Court Opinion

ID: 6935595
Source: CourtListenerOpinion
Date Created: 2022-07-24 00:30:39.2981+00
Date Added: 2024-06-11T16:07:26.605224
License: Public Domain

PAUL KELLY, Jr., Circuit Judge,
concurring in part and dissenting in part.
Le mieux est l’ennemi du bien. Voltaire, Dramatic Art.
For many of the reasons stated by the court, WARN does not apply to AMPEX’s Colorado Springs operation because it is a single site lacking the requisite number of laid-off employees, therefore, I respectfully dissent. If I agreed with the court that the operations constituted two separate sites, I would concur in the results reached in parts 111(A) (limitations), (C) (good faith) and part of (E) (calendar or work days), but I would dissent in Part III(D) (“pay in lieu of notice”). I would not reach Part III(F) (prejudgment interest).
WARN should not be interpreted in a vacuum. The purpose of WARN is clear — to lessen the economic impact of a plant closing or mass layoff on employees. See 20 C.F.R. § 639.1. It is not to be applied punitively against an employer for having to shrink its operations in order to remain viable, especially where, as in this case, the employer has taken steps in good faith to ameliorate the economic impact of such economic contraction.
A.
Applying the law to the virtually uncontro-verted evidence, Ampex’s characterization of VSC and RSC as a “single site of employment” is correct. If we are dealing with a “single site of employment” the requisite number of employees were not affected by the layoff and WARN does not apply.
The court makes two legal errors in affirming the district court’s determination that VSC and RSC were two single sites: (1) applying the “clearly erroneous” standard of review, and (2) treating the factors contained in the regulations narrowly, and as exclusive determinants of the “single site” inquiry. *775The court declines to consider other factors, as other appellate courts have, which bear on the “big picture.” See Prop. Op. at 766 n. 7. The court considers these other factors only insofar as Ampex’s good faith is concerned. Id. This is error — the broader approach of the other circuits is correct.
The “single site of employment” determination is a mixed question of fact and law. As the Court’s discussion of the legal principles underlying the applicable regulation, 29 C.F.R. § 6S9.3(i), makes clear, Prop. Op. at 765-766, application of the law to the established facts predominates the inquiry. Accordingly, I would review the district court’s determination de novo. See Carpenters Dist. Council v. Dillard Dep’t Stores, Inc., 15 F.3d 1275, 1289 (5th Cir.1994), cert. denied, — U.S. —, 115 S.Ct. 933, 130 L.Ed.2d 879 (1995). See also Supre v. Ricketts, 792 F.2d 958, 961-62 (10th Cir.1986). Apparently, the district court regarded the issue initially as a legal inquiry — it made its determination on summary judgment on the erroneous belief that “the two corporations are separate corporations for tax purposes.” Aplt. App. at 252, 278-79 (affidavit of Ampex Tax Manager that consolidated federal returns and combined state returns were filed). The district court declined to reconsider its ruling, Aplt. App. at 308, but added the rationale relied upon by this court in response to Ampex’s motion for judgment on partial findings, Fed. R.Civ.P. 52(c). Aplt. App. at 547, 549-554. See also Frymire v. Ampex, 858 F.Supp. 1081, 1083 (D.Colo.1994) (district court adheres to its summary judgment order). The district court treatment of this issue was hardly consistent, and undermines its decision on this issue because it is not possible to tell to what degree its decision was influenced by a factual finding which was clearly erroneous. Even under a clearly erroneous standard, however, the district’s court’s determination on this issue should be reversed because the uncontroverted evidence on how the operation functioned requires a contrary conclusion.
RSC and VSC are near-contiguous buildings owned by AMPEX. The court acknowledges, as it must, that such an arrangement would usually constitute a single site of employment. 20 C.F.R. § 639.3(i)(l). The contiguous site factor is especially important in this case against a backdrop of Ampex’s history in Colorado Springs. If the operations of Ampex had remained in the same building, no one would seriously question that a single site of employment was involved. The company’s expansion to a second building 150 feet from the original building yielded no significant change in operations. On closely analogous facts, the Fifth Circuit has found a single site of employment. See Carpenters Dist. Council, 15 F.3d at 1290 (certain divisions moved to another site to relieve overcrowding, job functions remained closely integrated and the same as before the move; held, single site of employment). This is not a situation in which there were two separate plants or two separate mines, situations in which a finding of multiple sites of employment would be appropriate. See International Union, UMW v. Jim Walter Resources, Inc., 6 F.3d 722, 726 (11th Cir.1993) (four mine sites); United Paperworkers Local 340 v. Specialty Paperboard, Inc., 999 F.2d 51, 56 (2d Cir.1993) (citing H.R.Rep. No. 576, 100th Cong. 2d Sess. 1045, reprinted in 1988 U.S.C.C.A.N. 2078, 2079 (“For example, General Motors has dozens of automobile plants throughout the country. Each plant would be considered a site of employ-ment_”)).
