No Overtime for Workers for Changing, Travel

CHICAGO (CN) - The 7th Circuit ruled that steel workers are not entitled by statute to overtime pay for time spent changing into work clothes and walking from locker rooms to their work site, ordering a class action against U.S. Steel Corporation dismissed.

An 800-member class of former and current hourly employees at U.S. Steel's Gary, Indiana plant filed suit under the Fair Labor Standards Act of 1938. The complaint alleged that the company had violated the act by failing to compensate them for changing and travel time, despite express provisions in their collective bargaining agreement precluding payment for these activities. According to the class, the statutory provisions of FLSA override the union agreement.

U.S. District Judge Robert Miller divided the question, ruling that the act does not require compensation for clothes-changing time. Miller certified the question of whether or not workers should be compensated for travel time to the 7th Circuit, which granted review.

While FLSA explicitly excludes from overtime "any time spent changing clothes or washing at the beginning or end of each workday which was excluded from measured working time... by the express terms or by custom or practice under a bona fide collective bargaining agreement applicable to the particular employee," the changing involves putting on "safety equipment" rather than "clothes," voiding the exception.

The 7th Circuit's opinion, penned by Judge Richard Posner, included a photograph of a steel worker "modeling" his daily outfit. Posner has frequently included photographs in his opinions, including his recent use of a photo of Bob Marley to illustrate the concept of dreadlocks.

The safety function of the clothing does not void the exemption, Posner ruled.

"Protection-against sun, cold, wind, blisters, stains, insect bites, and being spotted by animals that one is hunting-is a common function of clothing, and an especially common function of work clothes worn by factory workers. It would be absurd to exclude all work clothes that have a protective function... and thus limit the exclusion largely to actors' costumes and waiters' and doormen's uniforms," he wrote.

All federal appeals courts except the 9th Circuit, which the opinion criticized as an "outlier," have issued similar rulings.

Proceeding to the issue of travel time, the 7th Circuit ruled that employers do not have to pay workers for time spent walking from the locker room to their work site.

The court ejected plaintiffs' contention that the activity was outside of an exception to the Portal-to-Portal Act, which generally requires employers to pay for time spent traveling between "principle activities" while at work. Changing clothes is not a "principal activity," the three-judge panel determined.

Posner explained the paradox that would be created under the plaintiffs' interpretation: "Suppose it is 100 yards from the plant entrance to the locker room and another 100 yards to the work station. On the plaintiffs' view, traversing the second 100 yards is compensable, though traversing the first 100 yards is not, but if the locker room were adjacent to the work station none of the workers' travel time would be compensable even though the amount of walking they'd be doing would be identical. What sense could that make?"

The opinion noted that Congress had specifically added exceptions to the FLSA, which explicitly allow travel time pay to be negotiated by unions and management, in order to eliminate disruptions caused by the Supreme Court rulings that FLSA required overtime payment for the activities.

The travel time ruling creates a circuit split on the issue; the 6th Circuit recently released an opposite ruling in Franklin v. Kellogg Company. Noting the Circuit split, the 7th Circuit circulated its opinion to all active judges before release. No judge voted to rehear the case en banc.

"If the workers have a legal right to be paid for [time spent at the plant, but not producing steel], the company will be less willing to pay them a high wage for the time during which they are making steel; it will push hard to reduce the hourly wage so that its overall labor costs do not rise," Posner wrote, acknowledging the practical problems with an employee-friendly ruling.

"The steel industry is international and highly competitive, and unions temper their wage demands to avoid killing the goose that lays the golden eggs. They don't want the American steel industry to go where so much American manufacturing has gone in recent years-abroad."

The opinion concluded by explaining that the 7th Circuit was willing to rule in opposition to the Department of Labor's amicus briefs in favor of the plaintiffs because its recommendation was essentially political. Posner noted that the department's position on whether donning safety equipment must count towards overtime had flip-flopped between the Clinton, Bush, and Obama administrations.

"It would be a considerable paradox if before 2001 the plaintiffs would win because the President was a Democrat, between 2001 and 2009 the defendant would win because the President was a Republican, and in 2012 the plaintiffs would win because the President is again a democrat. That would make a travesty of the principal of deference to interpretations of statutes by the agencies responsible for enforcing them," he concluded.

The 7th Circuit directed the district court to dismiss the case.

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