IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

KAREN HUYCK,

Plaintiff,

v.

Limitless, LLC, an Oregon

Limited Liability Company,

Defendant.

3:15-CV-01298-BR

 

OPINION AND ORDER 

GLENN N. SOLOMON

1001 S.W. Fifth Avenue, #1414

Portland, OR 97204

(503) 241-3508 

Attorney for Plaintiff

JEREMY L. FELLOWS

14780 S.W. Osprey Drive

Suite 365

Beaverton, OR 97007

(971) 249-3963

Attorney for Defendant

1 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 1 of 27
BROWN, Judge.

This matter comes before the Court on Plaintiff Karen

Huyck’s Motion (#22) for Summary Judgment and Defendant

Limitless, LLC’s Cross-Motion (#26) for Summary Judgment. For

the reasons that follow, the Court GRANTS in part and DENIES in

part Plaintiff’s Motion and GRANTS in part and DENIES in part

Defendant’s Cross-Motion. Accordingly, the Court AWARDS

Plaintiff damages for back overtime wages in the amount of

$4,056.63 and liquidated damages in the amount of $5,456.63 for a

total award of damages of $9,513.26.

BACKGROUND

The following facts are taken from the parties’ Joint

Statement of Agreed Upon Facts and other summary-judgment

materials and are undisputed unless otherwise noted.

Defendant employed Plaintiff as a Helper to clean, to

repair, and to recondition repossessed properties from 

January 19, 2015, through April 27, 2015. Plaintiff was a

nonexempt employee pursuant to the Fair Labor Standards Act

(FLSA), 29 U.S.C. § 213(a)(1).

Although the parties did not enter into a written contract

for Plaintiff’s employment, they entered into an oral contract

regarding payment of Plaintiff’s wages. Specifically, Plaintiff

“was paid according to the terms of her contract” at a rate of

2 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 2 of 27
“$200 per work day for a total of $1000 per work week regardless

of the number of hours that she worked.” Jt. Statement of Agreed

Upon Facts at ¶ 7.

Plaintiff submitted weekly time sheets that reflect she

frequently worked more than 40 hours per week but occasionally

worked fewer than 40 hours. The time sheets that Plaintiff

submitted to Defendant indicated she worked approximately 150

hours of overtime during her course of employment with Defendant. 

Defendant, however, never paid Plaintiff more or less than $200

per day or more than $1,000 per week regardless of the number of

hours that Plaintiff worked.

On July 13, 2015, Plaintiff filed a Complaint for Wages Due

and Owing in this Court. 

On September 14, 2015, Defendant filed an Answer,

Affirmative Defenses, and Counterclaim. 

On May 10, 2016, Plaintiff filed a Motion for Summary

Judgment.

On May 31, 2016, Defendant filed a Cross-Motion for Summary

Judgment. The Court took this matter under advisement on 

July 29, 2016.

STANDARDS

Summary judgment is appropriate when “there is no genuine

dispute as to any material fact and the movant is entitled to

3 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 3 of 27
judgment as a matter of law.” Washington Mut. Ins. v. United

States, 636 F.3d 1207, 1216 (9th Cir. 2011). See also Fed. R.

Civ. P. 56(a). The moving party must show the absence of a

dispute as to a material fact. Rivera v. Philip Morris, Inc.,

395 F.3d 1142, 1146 (9th Cir. 2005). In response to a properly

supported motion for summary judgment, the nonmoving party must

go beyond the pleadings and show there is a genuine dispute as to

a material fact for trial. Id. "This burden is not a light one

. . . . The non-moving party must do more than show there is

some 'metaphysical doubt' as to the material facts at issue." In

re Oracle Corp. Sec. Litig., 627 F.3d 376, 387 (9th Cir. 2010)

(citation omitted). 

A dispute as to a material fact is genuine "if the evidence

is such that a reasonable jury could return a verdict for the

nonmoving party." Villiarimo v. Aloha Island Air, Inc., 281 F.3d

1054, 1061 (9th Cir. 2002)(quoting Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 248 (1986)). The court must draw all

reasonable inferences in favor of the nonmoving party. Sluimer

v. Verity, Inc., 606 F.3d 584, 587 (9th Cir. 2010). "Summary

judgment cannot be granted where contrary inferences may be drawn

from the evidence as to material issues." Easter v. Am. W. Fin.,

381 F.3d 948, 957 (9th Cir. 2004)(citation omitted). A “mere

disagreement or bald assertion” that a genuine dispute as to a

material fact exists “will not preclude the grant of summary

4 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 4 of 27
judgment.” Deering v. Lassen Cmty. Coll. Dist., No. 2:07-CV1521-JAM-DAD, 2011 WL 202797, at *2 (E.D. Cal., Jan. 20, 2011)

(citing Harper v. Wallingford, 877 F.2d 728, 731 (9th Cir.

