W
ILLFULNESS
, G
OOD
F
AITH
,
AND THE
F
AIR
L
ABOR
S
TANDARDS
A
CT
Emily Nolan Litzinger*
A
BSTRACT
The statute of limitations for a minimum-wage or overtime violation under the
Fair Labor Standards Act (FLSA) is generally two years, but extends to three years if
a jury finds that an employer willfully violated the statute. Damages for an FLSA
violation include unpaid minimum wages or overtime, which may be doubled as liq-
uidated damages depending on whether the trial court judge (not a jury) finds that
the employer acted in good faith. The federal courts of appeal are split on the issue
of whether a jury’s finding of a willful violation precludes a judge from finding good
faith. This Article argues that a jury’s positive finding of willfulness should preclude
the judge’s discretion to withhold liquidated damages based on good faith.
I. I
NTRODUCTION
............................................. 113
II. B
ACKGROUND AND
F
ACTS
................................... 114
A. Fair Labor Standards Act ............................... 114
B. Statute of Limitations ................................... 115
C. Liquidated Damages .................................... 116
III. T
HE
C
IRCUIT
S
PLIT
......................................... 117
A. The Preclusion Majority Approach....................... 118
B. The Distinct Test Approach ............................. 121
IV. A
NALYSIS
.................................................. 124
A. Arguments of Each Side of the Circuit Split .............. 124
i. Argument for the Distinct Test Approach ............. 124
ii. The Flaws of the Distinct Test Approach ............. 125
iii. Argument for the Preclusion Majority Approach ...... 125
iv. The Flaws of the Preclusion Majority Approach ...... 126
B. Proposal ............................................... 126
i. Incorporates Reasoning From Across the Circuit ..... 126
ii. In Line with Statutory Authority ..................... 127
iii. Furthers a Policy of Consistency .................... 128
V. C
ONCLUSION
............................................... 129
* Emily Nolan Litzinger is an attorney at
F
ISHER
& P
HILLIPS
, LLP
in Louisville, Kentucky,
who represents employers nationally in labor and employment matters. She earned her J.D.
from Salmon P. Chase College of Law, Northern Kentucky University, graduating magna
cum laude in May 2010 with a concentration in Labor & Employment. She earned her B.A.
in Political Science and Spanish from the University of Kentucky, graduating summa cum
laude and Phi Beta Kappa in May 2006. As always, she would like to thank her husband and
best friend for his endless love and support. Also, she would like to send a special thank you
to Professor Richard A. Bales for his time, edits, and advice throughout the development of
this article.
112
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 113
I. I
NTRODUCTION
You are a federal judge hearing a case brought by former employees
against an employer for failure to pay overtime wages under the Fair Labor
Standards Act (hereinafter “FLSA”).
1
The employer has faced similar trouble
several times in the past for failing to pay overtime wages to its employees, but
has avoided litigation by paying back wages and promising future compliance.
However, the jury found the employer’s current breach is in willful violation of
the Act in light of the employer’s notice of previous violations. As such, a
willful violation under the FLSA extends the statute of limitations from two to
three years.
2
Now, as the judge, you must determine whether the employer
should be assessed liquidated damages. The assessment of liquidated damages
depends on whether you determine the employer is in good-faith compliance
with the Act. The fundamental issue that confronts you as the judge is whether
a finding of willfulness by the jury wholly precludes you from making a subse-
quent good-faith finding.
Circuit courts are split as to whether a finding of willfulness by the jury
precludes a subsequent finding of good-faith compliance by the judge.
3
One
group of courts takes the approach that the judge is precluded from finding
good-faith compliance once a jury finds a willful violation of the Act (the “Pre-
clusion Majority Approach”).
4
These courts reason that the jury, in its willful-
ness assessment, has already accounted for the good-faith determination, and
that a subsequent finding of good faith is illogical.
5
A second group of courts
uses the approach that the two findings are wholly separate and, in essence, a
positive finding of both willfulness and good faith can co-exist without conflict
(the “Distinct Test Approach”).
6
These courts reason that differential findings
do not conflict because the analysis for each determination relies upon different
burdens of proof.
7
This Article argues for an approach which is similar to the Preclusion
Majority Approach, where a jury’s positive finding of willfulness precludes the
judge’s discretion to withhold liquidated damages based on good faith. Part II
lays out the background and standards of FLSA as well as the Preclusion
Majority and Distinct Test approaches. Part III closely analyzes and evaluates
the persuasiveness of the arguments courts have used to support the Preclusion
Majority and Distinct Test approaches. Finally, this Article seeks to resolve this
1
W
AGE
& H
OUR
D
IV
., U.S. D
EP
TOF
L
ABOR
, WH P
UB
. 1282, H
ANDY
R
EFERENCE
G
UIDE TO
THE
F
AIR
L
ABOR
S
TANDARDS
A
CT
i, 2 (2010) (“All employees of certain enterprises having
workers engaged in interstate commerce, producing goods for interstate commerce, or han-
dling, selling, or otherwise working on goods or materials that have been moved in or pro-
duced for such commerce by any person, are covered by FLSA.”).
2
29 U.S.C. § 255(a) (2006).
3
See, e.g., Rodriguez v. Farm Stores Grocery, Inc., 518 F.3d 1259, 1274 (11th Cir. 2008);
Alvarez Perez v. Sanford-Orlando Kennel Club, Inc., 515 F.3d 1150, 1166 (11th Cir. 2008);
Davis v. Mountaire Farms, Inc., 598 F. Supp. 2d 582, 588 n.4 (D. Del. 2009).
4
Alvarez Perez, 515 F.3d at 1166; see Herman v. Palo Grp. Foster Home, Inc., 183 F.3d
468, 474 (6th Cir. 1999).
5
Castle v. Sangamo Weston, Inc., 837 F.2d 1550, 1561 (11th Cir. 1988).
6
See Rodriguez, 518 F.3d at 1274; Fowler v. Land Mgmt. Groupe, Inc., 978 F.2d 158, 162
(4th Cir. 1992).
7
Rodriguez, 518 F.3d at 1274; Fowler, 978 F.2d at 162.
114 NEVADA LAW JOURNAL [Vol. 12:112
split by arguing a jury’s positive finding of willfulness precludes the judge’s
discretionary determination of good-faith compliance, unless there is an
absence of willfulness by the jury, in which case each decision maker retains its
distinct authority. This approach is rooted in the conditional statutory language
of 29 U.S.C. §260, which implies that the judge’s determination of good faith is
contingent upon the jury’s preliminary findings.
II. B
ACKGROUND AND
F
ACTS
A. Fair Labor Standards Act
The Fair Labor Standards Act of 1938 established minimum wage, over-
time pay, and youth employment standards that affect employees in the private
sector as well as in federal, state, and local governments.
8
Covered nonexempt
workers are entitled to a minimum wage of no less than $7.25 per hour.
9
Over-
time pay at a rate of not less than one-and-one-half times the regular rate of pay
is required after 40 hours of work in a workweek.
