Having reviewed the contentions advanced on appeal in light of the applicable legal principles, we hold that such discretе determinations by DOL officials, which are subject to further administrative appeal, do not constitute an "administrative practice or enforcement policy" and are insufficient to invoke the good-faith defense. N.J.S.A. 34:11-56a25.2. Accordingly, we reverse the trial court's grant of summary judgment and remand for further proceedings.
I.
A.
On November 29, 2016, plaintiff filed a putative class action complaint in the Law Division against COL. The class is defined to include: "All individuals that performed truck driving functions in the State of New Jersey for [d]efendant[ ] from 2014 to present." Plaintiff alleged that the class members worked approximately
Defendant answered the complaint, denying the allegations and asserting, among other defenses, the statutory good-faith defense. See N.J.S.A. 34:11-56a25.2. After the parties exchanged some written discovery, on August 4, 2017, defendant moved for summary judgment on the grounds that it was immunized from liability under the good-faith defense. At the time of the motion, the discovery end date was scheduled to elapse on November 16, 2017, and the discovery end date had not been previously extended. In support of its entitlement to the good-faith defense, defendant cited to three determinations made by DOL officials in response to employee complaints involving COL.
First, John Callahan, a hearing and review officer in the DOL's Division of Wage and Hour Compliance, issued a handwritten investigation report dated July 27, 2007. The report stemmed from a complaint by a truck driver employed by COL alleging a failure to pay appropriate overtime wages. After "a full field investigation and internal review," the DOL initially assessed a penalty of $40,000 for failure to pay overtime wages. Following an administrative appeal by COL, however, Callahan conducted an informal settlement conference with COL. As a result of the conference, Callahan issued his report and overturned the penalty. The report determined that COL was considered a "trucking industry employer" and was required only to pay its drivers one-and-one-half times the state minimum wage for overtime hours. See N.J.S.A. 34:11-56a4(f). The report concluded that COL was meeting this requirement.
Secоnd, in June 2014, counsel for COL emailed Santiago Zayas, then a senior investigator for the DOL, asking if any follow-up was needed from COL regarding
Third, in April 2017, COL's counsel emailed David Schraeger, then section chief of the Division of Wage and Hour Compliance, inquiring about the status of a truck driver's overtime complaint. Schraeger replied via email, stating:
The inspection report indicated that [COL] is considered a transportation compаny rather than a dairy. Since the complainant consistently made above 1 1/2 times minimum wage - currently $8.44 - which equals $12.66 - per hour, we did not find the company to be in violation of [the] law at this time. We have sent the complainant a letter advising him of his right to pursue his claim at a formal [w]age [c]ollection proceeding, but he has not replied. The complaint has to be a moving party in order for a [w]age [c]ollection proceeding to go forward. Failing to hear from him, we shall take no further action on this matter at this time.
Defendant also provided two certifications in support of its motion for summary judgment. Scott Stoner, the vice president of operations for COL, certified that COL has a fleet of over 200 trucks that "warehouse[ ] аnd convey[ ] ... refrigerated and non-refrigerated products (including but not limited to milk, dairy, juice, and non-dairy products, mechanical plastic, and baked products) from one place to another by highway[.]" Stoner emphasized: "The company does not manufacture or produce any products. It owns no dairy farms, and does not produce any of the products in delivers." Stoner noted that there are products affixed with the COL label, but "that is done for branding/logistical purposes, and/or at customer request."
Michael P. McCarthy, an employee of the DOL for thirty-seven years and the former Director of the Division of Wage and Hour Compliance, certified as to the qualifications of the individuals involved in the DOL's three previous investigаtions of COL. He certified that "COL has justifiably and in good faith, relied upon the results of these three (3) investigations as contemplated by N.J.S.A. 34:11-56a25.2."
Plaintiff opposed the motion for summary judgment, primarily contending that the three informal determinations relied on by COL were insufficient to entitle it to the good-faith defense.
