DENVER (CN) — Tour companies operating on federal land must pay raft guides $15 an hour and overtime after the 10th Circuit on Tuesday affirmed a lower court’s denial of an injunction that would have floated the industry’s traditional trip-based pay scheme instead.
"The district court did not err in concluding that the Federal Property and Administrative Services Act likely authorizes the minimum wage rule because the Department of Labor’s rule permissibly regulates the supply of nonpersonal services and advances the statutory objectives of economy and efficiency,” Chief U.S. Circuit Judge Jerome Holmes wrote in Tuesday’s 44-page opinion. Holmes was appointed by George W. Bush.
Following a 2021 executive order from President Joe Biden, the Department of Labor began requiring covered federal contractors and holders of U.S. Forest Service special-use permits to pay workers a minimum wage of $15 and time-and-a-half overtime.
The updated wages rules also rescinded a Trump-era exemption for recreational service outfitters, including raft guides.
Hoping to block the updated pay scheme, Duke Bradford, owner of Arkansas Valley Adventure, joined the Colorado River Outfitters Association, which represents 150 independent operators, to sue the U.S. Department of Labor and President Joe Biden in December 2021.
In court, the outfitters argued that outdoor guides typically exceed 40-hour work weeks to take advantage of the short season and run multiday trips — so time-and-a-half overtime wages are not feasible for the companies. Instead of paying hourly, outfitters have traditionally paid per trip, giving guides with more experience higher rates.
This scheme did not cover pre- and post-trip duties, and left guides out of luck on days without boats, but many workers supported it, anticipating that outfitters would cut their hours to avoid paying overtime premiums.
In January 2022, U.S. District Judge Philip Brimmer — also a Bush appointee — denied the outfitters’ request for a preliminary injunction. Duke appealed. On Tuesday, the 10th Circuit affirmed.
“According to the government, the DOL’s rule ‘promotes economy and efficiency’ by ‘enhanc[ing] worker productivity and generat[ing] higher-quality work by boosting workers’ health, morale, and effort; reducing absenteeism and turnover; and lowering supervisory and training costs,'" Holms wrote, joined by Ronald Reagan appointee U.S. Circuit Judge David Ebel.
Donald Trump-appointed U.S. Circuit Judge Allison Eid penned a 19-page dissent warning that the Federal Property and Administrative Services Act, or FPASA, appeared unconstitutional, likely running afoul of the nondelegation doctrine.
The law, Eid wrote, “grants the president nearly unfettered power to create any policy he considers necessary to carry out nonpersonal services under the guide of economy and efficiency.”
Because the law lacks fact-finding requirements and standards, Eid cautioned that it gave the president unchecked power to alter requirements for everything from cutting down a Christmas tree to visiting the U.S. Capitol.
"What seems ‘economical’ and ‘efficient’ is not just left to the president’s subjective opinion but is always in the federal government’s best interest because the FPASA does not require the president to consider how river rafters, a state, or any private citizen may view what is ‘economical’ and ‘efficient,” Eid wrote. “It only requires him to consider what he alone considers necessary to benefit himself or other parts of the federal government."
Michael Poon, an attorney with the nonprofit Pacific Legal Foundation, represented the raft outfitters and applauded Eid’s dissent.
"The 10th Circuit’s ruling is dangerous and mistaken,” Poon said in an email. “As Judge Eid’s dissent points out, the majority’s reading of the Procurement Act contradicts the Constitution, because it gives the president unlimited unilateral power to ‘impose any conditions at any time’ on any person or company who holds a federal permit, allowing him to personally commandeer vast portions of the American economy.”
Representatives for the government did not immediately respond to an inquiry for comment.
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