1989)). When the nonmoving party's claims are factually

implausible, that party must "come forward with more persuasive

evidence than otherwise would be necessary." LVRC Holdings LLC

v. Brekka, 581 F.3d 1127, 1137 (9th Cir. 2009)(citation omitted). 

The substantive law governing a claim or a defense

determines whether a fact is material. Miller v. Glenn Miller

Prod., Inc., 454 F.3d 975, 987 (9th Cir. 2006). If the

resolution of a factual dispute would not affect the outcome of

the claim, the court may grant summary judgment. Id.

DISCUSSION

I. Plaintiff’s Claim for Breach of Contract

It is not entirely clear from Plaintiff’s Complaint, but she

appears to assert a claim against Defendant for breach of

contract. In the first paragraph of Plaintiff’s Complaint she

alleges:

This is an action for wages due and owing in which

the plaintiff, (Huyck), alleges she was not paid

overtime wages in violation of section 7 of the

Fair Labor Standards Act, 29 USC 201 et seq, (the

FLSA). The plaintiff seeks back pay, liquidated

damages and contract damages.

In her statement of claims, however, Plaintiff asserts only that

5 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 5 of 27
she was not paid overtime wages in violation of the FLSA. In

addition, in her Motion for Summary Judgment Plaintiff states she

“asserts claims for overtime wages and liquidated damages under

the FLSA, penalty wages under state law, as well as attorney

fees.” Pl.’s Mot. for Summ. J. at 1. Plaintiff does not make

any reference or argument as to a claim for breach of contract or

for contract damages. 

To the extent that Plaintiff asserts a claim for failure to

pay her wages in breach of the parties’ oral contract, Plaintiff

fails to state a claim. The parties agree in their Joint

Statement that the terms of the contract required Defendant to

pay Plaintiff $200 per day regardless of the number of hours she

worked. Plaintiff, however, does not allege Defendant failed to

pay her $200 on any day that she worked, and the record reflects

Defendant paid Plaintiff $200 for each day that she worked

regardless of the number of hours she worked during that day.

Accordingly, the Court denies Plaintiff’s Motion for Summary

Judgment and grants Defendant’s Cross-Motion for Summary Judgment

as to Plaintiff’s breach-of-contract claim.

II. Plaintiff’s FLSA Claim

In her FLSA Claim Plaintiff asserts Defendant failed to pay

Plaintiff for all of her overtime. Specifically, Plaintiff

asserts Defendant should have paid her at the rate of 1.5 times

her regular rate of pay for all of the hours she worked in excess

6 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 6 of 27
of 40 hours per week pursuant to § 207(a) of the FLSA. 

Defendant, in turn, contends Plaintiff’s weekly pay was

intended to compensate her for all of her regular and overtime

wages. In addition, Defendant asserts it paid her sufficient

wages to account for all of the overtime wages she was due, and,

therefore, Plaintiff is not entitled to any further overtime

wages or penalties. Defendant, however, does not point to any

provision of the FLSA that permits it to pay Plaintiff a flat

daily and/or weekly sum in satisfaction of both her regular and

overtime wages regardless of the number of hours that Plaintiff

worked in a particular week.

A. FLSA Generally

Congress enacted the FLSA to eliminate “labor

conditions detrimental to the maintenance of the minimum standard

of living necessary for health, efficiency, and general

well-being of workers.” 29 U.S.C. § 202(a). To further that

goal the FLSA provides:

[N]o employer shall employ any of his employees 

. . . for a workweek longer than forty hours

unless such employee receives compensation for his

employment in excess of the hours above specified

at a rate not less than one and one-half times the

regular rate at which he is employed.

29 U.S.C. § 207(a). 

To ensure compliance with its provisions, the FLSA

authorizes actions by employees to recover unpaid overtime wages

and an equal amount as liquidated damages. 29 U.S.C. § 216(b).

7 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 7 of 27
B. Exceptions to the Overtime Requirement of 29 U.S.C. 

§ 207(a)(1)

As noted, Plaintiff and Defendant agreed Defendant

would pay Plaintiff $200 per day up to $1,000 for five days of

work per week regardless of the number of hours Plaintiff worked

in a day. The record reflects Defendant paid Plaintiff $200 per

day up to $1,000 per five-day work week regardless of the number

of hours Plaintiff worked in a day and that Defendant never paid

Plaintiff more than $200 per day. Defendant asserts the logical

inference of the parties’ agreement and actions is that they

intended $200 per work day to compensate Plaintiff for both her

regular hours and her overtime hours regardless of the number of

hours she worked in a day. Defendant, however, does not point to

any exception to the general rule provided in § 207(a)(1) of the

FLSA that requires an employer to pay an employee overtime at a

rate of 1.5 times her regular rate of pay for time worked over

forty hours.

