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MALDONADO v. LUCCA

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY


May 1, 1986

EFRAIN MALDONADO, JESUS COLON, RENE TORRES, NELSON GARCIA, HECTOR COLON, REINALDO CLARIN, ANGEL CARABALLO, DANIEL CARABALLO, HERNAN CORTES, LUIS ACEVEDO, BENJAMIN PABON, ROBERTO CLAUDIO, PABLO SANCHEZ, ALFREDO MUNIZ, FELIPE MELENDEZ, and KETSY ALICEA (MERCED), Plaintiffs,
v.
RUSTY LUCCA, LAWRENCE ERRERA, d/b/a BAR O FARMS, and PEDRO BERMUDEZ, Defendants

The opinion of the court was delivered by: BROTMAN

BROTMAN, District Judge.

 This opinion addresses the amount of damages, attorney's fees, and costs owed to plaintiffs by defendants Rusty Lucca and Lawrence Errera, d/b/a Bar O Farms. On February 24, 1986 the court issued its findings of fact and conclusions of law, pursuant to a week-long trial on liability issues. The court found, inter alia, that defendants Lucca and Errera were "joint employers" with crewleader and co-defendant Pedro Bermudez under the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., and the Migrant and Seasonal Agricultural Worker Protection Act ("MSPA"), 29 U.S.C. § 1801 et seq. Accordingly, they are liable to plaintiffs for unpaid minimum wages for work performed on defendants' blueberry farm in the summer of 1984.

 The damage phase of the trial was held March 10, 1986. At its conclusion, counsel for defendants Lucca and Errera stipulated that the figures set out in the Joint Final Pre-Trial Order accurately represented the unpaid minimum wages owed to plaintiffs. The aggregate amount of unpaid wages is $3,636.81. *fn1" The FLSA provides that successful plaintiffs shall recover costs and attorney's fees. Accordingly, plaintiffs' counsel has filed a motion for costs and attorney's fees.

 Factual and Legal Background

 The court incorporates by reference its Findings of Fact and Conclusions of Law in Maldonado v. Lucca, 629 F. Supp. 483 (D.N.J. 1986).

 A. Damages

 1. FLSA

 a. Actual Damages

 As noted, defendants stipulated that actual damages total $3,636.81 for violation of the minimum wage provision, 29 U.S.C. § 206(a) (5).

 b. Liquidated Damages

 Section 216(b) of the FLSA provides that defendants found to have violated the act's minimum wage or maximum hour provisions shall pay to plaintiffs damages consisting of unpaid wages and "an additional equal amount as liquidated damages." 29 U.S.C. § 216(b). However, employers have a defense to this otherwise mandatory liquidated damages provision. Section 11 of the Portal-to-Portal Act, 29 U.S.C. § 260, provides:

 

if the employer shows to the satisfaction of the court that the act or omission giving rise to such action was in good faith and that he had reasonable grounds for believing that his act or omission was not a violation of the [FLSA], the court may, in its sound discretion, award no liquidated damages or award any amount thereof not to exceed the amount specified in section 216 of this title.

 29 U.S.C. § 260.

 The employer thus has the "'plain and substantial burden of persuading the court by proof that his failure to obey the statute was both in good faith and predicated upon such reasonable grounds that it would be unfair to impose upon him more than a compensatory verdict.'" Marshall v. Brunner, 668 F.2d 748, 753 (3rd Cir. 1982), quoting Rothman v. Publicker Industries, 201 F.2d 618, 620 (3rd Cir. 1953). Without such a showing, a district court has no discretion to mitigate an employer's statutory liability for liquidated damages. Id. See also Williams v. Tri-County Growers, Inc., 747 F.2d 121, 128-30 (3rd Cir. 1984).

 In its previous opinion, the court observed that defendants had attempted to meet their legal obligations to the farmworkers.

 

The court believes that defendants Lucca and Errera did act responsibly in requiring their crew leaders to submit payroll records and to provide proof of their state and federal certification. They complied with the state's investigation of Bermudez' crew members' claims for unpaid wages and willingly wrote checks to satisfy the amounts the state decided were due. However, the court is obliged to find that defendants Lucca and Errera were plaintiffs' employers within the meaning of the federal scheme. Defendants' prior conduct and compliance may well mitigate the amount of damages assessed against them, but the issue of damages is not before the court at this time.