10
A workweek is defined as
any fixed and regularly recurring period of 168 hours—seven consecutive 24-
hour periods.
11
Department of Labor investigators stationed across the United States gen-
erally enforce FLSA.
12
The investigators gather data on wages, hours, and
other employment conditions or practices in order to determine employer com-
pliance with the law.
13
Where investigators find violations, the Department of
Labor may recommend changes in employment practices to bring an employer
into compliance.
14
Willful violations may be prosecuted criminally and the vio-
lator fined up to $10,000.
15
Employers who willfully or repeatedly violate the
minimum wage or overtime pay requirements are subject to a civil penalty of
up to $11,000 for each violation.
16
Upon violation of FLSA’s overtime or minimum wage requirements, an
employer may be liable to the affected employees for the amount of unpaid
overtime compensation or unpaid wages, or both, as well as an additional equal
amount in liquidated damages.
17
FLSA provides several methods for recover-
ing unpaid minimum and overtime wages.
18
These methods include: (1) the
supervised payment of back wages; (2) an action brought by the Secretary of
Labor for back wages and liquidated damages; (3) a private suit brought by an
employee for back pay and liquidated damages, plus attorney’s fees and court
costs; or (4) an injunction to restrain any person from violating FLSA, includ-
8
29 U.S.C. §§ 203, 206, 207, 212 (2006).
9
Id. § 206(a)(1)(C).
10
Id. § 207(a)(1).
11
W
AGE
& H
OUR
D
IV
.
,
U.S. D
EP
TOF
L
ABOR
,
supra note 1, at 11.
12
See id. at 13.
13
Id.
14
Id.
15
29 U.S.C. § 216(a).
16
Id. § 216(e)(1)(A)(i).
17
Id. § 216(b).
18
See
W
AGE
& H
OUR
D
IV
.
,
U.S. D
EP
TOF
L
ABOR
,
supra note 1, at 14.
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 115
ing through the unlawful withholding of proper minimum wage and overtime
pay.
19
B. Statute of Limitations
Generally, an action for unpaid minimum wages, unpaid overtime, or liq-
uidated damages under FLSA has a two-year statute of limitations for the
recovery of back pay, except when the jury finds a willful violation, in which
case a three-year statute of limitations applies.
20
The determination of willful-
ness for statute of limitations purposes is an issue of fact for the jury.
21
To
establish willfulness for the purposes of extending the limitations period, the
employee must prove by substantial evidence that the employer knew it was in
violation of the Act or acted in reckless disregard as to whether it was in viola-
tion of the Act.
22
The Code of Federal Regulation defines reckless disregard as
the “failure to make adequate inquiry into whether conduct is in compliance
with the Act.”
23
A violation of the Act is willful where undisputed evidence shows that the
employer “had actual notice of the requirements of the FLSA by virtue of ear-
lier violations, [an] agreement to pay unpaid overtime wages, and assurances of
future compliance with the [Act].”
24
It is not necessary to show that the
employer “knew” it was in violation of the Act; rather, it is sufficient to show
that the employer knew that the Act “was in the picture” and was aware of the
Act’s possible application to its employees.
25
Other courts distinguish willful
conduct from accidental conduct.
26
These courts have held that a willful “viola-
tion must be shown to be deliberate, voluntary and intentional as distinguished
from one committed through inadvertence, accident or by ordinary negli-
gence.”
27
The employer’s state of mind or awareness of the law is irrelevant to
the question of its willfulness.
28
From a practical standpoint, the willfulness
19
Id.
20
29 U.S.C. § 255(a).
21
See Fowler v. Land Mgmt. Groupe, Inc., 978 F.2d 158, 163 (4th Cir. 1992).
22
McLaughlin v. Richland Shoe Co., 486 U.S. 128, 130 (1988).
23
5 C.F.R. § 551.104 (2011).
24
Dole v. Elliott Travel & Tours, Inc., 942 F.2d 962, 967 (6th Cir. 1991) (citing Brock v.
Superior Care, Inc., 840 F.2d 1054, 1062 (2d Cir. 1988)).
25
Donovan v. McKissick Prods. Co., 719 F.2d 350, 354 (10th Cir. 1983) (concluding that
the general manager’s deposition testimony concerning necessity of meeting minimum wage
and overtime requirements indicated that the violating company knew the Act was “in the
picture”); Casserly v. State, 844 P.2d 1275, 1282 (Colo. App. 1992).
26
See Terwilliger v. Home of Hope, Inc., 21 F. Supp. 2d 1305, 1308 (N.D. Okla. 1998)
(holding “[n]egligence or an incorrect assumption that a pay plan complies with the FLSA
do not meet the criteria for a willful violation of the FLSA,” which would trigger application
of three-year statute of limitations); Dowd v. Blackstone Cleaners, Inc., 306 F. Supp. 1276,
1281 (N.D. Tex. 1969).
27
Dowd, 306 F. Supp. at 1281.
28
Andrews v. DuBois, 888 F. Supp. 213, 220 n.9 (D. Mass. 1995); see also Reich v. News-
papers of New England, Inc., 44 F.3d 1060, 1080 (1st Cir. 1995) (holding that evidence that
employer was aware of Act’s requirements does not prove that the employer acted willfully);
Mills v. Maine, 853 F. Supp. 551, 555 (D. Me. 1994) (reasoning that no reckless disregard
was present where employer discussed the Act with state officials and reviewed brochures
and pamphlets (citing Mireles v. Frio Foods, Inc., 899 F.2d 1407, 1416 (5th Cir. 1990))).
116 NEVADA LAW JOURNAL [Vol. 12:112
standard is difficult to satisfy because it places the burden upon employees to
prove subjective intent or, at a minimum, extreme negligence on the part of the
employer.
29
C. Liquidated Damages
Although the determination of willfulness for purposes of establishing the
statute of limitations is an issue of fact for the jury, the determination of good
faith for purposes of establishing liquidated damages is a question of law for
the court to decide at its discretion.
30
The court can assess or withhold liqui-
dated damages.
31
Therefore, an employer that violates the provisions of the Act
can be liable to affected employees for unpaid minimum wages or their over-
time compensation, and, as the case may be, liquidated damages in an equal
amount.
32
In 1947, the Portal-to-Portal Act amended FLSA, and among other sub-
stantive changes to the Act, it created a safe harbor clause by which an
employer can avoid liquidated damages when it can establish it acted in good
faith under the reasonable belief that it was in compliance with the Act.
33
Prior
to this time, no such discretionary tool existed.
34
Specifically, the safe harbor
clause provides:
In any action . . . to recover . . . unpaid overtime compensation, or liquidated dam-
ages, under the [FLSA] . . . , if the employer shows to the satisfaction of the court
that the act or omission giving rise to such action was in good faith and that he had
reasonable grounds for believing that his act or omission was not a violation . . . the
court may, in its sound discretion, award no liquidated damages . . . .