The Court notes the FLSA provides an exception to 

§ 207(a)(1) for employees who work irregular hours in § 207(f),

which states in relevant part:

No employer shall be deemed to have violated 

[§ 207(a)] by employing any employee for a

workweek in excess of the maximum workweek

applicable to such employee under [§ 207(a)] if

such employee is employed pursuant to a bona fide

individual contract . . . if the duties of such

employee necessitate irregular hours of work, and

the contract . . . (1) specifies a regular rate of

pay of not less than the minimum hourly rate

8 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 8 of 27
provided in [§ 206(a) or (b)] . . . and

compensation at not less than one and one-half

times such rate for all hours worked in excess of

such maximum workweek, and (2) provides a weekly

guaranty of pay for not more than sixty hours

based on the rates so specified.

Emphasis added. “Exceptions to the FLSA like § 207(f) are

narrowly construed against employers . . . to further the goals

of the FLSA; protecting workers, spreading employment instead of

consolidating hours in fewer workers, and compensating employees

for the burden of working overtime.” Escobar v. Rental Xpress,

LLC, No. SA–14–CV–267–XR, 2015 WL 3408115, at *1 (W.D. Tex. 

May 26, 2015)(citing Walling v. Helmerich & Payne, 323 U.S. 37,

40 (1944)). The regulations relating to § 207(f) make clear that

exception applies only when 

the contract . . . (1) specifies a regular rate of

pay of not less than the minimum hourly rate

[mandated by the FLSA] and compensation at not

less than one and one-half times such rate for all

hours worked in excess of such maximum workweek,

and (2) provides a weekly guaranty of pay for not

more than 60 hours based on the rates so

specified.

29 C.F.R. § 778.402 (emphasis added). Defendant fails to

establish that it satisfied the requirements of § 207(f). 

Specifically, Defendant does not point to any evidence in the

record that its agreement with Plaintiff provided a weekly

guaranty of pay for “not more than 60 hours.” In fact, it is

undisputed that the parties’ agreement with respect to

Plaintiff’s pay was for all hours that Plaintiff worked in a week

9 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 9 of 27
regardless of the number of hours. The parties’ agreement did

not contain any provision related to weeks in which Plaintiff

worked more than 60 hours. Thus, the exception to § 207(a)(1)

found in § 207(f) does not apply.

The regulations relating to the FLSA also provide an

exception for employees who receive a fixed salary for

fluctuating hours in 29 U.S.C. § 778.114(a). Specifically, that

regulation provides:

An employee employed on a salary basis may have

hours of work which fluctuate from week to week

and the salary may be paid him pursuant to an

understanding with his employer that he will

receive such fixed amount as straight time pay for

whatever hours he is called upon to work in a

workweek, whether few or many. Where there is a

clear mutual understanding of the parties that the

fixed salary is compensation (apart from overtime

premiums) for the hours worked each workweek,

whatever their number, rather than for working 40

hours or some other fixed weekly work period, such

a salary arrangement is permitted by the Act if

the amount of the salary is sufficient to provide

compensation to the employee at a rate not less

than the applicable minimum wage rate for every

hour worked in those workweeks in which the number

of hours he works is greatest, and if he receives

extra compensation, in addition to such salary,

for all overtime hours worked at a rate not less

than one-half his regular rate of pay. Since the

salary in such a situation is intended to

compensate the employee at straight time rates for

whatever hours are worked in the workweek, the

regular rate of the employee will vary from week

to week and is determined by dividing the number

of hours worked in the workweek into the amount of

the salary to obtain the applicable hourly rate

for the week. 

Emphasis added. The regulation includes the following example of

10 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 10 of 27
the proper application of § 778.114(a):

[A]n employee [has] hours of work [that] do not

customarily follow a regular schedule but vary

from week to week, whose total weekly hours of

work never exceed 50 hours in a workweek, and

whose salary of $600 a week is paid with the

understanding that it constitutes the employee's

compensation, except for overtime premiums, for

whatever hours are worked in the workweek. If

during the course of 4 weeks this employee works

40, 37.5, 50, and 48 hours, the regular hourly

rate of pay in each of these weeks is $15.00,

$16.00, $12.00, and $12.50, respectively. Since

the employee has already received straight-time

compensation on a salary basis for all hours

worked, only additional half-time pay is due. For

the first week the employee is entitled to be paid

$600; for the second week $600.00; for the third

week $660 ($600 plus 10 hours at $6.00 [which is

1/2 the employee’s regular hourly rate of $12.00

that week]); for the fourth week $650 ($600 plus 

8 hours at $6.25 [which is 1/2 the employee’s

regular hourly rate of $12.50 that week]).