 629 F. Supp. at 489.

 The good faith requirement of 29 U.S.C. § 260 requires that an employer demonstrate an "honest intention to ascertain and follow the dictates of the [FLSA]." Marshall v. Brunner, supra, 668 F.2d at 753, citing Laffey v. Northwest Airlines, Inc., 185 U.S. App. D.C. 322, 567 F.2d 429, 464 (D.C. Cir. 1976), cert. denied, 434 U.S 1086, 55 L. Ed. 2d 792, 98 S. Ct. 1281 (1978). The court has already made specific findings which appear to support defendants' contention that they had such an "honest intention."

 --Defendants required crew leaders to submit payroll records on a daily basis. Findings of Fact, para. 17.

 --Lucca scanned those payroll records to check that blueberry pickers were making the minimum wage. Id. P 18.

 -- Defendants complied with the state Wage and Hour Division's request to write checks to members of Bermudez' crew for unpaid minimum wages. They also cooperated with the state's investigation of those claims. Id. P 20.

 --Errera attended an informational meeting in 1984 where state and federal labor officials explained the crew leaders' legal obligations. Id. P 23.

 In addition, during the damages phase of the trial, Lucca reiterated his previous testimony that he was aware that pickers were entitled to receive at least the minimum wage and that he and Errera attempted to comply with state and federal law, as they understood it.

 Nonetheless, one factor precludes that court from finding that defendants acted wholly reasonably and in good faith. While defendants cooperated with the state's investigation of the unpaid wage claims filed by members of Bermudez' crew, they made compensation for those claims conditional on workers' waiver of any other related claims. Id. P 21. Defendants were responsible, as joint employers, for paying or making sure their workers were paid the minimum wage. This obligation is entirely separate from their obligation to comply with other provisions of state and federal law, such as record keeping, furnishing written descriptions of employment, or issuing pay statements reflecting deductions for FICA or unemployment insurances.

 Requiring workers to waive any and all related claims in order to receive long-overdue benefits strikes this court as a duplicitous attempt to capitalize on the workers' utter lack of bargaining power. The workers deserved their wages, regardless of whatever other claims they may have had. Defendants' insistence that they waive future claims as a condition of receiving a check signifies a high degree of self-interest and a fundamental lack of good faith. Furthermore, such a waiver conflicts directly with protections guaranteed by the MSPA, 29 U.S.C. § 1856, and FLSA (see Brooklyn Savings Bank v. O'Neil, 324 U.S. 697, 89 L. Ed. 1296, 65 S. Ct. 895 (1945)). Offering wages not in dispute in exchange for a waiver of other claims also violates the New Jersey Wage and Hour Law, N.J.S.A. 34:11-4.8.

 Accordingly, defendants Lucca and Errera have not met the two-pronged test of good faith and reasonableness under the Portal-to-Portal Act's defense and the court must assess liquidated damages in an amount equal to the actual damages suffered, in this case $3,636.81. See 29 U.S.C. §§ 216(b), 260.

 2. MSPA

 The court's previous opinion held that defendants Lucca and Errera were also "joint employers" under the MSPA, 29 U.S.C. § 1801 et seq. Consequently, plaintiffs are entitled to damages for violations of that act in an amount sufficient to further its purposes. Congress enacted MSPA to protect migrant and seasonal agricultural workers, who have historically been exploited. See generally H.R. Rep. No. 97-885, 97th Cong., 2d Sess., page 7 (1982), reprinted in 1982 U.S. Code Cong. & Ad. News 4547, 4553 ("House Report"). Under the MSPA, the court is authorized to assess liquidated damages of up to $500.00 per violation for each plaintiff.