35
The safe harbor clause allows the court discretion in assessing liquidated
damages when it deems an employer acted in good faith. The purpose of the
safe harbor clause is to enable the court to lessen the harshness of the liquidated
damages provision by imposing merely compensatory damages.
36
An employer
who violates FLSA provisions carries the burden of proving it is entitled to the
safe harbor and must show that it acted with both objective and subjective good
faith.
37
To prove subjective good faith, the employer must show it had “an
honest intention to ascertain what [the Act] requires and to act in accordance
with it.”
38
The employer must shoulder the additional objective good faith
requirement of showing it had reasonable grounds for believing its conduct
29
David H. Spalter, The 11th Circuit Addresses the Interplay Between ‘Good Faith’ and
‘Willfulness’,
FLSA E
MP
. E
XEMPTION
H
ANDBOOK
N
EWSL
., June 2008, at 6.
30
29 U.S.C. § 260 (2006).
31
See id.
32
Id.
33
Id.
34
Romualdo P. Eclavea, Annotation, Liquidated Damages for Violation of Wage and Hour
Provisions of Fair Labor Standards Act, 26 A
.L.R. F
ED
.
607 n.15 (1976).
35
29 U.S.C. § 260.
36
Barcellona v. Tiffany English Pub, Inc., 597 F.2d 464, 468 (5th Cir. 1979).
37
Dybach v. Fla. Dep’t of Corr., 942 F.2d 1562, 1566–67 (11th Cir. 1991); Joiner v. City of
Macon, 814 F.2d 1537, 1539 (11th Cir. 1987).
38
Dybach, 942 F.2d at 1566 (citing Brock v. Shirk, 833 F.2d 1326, 1330 (9th Cir. 1987)).
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 117
comported with the Act.
39
This “reasonableness” requirement is objective, and
ignorance alone does not exonerate the employer.
40
Objective good faith can
exist when the employer has consulted with Department of Labor authorities
and relied on such expert opinion.
41
If the employer can demonstrate that it had
both a subjective belief that it was in compliance with the Act and it had an
objectively reasonable basis for its belief, then the court may apply the safe
harbor provision and limit or deny an award of liquidated damages.
42
However,
“[a]bsent . . . a showing [of both the subjective and objective elements of the
good faith defense], liquidated damages are mandatory.”
43
III. T
HE
C
IRCUIT
S
PLIT
The United States Circuit Courts of Appeals are split on the issue of
whether a jury’s finding of willfulness is wholly separate from and can co-exist
with a finding of good faith because the burdens of proof differ, or whether the
findings are so inherently inconsistent that a positive finding of willfulness pre-
cludes a subsequent finding of good faith by the court.
44
The Fifth, Sixth,
Ninth, Tenth, and Eleventh Circuits have adopted the Preclusion Majority
Approach, holding that two positive findings are inherently inconsistent and
cannot co-exist.
45
On the other hand, the Fourth and Eighth Circuit Courts have
adopted the Distinct Test Approach, holding that the different burdens of proof
allow for both findings to co-exist as they are irrelevant to each other.
46
The
incompatible holdings from the circuit split will be examined in turn.
39
Marshall v. Brunner, 668 F.2d 748, 753 (3d Cir. 1982); Chao v. Tyson Foods, Inc., 568
F. Supp. 2d 1300, 1322 (N.D. Ala. 2008).
40
Andrews v. DuBois, 888 F. Supp. 213, 221 (D. Mass. 1995).
41
See Elwell v. Univ. Hosps. Home Care Servs., 276 F.3d 832, 841 (6th Cir. 2002) (recog-
nizing the absence of good faith where the defendant did not rely on the expertise or opinion
of any other person or entity with knowledge of the FLSA regulations, including its attorney
or the Department of Labor); Samson v. Apollo Res., Inc., 242 F.3d 629, 640–41 (5th Cir.
2001) (suggesting good faith could be found where an employer relies on the expertise or
opinion of any other person or entity with knowledge of the FLSA regulations, including its
attorney or the Department of Labor).
42
See Stevenson v. Orlando’s Auto Specialists, Inc., No. 6:07-cv-500-Orl-19GJK, 2008
WL 4371830, at *4 (M.D. Fla. Sept. 23, 2008).
43
Dybach, 942 F.2d at 1566–67 (quoting EEOC v. First Citizens Bank of Billings, 758 F.2d
397, 403 (9th Cir. 1985); see also Hayes v. Bill Haley & His Comets, Inc., 274 F. Supp. 34,
37 (E.D. Pa. 1967).
44
See Davis v. Mountaire Farms, Inc., 598 F. Supp. 2d 582, 588 n.4 (D. Del. 2009); Wil-
liams v. R.W. Cannon, Inc., No. 08-60168-CIV, 2009 WL 655730, at *2 (S.D. Fla. Mar. 12,
2009).
45
See Alvarez Perez v. Sanford-Orlando Kennel Club, Inc., 515 F.3d 1150, 1166 (11th Cir.
2008) (Although the Eleventh Circuit in Alvarez has adopted the Preclusion Majority
Approach, its opinion in Rodriguez is the only FLSA authority that illustrates the Distinct
Test Approach. Such illustration, however, does not conflict with its holding in Alvarez as
there was no finding of both willfulness and good faith.); see also Brinkman v. Dep’t of
Corr., 21 F.3d 370, 372–73 (10th Cir. 1994); Chao v. A-One Med. Servs. Inc., 346 F.3d 908,
920 (9th Cir. 2003); Herman v. Palo Grp. Foster Home, Inc., 183 F.3d 468, 474 (6th Cir.
1999); Singer v. City of Waco, Tex., 324 F.3d 813, 822–23 (5th Cir. 2003).
46
See Rodriguez v. Farm Stores Grocery, Inc., 518 F.3d 1259, 1274 (11th Cir. 2008);
Broadus v. O.K. Indus., 226 F.3d 937, 944 (8th Cir. 2000); Fowler v. Land Mgmt. Groupe,
Inc., 978 F.2d 158, 162 (4th Cir. 1992).
118 NEVADA LAW JOURNAL [Vol. 12:112
A. The Preclusion Majority Approach
Courts adopting the Preclusion Majority Approach have found that it is
inconsistent to allow a good-faith safe harbor for liquidated damages when the
jury has found the employer has acted in willful violation of the Act.
47
For
example, the Tenth Circuit Court of Appeals in Brinkman v. Department of
Corrections held that the same willfulness standard for the statute of limitations
issue applies to the liquidated damages issue.
48
The Tenth Circuit centered its
holding on the constitutional reasoning that the Seventh Amendment precludes
the court from overriding the jury when a fact issue central to the claim has
been decided upon evidence that justifies its conclusion.
49
In Brinkman, corrections officers sued the Department of Corrections,
seeking overtime compensation for thirty-minute meal breaks.
50
The Depart-
ment of Corrections did not pay its officers for meal breaks even though “they
could not leave the prison grounds, go to their automobiles, or read, and were
[still] required to respond to alarms.”
51
The jury determined the Department of
Corrections’ violations of FLSA established the willfulness of its current viola-
tion.
