Claudia Harbourt v. PPE Casino Resorts Maryland
820 F.3d 655
| 4th Cir. | 2016Background
- PPE Casino Resorts Maryland opened Maryland Live! and in late 2012 prepared to add ~150 table games starting April 11, 2013, requiring hire/training of ~830 dealers.
- Casino created a 12-week, free "dealer school" (Jan–Apr 2013), run entirely by the Casino though advertised as in conjunction with a community college; training was specific to Casino procedures.
- Trainees (including Harbourt, Lukoski, Pocknett) completed varying lengths of the course; only those who completed all 12 weeks (including Lukoski) were paid minimum wage for the final two days; others were unpaid.
- Trainees submitted employment paperwork and underwent background checks and drug testing during the course; Casino alleges need to train dealers to specific Casino standards.
- Plaintiffs filed a putative class action asserting FLSA, Maryland Wage & Hour Law, and Maryland Wage Payment & Collection Law claims; district court dismissed under Rule 12(b)(6) for failure to plead that Casino, not trainees, primarily benefited from training.
- Fourth Circuit reversed and remanded, holding trainees alleged sufficient facts to state FLSA and related Maryland-law claims to survive dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether attendees of the dealer school were "employees" under the FLSA | Trainees: the school primarily benefitted the Casino because it produced a large, Casino-specific trained workforce ready when games launched | Casino: no table games were operated during training, so trainees provided no work and Casino received no benefit | Court: plausible allegations that Casino primarily benefited; cannot dispose on Rule 12(b)(6) |
| Whether the training constituted "work" under the FLSA | Trainees: training involved employer-controlled exertion pursued primarily for employer benefit and included employment-like activities (forms, background checks) | Casino: absence of live table-game operations means no immediate advantage and thus no compensable work | Court: compensable "work" may exist despite lack of customer interaction; factual record needed to resolve |
| Whether the complaint plausibly alleged facts showing a scheme to avoid paying wages | Trainees: Casino disguised an employment relationship as a "school," ran course solely to staff openings, and later paid some trainees for final days | Casino: characterized program as bona fide unpaid training | Court: allegations (course run to fill positions, college tie illusory, partial payment) are plausible and could support a finding of intent to avoid wages |
Key Cases Cited
- Tennessee Coal & Iron Co. v. Muscoda Local No. 123, 321 U.S. 590 (Sup. Ct. 1944) (defines "work" as exertion controlled by employer pursued primarily for employer benefit)
- Walling v. Portland Terminal Co., 330 U.S. 148 (Sup. Ct. 1947) (trainee may be an employee; employer must not primarily benefit from training)
- McLaughlin v. Ensley, 877 F.2d 1207 (4th Cir. 1989) (balancing test: identify the primary beneficiary of training)
- Weidman v. Exxon Mobil Corp., 776 F.3d 214 (4th Cir. 2015) (standard of review for Rule 12(b)(6) motions)
- Ashcroft v. Iqbal, 556 U.S. 662 (Sup. Ct. 2009) (pleading standard: well-pled facts accepted; claims must be plausible)