Opinion ID: 2634386
Heading Depth: 2
Heading Rank: 1

Heading: Summary Judgment Was Appropriate on the Issue of Compensable Hours.

Text: The superior court granted partial summary judgment to Throop on the question of compensable hours, holding that all of the hours paid counted as hours worked under the AWHA. A grant of summary judgment is reviewed de novo. [4] We will affirm if the record contains no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. When considering a motion for summary judgment, all reasonable inferences of fact from the proffered evidence must be drawn against the moving party and in favor of the non-moving party.[ [5] ] Air Logistics argues that the hours paid did not accurately reflect the hours the mechanics actually worked because the mechanics at remote sites were free to do as they pleased for many hours every day. Air Logistics cites several federal cases finding that employees were not paid overtime in similar situations and notes that the DOL has consistently maintained that only hours worked should be used for overtime calculations. Air Logistics also argues that even if Throop disputes the issue of whether the mechanics were actually working during the entire pay period, this raises questions of fact, such as how the mechanics spent their time, sufficient to preclude summary judgment. Throop argues that work hours under AWHA can be defined by agreement between the employee and the employer and that the agreement between Air Logistics and its employees established that all of the paid hours should be used to calculate overtime for AWHA purposes. Throop also notes that Air Logistics's pay stubs only report the scheduled hours paid, not the actual hours worked. Throop argues that since the DOL regulations require an employer to disclose the weekly hours actually worked to an employee, [6] Air Logistics repeatedly violated this regulation unless all hours paid are counted as hours worked. At oral argument the superior court seemed to base its holding on the fact that the pay stubs only reflected the ten-hour day that the employees were paid and did not contain an entry for the number of hours actually worked. It emphasized the DOL requirement that the employer provide the employee with an earning statement that shows the hours actually worked. The superior court indicated that Air Logistics would have prevailed if it had recorded the number of hours actually worked on the pay stubs. We have doubts about this approach. It is true that DOL regulations require the employer to communicate the actual hours worked for each pay period to its employee. [7] It is also true that Air Logistics failed to do this. However, there is no indication in the regulations that failure to provide this information to employees will result in all hours paid being considered hours worked for the purposes of the AWHA. While an employee could certainly bring a complaint against Air Logistics for such an omission, and the DOL could choose to penalize Air Logistics, the regulations do not mandate the superior court's outcome. Instead it is necessary to look to the statute to determine whether all of the pay hours were compensable under the AWHA. The AWHA requires an employer to pay employees at the overtime rate of one and one-half times the regular rate for  hours worked in excess of eight hours a day or forty hours a week. [8] Thus in order to determine whether Air Logistics is liable for the correct overtime rate for all of the hours paid, it is necessary to determine whether the employees were actually working for the purposes of the AWHA. The key question in this analysis is to what extent employees can use their time for their own purposes. [9] There is very little Alaska case law dealing with the question of whether an employee's use of time is restricted to such an extent that it should be classified as compensable under AWHA. There is, however, substantial federal jurisprudence dealing with the similar question of whether an employee's time should be counted as compensable for the purposes of the Fair Labor Standards Act (FLSA). [10] In Armour & Co. v. Wantock, the United States Supreme Court noted the following: Of course an employer, if he chooses, may hire a man to do nothing, or to do nothing but wait for something to happen. Refraining from other activity often is a factor of instant readiness to serve, and idleness plays a part in all employments in a stand-by capacity. Readiness to serve may be hired, quite as much as service itself, and time spent lying in wait for threats to the safety of the employer's property may be treated by the parties as a benefit to the employer.[ [11] ] In other words, to quote Armour's companion case Skidmore v. Swift & Co., [f]acts may show that the employee was engaged to wait, or they may show that he waited to be engaged. [12] The jurisprudence dealing with this question covers widely varying situations. In Skidmore, the United States Supreme Court noted that it would be imprudent to lay down a legal formula to resolve cases so varied in their facts. [13] Federal courts have, however, looked to two predominant factors when dealing with this question: (1) the degree to which the employee is free to engage in personal activities; and (2) the agreements between the parties. [14] This court adopted this analysis in Hutka v. Sisters of Providence in Washington. [15] The following subsections will address both factors in turn.