52
The district court refused to admit evidence contrary to the jury’s find-
ing of willfulness.
53
The district court assessed liquidated damages based on
the jury’s finding of willfulness.
54
The Department of Corrections appealed the
assessment of liquidated damages and argued that the willfulness and good
faith standards are distinct.
55
On appeal, the Tenth Circuit affirmed the district court’s assessment of
liquidated damages, holding the standards for willfulness and good faith are the
same.
56
The Tenth Circuit reasoned the Seventh Amendment right to jury trial
and its constitutional restraints precluded the court from substituting its judg-
ment of the facts for that of the jury.
57
Thus, the Seventh Amendment pre-
vented the court from reaching a contrary conclusion and, therefore, precluded
the court from finding the defendant acted in good faith. For the Tenth Circuit,
the right to a jury trial expressly precludes a contradictory finding by a judge.
58
The Sixth Circuit also held a finding of willfulness precludes a subsequent
finding of good-faith compliance, but for different reasons.
59
Rather than
focusing on the Seventh Amendment, the Sixth Circuit analyzed the statutory
language of FLSA. In Herman v. Palo Group Foster Home, Inc., the Sixth
Circuit held a finding of willfulness was dispositive on the liquidated damages
47
See Bothell v. Phase Metrics, Inc., 299 F.3d 1120, 1130 (9th Cir. 2002) (noting the con-
trapositive, that a finding of good faith precludes a finding of willfulness).
48
Brinkman v. Dep’t of Corr., 21 F.3d 370, 373 (10th Cir. 1994).
49
Id. at 372–73.
50
Id. at 371.
51
Id.
52
Id.
53
Id. at 372.
54
Id.
55
See id. at 370.
56
Id. at 373.
57
Id.
58
Id.
59
See Herman v. Palo Grp. Foster Home, Inc., 183 F.3d 468, 474 (6th Cir. 1999).
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 119
issue based on the statutory interpretation of Section 260.
60
The Sixth Circuit
reasoned that the liquidated damages issue is so closely related to the willful-
ness issue that “[a]bsent a good-faith disagreement with the authority of the
government to promulgate the statute, a finding of willfulness is dispositive.”
61
In Herman, the Secretary of Labor sued to enjoin the Palo Group Foster
Home from violating FLSA and to recover unpaid wages owed to employees
plus statutory liquidated damages.
62
The Department of Labor had investigated
the foster home in the past for its failure to keep records required by the Act.
63
The foster home agreed to comply in the future; however, upon an investigation
several years later, the Department of Labor discovered that the foster home
had not changed its unlawful practices.
64
Undisputed evidence existed which
indicated the foster home had actual notice of its violation of the Act and the
court found the employer to be in willful violation.
65
Based on the inherent
similarities of the good faith and willfulness tests, the district court assessed
liquidated damages against the foster home.
66
On appeal, the foster home
objected to the assessment of liquidated damages, arguing the tests for willful-
ness and good faith were not the same.
67
The Sixth Circuit affirmed the district
court’s decision because it found that a finding of willfulness precludes a sub-
sequent finding of good-faith compliance.
68
Regardless of the inherent incon-
sistency in allowing two positive findings, the court found that no statutory
authority indicates the test for willfulness and good faith is separate and
distinct.
69
Neither the Brinkman nor Herman courts specifically addressed the inher-
ent inconsistency between a positive finding of both a willful violation and
good-faith compliance. However, the Eleventh Circuit in Alvarez Perez v. San-
ford-Orlando Kennel Club, Inc. dealt with the issue head-on.
70
The rationale
behind the Eleventh Circuit’s finding of preclusion was based on the notion that
the standards were so intrinsically similar that when a jury found a willful vio-
lation it had already taken into account the possibility of good faith.
71
In Alva-
rez Perez, the employees of the kennel club sued for unpaid overtime wages
under FLSA.
72
At the trial court level, the jury found that the kennel club had
willfully violated the Act because it repeatedly failed to compensate employees
for overtime hours.
73
However, the district court subsequently found the kennel
club had acted in good-faith compliance with FLSA.
74
The district court per-
60
Id.
61
Id.
62
Id. at 470.
63
Id. at 470–71.
64
Id. at 471.
65
Id. at 474.
66
Id.
67
See id. at 473–74.
68
Id.
69
Id. at 474.
70
Alvarez Perez v. Sanford-Orlando Kennel Club, Inc., 515 F.3d 1150, 1166 (11th Cir.
2008).
71
Id. at 1165.
72
Id. at 1153.
73
See id. at 1154.
74
Id. at 1155.
120 NEVADA LAW JOURNAL [Vol. 12:112
mitted the inconsistency between its finding and the jury’s because it was the
court’s domain to determine good faith as a question of law, not the jury’s.
75
On appeal, the employees contended the district court erred in finding the
kennel club acted in good faith because the good-faith finding conflicted with
the jury’s willfulness finding, to which the court must yield.
76
The Eleventh
Circuit agreed finding that the core of the conflict is that the judge and jury are
answering essentially the same question for two different purposes.
77
The Eleventh Circuit provided three reasons for its holding. First, similar
to Equal Pay Act (“EPA”) and Age Discrimination in Employment Act
(“ADEA”) cases, which also apply the Portal-to-Portal Act, finding a defendant
acted willfully precludes a subsequent finding of good faith.
78
Second, when a
jury finds a defendant’s violation is willful for statute of limitations purposes,
“it has already factored the possibility of good faith into its examination.”
79
Third, no distinction exists between the test for willfulness and that for good
faith.
80
Because the two terms are mutually exclusive, finding an employer
willfully violated FLSA and complied with its terms in good faith would be
illogical.
81
In sum, Alvarez Perez and the Preclusion Majority Approach stand for the
proposition that in FLSA litigation a positive finding by a jury of willfulness
precludes a subsequent finding by the court that the defendant was in good-
faith compliance.
82
The standards for determining willfulness and good faith
are essentially the same and two positive findings cannot co-exist.
83
In addition
to the Fifth, Sixth, Ninth, Tenth, and Eleventh Circuits, several district courts
have held that a finding of willfulness and good faith cannot co-exist, including
United States District Court for the Southern District of Florida and the United
States District Court of Delaware.
84
75
Id.
76
Id. at 1162.
77
Id.
78
Id. at 1164; see also Glenn v. Gen. Motors Corp., 841 F.2d 1567, 1573 n.14 (11th Cir.
1988) (explaining that the “conclusion in the context of the discussion on the statute of
limitations issue that [the defendant’s] acting met . . . [the] definition of ‘willful’ precludes a
finding of good-faith on the part of” the defendant); EEOC v. City of Detroit Health Dep’t,
Herman Kiefer Complex, 920 F.2d 355, 358 (6th Cir. 1990) (holding that “since the jury
determined that the [defendant’s] violation of the Equal Pay Act was willful, and since the
district court was, in determining whether the violation was in good-faith and with reasona-
ble grounds, presented with the same issue, the district court was bound by the jury
finding”).