29 C.F.R. § 778.114(b). Finally, § 778.114(c) makes clear that

“overtime premiums must be paid contemporaneously with regular

pay.” Wallace v. Countrywide Home Loans, No. SACV 08-1463-JST

(MLGx), 2013 WL 1944458, at *4 (C.D. Cal. Apr. 29, 2013)(citing 

Zulewski v. Hershey Co., No. CV 11–05117–KAW, 2013 WL 633402, at

*2 (N.D. Cal. Feb. 20, 2013)). 

Here the record reflects Defendant did not

contemporaneously pay Plaintiff any more than $200 per day or

$1,000 per five-day week even when she worked more than 40 hours

in a week. Defendant, therefore, did not pay Plaintiff any

overtime premium at the time that Defendant paid Plaintiff’s

regular wages of $200 per day or $1,000 per five-day week. 

11 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 11 of 27
Accordingly, the Court concludes § 778.114 does not apply here.

As noted, Defendant failed to identify any provision of

the FLSA or its implementing regulations to support its position. 

The Court points out that it is not required to search the FLSA

and its regulations to find a provision to justify Defendant’s

position that it has not violated the overtime requirement of 

§ 207(a)(1). The Court, therefore, concludes on this record that

Defendant failed to pay Plaintiff overtime in violation of the

FLSA.

Accordingly, the Court grants Plaintiff’s Motion for

Summary Judgment and denies Defendant’s Cross-Motion for Summary

Judgment as to the issue of Defendant’s liability for failure to

pay Plaintiff overtime wages in violation of the FLSA. 

C. Plaintiff’s Unpaid Overtime Wages

1. Calculation Method of Plaintiff’s Overtime Rate

As noted, the FLSA authorizes actions by employees

to recover unpaid overtime wages. See 29 U.S.C. § 216(b). The

FLSA provides overtime wages are generally to be calculated “at a

rate no less than one and one-half times the regular rate at

which [an employee] is employed.” 29 U.S.C. § 207(a). Although

there are exceptions to that calculation rate, Defendant has not

established they apply to this matter, and, therefore, 

Plaintiff is entitled to unpaid overtime wages at a rate of 1.5

times her “regular rate” of pay.

12 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 12 of 27
Plaintiff asserts the Court should calculate her

regular rate of pay by dividing her weekly rate of pay ($1,000)

by 40 hours, which results in a regular hourly rate of pay of $25

per hour. 

Defendant, on the other hand, asserts the Court

should calculate Plaintiff’s regular rate of pay by dividing her

weekly rate of pay ($1,000) by the number of hours she worked in

any particular week (including overtime). Under that calculation

method, the more hours Plaintiff worked in a week, the lower her

“regular rate” of pay becomes. See Decl. of Laura Bush, Ex. 1. 

The method that Defendant urges the Court to use in calculating

Plaintiff’s regular rate of pay, however, is only permitted in

limited circumstances as set out in 29 U.S.C. § 207(f) and 29

C.F.R. § 778.114 relating to fluctuating work weeks. As the

Court has already concluded, however, Defendant has failed to

establish that this method applies under the circumstances here. 

The Court, therefore, declines to use the method of calculating

regular wages and overtime wages set out in 29 U.S.C. § 207(f)

and 29 C.F.R. § 778.114.

In summary, the Court concludes Plaintiff’s

regular rate of pay should be calculated in the manner suggested

by Plaintiff and authorized by § 207(a) of the FLSA resulting in

a regular hourly rate of $25. Plaintiff’s rate of overtime,

therefore, is $37.50 per hour (1.5 times her regular hourly rate

13 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 13 of 27
of pay). 

2. Application of Plaintiff’s Overtime Rate

The record reflects Plaintiff submitted time

sheets indicating that she worked a total of 145.51 hours of

overtime.1 See Bush Decl., Ex. 1. Although Defendant states in

its Cross-Motion and in its Response to Plaintiff’s Motion that

it disputes Plaintiff worked that amount of overtime, Defendant

does not point to any evidence in the record to refute the number

of Plaintiff’s requested overtime hours. The Court, therefore,

concludes on this record that Plaintiff is entitled to 145.51

hours of overtime at a rate of $37.50 per hour for a total of

$5,456.63 in back wages for overtime. 

The record also reflects Defendant paid Plaintiff

an additional $1,400 in June 2015 in partial satisfaction of

Plaintiff’s claim. “In actions under the FLSA, although a

plaintiff is entitled to be made whole, he is not entitled to a

windfall at the defendant's expense.” Martin v. Ind. Mich. Power

Co., 292 F. Supp. 2d 947, 960 (W.D. Mich. 2002)(citing Roman v.

