Parth v. Pomona Valley Hospital Medical Center
630 F.3d 794
| 9th Cir. | 2010Background
- PVHMC is a California hospital subject to the FLSA, required to pay overtime at 1.5x their regular rate for overtime and 8/80 plan eligibility.
- PVHMC introduced a voluntary 12-hour shift schedule with a lower base rate for those nurses, offset by overtime and double-time for long hours, in 1989–1990, following nurses' requests.
- In 1993, Parth, a nurse, elected the 12-hour shift and accepted a reduced base rate; she continued on that schedule for years.
- In 2003, nurses unionized; a CBA provided a 10% raise first year and 5% raises thereafter, while preserving the 12-hour shift pay differential.
- Parth sued in 2006–2008 alleging the 12-hour shift pay plan violated the FLSA by paying a lower base rate and thereby avoiding overtime, leading to district court summary judgment for PVHMC.
- The Ninth Circuit affirmed, finding the plan permissible under pre-FLSA and FLSA framework and not a scheme to evade overtime.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can base pay be reduced for 12-hour shifts under the FLSA? | Parth: reduction violates FLSA regular rate. | PVHMC: reduction permissible if minimums met and overtime computed correctly. | Permissible under FLSA constraints. |
| Is the 12-hour base-rate reduction an artificial device to avoid overtime? | Parth: scheme to sidestep overtime requirements. | PVHMC: bona fide, aligned with employee consent and practice. | Not a prohibited artifice; bona fide under proper supervision. |
| Does paying different base rates for different shifts violate FLSA when duties are the same? | Parth: differential pay for same job is unlawful. | PVHMC: permissible shift-based pay differentials if overtime rules met. | Permissible; different shift rates allowed. |
Key Cases Cited
- Walling v. Belo Corp., 316 U.S. 624 (U.S. 1942) (employer can adjust regular rate to meet overtime goals if minimums met)
- Youngerman-Reynolds Hardwood Co., 325 U.S. 424 (U.S. 1945) (employer free to set regular rate so long as min wages are respected)
- Wethington v. City of Montgomery, 935 F.2d 222 (11th Cir. 1991) (budget-neutral pre-FLSA pay plan adjustments discussed)
- Gorman v. Consolidated Edison Co. of N.Y., 488 F.3d 586 (2d Cir. 2007) (validates weighted-average approach to regular rate)
- Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728 (U.S. 1981) (employee consent cannot waive FLSA protections)
- Helmerich & Payne, Inc. v. Walling, 323 U.S. 37 (U.S. 1944) (regular rate defined as hourly rate for normal non-overtime workweek)
- Adams v. Department of Juvenile Justice of New York, 143 F.3d 61 (2d Cir. 1998) (regular rate calculation cannot be wholly unrealistic or artificial)