79
Alvarez Perez, 515 F.3d at 1165 (quoting Castle v. Sangamo Weston, Inc., 837 F.2d
1550, 1561 (11th Cir. 1988)).
80
Id. at 1165.
81
Id.
82
Id.
83
See id.
84
See Singer v. City of Waco, Tex., 324 F.3d 813, 823 (5th Cir. 2003); Williams v. R.W.
Cannon, Inc., No. 08-60168-CIV, 2009 WL 655730, at *1 (S.D. Fla. Mar. 12, 2009) (holding
that “[b]ased upon the clear and binding Eleventh Circuit precedent that precludes a good
faith finding by the Court after the jury has found a willful violation of the FLSA, the
undersigned agrees that Plaintiff is entitled to an award of liquidated damages”); Bothell v.
Phase Metrics Inc., 299 F.3d 1120, 1130 (9th Cir. 2002) (noting the contrapositive, that a
finding of good faith precludes a finding of willfulness); Davis v. Mountaire Farms, Inc., 598
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 121
B. The Distinct Test Approach
The Distinct Test Approach relies upon the theory that the test for willful-
ness is a wholly separate and distinct test from that of good faith.
85
In theory,
the courts following this approach have reasoned that a finding of willfulness
by the jury can peacefully co-exist with a finding of good faith by the court. In
practice, however, the circuit courts that follow the Distinct Test Approach
have yet to deal with a circumstance where there are simultaneous findings of
willfulness and good faith.
Though the Eleventh Circuit follows the Preclusion Majority Approach, its
2008 decision in Rodriguez v. Farm Stores Grocery, Inc. is currently the only
FLSA authority that illustrates the Distinct Test Approach.
86
In Rodriguez, a
group of former managers for a drive-through grocery store chain sued their
employer for unpaid overtime.
87
At trial, the jury found the grocery store was
not in willful violation of the Act, and this finding effectively limited the “man-
agers to a maximum of two years of back pay.”
88
The former store managers
also filed a post-trial motion, seeking an award of liquidated damages equal to
the amount of the jury award and were awarded such because the judge did not
find the employer was in good-faith compliance with the Act.
89
The grocery store appealed the imposition of liquidated damages, arguing
the jury’s prior finding of no willful violation of FLSA on the statute of limita-
tions issue “barred [the court] from finding that the company had not acted in
good faith.”
90
The grocery store argued two points: first, “the absence of will-
fulness is inconsistent with the absence of good faith,” meaning that if there is
no willfulness, then good faith must exist; second, “where there is evidence on
both sides of a factual issue, the court cannot make findings inconsistent with
those of the jury.”
91
However, the Eleventh Circuit decided it was not neces-
sary to deviate from its previous holding in Alvarez Perez in order to decide
Rodriguez.
92
The court recognized an important difference between the facts of
this case and the Preclusion Majority Approach cases: because there was no
F. Supp. 2d 582, 588 n.4 (D. Del. 2009) (noting that “[t]he court does not deem willfulness
and a lack of good faith to be equivalents, but recognizes, in concurrence with the majority
of Circuit Courts, that a finding of willfulness would preclude a finding of good faith”); see
also Blackmon v. Brookshire Grocery Co., 835 F.2d 1135, 1138 (5th Cir. 1988) (holding
that “[t]he trial court’s finding that [the defendant] acted in good faith negates any sugges-
tion that [it] acted in reckless disregard of the rights of [the plaintiffs]”); cf. Chao v. A-One
Med. Servs., Inc., 346 F.3d 908, 920 (9th Cir. 2003) (affirming the assessment of liquidated
damages on appeal because “a finding of good faith is plainly inconsistent with a finding of
willfulness”); Heidtman v. Cnty. of El Paso, 171 F.3d 1038, 1042 (5th Cir. 1999) (reasoning
that “[b]ecause employers cannot act in good faith based on reasonable grounds when they
suspect that they are out of compliance with the FLSA, it would have been an abuse of
discretion if the district court had not awarded liquidated damages”).
85
See Broadus v. O.K. Indus., 226 F.3d 937, 944 (8th Cir. 2000).
86
See Rodriguez v. Farm Stores Grocery, Inc., 518 F.3d 1259, 1273–75 (11th Cir. 2008).
87
Id. at 1261–62.
88
Id. at 1263.
89
Id. at 1263, 1273.
90
Id. at 1273.
91
Id.
92
See id.
122 NEVADA LAW JOURNAL [Vol. 12:112
finding of willfulness, there was no conflict between a finding of willfulness
and good faith.
93
Although the Rodriguez court was not faced with a factual finding of will-
fulness, the decision clearly illustrated the two basic premises supporting the
Distinct Test Approach. First, the jury’s finding of no willful violation by the
employer does not per se remove the court’s statutory discretion to find that an
employer did not act in good faith.
94
Unlike a positive finding of both a willful
violation and good-faith compliance, which results in a logical inconsistency,
no factual inconsistency exists when there is a failure to prove both good faith
and willfulness.
95
Second, the court reasoned that the burdens of proof are different because
the burden for the willfulness issue lies with the employee, while the burden for
good faith is placed on the employer.
96
Courts have held that “[b]ecause the
burden of proof is placed differently, a finding that willfulness was not present
may co-exist peacefully with a finding that good faith was not present.”
97
The
placement of the burdens of proof in this circumstance allows a jury to con-
clude the evidence issue is evenly balanced and collateral estoppel does not
necessarily apply.
98
Under this line of reasoning, each party is litigating a sepa-
rate and distinct issue to different decision makers without fear of issue preclu-
sion. The initial determination of willfulness by the jury does not prevent the
subsequent determination of good faith by the judge. Therefore, collateral
estoppel is inapplicable as no inconsistency is present.
99
The rationale behind the Distinct Test Approach is reinforced by the rea-
soning in the correlating EPA cases, such as Fowler v. Land Management
Groupe, Inc.
100
The Portal-to-Portal Act of 1947, which is analyzed in FLSA
litigation to determine the statute of limitations and liquidated damages, equally
applies to litigation under the EPA.
101
Courts making a decision under FLSA,
as well as the EPA, use the same statutory language of the Portal-to-Portal Act
in determining the culpability of an employer.
102
Therefore, a circuit court’s
interpretation under the EPA and FLSA is essentially the same for purposes of
determining willfulness and good-faith compliance.
In Fowler, the Fourth Circuit found wholly unconvincing the employer’s
argument that the good faith test for assessing liquidated damages is synony-
mous with the willfulness test for extending the statute of limitations.
103
A
female employee sued her former employer, alleging she was underpaid in vio-
lation of EPA.
104
At trial, the district court ruled on the willfulness issue rather
than submitting it to the jury, and found the employer did not willfully violate
93
Id. at 1274–75.
94
See id. at 1274.
95
Id.
96
Id.
97
Id.
98
Id.
99
See id.