 In order to recover for violations of the MSPA, plaintiffs must show that defendants' violations of the act were "intentional." 29 U.S.C. § 1854(c)(1). As used in the MSPA, "intentional" means "conscious or deliberate and does not require a specific intent to violate the law." Alvarez v. Joan of Arc, Inc., 658 F.2d 1217, 1224 (7th Cir. 1981). Under this standard, persons are responsible for and liable for the natural consequences of their acts. Castillo v. Givens, 704 F.2d 181, 197, 198 (5th Cir. 1983); De la Fuente v. Stokely-Van Camp, Inc., 514 F. Supp. 68, 79 (C.D. Ill. 1981); Stewart v. James, 519 F. Supp. 315, 321 (E.D.N.Y. 1981).

 In Castillo v. Givens, supra, the court held that because a farmer was aware of the existence of a law requiring farm labor contractors to carry identification cards in order to be paid, his failure to keep payroll records on the individual plaintiffs was intentional within the meaning of the MSPA. 704 F.2d at 198. The court also noted that its standard for "intentional violation" facilitates the enforcement through the MSPA of otherwise unenforceable rights created by the FLSA. Id. at 198, n.41, quoting Note, A Defense of the Farm Labor Contractor Registration Act, 59 Tex. L. Rev. 531, 537 n.61 (1981). For example, the penalties authorized under the MSPA can be used to address an employer's failure to maintain proper payroll records, as required under both acts. Id.

 In the instant case, both Lucca and Errera testified that they knew that workers were entitled to earn at least the minimum wage and that accurate payroll records had to be maintained. They presumed that keeping accurate records was the crew leader's responsibility, but as joint employers of the blueberry pickers they shared that obligation. Defendants were aware that migrant and seasonal workers are protected by state and federal labor laws, as evidenced by their testimony and by Errera's attendance at at least one informational meeting sponsored by state and federal labor officials.

 Because they were admittedly aware of the statutes and regulations applicable to their business, any violation by defendants of the MSPA must be deemed "intentional" within the meaning of that act.

 a. Specific Violations

 (1) Recordkeeping violations

 The MSPA requires farm labor contractors and agricultural employers to "make, keep and preserve records for 3 years" of information, including the total number of hours worked in a pay period. 29 U.S.C. §§ 1821 (a), 1831(c). The evidence at both trials showed that defendants kept no records at all for the plaintiffs' first week of employment. Furthermore, the records which Bermudez submitted to Lucca after his crew had stopped picking blueberries for Bar O Farms on July 5, 1984 (Plaintiffs' Exhibit 8) conflict in numerous ways with other trial testimony. *fn2" These conflicts suggest strongly that Bermudez fabricated these records after the fact and that no accurate records were ever kept.

 (2) Pay Statement Violation

 The court found that no plaintiff ever received an itemized written statement for each pay period which reflected deductions from pay or number of hours worked. Findings of Fact para. 12. The MSPA requires farm labor contractors and agricultural employers to provide workers with such statements. 29 U.S.C. §§ 1821 (d) (2), 1831(c)(2). Defendants Lucca and Errera are liable to each plaintiff for this violation.

 (3) Failure to Pay Wages When Due

 The MSPA requires employers to pay agricultural workers "wages owed" when due. 29 U.S.C. § 1832 (a). Plaintiffs Benjamin Pabon and Ketsy Alicea and Widillia Hernandez, the administrator of New Jersey's farmworkers opportunity program, testified without contradiction that plaintiffs' working arrangement provided for payment each week. Defendants admit, and the court found, that plaintiffs were not paid at all for their last week of work. Findings of Fact para. 11. As noted earlier, when state officials asked defendants to make good on claims filed by members of Bermudez' crew, defendants made payment contingent on the workers' waiver of state and federally protected rights. For this violation, defendants Lucca and Errera are liable to all plaintiffs.

