Opinion ID: 439951
Heading Depth: 2
Heading Rank: 1

Heading: Plaintiff's Entitlement to Liquidated Damages

Text: 106 As Laffey I recounted, 567 F.2d at 463-65, the Fair Labor Standards Act, which serves as the procedural and remedial framework for Equal Pay Act claims, initially provided that prevailing employees were entitled to an automatic award of liquidated damages in an amount equal to unpaid wages. Congress amended the statute in 1947 36 to commit to judicial discretion disallowance or limitation of liquidated damages if the employer satisfies the court that he acted in good faith and with reasonable grounds for believing that his act or omission was [lawful]. 29 U.S.C. Sec. 260 (1982). Both prior to and after this amendment, courts have described liquidated damages as serving a compensatory, not a penal, purpose. See, e.g., Brooklyn Savings Bank v. O'Neil, 324 U.S. 697, 707, 65 S.Ct. 895, 902, 89 L.Ed. 1296 (1945); Thompson v. Sawyer, 678 F.2d 257, 281 (D.C.Cir.1982); Marshall v. Brunner, 668 F.2d 748, 753 (3d Cir.1982); Usery v. Chef Italia, 540 F.Supp. 587, 591 n. 9 (E.D.Pa.1982). 107 Initially, the district court concluded that NWA had acted in good faith: NWA committed a willful violation of the Equal Pay Act, the court explained, because it was fully aware of [the Act] and adopted a deliberate and knowing course of conduct despite its awareness; but the evidence did not indicate an intentional, bad faith, attempt [by NWA] to evade the law. 1974 Remedial Order, 374 F.Supp. at 1390. 37 For several reasons, the district court, on first examination, also found it not unreasonable for NWA to believe that its purser/stewardess pay differential was lawful. Id. 108 On review, we held the reasons given by the District Court for disallowing liquidated damages ... legal[ly] inadequa[te]. Laffey I, 567 F.2d at 465. The good faith of which the Act speaks, we restated, is 'an honest intention to ascertain what the ... Act requires and to act in accordance with it.'  Id. at 464 (quoting Addison v. Huron Stevedoring Corp., 204 F.2d 88, 93 (2d Cir.), cert. denied, 346 U.S. 877, 74 S.Ct. 120, 98 L.Ed. 384 (1953) ). Good faith must be established affirmatively, we observed; it is not enough that it appear that the employer probably did not act in bad faith. Laffey I at 465. 109 Four of the five reasons supplied by the district court for finding NWA reasonably believed it complied with the law related to then traditional industry practice and employee acquiescence. 38 We stated: That an employer and others in the industry have broken the law for a long time without complaints from employees is plainly not the reasonable ground to which the statute speaks. Id. (footnote omitted). Further, we remarked that the prevalence of sex-discrimination litigation against the airline industry naturally prompts the question whether NWA should reasonably have known that neither its own tradition, the industry custom nor the employees' silence was a reliable indicium of the demands of the law. Id. (footnotes omitted). 39 110 In Laffey I, we recognized that [a]ny assessment of an employer's good faith or grounds for his belief in the legal propriety of his conduct is necessarily a finding of fact, to be disturbed on appeal only if clearly erroneous. 567 F.2d at 464 (footnote omitted). We found, however, that the district court had erroneously declared and applied the governing law: it had misperceived the meaning of both good faith (by apparently accepting the absence of bad faith as sufficient) and reasonable grounds (by considering several factors irrelevant to that determination). The clearly erroneous rule, see FED.R.CIV.P. 52(a), therefore did not stand in the way of a remand. 111 On this appeal, by contrast, we find no legal infirmity in the district court's assessment. Instead, we are satisfied that the district court closely followed the guidance supplied in Laffey I, which constitutes the law of the case and of this circuit. Approaching the district court's fact findings with appropriate regard to that tribunal's function and to the need for finality served by FED.R.CIV.P. 52(a), we have no occasion to disturb the liquidated damages award. 112 We summarize here the principal points made by the district court, with ample record support, in explanation of its ultimate finding that NWA did not have a reasonable foundation for a positive belief that in fact its policies compl[ied] with the law. Nov. 21, 1980, Decision, 24 Empl.Prac.Dec. at 18,286 (emphasis in original). First, NWA officials concluded that the jobs of purser and stewardess were in fact different without consulting the in-flight supervisors responsible for knowing the duties of each, without commissioning a study of the jobs (as they did nine years later), and without scrutinizing the jobs for differences in duties. Id. 40 Next, NWA's alleged belief that wages established through collective bargaining were invulnerable to Equal Pay Act challenge, despite the language of the Act and the Wage-Hour Administrator's published interpretation, 41 could not rest on an honest intention to ascertain what the Act required. Id. 113 Additionally, NWA could not establish its good faith by reason of its termination of other discriminatory personnel practices--after considerable delay and an EEOC finding of probable violations. Id. (emphasis in original). Further, NWA gained no mileage from its purported reliance on an EEOC statement that the duties of the purser and stewardess were different, for the vaunted EEOC statement merely recited [NWA's] own job descriptions. Id. at 18,287. Finally, NWA's actions after the lawsuit was filed ... fail[ed] to satisfy its burden of showing an honest intention to comply [with the law] prior to commencement of litigation. Id. (emphasis in original). 42 114 In Laffey I, we cautioned the district court that the employer bore a  'substantial burden' of proving that his failure to comply was in good faith and also was predicated on reasonable grounds for a belief that he was in compliance. 567 F.2d 464-65 (quoting in part Rothman v. Publicker Indus., Inc., 201 F.2d 618, 620 (3d Cir.1953)) (footnote omitted). If the employer cannot convince the court in these respects, we emphasized, an award of liquidated damages remains mandatory. Id. at 465 (footnote omitted). The district court, for solid, plainly stated reasons, was unconvinced that NWA acted with the requisite good faith and reasonable grounds. 43 We uphold that determination as free from any clear error.