Maietta Constr., Inc., 147 F.3d 71, 77 (1st Cir. 1998)). Section

216(b) provides an employee is entitled to receive “unpaid

overtime compensation” in addition to liquidated damages as a

1

 Although Plaintiff asserts she worked more overtime hours,

Plaintiff did not produce all of her time sheets and did not

submit any other additional evidence to support her assertion. 

The Court, therefore, uses the number of overtime hours reflected

in Defendant’s records of Plaintiff’s time sheets.

14 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 14 of 27
remedy. Emphasis added. When “an employer pays an employee for

[overtime hours] . . . the employer is entitled to an offset for

compensation due under the statute . . . because the statute

‘sets a floor, not a ceiling, on compensation that employees must

receive.’” Martin, 292 F. Supp. 2d at 960 (quoting Barefield v.

Village of Winnetka, 81 F.3d 704, 710-11 (7th Cir. 1996)). 

Accordingly, the Court concludes Defendant is

entitled to offset the $1,400 Defendant paid to Plaintiff in June

2015 from Plaintiff’s back overtime wages. Plaintiff, therefore,

is entitled to back overtime wages in the total amount of

$4,056.63.

D. Plaintiff’s Liquidated Damages Pursuant to § 216(b).

Plaintiff also seeks liquidated damages pursuant to 

§ 216(b) of the FLSA, which provides an employer who violates 

§ 207 of the FLSA shall be liable to the employee “in the amount

of their unpaid overtime compensation . . . and in an additional

equal amount as liquidated damages.” Emphasis added. Defendant

asserts Plaintiff is not entitled to liquidated damages because

Defendant acted in good faith and had objectively reasonable

grounds not to pay Plaintiff more than $200 per day or $1,000 per

five-day work week.

The Ninth Circuit has held

[u]nder 29 U.S.C. § 260, courts need not award

liquidated damages in every instance; instead,

courts retain discretion to withhold a liquidated

damages award, or to award less than the statutory

15 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 15 of 27
liquidated damages total, [when] an employer shows

. . . despite the failure to pay appropriate

wages, the employer acted in subjective good faith

and had objectively reasonable grounds for

believing that the acts or omissions giving rise

to the failure did not violate the FLSA.

Alvarez v. IBP, Inc., 339 F.3d 894, 909 (9th Cir. 2003)(quotation

omitted). The Ninth Circuit, however, has made clear that “[t]o

satisfy § 260, [an] employer bears the difficult burden of

proving both subjective good faith and objective reasonableness,

with double damages being the norm and single damages the

exception.” Id. (quotation omitted). When an “employer fails to

carry that burden . . . liquidated damages are mandatory.” Id.

(quotation omitted). “To avail itself of [§ 260], the employer

must establish that it had an honest intention to ascertain and

follow the dictates of the Act and that it had reasonable grounds

for believing that [its] conduct complie[d] with the Act.” 

Flores v. City of San Gabriel, 824 F.3d 890, 905 (9th Cir. 2016)

(quotations omitted).

To establish its good faith Defendant relies on the

Declarations of Jeremy Fellows and Laura Bush. Fellows testifies

in his Declaration about his negotiations with Plaintiff’s

counsel regarding Plaintiff’s overtime claim after Plaintiff had

stopped working for Defendant and before she filed this action. 

Specifically, Fellows testifies regarding his efforts to

determine the basis for the amount of overtime wages that

Plaintiff was seeking. Bush testifies regarding Plaintiff’s

16 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 16 of 27
agreement with Defendant

that by paying [Plaintiff] a salary of $200 for

each day she worked that her wages would be

sufficient to provide compensation to her at a

rate not less than the minimum wage rages required

by . . . [law] for all of the hours she would

likely be working, including hours in excess of

eight hours per day or in excess of 40 hours per

work week.

Bush Decl. at ¶ 10. Neither Fellows nor Bush testify as to any

efforts taken by Defendant to ascertain whether Defendant’s

agreement with Plaintiff satisfied the requirements of any part

of the FLSA or its regulations before, during, or after

Plaintiff’s employment. Moreover, Defendant does not point to

any steps it took to ascertain whether the kind of agreement it

had with Plaintiff satisfied any exception to the general rule

for overtime pay in § 207(a)(1) of the FLSA or to any evidence

that it had reasonable grounds for believing its failure to pay

Plaintiff overtime under the parties’ agreement complied with the

FLSA. 

