Park Row Props., Ltd. v. R.I. Dep't of Labor & Training, Labor Standards Div.
| Decision Date | 08 November 2012 |
| Docket Number | C.A. No. PC-2011-5077 |
| Parties | PARK ROW PROPERTIES, LTD., METROPARK v. RHODE ISLAND DEPARTMENT OF LABOR AND TRAINING, LABOR STANDARDS DIVISION, through its Director, CHARLES J. FOGARTY; GEORGE KLANIAN; and CARLO ACQUISTO |
| Court | Rhode Island Superior Court |
DECISION
In this administrative appeal, Appellant Park Row Properties, Ltd. ("Appellant" or "Park Row") challenges a decision ("decision") by the Rhode Island Department of Labor and Training ("D.L.T." or "Department"), finding Park Row liable for back-wages to George Klanian ("Mr. Klanian") and Carlo Acquisto ("Mr. Acquisto") under G.L. 1956 § 25-3-3, as amended 1998. Jurisdiction is pursuant to G.L. 1956 §§ 25-3-5 and 42-35-15.
A brief history of § 25-3-1, et seq. is necessary. In the statutory scheme in effect prior to 1998 ("Old Statute"), § 25-3-2 prohibited employers from requiring employees to work on Sundays except for work that (1) was "of absolute necessity" or (2) was "performed pursuant to a permit issued under the provisions of section 25-3-3."1 Section 25-3-3 authorized the director ofthe D.L.T. to issue such permits in cases of "economic necessity." The statute defined "Economic Necessity" by providing an exhaustive list of seven instances in which the director might find that it was economically necessary for an employer to require his or her employees to work on a Sunday. Sec. 25-3-1(2). In particular, § 25-3-1(2)(vii) provided that "Economic Necessity" exists where the director determines that "[c]ircumstances, temporary in nature, are such that undue economic hardship would result from the inability to operate on one or more Sundays or holidays."2 The Old Statute also addressed the rate at which employers wererequired to compensate their employees for work on Sundays. Specifically, § 25-3-3 provided that "[w]ork performed by employees on Sundays . . . pursuant to [a] permit . . . must be paid for at least one and one half (1 1/2) times the normal rate of pay for the work performed" (the "Sunday premium pay requirement").3 Section 25-3-7 gave the D.L.T. the authority to exempt by regulation, "any class of employers" who "in the opinion of the Director . . . either because of the nature of their operations or their size, should be exempted from the provisions of this chapter." Sec. 25-3-7.
The D.L.T. also provided in the Old Regulations that "[e]conomic hardship . . . shall mean that, because of events over which an employer has no control, the employer would lose a substantial amount of business if unable to operate on a particular Sunday or holiday." R.I. Admin. Code 425-4:1 ¶ 6. Pursuant to its authority under § 25-3-7 to exempt classes of employers through regulations, the D.L.T. provided that those "employer[s] whose business is licensed or regulated by the federal government . . . shall not be required to obtain a work permit to conduct said business on a Sunday . . . ." R.I. Admin. Code 42-5-4:1 ¶ 5.5
In 1998, the Rhode Island General Assembly substantially amended §§ 25-3-2 and 25-3-3 ("New Statute"). The amendments eliminated any reference to a permit in either section.6 See §§ 25-3-2 and 25-3-3. The term "absolute necessity" also no longer appears in § 25-3-2 of the New Statute. Therefore, as of 1998, employers no longer need to show "absolute necessity" or obtain a permit in order to require their employees to work on Sundays. With regard to the rate at which employers are required to compensate employees for work on Sundays, § 25-3-3(a) of the New Statute, in pertinent part, reads: "[w]ork performed by employees on Sundays and holidays must be paid for at least one and one-half (1 1/ 2) times the normal rate of pay for the work performed." Notably, the word "economic necessity" no longer appears in § 25-3-3. See § 25-3-3. However, the Legislature retained the definitions of "economic necessity" in § 25-3-1(2)(i) - (vii) of the New Statute.7
