Stipulations [Docket No. 50, Ex. B. The Court concludes, in its capacity as fact-finder, that this is the most likely interpretation and thus rules that Mogilevsky is entitled to the difference between 147 hours paid at the overtime rate (which is what he should have received) and 198 hours paid at the standard rate (which is what he apparently did receive).

To determine the amount that Mogilevsky should have received for those 147 hours, the Court must further break those hours down by quarter, since his overtime rate should have varied by quarter depending on his commissions for that quarter. It appears that 41⁵ of those hours were worked between May 18, 1999 and July 1,1999 (approximately the second half of the second quarter),...