Opinion ID: 776458
Heading Depth: 2
Heading Rank: 1

Heading: flsa first processing exemption

Text: 9 FLSA exempts numerous employment arrangements from its minimum wage and overtime requirements. The FLSA provision at issue in this appeal exempts 10 any employee employed in the catching, taking, propagating, harvesting, cultivating, or farming of any kind of fish, shellfish, crustacea, sponges, seaweeds, or other aquatic forms of animal and vegetable life, or in the first processing, canning or packing such marine products at sea as an incident to, or in conjunction with, such fishing operations, including the going to and returning from work and loading and unloading when performed by any such employee. 11 29 U.S.C. § 213(a)(5). FLSA exemptions are to be construed narrowly. McCune v. Or. Senior Servs. Div., 894 F.2d 1107, 1109 (9th Cir.1990) (citing A.H. Phillips, Inc. v. Walling, 324 U.S. 490, 493, 65 S.Ct. 807, 89 L.Ed. 1095 (1945)). 12 Ocean Peace argues that the fish processing that occurred on its trawlers was first processing within the meaning of § 213(a)(5). Do and Pham argue to the contrary. It is undisputed that both Do and Pham were fish processors. Pham actually worked as a fish processor. Although Do did not work as a fish processor, her housekeeping duties on the trawler fell within the exemption. The FLSA regulations provide that 13 generally, an employee performing functions without which the ... operations [named in Sections 213(a)(5) and 213(b)(4)] could not go on is, as a practical matter, employed in such operations. It is also possible for an employee to come within the exemption provided by section 13(a)(5) or section 13(b)(4) even though he does not directly participate in the physical acts which are performed on the enumerated marine products in carrying on the operations which are named in that section of the Act. 14 29 C.F.R. § 784.106 (citations omitted); see also 29 C.F.R. § 784.105(b); Wirtz v. Carstedt, 362 F.2d 67, 70 (9th Cir.1966) (It is reasonable to assume that Congress intended to extend the exemption to work customarily or frequently associated with the exempt activity.). Do concedes that the work she performed satisfied § 784.106. Therefore, the only question presented is what first processing means. 15 The first in first processing can be traced to the 1961 amendments to the FLSA. Pub.L. 87-30 § 9. Before 1961, § 213(a)(5) simply referred to processing. 29 U.S.C. § 213(a)(5) (1958); 2 see also McComb v. Consol. Fisheries Co., 174 F.2d 74, 77 (3d Cir.1949). In McComb, which appears to be the earliest case to address the processing exemption, the Third Circuit interpreted a prior but substantially similar incarnation of § 213(a)(5) in the context of shoreside operations. The court noted that Congress intended the list of activities in subsection (a) to be a complete catalog of the activities involved in the fishery industry. Id. at 77. Although the earlier statute referred to processing rather than first processing, curiously the court itself referred to first processing and concluded that shoreside employees fell within the exemption. The court expressly declined to decide whether the exemption applied to work performed after first processing. Id. at 78. 16 Do and Pham argue that the word first in § 213(a)(5) implies that, in order for the exemption to apply, there must be some sort of second or final processing beyond the immediate measures required to preserve the fish. That is to say, the word first has no meaning unless there is subsequent processing. There is no judicial or regulatory authority supporting Do and Pham's interpretation of first processing. 3 On its face, the statute does not require such a narrow reading of first processing. The statute makes no reference to secondary or subsequent processing and, as a matter of common sense, first processing encompasses the initial processing at sea. 17 Because § 213(a)(5) is ambiguous, we look to the Department of Labor's FLSA regulations and conclude that they squarely answer the question presented by this appeal. See Baldwin v. Trailer Inns, Inc., 266 F.3d 1104, 1112 n. 4 (9th Cir.2001) (We give deference to the DOL's regulations interpreting the FLSA.) (citing Auer v. Robbins, 519 U.S. 452, 457, 117 S.Ct. 905, 137 L.Ed.2d 79 (1997)). To qualify for a § 213(a)(5) first processing exemption, the FLSA regulations require that 18 (a) the work of the employees is such that they are, within the meaning of the Act, employed in one or more of the named operations of first processing, canning or packing, (b) such operations are performed as an incident to, or in conjunction with, fishing operations of the vessel, (c) such operations are performed at sea, and (d) such operations are performed on the marine product specified in the statute. 19 29 C.F.R. § 784.128. Those regulations read the text of the statute in a permissible way. Do and Pham argue that because floating factories like the Ocean Peace and Seafreeze trawlers did not exist at the time Congress amended § 213(a)(5) in 1961, or when the Department of Labor promulgated the regulations in 1970, 35 Fed.Reg. 13342 (1970), the first processing exemption should not apply. There is no evidence in the record, however, indicating when factory trawlers made their first appearance on Alaskan waters, or any waters, for that matter. Even assuming that factory trawlers did not appear until after 1970, both the statute and the regulations are framed in terms of specific fishing operations, not specific types of vessels. In this case, each of the elements specified in the regulations has been satisfied. 20 The regulations define first processing as the first operation or series of continuous operations that effectuate change from a marine product's natural state. 29 C.F.R. § 784.133. 4 In illustrating typical first processing operations, § 784.133 describes operations that are virtually identical to those performed on the Ocean Peace and Seafreeze: cleaning, washing, and grading in preparation for first processing, and then gutting and freezing. Id. The regulations specify that § 213(a)(5) is designed to exempt employment in those fishing activities that are ... materially affected by natural factors or elements, such as the vicissitudes of the weather, the changeable conditions of the water, the run of the catch, and the perishability of the products obtained. 29 C.F.R. § 784.118. As suggested by § 784.133, the regulations account for various workers who are not engaged in fishing, but who are nonetheless important to an integrated fishing expedition. See, e.g., 29 C.F.R. § 784.122 (maintenance workers); 29 C.F.R. § 784.127 (office and clerical workers). Legislative history evinces Congress' intent that FLSA apply uniformly to all employees on a fishing vessel. S.Rep. No. 87-145 (1961), reprinted in 1961 U.S.C.C.A.N. 1620, 1653; see also 29 C.F.R. § 784.131. 21 Indeed, Do and Pham never argue that the FLSA regulations are an unreasonable construction of § 213(a)(5). See Martin v. Refrigeration Sch., Inc., 968 F.2d 3, 5 (9th Cir.1992) (citing Chevron USA v. NRDC, 467 U.S. 837, 844, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984)). Do and Pham offered no evidence that the processing that occurred on the Ocean Peace and Seafreeze in any way deviated from what the regulations define as first processing. Indeed, the term first processing, coupled with the explanatory regulations, describes precisely what occurred aboard Ocean Pacific's trawlers.