The index of U.S. leading economic indicators declined 0.1 percent in January, the Conference Board said on Thursday, but it advised that some of the components of the index were estimated due to the government shutdown.

By Ronald Miller, J.D.

Agreeing with its sister circuits and the Department of Labor, the Seventh Circuit ruled that under the FLSA, the relevant unit for determining a pay violation is not wages per hour, but the average hourly wage across a workweek. Because none of the flight attendants in this action pleaded a single workweek in which they were paid an average wage less than $7.25 per hour, the appeals court affirmed the dismissal of their FLSA claims. However, because the FLSA itself reserves that authority to the states and localities to regulate the labor of their own citizens and companies, the appeals court reversed the dismissal of the employees’ state and local wage claims (Hirst v. SkyWest, Inc., December 12, 2018, Brennan, M.).

SkyWest charters planes for other airlines. It employs over 2,600 individual as cabin crew. SkyWest flight attendants are based out of airports in ten different states, including the flight attendants in this action who reside in Arizona, California, Washington, and Illinois. A typical workday for a flight attendant is long and varied, including time onboard the aircraft, and in airports before, between, and after flights. SkyWest flight attendants are paid only for their time in the air, known in the industry as “block time.” The amount of block time worked in a given day is much shorter than the “duty day.”

Flight attendants for SkyWest challenged the airline’s compensation policy of paying for their work in the air but not on the ground. Beginning in March 2015, three groups of SkyWest flight attendants filed suit alleging that the airline violated the FLSA and the wage laws of their respective states by failing to pay minimum wage. The also sought to certify a class of similarly situated SkyWest employees. The cases were consolidated in the Northern District of Illinois.

Following multiple amended complaints and limited discovery, the district court dismissed all of the flight attendants’ claims with prejudice. The court determined that, in assessing violations of the federal minimum wage, an employee’s wage is calculated as the average hourly wage across the workweek. Because none of the flight attendants pleaded a single workweek in which they were paid an average wage less than $7.25 per hour, the federal minimum wage, the court concluded that they had not properly pleaded an FLSA claim. Additionally, the district court held that their state and local wage claims were preempted by the dormant Commerce Clause.

FLSA claims. On appeal, the flight attendants first challenged the dismissal of their FLSA claims. The text of 29 U.S.C. § 206 does not state what measure should be used to determine compliance with the minimum wage. Thus, the Seventh Circuit turned to the interpretation of the Department of Labor. In 1940, the DOL issued a policy statement adopting the workweek as “the standard period of time over which wages may be averaged to determine whether the employer has paid [the minimum wage.]” Other circuits have uniformly adopted the Department’s per-workweek measure, including the Ninth, Fourth, Sixth, Eighth, Eleventh, Second and D.C. Circuits. Seeing no reason to deviate from the DOL’s interpretation or the consensus of other federal appellate courts, the Seventh Circuit adopted the per-workweek measuring for determining compliance with the federal minimum wage.

Next, the appeals court applied the per-workweek measure to this case. A plaintiff alleging a federal minimum wage violations must provide sufficient factual context to raise a plausible inference there was at least one workweek in which he or she was underpaid. As found by the district court, none of the flight attendants pleaded a single workweek in which they were paid an average wage less than $7.25 per hour. Claiming that they worked many hours and citing several weeks in which they were paid the minimum wage was not enough to render their claims plausible. Accordingly, the appeals court affirmed the dismissal of their FLSA claims.

State and local claims. Next, the flight attendants argued that their state and local wage claims should be reinstated. Specifically, the contended that the dormant Commerce Clause did not apply to this case. The appeals court agreed that application of the dormant Commerce Clause was not appropriate in this case. Under the dormant Commerce Clause, courts invalidate a state law only where there is a clear showing of discrimination against interstate commerce “either expressly or in practical effect. In this instance, SkyWest failed to allege any discrimination against interstate commerce. This failing precluded application of the dormant Commerce Clause to the flight attendants’ state and local claims.

Moreover, even if minimum wage laws did discriminate against interstate commerce, the dormant Commerce Clause does not apply to state and local laws expressly authorized by Congress. Here, the appeals court observed that the FLSA itself reserves authority to the states and localities to regulate the labor of their own citizens and companies. Thus, the dormant Commerce Clause did not preclude state regulation of flight attendants wages in this case. Accordingly, the court reversed the dismissal of the employees’ state and local wage claims and remand for further proceedings.

By Lorene D. Park, J.D.

