On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. Civ. No. 84-3821).
Before: WEISS, HIGGINBOTHAM, BECKER, Circuit Judges
This case was brought by the Secretary of Labor to enjoin defendant Richland Shoe Company from violating the overtime and recordkeeping provisions of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., and from withholding unpaid overtime compensation owed to several employees. This appeal, from an order granting the Secretary's motion for summary judgment and awarding an injunction and backpay, requires us to construe the word "willful" in the statute of limitations section of the Portal-to-Portal Act, 29 U.S.C. § 255(a), applicable FLSA proceedings. A "willful" violation adds one year to the statute of limitations, potentially rendering a willful violator liable for substantial additional sums.
The district court applied the standard of willfulness announced in Coleman v. Jiffy June Farms, Inc., 458 F.2d 1139 (5th Cir. 1972), cert. denied, 409 U.S. 948, 93 S. Ct. 292, 34 L. Ed. 2d 219 (1972) and adopted by several courts of appeals, see infra n.4. Under this standard, the action of an employer is willful when the "employer knew or suspected that his actions might violate the FLSA. Stated most simply . . . Did the employer know the FLSA was in the picture? Id. at 1142. For the reasons set forth below, we conclude that a more rigorous standard is appropriate. Specifically, we hold that for the purposes of 29 U.S.C. § 255(a), a violation of the relevant section of the FLSA is willful if the employer knew or showed reckless disregard for the matter of whether its conduct was prohibited by the FLSA. Although we shall affirm the district court's decision in favor of the Secretary in all other respects, we shall vacate the district court's order with respect to the statute of limitations issue and remand the case for recalculation of the amount of back overtime pay due.
Richland is a Pennsylvania corporation that manufactures footwear and leather products in Womelsdorf, Pennsylvania. The Secretary brought this action in the United States District Court for the Eastern District of Pennsylvania on August 8, 1984 to enjoin Richland from violating overtime and recordkeeping provisions of the FLSA and from withholding unpaid overtime compensation owed to several employees. These employees are seven mechanics whose duties primarily involve the repair and maintenance of equipment at Richland's manufacturing plant.*fn1
On February 25, 1985, the Secretary moved for summary judgment. In support of this motion, the Secretary submitted depositions of the office manager and the general manager of Richland; payroll records and computations based thereon; and the Department of Labor Wage and Hour Division's coefficient table that was used to compute the amount of overtime compensation due. While the parties disagreed on the conclusions to be drawn from these materials, there was no dispute regarding the underlying facts and records. The district court granted summary judgment in favor of the Secretary on April 17, 1985 and enjoined Richland from violating the overtime section (29 U.S.C. §§ 207, 215(a)(2)) and recordkeeping requirements (29 U.S.C. §§ 211(c), 215(a)(5); 29 C.F.R. 516) of the FLSA. The order also required Richland to pay back overtime pay to the mechanics in the sum of $11,084.26 plus interest.
Although Richland raises five contentions on appeal, only one merits our attention, Richland's claim that the district court applied an improper standard of "willfulness" under 29 U.S.C. § 255(a) in calculating back overtime pay awards under the FLSA.*fn2 That section establishes a two-year statute of limitations for an employer's violation of FLSA standards unless the employer's violation was "willful," in which case the statute of limitation is three years.*fn3 This court has not previously had occasion to determine what constitutes willfulness under this section. As noted above, the district court applied the Jiffy June standard, under which the action of an employer is willful when the "employer knew or suspected that his actions might violate the FLSA. Stated most simply . . . Did the employer know the FLSA was in the picture? 458 F.2d at 1142.*fn4
In this case, Richland's vice president and general manager stated in his deposition that he knew that the FLSA applied to overtime pay schemes such as that used for the mechanics. Because of this admission, the district court concluded that willfulness was established under the Jiffy June standard. Accordingly, the court awarded damages based on the three-year limitations period.
We believe that the Jiffy June standard is wrong because it is contrary to the plain meaning of the FLSA. Although the meaning of willful is not fixed and determinate, it is clear that willfulness is akin to intentionality. A willful act requires a deliberate effort, more than mere negligence. Webster's New Collegiate Dictionary 1331 (1971) defines "willful" to mean "done deliberately: intentional." The "words of statutes . . . should be interpreted where possible in their ordinary, everyday senses." Malat v. Riddell, 383 U.S. 569, 571, 16 L. Ed. 2d 102, 86 S. Ct. 1030 (1966) ...