100
See Fowler v. Land Mgmt. Groupe, Inc., 978 F.2d 158, 162 (4th Cir. 1992).
101
See 29 C.F.R. § 1621.4 (2011); see generally Fowler, 978 F.2d 158.
102
29 C.F.R. § 1621.4.
103
Fowler, 978 F.2d at 162.
104
Id. at 160.
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 123
EPA.
105
On appeal, the employee contended the willfulness issue was a factual
determination for the jury and the court should have assessed liquidated dam-
ages based on the jury’s finding.
106
The employer argued “the trial court’s
inquiry into an employer’s ‘good faith’ is synonymous with a determination of
the employer’s ‘willfulness.’
107
However, the Fourth Circuit rejected the
employer’s interpretation reasoning that it could “not discern any negative
ramifications that would result from inconsistent determinations on the issues
by the judge and the jury.”
108
Furthermore, the court found “[t]he consequences
of the judge’s decision [were] entirely separate from the consequences of the
jury’s determination, and it [was] entirely acceptable that the two fact-finders
reach[ed] conflicting conclusions on the issues.”
109
Some of the negative ramifications that the Fourth Circuit could not dis-
cern included the constitutional issues the Rodriguez court did not address.
110
The Fowler court rejected the argument that allowing inconsistent findings is a
violation of the Seventh Amendment’s right to a civil trial by jury.
111
Section
260 of the Portal-to-Portal Act expressly vests discretion in the trial judge,
rather than the jury, to assess liquidated damages; thus, there is no inconsis-
tency.
112
If the willfulness issue precluded the good-faith determination, it
would constrain the judge’s discretion in conflict with Congress’s intent.
113
The Fourth Circuit affirmed the district court’s refusal to grant liquidated dam-
ages against the employer, but agreed with the employee’s contention that it
was an error for the trial court to refuse to submit the willfulness issue to the
jury.
114
In sum, the Distinct Test Approach under Rodriguez represents the idea
that the tests for establishing willfulness and determining good-faith compli-
ance are wholly separate because the burdens of proof are on separate parties
and are determined by separate fact-finders.
115
In theory, the varying burdens
of proof allow the two findings to aptly co-exist.
116
However, in practice, no
Distinct Test Approach court has faced the dilemma of finding willfulness and
good faith simultaneously. Other courts, in addition to those mentioned above,
have also held similarly to the Distinct Test Approach courts, including the
United States District Court for the Southern District of Florida, United States
District Court for the Western District of Michigan, United States District
Court for the Eastern District of Louisiana, and the Colorado Court of
Appeals.
117
105
Id. at 160, 162.
106
Id. at 162.
107
Id.
108
Id.
109
Id.
110
See id.
111
Id.
112
Id.
113
Id.
114
Id.
115
See Rodriguez v. Farm Stores Grocery, Inc., 518 F.3d 1259, 1274 (11th Cir. 2008).
116
See id.
117
Johnson v. Big Lots Stores, Inc., 604 F. Supp. 2d 903, 926 (E.D. La. 2009) (quoting
Rodriguez, 518 F.3d at 1274, “[b]ecause the burden of proof is placed differently, a finding
124 NEVADA LAW JOURNAL [Vol. 12:112
IV. A
NALYSIS
Inconsistent findings across the circuits have created a question of which
approach the courts should apply. On one hand, the Preclusion Majority
Approach finds that inconsistent holdings may not co-exist and a positive find-
ing of willfulness by the jury precludes a positive finding of good faith by the
court.
118
The Distinct Test Approach holds that the standards for willfulness
and good faith are distinct and differ based on burdens of proof, and thus, allow
inconsistent findings to co-exist.
119
The key distinguishing aspects of the cases turn on various factors, includ-
ing the varying burdens of proof, the existence of two positive findings, and the
absence of findings. The arguments in favor of the Distinct Test and Preclusion
Majority approaches will be analyzed in turn to assess the persuasiveness of the
courts’ reasonings. Taking into account the level of persuasiveness in each
argument, this Article proposes an approach that is similar to the Prelusion
Majority Approach, where if the jury finds willfulness, the judge’s discretion to
withhold liquidated damages based on good faith is curtailed, but if the jury
does not find willfulness, the judge has the authority to determine good faith.
A. The Arguments of Each Side of the Circuit Split
Noteworthy authority supports persuasive arguments on each side of the
circuit split. However, the logical reasoning presented in the Preclusion Major-
ity Approach provides a comprehensive guideline for evaluating claims under
FLSA. Such consistency outweighs the factual contradictions ubiquitous in the
Distinct Test Approach.
i. Argument for the Distinct Test Approach
The Distinct Test Approach is premised upon the idea that the good faith
and willfulness standards have differing burdens of proof and therefore con-
flicting findings may co-exist. The issue of whether willful conduct exists on
the part of the employer is an issue of fact that must be determined by the
that willfulness was not present may co-exist peacefully with a finding that good faith was
not present,” and reaffirming Rodriguez in that “[a] finding that defendant’s actions were not
willful does not preclude a finding that defendant did not act in good faith and on reasonable
grounds”); Brandt v. Magnificent Quality Florals Corp., No. 07-20129-CIV, 2009 WL
899922, at *2 (S.D. Fla. Mar. 31, 2009) (citing Rodriguez, 518 F.3d at 1274 and holding that
“the difference in the burden of proof permits different outcomes between the jury determi-
nation of lack of willfulness and a court’s determination of lack of good faith . . .” as the
burden of proof was on the plaintiff to establish that the employer was in willful violation of
the Act, while the burden of proof was on the defendant to prove objective and subjective
good faith compliance with the Act); Usery v. Godwin Hardware, Inc., 426 F. Supp. 1243,
1267 (W.D. Mich. 1976) (“Not even a finding of good faith, if one were justified, would call
for a different conclusion . . .”, as the good faith test for liquidated damages is different than
the willfulness test for statute of limitations purposes.); Casserly v. State, 844 P.2d 1275,
1282 (Colo. App. 1992) (holding that “[t]he issue of willfulness is distinct from the issues of
reasonableness and good faith).
118
Alvarez Perez v. Sanford-Orlando Kennel Club, Inc., 515 F.3d 1150, 1166 (11th Cir.
2008).
119
Rodriguez, 518 F.3d at 1274.
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 125
jury.
120
The issue of whether good faith exists on the part of the employer is a
question of law, which is expressly allocated to the judge’s discretion by Sec-
tion 260 of the Portal-to-Portal Act.
121
The varying burdens of proof allow the
judge to determine the question of law even when the answer contradicts the
jury’s prior determination of fact.
122
The point of reconciliation of such incon-
sistent findings lies within divergence in the burdens of proof.
123
Furthermore,
because the burdens of proof vary then it is possible that the initial determina-
tion rested on a conclusion in which the evidence for a finding of willfulness
and a finding of good faith were in exact equipoise and collateral estoppel
would not apply.