The Ninth Circuit has found under similar circumstances

that the defendant did not establish it acted in good faith

within the meaning of § 260. For example, in Flores the

plaintiffs brought an action against the defendant alleging the

defendant violated the FLSA when it failed to include cash

payments made in lieu of medical benefits under the defendant’s

flexible benefits plan when calculating the plaintiffs' regular

rate of pay for overtime purposes. 824 F.3d at 895. The Ninth

17 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 17 of 27
Circuit concluded the defendant’s cash payments were required to

be included in the calculation of the plaintiffs’ regular rate of

pay and, therefore, in the calculation of their overtime pay. 

Id. The Ninth Circuit also concluded the defendant failed to

establish an exception to the award of liquidated damages found

in § 260. 

To support its claim of good faith the defendant

relied on the deposition testimony of Linda Tang,

an employee in [the defendant’s] payroll

department, who testified about the [defendant’s]

process for determining whether a particular

payment must be included in the regular rate of

pay. Ms. Tang testified that [the defendant’s]

payroll and human resources departments work

together to determine whether a particular type of

payment should be included in the calculation of

the regular rate of pay when the payment is first

provided. After a payment's initial

classification, [the defendant] conducts no

further review of a payment's designation,

although Ms. Tang testified that the human

resources department notifies the payroll

department if it learns of new authority

concerning the classification of a payment. 

Because the cash-in-lieu of benefits payments were

classified as a “benefit” in the payroll system

during this initial review, they have never been

included in the calculation of the regular rate of

pay.

Id. The Ninth Circuit found Tang’s testimony was insufficient to

establish good faith:

Such paltry evidence is not sufficient to carry

[the defendant’s] burden to demonstrate that it

acted in good faith. [The defendant] has

presented no evidence of what steps the human

resources department took to determine that the

cash-in-lieu of benefits payments were

appropriately classified as a “benefit” under the

FLSA and excluded from the calculation of the

18 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 18 of 27
regular rate of pay. That the payroll department

consulted the human resources department to find

out how a given payment should be categorized in

[the defendant’s] payroll system sheds no light on

how either department determined that the

payment's designation as a “benefit” complied with

the FLSA. An employer who “‘failed to take the

steps necessary to ensure [its] [ ] practices

complied with [FLSA]’” and who “offers no evidence

to show that it actively endeavored to ensure such

compliance” has not satisfied § 260's heavy

burden. Alvarez v. IBP, Inc., 339 F.3d 894, 910

(9th Cir. 2003)(emphasis added)(quoting Herman v.

RSR Sec. Servs. Ltd., 172 F.3d 132, 142 (2d Cir.

1999)); see also Chao v. A–One Med. Servs., Inc.,

346 F.3d 908, 920 (9th Cir. 2003)(upholding an

award of liquidated damages where the employer

believed that it was not required to pay overtime

because employees divided their hours between two

legal entities that were operated together, but

had failed to consult an objective authority or

seek advice on the legality of its position).

Id. 

Here Defendant does not offer evidence of any effort to

ensure its agreement and payments to Plaintiff satisfied the

FLSA. The Court, therefore, concludes Defendant has not met its

burden to establish it satisfied the requirements of § 260. 

According to the Ninth Circuit, therefore, “liquidated damages

are mandatory.” Alvarez, 339 F.3d at 909.

As noted, § 216(b) requires an award of liquidated

damages in an amount equal to the employee’s unpaid overtime

wages. The parties do not address and the Ninth Circuit does not

appear to have decided whether an employer who has paid an

employee some of the employee’s overtime wages due after the time

the employer was required to do so under the FLSA but before a

19 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 19 of 27
judgment is entered by a court is liable for the entire amount of

the employee’s overtime wages due at the time of the employee’s

termination as liquidated damages or only that portion of the

employee’s unpaid overtime wages still due at the time of

judgment. The few courts that have addressed this issue have

concluded the employer remains liable for liquidated damages in

the amount of overtime wages due at the time the employer failed

to pay such wages even if the employer made an additional payment

prior to judgment. For example, in Martin the plaintiff filed an

action alleging the defendant failed to pay him overtime in

violation of § 207(a) of the FLSA. In December 2001 after the

plaintiff filed the action, the defendant gave the plaintiff a

check for $10,000 that the defendant “intended . . . to encompass

any unpaid overtime which was due plaintiff. [The] plaintiff

accepted and cashed the check.” 292 F. Supp. 2d at 953. In

January 2002 the court granted summary judgment in favor of the

plaintiff on the issue of the defendant’s liability for violation

of the FLSA. The court concluded the amount of overtime the

defendant failed to pay to the plaintiff (prior to the

defendant’s December 2001 payment) was $9,879.58. Id. In

October 2002 the court issued a second opinion in which it

concluded the plaintiff was entitled to liquidated damages

pursuant to § 216(b) of the FLSA. The court concluded the

defendant was entitled to offset the $10,000 the defendant paid

20 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 20 of 27
to the plaintiff in December 2001 against the plaintiff’s unpaid

overtime wages because § 216(b) provides an employee is only

entitled to receive the amount of “unpaid overtime compensation.” 

