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Media Alerts - Amaya v. Power Design, Inc. -- Fourth Circuit
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October 24, 2016
  Amaya v. Power Design, Inc. -- Fourth Circuit
Fourth Circuit Confirms Private Right of Action Under FLSA

Areas of Law: Labor & Employment law

Issue Presented: Whether workers employed under federal contracts expressly incorporating two federal labor statutes (the Davis-Bacon Act and Contract Work Hours and Safety Standards Act) can bring claims for unpaid hourly and overtime wages under the Fair Labor Standards Act.

Brief Summary: The United States Court of Appeals for the Fourth Circuit vacated and remanded the district court's grant of summary judgment of plaintiffs' FLSA claims in favor of defendant Power Design, Inc. The subcontracts at issue were governed by the Davis-Bacon Act (DBA) and the Contract Work Hours and Safety Standards Act (CWHSSA). While neither of those two statutes provided for a private right of action, they also did not bar the plaintiffs' FLSA claims. The Fourth Circuit explained that Congress enacted FLSA knowing it would apply broadly despite overlap with other labor statutes. Because there are no conflicts between the three statutes, plaintiffs were entitled to bring unpaid hourly and overtime wages under FLSA.

Extended Summary: Twenty electrical construction workers sought unpaid hourly and overtime wages for work completed under federally-funded subcontracts. The relevant subcontracts expressly incorporated the DBA and CWHSSA. These two federal statutes regulate different aspects of federal construction contracts. However, the workers sought relief under the FLSA because, unlike the DBA and CWHSSA, the FLSA provides a private right of action in state or federal court. The United States District Court for the District of Maryland held the workers could not "circumvent" the DBA and CWHSSA's lack of private rights of action by bringing a FLSA claim. The trial court therefore granted summary judgment in favor of the defendant.

The Fourth Circuit reviewed the issue de novo. The court began by comparing the justifications for the three statutes and their enforcement mechanisms. The DBA and CWHSSA regulate only certain aspects of federal construction contracts. The U.S. Department of Labor can address violations of the two statutes by withholding contract funds or banning awards of federal contracts for up to three years. In contrast, the FLSA has a broader purpose to "to eliminate, as rapidly as practicable, substandard labor conditions throughout the nation" and "to raise living standards without substantially curtailing employment or earning power." To enforce this statute, individuals can bring suit for FLSA violations directly in state or federal court.

Next, the court reviewed precedent from the United States Supreme Court and the Fourth Circuit that explained the interaction between the FLSA and other labor statutes. This precedent instructed that such statutes are not mutually exclusive. Consequently, the applicable provisions of all statutes can apply insofar as they do not conflict.

Turning to the case before it, the Fourth Circuit held that because Congress intended the FLSA to apply broadly regardless of overlap with other labor statutes and because the three statutes do not conflict, the workers' FLSA claims were not barred by the subcontracts' inclusion of the DBA and CWHSSA. Before examining potential conflicts among the three statutes, the court noted that the language of both the FLSA and the DBA and CWHSSA envisioned that they could all be applied concurrently with one another and other federal labor statutes. For example, when Congress passed the CWHSSA it acknowledged that the FLSA already applied to a lot of the construction industry and therefore many contractors would be subject to "several different legislative standards and enforcement procedures applicable to the same conduct."

Next, the court rejected the defendant's proposed conflicts among the three statutes. First, the Fourth Circuit explained that the DBA and CWHSSA's failure to provide an implied private right of action does not amount to a conflict with the FLSA. The court also found the DBA's wage requirements, which may impose higher payments than the FLSA's federal minimum wage, did not create a conflict. Next, the court concluded that calculating overtime under each statute does not create a statutory inconsistency or conflict. Lastly, the court found there is no conflict between the DBA and FLSA when calculating overtime under the FLSA. The court also rejected the defendant's argument that the actual amount of overtime compensation sought by the workers created a conflict between the DBA and FLSA. This was in part because the purported conflict did not arise from the statutes themselves but from a Department of Labor regulation, and the court would not defer to a regulation that causes a conflict with the FLSA. Finally, determining the overtime compensation the workers are properly owed is an issue of proof for the district court, not a legislative conflict.

To read the full text of this opinion, click here.

Panel: Judges Diaz, Floyd, and Thacker

Argument Date: 05/10/2016

Date of Issued Opinion:

Docket Number: No. 15-1691

Decided: Vacated and remanded by published opinion

Case Alert Author: Annie McGuire, Univ. of Maryland Carey School of Law

Argued: Daniel Adlai Katz, THE LAW OFFICES OF GARY M. GILBERT &
ASSOCIATES, P.C., Silver Spring, Maryland, for Appellants. Leslie A. Stout-Tabackman, JACKSON LEWIS P.C., Reston, Virginia, for Appellee. Erin Michelle Mohan, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Secretary of Labor. On Brief: Lucy Brierly Bansal, THE LAW OFFICES OF GARY M. GILBERT & ASSOCIATES, P.C., Silver Spring, Maryland; Virginia Rae Diamond, ASHCRAFT & GEREL, LLP, Alexandria, Virginia, for Appellants. Paul DeCamp, Jeremy S. Schneider, JACKSON LEWIS P.C., Reston, Virginia, for Appellee. M. Patricia Smith, Solicitor of Labor, Jennifer S. Brand, Associate Solicitor, William C. Lesser, Deputy Associate Solicitor, Paul L. Frieden, Counsel for Appellate Litigation, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Secretary of Labor. Maurice Baskin, LITTLER MENDELSON, P.C., Washington, D.C., for Amicus Associated Builders and Contractors, Inc.

Author of Opinion: Judge Diaz

Case Alert Supervisor: Professor Renée Hutchins

    Posted By: Renee Hutchins @ 10/24/2016 10:14 AM     4th Circuit  

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