 (4) Failure to Provide Plaintiffs at the Time of Recruitment with Written Terms and Conditions of Employment

 The MSPA also attempts to safeguard workers' rights by requiring employers to provide them with the written terms and conditions of their employment when they are recruited. 29 U.S.C. §§ 1821(a), 1831(a). The court found previously that no plaintiff ever received such written confirmation. Findings of Fact para. 12. This violation is particularly significant because without tangible evidence of the terms and conditions of promised employment, workers are at a considerable disadvantage to show the duration of employment offered and promised benefits. This, in turn, could make it more difficult to prove actual damages. *fn3"

 (5) Defendants' Failure to Abide by the Working Arrangements Made with Plaintiffs

 The MSPA prohibits an employer from violating terms of a working arrangement without justification. 29 U.S.C. §§ 1822(c), 1832(c). Regulations promulgated by the Department of Labor indicate that ordinarily, "'without justification' would not include situations in which failure to comply with the terms of any working arrangements was directly attributable to acts of God, due to conditions beyond the control of the person or to conditions which he could not reasonably foresee." 29 C.F.R. § 500.72(a). This court can find no case interpreting either the statute or the regulation, and will treat this as a question of first impression.

 Bermudez recruited migrant workers on his own, telling them that they would work picking blueberries and then move on to peaches and apples. He promised to provide transportation and housing. See Testimony of Widillia Hernandez, Benjamin Pabon. At that point, Bermudez was recruiting workers on Bar O's behalf, because Lucca had advanced funds and assured Bermudez that he and his crew would have work for the entire blueberry season.

 As joint employers, Lucca and Errera were required to abide by the working arrangement which Bermudez offered to plaintiffs unless they had justification, at least for the duration of the blueberry season. By incorporating the joint employment doctrine into the MSPA, Congress intended to protect agricultural workers and prevent farmers from shielding themselves by blaming broken agreements on delinquent farm labor contractors.

 

It is the [House Committee on Education and Labor]'s intention that the duty is owed by the entity that makes the arrangement with the migrant worker and any additional entity which is a joint employer with such entity.

 House Report at 17.

 Plaintiffs argue that Lucca and Errera had no justification for violating the working arrangement established by Bermudez. Specifically, they contend that Lucca and Errera made little or no attempt to inquire into the workers' needs and made no effort to provide workers with the housing and/or transportation they needed to continue working through the blueberry season after Bermudez terminated his relationship with Bar O Farms. They concede that Lucca did offer continued employment to the workers but fault him for not offering any transportation and/or housing. Without these essentials, the workers were in no position to accept Lucca's presumably well-intentioned offer. Plaintiffs argue that where joint employers control different aspects of the employment relationship, it would frustrate the purposes of the MSPA to allow each to claim no responsibility for the benefits provided by the other. They contend that farmers like Lucca and Errera must be required to make inquiries about the benefits provided by their crewleaders and make reasonable efforts to supply such benefits if the crewleaders depart prematurely. Otherwise, plaintiffs claim, farmworkers will be stripped of both the benefits promised when they were hired and the federal guarantees of the MSPA.

 Realizing that it may work a harsh result on these defendants, the court agrees with plaintiffs' position. Lucca and Errera "intentionally" breached the terms of plaintiffs' working arrangements by not offering transportation and/or housing for the duration of the blueberry season once Bermudez was fired. The evidence did not show that this breach resulted from an act of God or conditions beyond defendants' control. Nor did it show that defendants could not have reasonably foreseen plaintiffs' predicament. 29 C.F.R. § 500.72(a).

 By firing Bermudez in mid-season, and failing to bolster his offer of continued employment with a promise of housing and/or transportation, Lucca placed plaintiffs in economic jeopardy. He and his partner are responsible for the "natural consequences" of that conduct. Castillo v. Givens, supra, 704 F.2d at 197. Joint employers cannot delineate areas of responsibility among themselves and then plead ignorance when one of them disappears. Lucca and Errera are liable to all plaintiffs for violations of this provision.

 b. Amount of Liquidated Damages

 As joint employers, defendants Lucca and Errera are liable to these plaintiffs for "intentionally" violating the above-mentioned provisions of the MSPA, regardless of Bermudez' role. These defendants try to persuade the court that defendant Bermudez "in effect must undertake some of the liability." Affidavit of William Cappuccio, para. 3. Although Bermudez did not appear in these proceedings, testimony established his pivotal role in the circumstances which led to this litigation. But Bermudez' potential liability does not diminish Lucca and Errera's liability under the joint employer doctrine of FLSA and MSPA. See Slip op. As in other civil actions, these defendants may well have a cause of action for contribution or indemnification against Bermudez. That possibility does not affect their liability to these plaintiffs. The court will assess defendants Lucca and Errera $35.00 for each of five violations of the MSPA, or a total of $175.00, for each of the seventeen (17) plaintiffs. The total amount of liquidated damages under the MSPA is therefore $2,975.00.