Plaintiff moved for reconsideration, asserting that the class members were entitled to "trucking industry overtime" at the rate of one-and-one-half times the minimum wage even if the good-faith defense barred the claim for regular overtime. See N.J.S.A. 34:11-56a4(f). On October 27, 2017, following oral argument, the trial
B.
Plaintiff appealed from the trial court's orders granting summary judgment and denying reconsideration. On March 11, 2019, we held oral argument in this appeal. Following oral argument, defendant filed a motion to supplement the record with a June 19, 2006 opinion letter from McCarthy, who at that time was the Director of the Division of Wage and Hour Compliance. Plaintiff opposed the motion.
The 2006 opinion letter was sent by McCarthy to an attorney in response to a "fax inquiry on the acceptable method of computation for 'day rate employees' in the trucking industry." The letter does not reference any employer, nor does defendant сertify that
On March 26, 2019, we granted defendant's motion to supplement the record and indicated that "[t]he supplemental materials will be considered by the court to the extent it may find them relevant." We also invited the Attorney General to participate as amicus curiae with respect to the State's interpretation of the good-faith defense. The Attorney General acceptеd the invitation and filed a letter brief on April 26, 2019. The parties each responded to the Attorney General's brief on May 6, 2019. On May 13, 2019, we again held oral argument with the Attorney General appearing as amicus.
II.
A.
On appeal, plaintiff raises the following points for our review:
POINT I: THE TRIAL COURT ERRED IN DETERMINING THAT DEFENDANT COL COULD AVAIL ITSELF OF THE [WHL]'S "GOOD FAITH" DEFENSE IN THIS ACTION.
A. The [WHL] Is a Remedial and Humanitarian Legislation That Must Be Construed Liberally to Effectuate Its Purpose of Prohibiting Employers From Evading Their Obligations.
B. Defendant COL's Purported "Proofs" Do Not Establish Applicability of the [WHL]'s "Good Faith" Defense As a Matter of Law.
C. The Trial Court Erred In Relying Upon State v. Frech Rather than Keely v. Loomis.
D. Guidance From the Federal Courts Construing the [Fair Labor Standards Act]'s "Good Faith" Defense Supports Plaintiff's Position That Defendant COL Should Not Be Able to Avail Itself of the [WHL]'s "Good Faith" Defense.
POINT II: THE TRIAL COURT SHOULD HAVE ALLOWED PLAINTIFF THE OPPORTUNITY TO DEPOSE MESSRS. STONER AND McCARTHY
PRIOR TO ENTERING SUMMARY JUDGMENT AND DISMISSING PLAINTIFF'S COMPLAINT.
POINT III: EVEN IF THE [WHL]'S "GOOD FAITH" DEFENSE APPLIES, THE TRIAL COURT ERRED IN DISMISSING PLAINTIFF'S COMPLAINT IN TOTO BECAUSE PLAINTIFF WOULD STILL HAVE A VIABLE CLAIM FOR UNPAID "TRUCKING INDUSTRY OVERTIME."
In addition, plaintiff argues that defendant is not entitled tо the good-faith defense based on the 2006 opinion letter because: (1) the letter was not part of the summary judgment record; (2) there is no evidence in the record supporting that COL actually relied on the letter; and (3) the trial court's ruling on the good-faith defense did not involve a determination of the actual compensation paid by COL to plaintiff and the putative class of truck drivers during the relevant time period. For these reasons, plaintiff maintains that the 2006 opinion letter is irrelevant to the issues on appeal.
Defendant contends that the three previous DOL determinations constitute an enforcement policy upon which it reasonably relied and are sufficient to invoke the good-faith defense. Defendant similarly argues that the 2006 opinion letter represents the DOL's enforcement policy. Defendant also argues that federal case law interpreting the good-faith defense under the Fair Labor Standards Act ("FLSA")
The Attorney General argues that the three initial determinations relied on by COL do not meet the requirements for establishing the good-faith defense. The Attorney General notes that the threе initial determinations arose from the early stages of the Division of Wage and Hour Compliance's investigations into discrete matters and were subject to further administrative appeal or
On the other hand, the Attorney General argues that the 2006 opinion letter would be sufficient to invoke the good-faith defense because it "broadly discussed the Division's policy and interpretation of the law as a whole ... and described the means by which the [DOL] determined compliance with the WHL." The Attorney General contends that "[o]n its face, the letter reflects an interpretation of the law that applies to an entire class of employers
B.
