Massachusetts’ new law prohibiting hospitals from requiring nurses who deliver patient care to work mandatory overtime will become effective this November 4, 2012. Employers should take steps now to prepare for this change. To read more about the new legislation, see Mandatory Overtime Bill For Hospital Nurses In Massachusetts Becomes Law.
The U.S. Court of Appeals for the Ninth Circuit in 2009 dismissed a registered nurse’s claim that a California hospital violated the Fair Labor Standard Act’s overtime provisions when it used different base hourly rates to calculate regular rates of pay depending on whether RNs chose to work an 8-hour or 12-hour shift. Thus, the Ninth Circuit determined that employers can negotiate with employees reduced base hourly rates to find the regular rate of pay upon which overtime wages are calculated. The resulting rate must equal or exceed the minimum wage, the employees must agree to the rate reduction, and the reduced rate must have been in place for some substantial period of time. Of course, an employer cannot jump from rate to rate depending upon whether overtime was worked. The Ninth Circuit’s decision stands following U.S. Supreme Court’s denial of the request for review. Parth v. Pomona Valley Hosp. Med. Ctr., No. 10-1041, cert. denied, 5/23/2011.
In Parth, for many years, the Hospital offered the option of a 12-hour shift. RNs who opted for it received: (a) a lower hourly base rate of pay than those who worked the 8-hour shift for the first 8 hours of work; (b) overtime at 1.5 times the regular rate of pay for more than 8 hours of work; and (c) twice the regular rate of pay for hours worked in excess of 12 in one shift. The plaintiff and other RNs opted for the 12-hour shift (and corresponding reduced regular rate of pay). They each signed an individual agreement that later was incorporated into a collective bargaining agreement after the Hospital became unionized. The RN sued, alleging the use of different base hourly rates depending on length of a shift violated the FLSA.
The Ninth Circuit dismissed the RN’s claim. It found the FLSA allows employers and employees to contract for a new wage arrangement any time they choose as long as the rate exceeds the statutory minimum wage rate and the compensation plan “properly incentivizes [the Hospital] from overworking its nurses.” The RN appealed to the Supreme Court, claiming the payment scheme negated the statutory purpose of the FLSA. In opposition, the Hospital pointed out, inter alia, a series of U.S. Department of Labor opinion letters established that a reduced rate is not an “artifice or subterfuge” to circumvent the FLSA where (1) employees agree to the reduced rate; (2) the rate has been in place for a “substantial length of time”; and (3) the rate “equals or exceeds the minimum wage.” The Supreme Court declined to review the case.
* * *
In addition to the federal wage-hour law, employers must consider the requirement of relevant state wage-hour law. Some state wage laws, like newly-enacted Section 195.1 of the New York Labor Law, mandate written notice of the rate that will be paid. Therefore, negotiated rates generally should be transparent to all parties and duly documented. This is critical to administration of the agreement, not to mention providing a defense to allegations of non-compliance with the law.
Thanks to Joshua Rudin, Summer Law Clerk, for his assistance in preparing this post.
On May 3, 2011, the Second Circuit rejected an appeal by a group of Registered Nurses (“RNs”) of the partial denial of their motion for class certification. In a case pending since 2006, the RNs contend that certain hospitals in the Albany-Schenectady-Troy metropolitan area conspired to depress salaries in violation of the Sherman Antitrust Act, 15 U.S.C. §1. In July 2008, the United States District Court for the Northern District of New York partially granted the nurses’ motion for class certification under Rule 23 of the Federal Rules of Civil Procedure, finding “Plaintiff’s have adequately demonstrated that class certification is appropriate with respect to whether there has been a violation of antitrust law and whether there has been injury to the class that the Sherman Act was designed to prevent. Injury-in-fact and damages, however, must be separately determined, as there exists too much disparity among the proposed class members to proceed under one common trial.” The District Court explained that there are three elements to an antitrust claim, 1) violation of antitrust law; 2) injury and causation; and 3) damages. While the RNs had asserted a common violation of antitrust law, the issues of injury-in-fact and damages were, in the District Court’s view, insufficiently common among the putative class members to justify class certification.
The RNs appealed to the United States Court of Appeals for the Second Circuit under Rule 23(f) of the Federal Rules of Civil Procedure, which governs interlocutory appeals of orders granting or denying class action certification. Rule 23(f) provides that a petition for permission to appeal must be filed with the Circuit Court within 14 days after the certification order is entered. Since the appeal was made nearly 18 months after the decision, it was untimely and, accordingly, was rejected. The Circuit Court expressly rejected the RNs’ argument that denial of the motion to amend should reset the clock for the appeal stating, “if denial of amendment to an order granting class certification were sufficient to reset the clock for appeal, a litigant could easily circumvent Rule 23(f)’s deadline by filing a motion to amend or decertify the class at any time after the district court’s original order, then petitioning for leave to appeal within fourteen days from the denial of that motion.” Citing to its earlier decision in Coco v. Inc. Vill. Of Belle Terre, N.Y., 448 F.3d 490, 491-92 (2d Cir. 2006), the Circuit Court confirmed the Second Circuit’s well established rule that Rule 23(f)’s fourteen day filing requirement is “a rigid and inflexible restriction.”
Jackson Lewis' focus and knowledge in the realm of workplace law puts them at the very forefront of developments More...