124
ii. The Flaws of the Distinct Test Approach
Although distinctions between the burdens of proof exist, the logic the
Distinct Test Approach uses to reconcile its findings is limited to circumstances
where there is no finding of either willfulness or good faith, or neither. In fact,
the Rodriguez court specifically noted its reasoning did not have to take into
account the possibility of inconsistent findings because there was no finding of
willfulness
125
—thus revealing its flawed logic. The Rodriguez court and other
courts following this approach reason theoretically that willfulness and good
faith may co-exist; yet none have dealt with such a factual circumstance.
The Distinct Test Approach fails to account for situations in which the
jury finds the employer is in willful violation of the Act and where the judge
subsequently finds the employer was in good-faith compliance. The conflict
manifests where there are inconsistent findings of a judge and the jury who are
answering essentially the same question for two different purposes—once for
statute of limitations purposes and once under the safe harbor provision.
126
Though valid in the absence of findings, the Distinct Test Approach is unper-
suasive when dealing with any situation where there are two positive findings.
iii. Argument for the Preclusion Majority Approach
Three premises support the Preclusion Majority Approach. First, an inher-
ent conflict exists with the inconsistency in finding both willful violation and
good-faith compliance. A positive finding of willfulness by the jury warrants
preclusion of the court’s ability to subsequently find good-faith compliance.
127
Specifically, preclusion is necessary to prevent the conflict that arises where
120
See id.
121
See 29 U.S.C. § 260 (2006) (Noting that “if the employer shows to the satisfaction of the
court that the act or omission giving rise to such action was in good faith and that he had
reasonable grounds for believing that his act or omission was not a violation of the Fair
Labor Standards Act of 1938, as amended, the court may, in its sound discretion, award no
liquidated damages.”) (emphasis added).
122
See Rodriguez, 518 F.3d at 1274.
123
Id.
124
Id. (quoting 18
C
HARLES
A
LAN
W
RIGHT ET AL
.
,
F
EDERAL
P
RACTICE AND
P
ROCEDURE
§ 4422 (2d ed. 2002)).
125
Id. at 1273–74.
126
See id. at 1273.
127
Alvarez Perez v. Sanford-Orlando Kennel Club, Inc., 515 F.3d 1150, 1166 (11th Cir.
2008).
126 NEVADA LAW JOURNAL [Vol. 12:112
there is a pronouncement by the jury of willful conduct and another by the
judge that the employer acted in good-faith compliance.
128
Second, “when a
jury finds [an employer’s] violation is willful, . . .‘it has already factored the
possibility of good faith into its examination.’
129
A finding of “‘good faith’
after a finding of ‘willful’ violation is illogical [because] the two [concepts] are
now mutually exclusive.”
130
Essentially, the tests for the two standards are so
closely related that a positive finding of willfulness inherently precludes a sub-
sequent positive finding of good faith.
131
Third, the plaintiff’s Seventh Amend-
ment right to a jury trial could potentially be violated by two positive
findings.
132
When facts “central to a claim are decided by a jury upon evidence
that would justify its conclusion, the Seventh Amendment right to a jury trial
prohibits the court from reaching a contrary conclusion.”
133
iv. The Flaws of the Preclusion Majority Approach
The drawback to the Preclusion Majority Approach is the potential con-
flict between the statutorily-authorized discretion of the judge to determine
good-faith compliance and the right of the jury to determine willfulness.
134
The
issue of whether good faith exists is expressly allocated to the trial judge’s
discretion.
135
Restraining the trial judge’s vested discretion to award liquidated
damages pursuant to the jury’s determination of willfulness potentially acts as a
hindrance of the statute’s congressional intent to allocate authority specifically
to the trial judge’s discretion.
B. Proposal
This Article argues for an approach that is similar to the reasoning in the
Preclusion Majority Approach and allows for the statutory distinctions of the
tests, but also accommodates differing factual circumstances. The jury’s posi-
tive finding of willfulness should preclude the judge’s discretion to withhold
liquidated damages based on good faith, unless there is an absence of willful-
ness in which case each decision maker retains its authority. This proposed
approach has three main advantages. First, this approach takes into account the
expansive reasoning across the circuit. Second, it is most in line with the statu-
tory language of the Act. Third, it most effectively advances a policy of consis-
tency and a balance of statutory authority.
i. Incorporates Reasoning From Across the Circuit
This approach accounts for the positives in both the Distinct Test
Approach and Preclusion Majority Approach while remaining mindful of the
flaws in both approaches. As indicated by the Distinct Test Approach, the bur-
128
See id. at 1162.
129
Id. at 1165 (quoting Castle v. Sangamo Weston, Inc., 837 F.2d 1550, 1561 (11th Cir.
1988)).
130
Id. (quoting Castle, 837 F.2d at 1561).
131
See Singer v. City of Waco, Tex., 324 F.3d 813, 823 (5th Cir. 2003).
132
See Brinkman v. Dep’t of Corr., 21 F.3d 370, 372–73 (10th Cir. 1994).
133
Id. (citing Skinner v. Total Petroleum, Inc., 859 F.2d 1439, 1443 (10th Cir. 1988)).
134
See 29 U.S.C. § 260 (2006).
135
Id.
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 127
dens of proof are placed on different parties and the decision makers vary in
each analysis; the jury decides the willfulness of an employer, while the judge
determines an employer’s good faith. This approach allows for each decision
maker to maintain independent and distinct authority while recognizing the
inherent conflict that arises when there are two positive findings.
Under this Article’s approach, a jury determines whether the employee has
proven by a preponderance of the evidence that the employer’s conduct was in
willful violation of the Act.
136
If the jury does not find willfulness and limits
the statute of limitations to the statutory two years, the court maintains its
expressly allocated discretion to determine whether the employer has proven
objective and subjective good-faith compliance with the Act. In this circum-
stance, no inconsistency exists between the decision makers and each has main-
tained its own discretion and independence. If the jury determines that the
employee has proven by a preponderance of the evidence that the employer was
in willful violation of the Act, extending the statute of limitations to three
years, the court’s discretion to find good-faith compliance should be curtailed.
In essence, the trier of the fact has already taken into account the determination
of whether the employer acted in good-faith compliance when it determined
that the employer acted in willful violation of the Act.
137
Under this approach,
each decision maker maintains its respective authority, but the court’s authority
is curtailed only when the jury finds the employer acted willfully.
ii. In Line with Statutory Authority
This approach is also the most in line with relevant statutory authority.
Pursuant to the Act, the judge’s discretionary ability to withhold liquidated
damages for good-faith compliance is a secondary determination, dependent
upon the jury’s primary finding of the existence or absence of willfulness.
138
The statutory language of Section 260 states that “if the employer shows [good
faith] to the satisfaction of the court . . . , the court may, . . . in its sound
discretion, award no liquidated damages or award any amount thereof.”
139
The
conditional language of the statute implies it is a provisional determination by
the judge.
140
As it is well-settled in statutory interpretation case law, “the term
136
See Rodriguez v. Farm Stores Grocery, Inc., 518 F.3d 1259, 1274 (11th Cir. 2008); cf.