We review a grant of summary judgment de novo, applying the same standard as the trial court.
Although Rule 4:46-1 permits a party to move for summary judgment before the close of discovery, "[g]enerally, summary judgment is inappropriate prior to the completion of discovery." Wellington v. Estate of Wellington,
We review the denial of a motion for reconsideration for an abuse of discretion. Cummings v. Bahr,
Whether defendant is entitled to the GFD turns on the statutory interpretation of the WHL. We review issues of statutory construction de novo. Cashin v. Bello,
A.
In addressing the issues presented by this appeal, we adhere to well-established principles of statutory interpretation. "The Legislature's intent is the paramount goal when interpreting a statute and, generally, the best indicator of that intent is the statutory language." DiProspero v. Penn,
When a statute's plain language lends to only one interpretation, a court should not consider "extrinsic interpretative aids." DiProspero,
In addition, although we are not ultimately bound by an agency's statutory interpretation, "[g]enerally, courts afford substantial deference to an agency's interpretation of a statute that it is charged with enforcing." Univ. Cottage Club of Princeton New Jersey Corp. v. New Jersey Dep't of Envtl. Prot.,
B.
We begin our analysis with the legislative purpose of the WHL. "The WHL is designed to 'protect employees from unfair wages and excessive hours.' " Hargrove v. Sleepy's, LLC,
Turning to the relevant statutory text, N.J.S.A. 34:11-56a25.2 sets forth the good-faith defense:
In any action or proceeding commenced prior to or on or after the date of the enactment of this act based on any act or omission prior to or on or after the date of the enactment of this act, no employer shall be subject to any liability or punishment for or on account of the failure of the employer to pay minimum wages or overtime compensation under this act, if he pleads and proves that the act or omission complained of was in good faith in conformity with and in reliance on any written administrative regulation, order, ruling, approval or interpretation by the Commissioner of the [DOL] or the Director of the Wage and Hour Bureau, or any administrative practice or enforcement policy of such department or bureau with respect to the class of employers to which he belonged. Such a defense, if established, shall be a complete bar to the action or proceeding, notwithstanding, that after such act or omission, such administrative regulation, order, ruling, approval, interpretation, practice, or enforcement policy is modified or rescinded or is determined by judicial authority to be invalid or of no legal effect.
In construing this provision's plain language in accordance with the legislative purpose of the WHL, it is useful to consider the administrative structure by which the DOL enforces the WHL. Under the WHL, the Commissioner of the DOL, the Director of
Within fifteen days of receiving an assessment letter from the Division of Wage and Hour Compliance, an employer may request a formal hearing. N.J.S.A. 34:11-56a22 ; N.J.A.C. 12:56-1.3(b). When an employer requests a formal hearing, the Division of Wage and Hour Compliance considers whether the matter could be resolved at an informal settlement conference.
The employee is not a party to an enforcement action at any stage, including in the OAL. If the Division of Wage and Hour Compliance declines to pursue an enforcement action, it may refer the employee to the DOL's Wage Collection Division to pursue the
C.
"New Jersey case law is virtually nonеxistent on the requirements of that state's good-faith defense to a failure to pay statutory overtime rates[.]" Keeley v. Loomis Fargo & Co.,
Frech addressed whether a mortician's trainee should be exempted from the WHL's requirements based on employment in a "bona fide professional capacity."
In Keeley, the Third Circuit called into doubt the reasoning in Frech because it "appeared to ignore the requirement that good faith be based on a written regulations, order, etc."
D.