 B. Attorney's Fees and Costs

 The FLSA provides that a successful plaintiff may recover from defendants a reasonable attorney's fee, plus costs. 29 U.S.C. § 216(b). Laurence E. Norton, II, plaintiffs' counsel, has petitioned for an award at a rate of $125.00 per hour for legal time and $65.00 per hour for travel time, as well as for $1,487.40 in costs.

 Fee awards under the FLSA use the method set out in the Civil Rights Attorney Fees Awards Act, 42 U.S.C. § 1988. The Third Circuit uses, and the Supreme Court has implicitly endorsed, a "lodestar" approach for calculating fees. Hensley v. Eckerhart, 461 U.S. 424, 76 L. Ed. 2d 40, 103 S. Ct. 1933 (1983); Williams v. Tri-County Growers, Inc., supra, 747 F.2d at 138 n.38, 139-43.

 Under the "lodestar" approach, the court multiplies the hours reasonably expended by counsel in representation on the case by the reasonable hourly rate for the attorney involved. See Lindy Bros. Builders, Inc. v. American Radiator, 540 F.2d 102 (3rd Cir. 1976); Merola v. Atlantic-Richfield Co., 515 F.2d 165 (3rd Cir. 1975).

 Plaintiffs' counsel carries the burden of showing that the claimed rate and number of hours are reasonable. Blum v. Stenson, 465 U.S. 886, 104 S. Ct. 1541, 79 L. Ed. 2d 891 (1984). Neither the ultimate amount nor the method used are affected by the fact that plaintiffs' counsel is employed by a legal services office. Id. Mr. Norton, a staff attorney for Camden Regional Legal Services, Farmworker Division, has submitted a detailed affidavit of services.

 A court may increase or decrease the "lodestar" under certain circumstances, but "where a plaintiff has obtained excellent results, his attorney should recover a fully compensatory fee." Hensley v. Eckerhart, supra, 461 U.S. at 435. In determining whether the results obtained are "excellent," the court may consider whether persons other than the named plaintiffs will benefit from the outcome. Id. at 438. In this case, it is clear to the court had the impact of its decision will reach far beyond the individual plaintiffs. As a result of this litigation, farmers in New Jersey who employ migrant and seasonal agricultural workers must redouble their efforts to comply with state and federal wage and hour laws, without necessarily relying on transient crew leaders to hire, pay and fire their workers. The net beneficiaries of this stepped-up compliance will be the workers themselves.

 Plaintiffs' counsel seeks a fee of $125.00 an hour for 175.42 hours of legal work and $65.00 an hour for 27.17 hours of travel time. Plaintiffs' counsel submits affidavits from certain lawyers in the region to support his contention that such rates are reasonable. The court acknowledges that Mr. Norton has considerable experience in similar federal litigation across the country. He is well qualified and represented his clients capably, thoroughly and tirelessly throughout these proceedings. However, the court takes judicial notice of rates charged by lawyers in southern New Jersey, which range from $65 to over $150 an hour. The court believes that a fair rate to compensate Mr. Norton is $100 an hour for legal work and $50 an hour for travel time. *fn4"

  Consequently, the court will grant Mr. Norton's application for fees in the amount of $17,542.00 for legal time and $1,358.50 for travel time, for a total fee award of $18,900.50 plus costs in the amount of $1,487.40. *fn5"

 Conclusion For the reasons expressed in this opinion, the court will assess damages against defendants Lucca and Errera under the following: FLSA, 29 U.S.C. § 216(b) Actual damages $ 3,636.81 FLSA, 29 U.S.C. Liquidated damages 3,636.81 § 216(b) MSPA, 29 U.S.C. § 1854(c) Liquidated damages at $35 per violation (5) per plaintiff (17) $35 X 5 X 17 = 2,975.00 TOTAL DAMAGES $10,248.62

19860501

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