is is here with us today and i would like to reserve two minutes from about your honour's this case presents the question of whether consigner volunteers who labor standards act or actually volunteers for that that portion of time which they were permitted and allowed to work happy consignment sales of gently used children's clothing twice a year which took place both the set up and the sales himself over a period of seven or eight days twice a year can i just ask you said twice  correct i've seen references in the record to the the sales happening sometimes six times a year sometimes three times a year you're only six three or two your honor i think i think the confusion relates to the different locations there are different places where the sales take place so i just walk me through ok so it's it it's both a an operation of real which operate sales as well as a franchise operation other franchisees would you know franchise the template and the model and hold their own sales in other locations one location at any one city there would be a semiannual so it would be twice a year twice a year at any given location erect and how far apart are the locations are we talking like different days if you include the total time for getting to the location setting it up holding the sale and then breaking it all down and the offer to the volunteers is you can walk for any given sale you can volunteer in increments of five hours from five to twenty correct five hours ten fifteen or twenty that's correct what you offer correct ok your honor and i would volunteer using that term as it was used in the business so your honour's be the district court granted to the motion for summary judgment of the department of labor here in ny the motion for s that you are not entitled to judgment as a matter of law very hard for me to see him your honor but i will have but whatever reason i frame it that way is you make pointless where he is the decision maker and he has told us exactly what his reasoning was and why he made the decision and if you know there's no question what it was and if it if it's good enough to survive we're just sending everyone on a pointless exercise and multiplying litigation costs and just  exactly the problem your honor it's not good enough to survive mr darling's analysis even if you credit well ok that's an argument why you might win if we consider darling but i want to start with the question you know whether whether we should or not in a case where it seems like it's clearly too much too late but the remained seems pretty pointless well your honor to that point if if we if we put aside the darling declaration if we if we assume for the moment that it properly came into the record which i will for these purposes it's  on the record including even the darling declaration from twenty sixteen that the legal analysis of the department of labor and mr mr darling himself was fundamentally legally it permissible if fail to take account of governing supreme court precedent in the walling versus portland terminal case the first decision of the supreme court directly on point and the obama case which is also one point your honors those two supreme court presidents set out a spectrum on the one dalai declaration is properly then it's enough that at that point that i'm sorry if if what why why should we not consider the darling declaration let's try it that way ok you should not consider substantially the form that it does now yes it will show again that the analysis undertaken by mr darling was legally insupportable because he failed to take account of the governing supreme court precedent which says clearly there can be volunteers for for profit enterprise it's we that's the feeling that you're just coming back to your second level of argument that darling is arbitrary and capricious that's correct i'm still trying to drill down on a wall why we consider it at that what's your argument for keeping it out when it just seems like the right will remain to be agency and darling will take the same document and use the same words and say the same thing of your honor if the case remanded the court should reverse the district court's grant of summary judgment to the department of labor on the basis that the department of labor's policy has put forward in the declaration and all the governing all the relevant documents in the record contemporaneously that show the analysis is simply not in accordance shouldn't be considering the dalai declaration at all not because it's legally insufficient because that means that go ahead and consider it right i still when it is run or if you if that's a if you're now saying is ok for us to consider the dalai declaration then we'll it seems like every time we're trying to focus on why shouldn't we consider that all the declaration i'm getting the sense of your responses because if you do it would be it wouldn't it wouldn't be enough we still had well your honor i don't think  needs to strike the darling declaration or not consider it in order to reverse here but are are you are or are you or are you not continuing to press the alternative argument that we should not consider it at all your honor i do think that the court erred because it wasn't abusive of discretion to lead that declaration into the record so yes but again i don't think that the court for managers managers can decide to forego wages if they would prefer to get early treat their early access to the sales your honor that managers to to forego making their wages up in the first twelve and a half hours if they wanted to get access early access to the sales instead i believe that is true at some points during so if that's true that seems like pretty were offered that choice in some of them took it doesn't answer the question of whether the opportunity for early shopping is actually compensation the opportunity is just that you may go into the sale you may be there before anyone else you may browse and you so it might be on have to calumny the circumstances test which is what you have to know you go out and buy forty lottery tickets and give it to each of the people that's clearly compensation well and i guess it seems to me the point is the company seems to be treating it as compensation because the company has a policy that says i'll give you want to do things for you to pay you ten dollars an hour or i'll give you access for our early access to the sale that's the two ways that i'm going to  recognize so all the other circumstances in the economic relationship branded in the company recognized that that was an employee employer relationship for the managers right but i don't think that we  that the court can analogize the consigner volunteers to that night and i'm asking why not because if the company treats the managers as employees and the way it compensates as employees it says conclusion but it has a different piece of you population of people it says for you i'm only going to give you basket b which is what's going on because it's giving them early access it just sounds to me like what the company is saying is i'm not were just probing the narrow point whether this kind of opportunity is something of value this is only or any time sure clearly no quo for