With this background regarding the WHL and the good-faith defense in mind, we turn to the questions presented in this appeal. When considered in the context of WHL's enforcement structure, we agree with the Attorney General that in terms of the DOL's enforcement investigations, only either the Commissioner's final agency decision rendered after an OAL hearing or a Wage Collection Referee's final decision qualifies as a "written administrative regulation, order, ruling, approval or interpretation by the Commissioner of the [Department of Labor and Workforce Development] or the Director of the Wage and Hour Bureau[.]" N.J.S.A. 34:11-56a25.2. This interpretation is consistent with both the plain language of N.J.S.A. 34:11-56a25.2 and the enforcement structure of the WHL. Accordingly, the three initial determinations relied on by defendant do not serve as a basis for the good-faith defense under this portion of N.J.S.A. 34:11-56a25.2.
The second portion of N.J.S.A. 34:11-56a25.2, that an employer relied on "any administrative practice or enforcement policy of such department or bureau with respect to the class of employers to which he belonged," is more distinctly at issue in this appeal. We read this statutory language sensibly alongside the first portion of N.J.S.A. 34:11-56a25.2 and the WHL's enforcement provisions. See DiProspero,
Applying these principles of statutory construction, we agree with plaintiff and Attorney General that the three initial determinations
For all of these reasons, we hold that discrete determinations or communications by DOL officials regarding complaints by individual employees, which are subject to further administrative appeal, do not constitute an "administrative practice or enforcement policy" and are insufficient to invoke the good-faith defense. N.J.S.A. 34:11-56a25.2.
Turning to the 2006 opinion letter, we find that the letter constitutes an "administrative practice or enforcement policy" sufficient to support a good-faith defense. N.J.S.A. 34:11-56a25.2. In general, agencies offer this sort of informal guidance through means such as opinion letters, bulletins, and internal memoranda. See
The 2006 opinion letter constitutes such informal guidance and expresses the Division of Wаge and Hour Compliance's interpretation of the appropriate methods to calculate overtime wages for both non-exempt employees and trucking industry employees. In other words, the letter distinctly represents the Division's "administrative practice or enforcement policy ... with respect to [a] class of employers." N.J.S.A. 34:11-56a25.2. Based on the plain language of the statute, and giving deference to the Attorney General's interpretation of the WHL, see Univ. Cottage Club,
Turning to the facts of this case, however, we find that defendant is not entitled to the good-faith defense based on the 2006 opinion letter. The good-faith defense applies only when an employer "pleads and proves that the act or omission complained of was in good faith in conformity with and in reliance on [a qualifying source]." N.J.S.A. 34:11-56a25.2 (emphasis added). "When an affirmative defense is raised [in a civil case], the defendant normally has the burden of proving it." Roberts v. Rich Foods, Inc.,
Moreover, unlike the three initial documents, the 2006 opinion letter does not specifically address COL or determine that COL meets the statutory definition of a "trucking industry employer." N.J.S.A. 34:11-56a4(f). Because defendant did not present proofs that it was a trucking industry employer and had paid its employees in accordance with the formula for trucking industry overtime set forth in the letter, the letter is insufficient to support the good-faith defense on the facts of this case.
In this regard, the trial court made clear that "whether or not [defendant] is a trucking industry [employer] is clearly a question of fact. But that's not the issue for today." Similarly, based on its ruling on the good-faith defense, the trial court also did not make findings on the actual hourly compensation plaintiff received during the relevant time period.
The WHL defines "trucking industry employer" as
any business or establishment primarily operating for the purpose of conveying property from one place to another by road or highway, including the storage and warehousing of goods аnd property. Such an employer shall also be subject to the jurisdiction of the Secretary of Transportation pursuant to the federal Motor Carrier Act, 49 U.S.C. [§] 31501 et seq., whose employees are exempt under section [§] 213(b)(1) of the federal "Fair Labor Standards Act of 1938," 29 U.S.C. [§] 213(b)(1), which provides an exemption to employees regulated by section 207 of the federal "Fair Labor Standards Act of 1938," 29 U.S.C. [§] 207, and the Interstate Commerce Act, 49 U.S.C. [§] 501 et al.