Granting in part a motion for partial summary judgment filed by flight attendants who claimed JetBlue violated California law by failing to pay overtime they earned while working intrastate flights, a federal district court in California rejected the airline’s preemption, federal enclave, and Dormant Commerce Clause arguments. However, JetBlue was awarded summary judgment on the state-law claim concerning itemized wage statements because the attendants were not based in California, were not paid in California, and did not spend enough time in the state for that law to apply (Booher v. JetBlue Airways Corp., December 12, 2017, White, J.).

Bidding process. JetBlue operates flights from multiple airports in California and has around 3,692 flight attendants in the United States. Flight attendants’ monthly schedules are based on a bidding process whereby they submit preferences for flight “pairings,” a pre-planned sequence of flights that may consist of one or more flight segments or duty times in which they are not in flight. Schedules fluctuate and depend on their preferences and the seniority-based bid system.

Pre-flight and post-landing work. Attendants generally report to the airport at a designated report time to begin each paired sequence of flights, usually one hour ahead of flight time. They then attend a short briefing, report to the departure gate, and ready the cabin for passengers. The boarding process begins approximate 35 minutes before the departure and the attendants assist with that process. They also assist with deplaning upon arrival and cleaning of the cabin. Their duty period ends 15 minutes after the flight’s arrival.

Ground time between flights. For duty periods with multiple segments, there is time between one segment’s arrival and the next segment’s departure, referred to as “Turn” or “Ground” time. During Ground time, attendants are generally free to attend their own activities without job duties, but must report to the next gate 45 minutes before departure. JetBlue considers Ground time to be duty time for compensation purposes, but if the flight attendant’s duty period ends in a destination other than home, he or she is released from work for a layover, and rest time is not considered to be duty time. Although duty periods include work done in-flight and on the ground, the plaintiffs alleged that JetBlue pays only the hourly rates for time actually in the air.

Lawsuit. They filed suit under California wage and hour laws, alleging unpaid wages, failure to pay overtime, and failure to provide itemized wage statements, among other claims. In prior proceedings, the court granted summary judgment against the minimum wage claim. The plaintiffs have now moved for partial summary judgment as to liability on the remaining claims.

Overtime. It was undisputed the plaintiffs rely on both in-flight and on-the-ground hours to qualify for overtime. The issue for the court was whether hours flying between California airports should be considered hours “worked in California.” JetBlue argued they should not, because: (1) California labor laws are preempted by federal laws regulating air travel; (2) the intrastate flights included time flying over federal enclaves or waters; and (3) requiring JetBlue to comply with California’s overtime laws would violate the Dormant Commerce Clause.

No federal preemption. The court rejected JetBlue’s federal preemption argument, citing to and agreeing with a prior similar case explaining that “[a]lthough the federal government has exclusive sovereignty over the United States airspace and aviation safety, ‘Congress has not occupied the field of employment law in the aviation context and . . . the FAA does not confer upon the agency the exclusive power to regulate all employment matters involving airmen.’”

JetBlue’s federal enclave argument also failed. The plaintiffs claimed they met their initial burden by showing 32 days on which they worked over eight hours in and between California airports, as indicated by JetBlue’s records. Though the records lacked flight path data, the court held that they still provided “a just and reasonable inference that Plaintiffs did work full days within California in which they were eligible for overtime compensation under California law. Because neither party is able to provide evidence of the precise amount of work performed—actual flight paths with contemporaneous time stamps—the burden shifts to JetBlue to negative the reasonableness of Plaintiffs’ theory.” JetBlue failed to meet this burden. While it provided two example flight paths from 2016, that was not enough to show it was unreasonable that at least one of the plaintiff’s 32 alleged overtime days fell within the state’s borders.

The court further held that there was no plausible Dormant Commerce Clause argument because the California Labor Code applies equally to work done in California, whether or not it is performed by a state resident. Thus, “California has chosen to treat out-of-state residents equally with its own.”

JetBlue liable for overtime. Based on the foregoing, the plaintiffs were granted summary judgment with respect to JetBlue’s liability for overtime for duty periods spent in California.

Wage statement claim fails though. Granting summary judgment for JetBlue on the Labor Code Section 226 claim over the alleged failure to provide itemized wage statements, the court concluded that the law did not apply. It pointed to two approaches applied by federal district courts in California, and concluded that both led to the same result. The “job situs” test limits the statute’s application to employees who work principally in California, and the plaintiffs spent most of their working time outside of the state. Nor would Section 226 apply under the multi-factor test, which considers whether the employee resides in, receives pay in, or has a principal job situs in California; whether the employer resides in the state; and whether the employee’s absence from the state is temporary.