the state the services provide clearly your honor for some people they found that to be of value much now as in the cathedral buffet case out of the sister six circuit your honor which determined that there was no compensation people were incentivized by their by their local church to to volunteer quote unquote at the restaurant the fact that they were incentivised and that they find some value in it does not answer the question of whether it's compensation suppose same same situation except instead of offering the opportunity for early access to sales they offer a nice breakfast and a nice lunch for people your honor i think i think that that would weigh heavily against it being i think that wash why isn't that exactly exactly the kind of in kind compensation but the cases i think you know alamo specifically sas could be the equivalent of money wages can be under certain circumstances your honor if the fatality of the circumstances demonstrates among other things in the obama case dependents essentially dependents over a long period of time on that economic relationship then yes indeed where people are are dependent for r board over a long period of time on the foundation and yes that that can be compensation i don't i don't think obama stands for the proposition that in your hypothetical you rotter ipso facto have a free breakfast or a nice lunch it's compensation i don't i don't think it stands for the proposition but if so facto your employee but i'm not sure why it doesn't support the proposition that this is the so unless or other questions a profit before we get to the merits can we just start with the question of what who whose explanation we should be reviewing and race should should we look at the darling declaration the court we do think that the court should look at that early declaration we think the court could also occurred without looking at it but i think that the first decision memo decision memo is completely on reason and it's you know the declaration does help to tie the record together that is certainly true i think in zero three i mean if you just just assume assume for the sake of argument that if my review were limited to the decision by my which self i would find it on reason so then the question is can we look to the darling declaration and it seems i mean i get the point about filippi but it seems like if we allow the government to supplement to give the entirety of its reasoning in it is ok to rely on a rationale if they're offering and you can see declaration like this even though it is that needed during litigation and it's good to talk in that sense it's not doesn't run afoul of state farm because it's still actually the reasoning of the agency decision maker it's not as if  are primarily number one it's just not challenge or number two the ex post after david is accompanied by a supplement taishan of the record other documents that were contemporaneously created that are put before the court as further justification and then the affidavit is sort of like out an authentication piece and that's when we do it and when we don't do it it's cases like a t n t where we say the is offering something wholly new and if if that's the relevant line it seems to me you're on the wholly new side of it i don't think that that actually accurately characterizes what the president says about when you allow the declaration for example that you know the internal documents to which this court referred were simply the documents and the administrative records that were submitted with you know in connection with filing that petition for review so this is cases kind of just just like that the declaration is is was made to the court says you know help me try to explain that you can see the rationale since it wasn't necessarily fully clear from the internal documents that were part of the administrative record for the declaration attach previously  disclosed materials and we sat there was no new rationalization in all of our you think i mean upchuck had yeah i don't recall that it has to be a new material is my recollection is that there was a supplemental index of the record right or the index of the record that was filed in that case that listed it in the documents and agency record then actually the declaration was included as it turns out in a supplemental index of the record i don't recall that however because it shows the previously undisclosed internal materials just contemporaneously created agency records in fact you state the contemporaneous explanation rate which is different from what's going on here where the x post document is itself supplying the explanation well i mean a couple of reasons as mine we die again we do think it's just elaborating on the reasoning that was included in the underlying agency the decision making record i mean that would be fundamentally inconsistent with the notion that finally agency decision makers aren't bound by that reasoning you know their subordinates there's no surprise that it seems like it's also the case of informal education that is naturally going to be the situation in the final agency decision the action it was going to take it didn't even say any explain it any it legal conclusions on this case is very different from that we have these have a legal conclusion we just didn't have an elaboration on the reasons for that legal conclusion and i think we have to read  quite narrowly because otherwise it would be inconsistent with overton park it would be inconsistent with decisions like olivarez if you look at the the final agency decision overturned part of it it was it provide no more rationale than the decision here and yet the supreme court said and then it had a separate part later where it noted that some of the individuals in question consider themselves to be volunteers and then it explained that the incentive for those individuals is a j three zero six the incentive for those individuals to do their so she doesn't have a sentence in her area where she says they are not employees because x instead we just have that conclusion that they were not employees and we also have the application of the independent contractor factors and then this discussion of the volunteer mind kind of the reason for that big gap there was because we had a whole first round of litigation in connection with a motion to dismiss for lack of final agency action had we not had any of that it uses a declaration declared that the analysis you're talking about was not a decision knowing whether the documents you're now invoking which are recommendations of the support that were at the time or are now the position the position of the agency because darling is the decision maker he comes along later with his ex post affidavit and it gives the explanation he gives it doesn't say i hereby adopt the wreak the recommendations of my subordinates right that's exactly  compensation in return for your leave or is it if you can sing the bottom line of a you know for profit company that you know is that he or is it is somehow serving your own individual interests that kind of thing and there is analysis along those lines in the hands declaration so i'm not from kind of doing this all the entire thought about what's to