[ N.J.S.A. 34:11-56a4(f).]
Based on the legislative purpose of the WHL and the legislative history of the
In opposition to defendant's motion for summary judgment, plaintiff requested additional discovery to establish the defendant is not a trucking industry employer. Plaintiff identifies information on defendant's website suggesting that defendant may manufacture some of its products and is not only in the business of conveying goods. On the other hand, defendant's vice president of operations certified that COL does not manufacture or produce any of its own products.
When viewing the evidence in the light most favorable to plaintiff, we find that issues of fact exist as to whether defendant is a trucking industry employer. There were roughly three months until the close of discovery when defendant moved for summary judgment, and plaintiff had not yet deposed defendant's vice president of operations. Moreover, it is clear that the parties did not actually litigate this issue below.
In addition, even if defendant meets the definition of a trucking industry employer, defendant did not present sufficient proofs to establish that plaintiff received appropriate compensation. Plaintiff's
In light of these factual disputes, we remand for further discovery on whether defendant meets the statutory definition of a trucking industry employer and the actual hourly compensation plaintiff received. After determining whether defendant is a trucking industry employer, the trial court may determine whether plaintiff's actual compensation was sufficient to meet the regular overtime or trucking industry overtime rеquirements.
E.
In summary, we hold that the three initial determinations relied on by defendant are insufficient to support the good-faith defense and reverse the trial court's grant of summary judgment. Although we conclude the 2006 opinion letter represents "an administrative practice or enforcement policy," N.J.S.A. 34:11-56a25.2, defendant did not rely on this letter and therefore is not entitled to the good-faith defense on the facts of this case.
Reversed and remanded for further proceedings. We do not retain jurisdiction.
Notes
Fair Labor Standards Act of 1938,
The statute refers to the "Wage and Hour Bureau," see, e.g., N.J.S.A. 34:11-56a2 ; N.J.S.A. 34:11-56a25.2, but the DOL's regulations currently designate that division as the "Division of Wage and Hour Compliance." N.J.A.C. 12:56-2.1 (" 'Division of Wage and Hour Compliance' means Division of Wage and Hour Compliance of Labor Standards and Safety Enforcement of the New Jersey State Department of Labor and Workforce Development[.]").
Defendant contends that we are not required to narrowly construe the good-faith defense because it is not an "actual overtime exemption" such as the executive exemption or the administrative exemption. We find this argument unavailing. Because the good-faith defense provides a total bar on liability for violations of the WHL, it clearly operates as an exemption to the WHL's requirements. See Black's Law Dictionary 653 (9th ed. 2014) (defining "exemption" as "[f]reedom from a duty, liability, or other requirement; an exception.").
The Attorney General notes that a hearing officer will conduct the informal settlement conference, that employees do not particiрate in conference, and that the employer may provide additional information or clarification of the circumstances giving rise to the assessment at the conference. The hearing officer may close the case if a settlement is reached or if the Division of Wage and Hour Compliance decides to take no further action based on the information provided.
In the absence of precedential New Jersey cases, both parties invoke federal precedent interpreting the FLSA's good-faith defense. See
The defendant funeral home was charged in municipal court for failing to pay overtime wages as required by N.J.S.A. 34:11-56a4.
In 1996, the DOL enacted a regulation that established trucking industry overtime at one-and-one-half times the minimum wage.
Although we reach our conclusion based on the plain language of N.J.S.A. 34:11-56a25.2, we also note that the WHL's legislative history does not contain any amendments or comments regarding the good-faith defense. See L. 1967, c. 216, § 2.
During oral argument on the summary judgment motion, defendant's attorney acknowledged that the issue of plaintiff's actual compensation was not before the court. Likewise, in its appellate brief, defendant argues that "[t]he good-faith defense is absolute, obviating the need to address the underlying elements of a [trucking industry employer]."
The parties dispute the appropriate formulas for calculating regular overtime and trucking industry overtime and whether the 2006 opinion letter sets forth the proper formulas. We leave it to the trial court to adjudicate these issues in the first instance.