By Marjorie Johnson, J.D.

A flight attendant who was fired for dishonesty after reporting that she would be late due to a delayed commuter flight, but then flippantly saying she was “calling in sick” upon learning that she would be deemed a no-show, failed to defeat summary judgment on her FMLA interference and retaliation claims. A federal district court in Texas determined that no reasonable jury could find she gave proper notice of her intent to take FMLA leave because she did not follow Southwest Airlines’ procedures for doing so, despite an eligibility notice sent to her earlier that month related to her request for a few days off due to sinusitis. She also failed to present any evidence of pretext (DeVoss v. Southwest Airlines Co., November 13, 2017, Fitzwater, S.).

The flight attendant, hired in 2014, resided in Tampa and commuted to her base airport in Baltimore. Southwest’s collective bargaining agreement (CBA) with her union contained a points-based attendance policy, which allowed the airline to terminate flight attendants based on accumulated infractions. It also contained a commuter policy, which prevented flight attendants from being assessed attendance points if they were late or missed an assignment because their qualifying commuting flight was full.

Suspicious phone call. On June 24, 2015, the flight attendant called in to report that she would be late due to a delay of her commuter flight. She sought to invoke the commuter policy so as not to receive attendance points, but was advised that her flight did not qualify. Commenting that this was “ridiculous,” she stated that she was then “calling in sick.” When the representative attempted to confirm, she commented, “Guess I have to, huh,” asked “Do you know how many points you get for a no-show versus a sick call?” and when asked if she was sick replied, “Yep.”

Fired for dishonesty. Based on a recording of the call, Southwest commenced an internal investigation, with the investigating manager finding it suspicious that she had initially sought to invoke the commuter policy and then switched to a request for sick leave. Though the flight attendant subsequently presented a June 25 doctor’s note, the manager nevertheless determined that she had committed a dishonesty violation of the work rules and terminated her.

Prior notice of FMLA eligibility. Meanwhile, on June 8, Southwest had sent her an FMLA eligibility notice in response to her request for time off due to sinusitis from June 7 to 11. In the notice, the airline alerted her to the process through which she could secure leave, directed her to submit an FMLA application by June 23, and advised her that failure to do so could result in a delay or denial of leave. However, she neither submitted the FMLA application nor contacted her leave coordinator.

No notice of intent to take leave. The flight attendant couldn’t defeat summary judgment on her FMLA interference claim (let alone was she entitled to it), since she failed to give proper notice of her intent to take FMLA leave by complying with its procedures outlined in the June 8 eligibility notice. Her failure to comply with Southwest’s procedures for requesting FMLA leave precluded her from invoking FMLA protection. Though she was provided with FMLA resources at various points, there was simply no evidence that she ever contacted anyone at Southwest about applying for FMLA leave at any point before she was terminated.

No additional eligibility notice required from Southwest. The court squarely rejected her contention that Southwest had to send her an additional eligibility notice following her June 24 absence. All FMLA absences for the same qualifying reason are considered “a single leave” and the flight attendant claimed she was “still sick” on June 24, relating back to her sinusitis. Therefore, since the company notified her on June 8 of her FMLA eligibility, it was not required to provide her an additional notice for an absence relating to the same qualifying reason.

No pretext. She also failed to cast doubt on Southwest’s assertion that it fired her for dishonesty. The court squarely rejected her contention that its motives for discharging her were irrelevant since she was not required to show it acted with discriminatory to prove interference. An employee cannot defeat summary judgment if the employer articulates a legitimate nondiscriminatory reason for the adverse action, and no triable issue of pretext exists.

The court was also unpersuaded by her argument that pretext could be inferred from Southwest’s failure to properly discipline her under the attendance policy, which specified that she should receive a written warning (not a termination) for failing to show up to work. This argument failed since she was terminated due to dishonesty, not violations of the attendance policy. And while she also attempted to argue that pretext could be inferred from Southwest’s failure to send her an FMLA eligibility notice, her absence was not long enough to trigger that policy. Accordingly, a reasonable jury could only find that, following a thorough investigation, the manager believed for several reasons that she was dishonest during her June 24 call to the Southwest scheduling representative.

No FMLA retaliation. Also tossing her FMLA retaliation claim, the court noted that she failed to address Southwest’s contention that she hadn’t engaged in protected conduct because she did not take FMLA leave and that her failure to request FMLA leave undermined any finding that she was fired for taking FMLA leave. Accordingly, no reasonable jury could find that the company engaged in FMLA retaliation.