Id. at 960 (emphasis added). The court, however, declined to

offset the $10,000 against the amount of liquidated damages the

defendant owed the plaintiff. The court reasoned:

The amount of plaintiff's unpaid overtime

compensation is $ 9,879.58. It seems that [the

defendant] would have the court adopt the view

that because it paid plaintiff in excess of this

amount ($10,000) in December 2001, 21 months after

plaintiff filed the action and virtually on the

eve of trial . . . then no liquidated damages are

due because the overtime did not remain unpaid at

the time of trial.

What [the defendant] cannot do, however, is

effectively nullify plaintiff's entitlement to

liquidated damages simply by tendering a check on

the eve of trial which covers the full amount of

overtime compensation already long overdue. 

Section 16(b) of the FLSA, 29 U.S.C. § 216(b),

“provides absolutely that the employer shall be

liable for liquidated damages in an amount equal

to minimum wages overdue; liability is not

conditioned on default at the time suit is begun.” 

Brooklyn Savings Bank v. O'Neil, 324 U.S. 697, 711

(1945); see 29 C.F.R. § 790.22 (“Under this

provision of the law, the courts have held that

the liability of an employer for liquidated

damages in an amount equal to his underpayments of

required wages become fixed [sic] at the time he

fails to pay such wages when due[.]”). Section

16(b) “authorizes the recovery of liquidated

damages as compensation for delay in payment of

sums due under the Act.” O'Neil, 324 U.S. at 715. 

Although O'Neil was decided in 1945, two years

before the statute was amended in 1947 to permit

the court, in its discretion, to reduce the amount

of liquidated damages where certain conditions are

met, 29 U.S.C. § 260, nothing in these conditions

has anything to do with permitting the employer to

21 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 21 of 27
escape liability for liquidated damages by paying

overtime compensation which is already overdue.

Id. at 960-61. The court, therefore, concluded the plaintiff was

entitled to liquidated damages in the amount of $9.879.58, “which

represents an amount equal to the overtime compensation

unlawfully withheld.” Id. at 961.

The Court adopts the reasoning of Martin and concludes

Defendant is not entitled to an offset of $1,400 (the amount that

Defendant paid Plaintiff in June 2015) against the liquidated

damages to which Plaintiff is entitled. The Court, therefore,

concludes on this record that Plaintiff is entitled to an award

of liquidated damages in the amount of $5,456.63, which

represents an amount equal to the overtime compensation that

Defendant unlawfully withheld during Plaintiff’s employment.

III. Penalty Wages Pursuant to Oregon Revised Statute § 652.150

In her Complaint Plaintiff also seeks $4,000 that represents

“thirty days wages as a state law penalty of one day’s wages for

every day that [Plaintiff] was not paid after her terminating for

thirty days.” Compl. at 3. Defendant moves for summary judgment

as to this claim on the grounds that (1) § 652.150 is solely a

penalty provision rather than a stand-alone claim, and Plaintiff

failed to allege a stand-alone state-law claim and (2) to the

extent that Plaintiff alleges a claim for violation of Oregon

law, such a claim constitutes an inappropriate double recovery.

Oregon Revised Statute § 652.150(1) provides in relevant

22 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 22 of 27
part:

[I]f an employer willfully fails to pay any wages

or compensation of any employee whose employment

ceases, as provided in ORS 652.140 . . . then, as

a penalty for the nonpayment, the wages or

compensation of the employee shall continue from

the due date thereof at the same hourly rate for

eight hours per day until paid or until action

therefor is commenced.

Oregon Revised Statute § 652.140(1) provides in relevant part:

When an employer discharges an employee or when

employment is terminated by mutual agreement, all

wages earned and unpaid at the time of the

discharge or termination become due and payable

not later than the end of the first business day

after the discharge or termination.

Accordingly, under Oregon law when an individual’s employment

ceases, an employer must pay all of the employee’s earned and

unpaid wages no later than the end of the first business day

after the end of employment. When an employer willfully fails to

do so, an employee is entitled to penalty wages pursuant to 

§ 652.150.

As noted, Defendant asserts Plaintiff is not entitled to an

award of damages pursuant to § 652.150 because such an award is

dependent on a violation of § 652.140 and Plaintiff did not

allege a claim for violation of § 652.140 in her Complaint. 