In Owens v. Local No. 169, Ass'n of Western Pulp & Paper Workers, the Ninth Circuit set out many of the factors courts have considered when determining the degree to which the employee is free to engage in personal activities: (1) whether there was an on-premises living requirement; (2) whether there were excessive geographical restrictions on employee's movements; (3) whether the frequency of calls was unduly restrictive; (4) whether a fixed time limit for response was unduly restrictive; (5) whether the on-call employee could easily trade on-call responsibilities; (6) whether use of a pager could ease restrictions; and (7) whether the employee had actually engaged in personal activities during call-in time. Such a list is illustrative, not exhaustive. No one factor is dispositive.[ [16] ] Since the court granted Throop summary judgment on this issue, we resolve any factual disputes in favor of Air Logistics. We assume for the purposes of this appeal that the mechanics in the field were not required to stay on the work site itself, that they had no set response time requirement, that they could carry radios that served as pagers, that calls to work were infrequent, and that they actually engaged in personal activities during hours while they were on-call. The on-premises living requirement (factor 1) favors Throop, [17] as does the fact that the employees could not easily trade shifts (factor 5), since there was generally only one mechanic in a remote area. But the infrequency of calls (factor 3), the lack of a fixed response time (factor 4), the availability of radios that worked as pagers (factor 6), and the fact that many employees actually engaged in personal activities (factor 7) favor Air Logistics. The remoteness of the locations  inaccessible by car  means that the mechanics were constrained geographically in a general sense (factor 2), which favors Throop. But the employees were not geographically constrained in the sense that they had to remain at the work site, which favors Air Logistics. Thus a cursory look at the factors suggests that, taken together, they could favor Air Logistics. However, the fact that the mechanics were in remote areas weighs heavily in favor of Throop. Several of the factors that favor Air Logistics are less important when one considers that the employees were in isolated locations for extended periods of time. Their ability to leave the work site, the lack of any fixed response time, the availability of a radio that worked as a pager, and the fact that they actually engaged in personal activities must be viewed in this context. It is true that the mechanics could hike, fish, read, watch movies, or work out. But they could not shop, go out to eat, run errands, work on their houses or cars, spend time with friends, or do anything else one would normally do in the community where one resides. They were not allowed to bring their families to two of the remote stations, and even at the other stations they could presumably only do so if their family members had no work or school commitments for the two weeks in question. Because of the way the schedule was set up, the employee had to suffer these restrictions for two full weeks, rather than just for one shift lasting for a day or less. A Ninth Circuit case, Brigham ex rel. Estate of Brigham v. Eugene Water & Electric Board, involved a situation with similar facts. [18] As with the present case, the employees were in a remote location and on-call for a certain number of hours each week. [19] They also had an on-premises living requirement, received infrequent calls, and routinely engaged in personal activities while they were on-call. [20] The facts were more favorable to the employees' case because the employees were required to stay within earshot during their on-call shift, [21] but less favorable to the employees because they had the ability to trade shifts. [22] Thus the Brigham facts are comparable to the present case. In Brigham the Ninth Circuit found the facts to favor the employees. [23] If the Owens factors favored the employees in Brigham, then the Air Logistics employees should prevail. While the Brigham employees were in a remote area, it was accessible by car and only seventy miles away from Eugene, Oregon. [24] Thus when they were not on-call or working they could actually go into a town or have friends visit them. The Brigham employees lived with their families, [25] so they could spend time with them even when they were on-call and required to stay on premises. [26] Finally, the on-call shifts for the Brigham employees only lasted twenty-four hours, and there was generally only one shift per week. [27] By comparison, the Air Logistics employees were required to stay in the remote location with no access to any town, even when they were not on-call, for fifteen full days, during which they were unable to spend any time with their friends or in many cases their families. We find that the isolated and inaccessible location and the extended period of time spent there by employees outweigh the other factors that favor Air Logistics. Thus, the Owens factors favor Throop.
The second factor to consider is the agreement. An agreement to pay overtime while an employee is on-call does not necessarily mean that the time spent by the employee is compensable under wage and hour law. [28] That said, however, an agreement between parties is one factor that the fact finder properly should consider. [29] In Berry v. County of Sonoma , the Ninth Circuit discussed the significance of employment agreements in resolving whether time is compensable under the FLSA: The significance and importance of evaluating the agreements between the parties is that the existence of such agreements assists the trier of fact in determining whether the parties characterized the time spent waiting on-call as actual work. An agreement between the parties which provides at least some type of compensation for on-call waiting time may suggest the parties characterize waiting time as work. Conversely, an agreement pursuant to which the employees are to be paid only for time spent actually working, and not merely waiting to work, may suggest the parties do not characterize waiting time as work.[ [30] ] Under this analysis, the fact that Air Logistics agreed to compensate its employees at their regular rate and pay them overtime for any hours scheduled over eight per day/forty per week weighs in favor of the employees. [31] It is also relevant that the employees were effectively required to reside on the premises. There is a Federal Department of Labor Wage and Hour Division interpretive regulation that deals with situations, such as this one, in which employees are residing on employer's premises or working at home: An employee who resides on his employer's premises on a permanent basis or for extended periods of time is not considered as working all the time he is on the premises. Ordinarily, he may engage in normal private pursuits and thus have enough time for eating, sleeping, entertaining, and other periods of complete freedom from all duties when he may leave the premises for purposes of his own. It is, of course, difficult to determine the exact hours worked under these circumstances and any reasonable agreement of the parties which takes into consideration all of the pertinent facts will be accepted. [ [32] ] This interpretive regulation, while not binding, is persuasive authority. [33] In Brigham, the court found that even though the Owens factors discussed above favored the employees, the agreement was reasonable and thus controlling under 29 C.F.R. § 785.23. [34] In Brigham the employees were on-call for a twenty-four-hour period, of which they actually worked for approximately six hours. [35] Under their agreement they were compensated for ten hours of work. [36] In looking at whether the agreement was reasonable, the Brigham court noted the pressures and other constraints imposed on employees by virtue of their on-call duties, and concluded there was no reason why these factors cannot be accounted for as work time equivalents given the ways in which they diminished the otherwise unfettered enjoyment of the employees' time while on-call. [37] Thus, the court found that the parties' agreement treating the otherwise formally uncompensated duty shift call time as equivalent to four hours' actual work is eminently reasonable. [38] This analysis can be applied to the case at hand. Here, the employees performed a few hours of actual work each day, were on-call for ten hours, and were required to remain in a remote location twenty-four hours per day. Under their agreement they were paid for ten hours a day. This agreement  that a few hours of work, ten hours of on-call time, and twenty-four hours in a remote location is equivalent to ten hours of actual work  appears reasonable. Thus we find that the agreement to pay the employees ten hours per day favors the employees under the Federal DOL interpretive regulation. Since the facts viewed in favor of nonmovant Air Logistics favor the employees with respect to both of the Hutka factors  the employees' freedom to engage in personal activities and the employment agreement  summary judgment on this issue was appropriate.