Despite the Legislature's removal of any reference to a permit requirement in §§ 25-3-2 and 25-3-3, the D.L.T. re-filed its Old Regulations, "Rules and Regulations Relating to the Work Permit Law" in 2002 and 2007.8 (Appellant's Br. in Supp. of Appeal, Ex. D.) Thus, the regulatory definition of "absolutely necessary" contained in R.I. Admin Code 42-4-4:1 ¶ 1, the exemption for federally regulated businesses in 42-5-4:1 ¶ 5, and the definition of "economichardship" in 42-5-4:1 ¶ 6, remained on file subsequent to the 1998 amendments and at the time when Mr. Acquisto and Mr. Klanian filed their complaints. Moreover, the New Statute did not state that the Old Regulations were expressly repealed. Subsequent to the 1998 legislative amendments, the D.L.T. promulgated new regulations ("New Regulations"), entitled "Rules and Regulations Relating to Exemptions for Work on Holidays and Sundays," pursuant to its authority under § 25-3-7 to grant exemptions to classes of employers. See R.I. Admin. Code 42-5-6:1. Proposed in 2007 and effective in 2008, the New Regulations provide a procedure whereby an employer may petition the D.L.T. for an exemption from paying time and one-half for Sunday work by submitting a written statement containing, among other things, "a statement of the economic necessity, as defined by § 25-3-1, justifying the exemption." R.I. Admin. Code 42-5-6:1 ¶ 2.9 The New Regulations did not expressly repeal the Old Regulations. See R.I. Admin. Code 42-5-6:1.10
Park Row owns and operates a parking garage ("Garage") located adjacent to, and primarily serving, the Providence Train Station. (Tr. 6/10/2011 at 14.) Pursuant to an agreement with Amtrak ("Agreement"), the Garage remains open seven days a week from approximately 4:30 a.m. to approximately 12:30 a.m. (Park Row Memorandum to Helen Gage, Nov. 23, 2010, 3.) The Appellant hired Mr. Klanian in December 2007, and Mr. Acquisto in August 2009, asattendants at the Garage. (Tr. 5/13/2011 at 3, 15.) The Appellant paid Mr. Klanian and Mr. Acquisto $11.25 per hour and $12.00 per hour, respectively, and required both employees to work on Sundays. (Tr. at 4, 16.)
Mr. Acquisto filed a Complaint for Non-Payment of Wages with the D.L.T. on August 24, 2010, claiming that Park Row owed him back-wages for failing to pay him time and one-half for his work on Sundays. Mr. Klanian filed a similar complaint on November 7, 2010. They alleged that Park Row was required to pay them time and one-half for their work on Sundays under § 25-3-3, as amended 1998. On November 23, 2010, Park Row submitted a legal memorandum ("Memo") to the D.L.T. in opposition to Mr. Acquisto's and Mr. Klanian's complaints. The administrative record includes Park Row's Memo. (Decision 2.) After investigating the complaints and after giving notice, the Department held a formal hearing on this matter before a D.L.T. hearing officer ("Hearing Officer") on May 13 and June 10, 2011, in compliance with G.L. § 28-14-19 (amended 2012).
On May 13, 2011, Mr. Acquisto and Mr. Klanian testified generally about their hours worked, dates of employment, and compensation received. (Tr. 7-19.) The Hearing Officer gave Michael Chittick, Park Row's counsel, an opportunity to cross-examine Mr. Acquisto. (Tr. 12-15.) On cross-examination, Mr. Acquisto clarified that some of the hours he worked during his Sunday shifts actually went past 12 a.m. and therefore ran into Monday morning. (Tr. 13.) After hearing from Mr. Klanian, the Hearing Officer continued the matter to a later date to allow Park Row time to obtain necessary copies of Mr. Acquisto's and Mr. Klanian's payroll records. (Tr. 28.)
When the hearing continued on June 10, 2011, Charles Meyers, the owner of Park Row, testified concerning the Agreement with Amtrak. Mr. Meyers stated that the Agreement wasbetween the Federal Railroad Administration11 and the Providence and Worcester Realty Co., the two entities which originally built the Garage and the Providence Train Station. (Tr. 15.) He explained that Park Row is bound by the Agreement because it is part of Park Row's lease with Capital Properties, the owner of the land upon which the Garage sits. (Tr. 15.) Mr. Meyers testified that under the terms of the Agreement, Park Row is required to keep the Garage open seven days a week and that Amtrak also controls the Garage's operating hours. (Tr. 18.) Additionally, Mr. Meyers stated that the Agreement limits the rates that Park Row may charge users of the Garage, and those rates are significantly lower than the rates of other garages in the vicinity. (Tr. 19-20.) Mr. Meyers averred that he would not be permitted to raise rates to cover the additional expense of paying his employees time and one-half on Sundays. (Tr. 20.) According to Mr. Meyers, he has never paid employees time and one-half for Sunday work at any parking facility that he has run. (Tr. 16.) Mr. Meyers clarified, however, that it was company policy to pay workers double time or time and one-half for work on holidays and accordingly, Park Row had paid Mr. Acquisto and Mr. Klanian double time or time and one-half for work on Sundays that happened to fall on holidays. (Tr. 23-24.)
In its closing statement at the hearing and in its Memo, submitted to the D.L.T....
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