Plaintiff’s Complaint is particularly unclear as to her

request for damages pursuant to § 652.150. Plaintiff alleges in

the first paragraph of her Complaint:

This is an action for wages due and owing in which

the plaintiff, (Huyck), alleges she was not paid

23 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 23 of 27
overtime wages in violation of section 7 of the

Fair Labor Standards Act, 29 USC 201 et seq, (the

FLSA). The plaintiff seeks back pay, liquidated

damages and contract damages.

Emphasis added. Plaintiff references Oregon law in only two

other paragraphs. The first time is in the section of her

Complaint titled “FACTS”: “[Plaintiff] was not paid all the

wages that she had coming at the within [sic] 24 hours of her

termination on 4/27/1 [sic] in violation of Oregon law.” Compl.

at ¶ 13. The second time is in her prayer: 

WHEREFORE, [Plaintiff] prays for judgment against

[Defendant] as follows:

* * *

For $4,000.00 representing thirty days wages as a

state law penalty of one day’s wages for every day

that [Plaintiff] was not paid after her

termination for thirty days (ORS 652.150).

Compl. at ¶ 18(2). Plaintiff does not reference Oregon Revised

Statute § 652.140 or any specific Oregon statute other than 

§ 652.150 in her Complaint. It is unclear based on these

allegations whether Plaintiff intends to assert that she is

entitled to penalty wages under § 652.150 for Defendant’s

violation of the FLSA or whether she intends to assert Defendant

also violated some other unspecified provision of Oregon law. 

Plaintiff also fails to clarify her position in her Motion

for Summary Judgment in which she asserts: 

This is a wages due and owing case in which

[Plaintiff] asserts claims for overtime wages and

liquidated damages under the FLSA, penalty wages

24 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 24 of 27
under state law, as well as attorney fees. . . . 

The only dispute concerns the . . . calculation of

the overtime due under the FLSA.

* * *

The court should award additional penalties under

ORS 652.140(1)(a).

Pl.’s Mot. for Summary J. at 1-2, 5. These assertions suggest

Plaintiff contends Defendant failed to pay her overtime in

violation of the FLSA and that Plaintiff, therefore, is entitled

to, among other things, penalty wages under Oregon law. 

Plaintiff does not make any reference to state law in her

Response to Defendant’s Cross-Motion for Summary Judgment. In

fact, in her Response Plaintiff asserts “[t]he only real dispute

concerns the manner of calculation of the overtime due under the

FLSA.” Pl.’s Resp. at 2. 

The Court concludes on this record (and under the relatively

undemanding notice-pleading standards of Federal Rule of Civil

Procedure 8) that Plaintiff failed to assert adequately a claim

for violation of § 652.140. As noted, § 652.150 penalty wages

are available only when “an employer willfully fails to pay any

wages or compensation of any employee whose employment ceases, as

provided in ORS 652.140.” Because Plaintiff has not sufficiently

alleged a claim for violation of § 652.140, Plaintiff also has

not established she is entitled to penalty wages pursuant to 

§ 652.150.

Accordingly, the Court denies Plaintiff’s Motion for Summary

25 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 25 of 27
Judgment and grants Defendant’s Cross-Motion for Summary Judgment

as to Plaintiff’s claim for penalty wages under § 652.150.

CONCLUSION

For these reasons, the Court GRANTS in part and DENIES in

part Plaintiff’s Motion (#22) for Summary Judgment as follows:

1. GRANTS Plaintiff’s Motion as to Plaintiff’s claim for

failure to pay overtime in violation of the FLSA and

2. DENIES Plaintiff’s Motion as to Plaintiff’s claims for

breach of contract and penalty wages under Oregon

Revised Statute § 652.150.

The Court GRANTS in part and DENIES in part Defendant’s

Cross-Motion (#26) for Summary Judgment as follows:

1. GRANTS Defendant’s Cross-Motion as to Plaintiff’s

claims for breach of contract and penalty wages under

Oregon Revised Statute § 652.150 and

2. DENIES Defendant’s Cross-Motion as to Plaintiff’s claim

for failure to pay overtime in violation of the FLSA.

The Court AWARDS Plaintiff damages for back overtime wages

in the amount of $4,056.63 and liquidated damages in the amount 

26 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 26 of 27
of $5,456.63 for a total award of damages of $9,513.26.

Plaintiff is DIRECTED to submit a form of Judgment

consistent with the Opinion and Order no later than September 29,

2016.

IT IS SO ORDERED.

DATED this 26th day of September, 2016.

/s/ Anna J. Brown

 

ANNA J. BROWN

United States District Judge

27 - OPINION AND ORDER

Case 3:15-cv-01298-BR Document 40 Filed 09/26/16 Page 27 of 27