McLaughlin v. Richland Shoe Co., 486 U.S. 128, 133–35 (1988) (reading the “knew or
showed reckless disregard” willfulness standard onto the language of the Act).
137
See Castle v. Sangamo Weston, Inc., 837 F.2d 1550, 1561 (11th Cir. 1988) (citing Pow-
ell v. Rockwell Int’l Corp., 788 F.2d 279, 287 (5th Cir. 1986)).
138
See Herman v. Palo Grp. Foster Home, Inc., 183 F.3d 468, 474 (6th Cir. 1999) (holding
that “[a]bsent a good faith disagreement with the authority of the government to promulgate
the statute, a finding of willfulness is dispositive of the liquidated-damages issue”); EEOC v.
City of Detroit Health Dep’t., Herman Kiefer Complex, 920 F.2d 355, 356 (6th Cir. 1990)
(holding “that once the jury determined that the [defendant] willfully violated the Equal Pay
Act, the district judge had no discretion not to award liquidated damages”).
139
29 U.S.C. § 260 (emphasis added).
140
See Brinkman v. Dep’t of Corr., 21 F.3d 370, 372–73 (10th Cir. 1994) (holding that
“when fact issues central to a claim are decided by a jury upon evidence that would justify
its conclusion, the Seventh Amendment right to a jury trial prohibits the district court from
reaching a contrary conclusion”) (citing Skinner v. Total Petroleum, Inc., 859 F.2d 1439,
1443 (10th Cir. 1988).
128 NEVADA LAW JOURNAL [Vol. 12:112
‘may’ typically indicates authorization without obligation.”
141
In contrast, the
language in Section 255 regarding the statute of limitations states actions “shall
be forever barred unless commenced within two years after the cause of action
accrued, except that a cause of action arising out of a willful violation may be
commenced within three years after the cause of action accrued.”
142
The use of
the word “‘shall’ ‘normally creates an obligation impervious to judicial discre-
tion.’
143
The language in Section 255 is conclusive, implying that such deter-
mination takes priority over the determination of good faith for liquidated
damages purposes.
144
Furthermore, “[p]roper statutory construction requires more than linguistic
examination and review of the rules of statutory construction.”
145
“The inter-
pretation should be reasonable, and where the result of one interpretation is
unreasonable, while the result of another . . . is logical, the latter should pre-
vail.”
146
Allowing the judge to subsequently determine an employer is in good-
faith compliance after a jury has made the opposite finding of willfulness is not
only incoherent, but also illogical.
147
This Article’s approach best addresses the
illogical result of two positive findings and is most in line with the construction
of the statutory authority.
iii. Furthers a Policy of Consistency
This Article’s proposed approach most effectively advances a policy of
consistency because it accounts for the positives and negatives from the circuit
courts in addition to being the most in line with the statutory authority. More
importantly, it is applicable in all factual circumstances, including those situa-
tions where there are findings of willfulness and good faith. Moreover, this
approach mirrors the statutory interpretations a majority of the circuit courts
have settled on in employment discrimination cases for ADEA and EPA
involving the same statutory willfulness and good-faith standards under the
Portal-to-Portal Act.
148
141
Air Line Pilots Ass’n, Int’l v. US Airways Grp., 609 F.3d 338, 342 (4th Cir. 2010).
142
29 U.S.C. § 255 (emphasis added).
143
Whaley v. Tennyson (In re Tennyson), 611 F.3d 873, 877 (11th Cir. 2010) (quoting
Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26, 35 (1998)).
144
See Schultz v. W.R. Hartin & Son, Inc., 428 F.2d 186, 189 (4th Cir. 1970) (holding the
FLSA’s terms of coverage must be liberally construed and its exemptions “narrowly con-
strued and limited to ‘those plainly and unmistakably within their terms and spirit’”) (quot-
ing Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392 (1960)); Taylor v. Cnty. of Fluvanna,
Va., 70 F. Supp.2d 655, 659 (W.D. Va. 1999) (finding that “the FLSA is to be interpreted
liberally in the employee’s favor in order to promote its remedial purposes”); Meyer v.
Worsley Co., 881 F. Supp. 1014, 1017 (E.D. N.C. 1994) (holding “[t]he FLSA ‘is to be
interpreted liberally with exceptions narrowly construed against those seeking to assert
them’”) (quoting Wirtz v Jernigan, 405 F.2d 155, 158 (5th Cir. 1968)).
145
Sierra Club v. Train, 557 F.2d 485, 490 (5th Cir. 1977).
146
Id.
147
See Castle v. Sangamo Weston, Inc., 837 F.2d 1550, 1561 (11th Cir. 1988); see also
E.E.O.C v. City of Detroit Health Dep’t., Herman Kiefer Complex, 920 F.2d 355, 360 (6th
Cir. 1990) (holding that “it is hard to mount a serious argument that an employer, found to
have acted willfully, could nonetheless still be found to have acted in good faith”).
148
See, e.g., E.E.O.C., 920 F.2d at 356; Castle, 837 F.2d at 1561; Glenn v. Gen. Motor
Corp., 841 F.2d 1567, 1573 (11th Cir. 1988) (holding that a finding the defendant acted
Fall 2011] WILLFULNESS, GOOD FAITH, AND THE FLSA 129
By following this approach, results in FLSA litigation across the circuits
will be consistent regardless of differences in factual circumstances. Although
this proposed standard is not absolute, as reasonable minds could differ on stat-
utory interpretation, it is far more sound and straightforward than the inconsis-
tent and illogical approach followed by some of the circuit courts as it accounts
for varying factual circumstances, which courts frequently encounter in FLSA
litigation.
V. C
ONCLUSION
The United States Circuit Courts of Appeals continue to stand divided on
whether a finding of willfulness for the purposes of extending the statute of
limitations in FLSA litigation precludes a judge’s subsequent finding of an
employer’s good-faith compliance with the Act. The inconsistent holdings have
created a dilemma among the circuits as to which approach is appropriate. On
one end of the spectrum, courts in the Preclusion Majority Approach reason
that a positive finding of willfulness precludes the judge from finding good-
faith compliance. On the other end of the spectrum, the Distinct Test Approach
courts reconcile such inconsistencies in the varying burdens of proof by focus-
ing on negative findings in limited circumstances, and ignoring the inherent
conflict where positive findings exist. To date, no court following this approach
has dealt directly with both a finding of willfulness and a subsequent finding of
good faith.
When the jury makes a positive finding of willfulness, the court’s discre-
tion to withhold liquidated damages based on good faith should be curtailed.
Yet, when there is no finding of willfulness, each decision maker should main-
tain its distinct authority. Courts should employ this approach as it takes into
account the positives and negatives of the current approaches, it is the most in
line with the statutory language of the Fair Labor Standards Act, and it furthers
a policy of consistency by mirroring the approach used by the majority of
courts and providing a straightforward guideline for future cases.
willfully for statute of limitations purposes precludes a finding that the defendant acted in
good faith for liquidated damages purposes).