Far from separate management, different products and separate workforces, which could support the conclusion of “separate sites,” see 20 C.F.R. § 639.3(i)(5), the record reflects two divisions of one company functioning together to make complementary products, both before and after one division moved next door. In my view, this is not a case where § 639(f)(5) applies. The two divisions produced highly specialized electronic equipment, often to be sold as a system, utilizing substantial amounts of common parts. “There were, in fact, no absolute, clear-cut dividing lines between VSC and RSC employees and between VSC and RSC managers, and even less of a clear division between the products they produced.” Prop. Op. at 768. Rather, there was substantial overlap between the two divisions regarding support, such as purchasing, human resources, quality control, training and engi*776neering. Several requirements were handled on behalf of both divisions with assistance from the parent corporation, such as accounting, management information systems and payroll. There was a centralized phone system, and “[ejmployees at one building had free access to the other building, shared the parking lots, cafeteria, credit union, gym and athletic fields on the Colorado Springs campus.” Prop. Op. at 768. The two divisions were treated as one by the Equal Employment Opportunity Commission for purposes of compliance and affirmative action. The two divisions functioned as a single site, both before and after the move.
In its discussion on “good faith,” the court acknowledges that Ampex’s determination that the Colorado Springs campus was “reasonable,” “that reasonable minds could come to an entirely different conclusion,” that “if we consider variables not outlined in the regulations but rather relied upon in other appellate decisions, Ampex’s conclusions appear even more reasonable,” and that “given the presumption embodied in the regulations that contiguous or near-contiguous buildings are ‘single sites of employment,’ we are struck by the reasonableness that the presumption had not been defeated.” Prop. Op. at 768. Ampex’s characterization is not only reasonable, it is also correct.
B.
Ampex should receive credit for its “pay in lieu of notice” provision under 29 U.S.C. § 2104(a)(2)(B). The court indicates that “Ampex promulgated its ‘pay in lieu of notice’ policy applicable in this case on March 23, 1988.” Prop. Op. at 770. However, the record also reflects that Ampex has voluntarily continued its employees on the payroll following a layoff for at least 22 years. Aplt. App. at 494-95. This beneficence on the part of Ampex was not compelled by Congress and is not the product of any contract negotiation. Merely because employees anticipated the payments in the event of a layoff should not preclude Ampex from receiving credit. Under the court’s interpretation, if an employer announced in an employee handbook that it would comply with WARN, which it must do, by providing 60 days of severance pay in lieu of notice, an additional 60 days of pay would be required because the employer had announced its legal obligation and its employees had relied upon that announcement.
To be sure, the statute requires that the payment be “voluntary and unconditional” and “not required by any legal obligation.” 29 U.S.C. § 2104(a)(2)(B). But this requirement should be construed to apply to previously negotiated labor agreements or to payments bargained for between individual employees and the employer, in those situations where no blanket agreement exists. To apply the provision literally, is to punish an employer that voluntarily provided for its employees during a time of economic contraction. Ampex expended $566,012 for the very same purposes for which the trial court ordered the payment of an additional $568,-000. The court’s construction of “legal obligation” will quickly result in the elimination of voluntary severance provisions that frequently confer more generous benefits on employees than those bestowed by Congress.
Of the 90 employees found eligible for WARN payments, 41 received significantly more from Ampex’s voluntary “pay in lieu of notice” program than would have been required under WARN. See Aplt.App. at 698-700. The balance received somewhat less. I would credit any amounts received against Ampex’s WARN liability on a dollar for dollar basis, by employee.
Alternatively, since the record establishes that employees receiving “pay in lieu of notice” were kept on the payroll and paid their regular wages, including benefits, for the period they qualified for, Aplt. App. at 417, I would treat these payments as wages paid to the employees during the period of violation. See 29 U.S.C. § 2104(a)(2)(A). The employer’s liability would be reduced by the payments and thus would avoid what I consider to be a patently unfair result.
C.
I agree with the court in part 111(E) that “work days” should be the proper measure of damages under WARN. I also agree with n. 14 on page 29, to the extent it requires that *777the four employees who were notified of their impending layoff on January 24, 1991, but who continued to work past 30 days, receive awards reduced by the number of days worked in the 60-day period. Section 2104(a)(2)(A) plainly requires that any damages be reduced by “any wages paid by the employer to the employee for the period of violation.”