stop agencies from different offering i mean that's an understandable concern and obviously when the only virus was concerned about noting that persistent scofflaw behavior would not be tolerated but it's important to understand that in this it's not that there wasn't an initial reasoned decision is that it was sloppy it was that in the strings the government's it's upset again it's not manipulative i don't think this is official but when you do sloppy it was that not not any kind of sloppiness i think also it's important to keep in mind that you know you can't get over to parking can't be pits established that you can kind of follow this declaration procedure back in early one nine hundred seventy s we haven't seen a rash of litigation where and  you can see they're employing and i think that makes good sense it's in part already in the agency's interest to comply with the law and issue you know explanations where they're required but but it's also it just makes practical sense i memories are the most fresh obviously right away personal which none of the aid which darling would support and that's where the congressional letters don't address is that this is an extremely limited engagement if you have people offer to  perform work in five hour increments to twenty hours per sale with you know let's just say in the given community it's two sales per year is there any case that says that sort of engagement makes the volunteer work or whatever it is an employee will so there there aren't that many cases out volunteer relying on the cut folk foundation for all of life's necessities food shelter and clothing for an extended period of time is enough seems to me more like the first case th economic reality resume the economic reality when someone signs up to work five hours a day to you know be able to buy some better clothing use that's not like a second job characteristics that are intrinsic to the industry the next shouldn't be counted against kind of an individual engine or in terms of finding that he or she is an employee it's cited and we you know this court and more since i did that this is it says that in mr w fire words which we think this is a significant aspect of this case why would we send this back on the ground that the agency fail to consider an important aspect of the problem i think there can be no question i mean th get the access to the early shopping benefits which had value to them so we have that we have the fact that what's going on here is that that that the company is seeking to increase its profits by relying on unpaid  beneficial to the company there's something of value offered in return and there's a degree of supervision is debatable but i'll spot you that it just seems to me this to ration idea is different and it is the best argument on the other side and it's something that the agency ignore yet i think just when you analyze it in the context of considering all these other factors that so clearly point in employee direction there's just no question that you've been if you think that somehow that points against an employee determination that somehow that means then that that they're in place that's certainly not a requirement it's lame so same facts same facts as this case except the hyp most you could do was fall in cheer for a five hour shift i'm still an employee i think the answer would be yes and i mean one every five hour every five hour employee triggers all of the record keeping machinery of the f l i say yeah i mean obviously each case has to be analyzed on its assets not what we have here i mean i think one thing to keep in mind is kind of what would be the consequences of a ruling that somehow that is really significant that other to consequences i think would be quite problematic number one  is it would allow individuals who are some of the most vulnerable individuals out there who have to work in like multiple per time in temporary jobs to earn a living somehow now the fact that they are you assessed that based on economic realities i mean do you really think it is economically plausible to say that these folks are earning a living based on this five ten economic reality and duration is one relevant consideration it's certainly one relevant consideration but i think it's obviously can't be dispositive point especially when we have all the other factors pointing in favor of it where you have a question of the original question though suppose you had a situation in which you had the same arrangement that was offered to managers except they're not permanent employees of the company it's just a one time deal like oh i thought it was that yes ask you about and but the terms of the deal are these are in these are individual five hour shifts here's your choice you can either make nine dollars an hour or you can get only asked us to the sale with there would be a government with that would labor find that those are employees because of these they have the alternative of making  think that changes the fact that you're going to compensate either through wages or through even though it's a finite generation and it could be a one shot deal i think that's what i mean one way of thinking about it too is that if the plaintiffs are right here that this is not an employee relationship and there's nothing to stop you no business at large from doing things like you know offering individuals the opportunity to shop you know sales early or other benefits like that in exchange for just discrete amounts of work so we could have for example wal marts of the world could be offering individuals the opportunist shop at their black friday sales early if they'll put in eight hours of work maybe that only happens once a year but i don't think anyone would think that that is permissible under the fair labor standards act which was in in acted as walling explained in order to ensure that individuals who are contemplates compensation and should think it's important to play that out realize what what the the position of the department of labor is that people can't be allowed to choose to shop or early in exchange as an alternative to getting f l say cash wages that that's essentially the position that the department of labor is having is is making here and they can even do that for the decision to shop early on black friday but the second thing your honor is on the on the darling decoration that apart from the don't lay in presenting the darling decoration the biggest problem with it is that it is inconsistent with the rest of the administrative record as as informal were thought to be in formal decisions go this is a fairly well documented one your honour's there were there were multiple items of correspondence with members of congress there was a documentation of a final conference memo with the reiners in may of two thousand and thirteen there was a lot of documentation of what the department of labor's thought process analysis was here you are and the darling declaration is simply inconsistent with the rest of the record and to the independent contractor test it states actually in that letter that there's only one supreme court precedent on the question of whether they can be volunteers and that's a lot of that's simply not true