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Hernandez v. Ray Domenico Farms, Inc.

United States District Court, D. Colorado

April 14, 2017

ADOLFO HERNANDEZ, ROGELIO FLORES-ESCOBAR, FRANCISCO SILVA-GARCIA, MARTIN PEREZ-MEDEL, GUSTAVO ARELLANO- LMOS, LUIS LEON-SALINAS, and MANUEL MORALES, Plaintiffs,
v.
RAY DOMENICO FARMS, INC., GREGORY L. DOMENICO, and THERESA M. DOMENICO, Defendants.

          ORDER RESOLVING PENDING MOTIONS AND SUA SPONTE CERTIFYING QUESTION OF LAW TO THE COLORADO SUPREME COURT

          William J. Martinez United States District Judge.

         If an employee is fired in Colorado, does the Colorado Wage Claim Act (“CWCA”), Colo. Rev. Stat. §§ 8-4-101 to -123, authorize that employee to sue for all past-due wages owed regardless of how long ago those wages should have been paid, and regardless of whether the statute of limitations has run on the cause of action that the employee normally would bring to recover those wages? This case presents that question, and the authorities-up to now, all of them federal-are divided.

         This matter affects all employers and employees in Colorado. It is also the sort of thing that tends to evade Colorado state-court review indefinitely, given that CWCA claims are nearly always brought in the same lawsuit as a claim under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. §§ 201 et seq., thus invoking this Court's original jurisdiction. For these reasons and additional reasons explained below, the Court sua sponte certifies the question to the Colorado Supreme Court.

         I. BACKGROUND & SUMMARY OF RULING

         In this lawsuit, Plaintiffs Adolfo Hernandez, Rogelio Flores-Escobar, Francisco Silva-Garcia, Martin Perez-Medel, Gustavo Arellano-Olmos, Luis Leon-Salinas, and Manuel Morales (together, “Plaintiffs”) sue their former employer, Ray Domenico Farms, Inc. (“Domenico Farms”), and two of its principals, Gregory L. Domenico, and Teresa M. Domenico (together with Domenico Farms, “Defendants”), for various alleged violations of the FLSA, the CWCA, and the Migrant and Seasonal Agricultural Worker Protection Act (specifically, 29 U.S.C. §§ 1821(a), 1822(a) & (c), and 1855(a)), as well as for simple breach of contract and unjust enrichment. (See ECF No. 27.)

         The federal statutory causes of action are the bulk of Plaintiffs' fourteen claims for relief. But the “real money, ” so to speak, appears to be in the CWCA causes of action (Counts XI & XII), through which Plaintiffs seek to recover all unpaid wages going back to the beginning of their various employment relationships with Defendants-in some cases, back to 1992. This is something the FLSA, by itself, would not permit. See 29 U.S.C. § 255(a) (two- or three-year statute of limitations).

         Currently before the Court are the parties' early cross-motions for partial summary judgment disputing whether the CWCA permits such an indefinite “lookback” for unpaid wages, in contrast to the normal statute of limitations that (like the FLSA) requires an employee to sue within two or three years of going unpaid, depending on the circumstances. (See ECF No. 23 (Defendants' motion); ECF No. 25 (Plaintiffs' motion).) In light of the Court's decision to certify the question, the Court denies both motions without prejudice.

         Also before the Court is Defendants' Motion to Partially Dismiss Plaintiffs' Eleventh Count Against Defendants Pursuant to Fed.R.Civ.P. 12(b)(6). (ECF No. 33.) This motion presents an alternative, federal-law basis for limiting Plaintiffs' CWCA lookback to two or three years. For the reasons explained below, the Court denies this motion as well.

         II. FACTS

         The following facts are undisputed for purposes of this motion, unless attributed to one party or the other.[1]

         Domenico Farms is a Colorado corporation headquartered in Platteville, Colorado. (ECF No. 27 ¶ 19.) Domenico Farms grows organic vegetables. (Id. ¶ 38.) For many years, Domenico Farms has employed year-round workers, seasonal migrant workers, and temporary foreign workers brought to Colorado from Mexico through the H-2A visa program. (Id. ¶ 40.) All of the Plaintiffs in this action were either year-round workers or seasonal migrant workers. (Id. ¶¶ 44, 46.) They were all paid by the hour. (Id. ¶ 42.) Their claimed or undisputed periods of employment with Domenico Farms are as follows:

• Plaintiffs Leon-Salinas, Morales, and Perez-Medel all claim to have been employed as seasonal workers “from April 1992 through approximately April 2016.” (Id. ¶¶ 14, 16, 17.)
• Plaintiff Arellano-Olmos claims to have been employed as a seasonal worker “from approximately April 1997 through approximately 2004 and again on or around April 2005 through approximately April 2016.” (Id. ¶ 15.)
• Plaintiff Hernandez worked for Domenico Farms from October 24, 2001, to March 25, 2016. (ECF No. 25 at 2, ¶ 1.)
• Plaintiff Flores-Escobar worked for Domenico Farms from June 12, 2009, to March 25, 2016. (Id. ¶ 2.)
• Plaintiff Silva-Garcia worked for Domenico Farms “between 1999 and March 25, 2016.” (Id. ¶ 3.)

         Plaintiffs allege they never received overtime pay during their employment. (ECF No. 27 ¶ 84.) Agricultural workers are normally exempt from the FLSA's overtime requirements. See generally 29 C.F.R. part 780. Plaintiffs claim, however, that Domenico Farms employed them in non-agricultural tasks, and did so in weeks in which they worked more than forty hours, thus requiring Domenico Farms to pay overtime. (See ECF No. 27 ¶¶ 75-88, 98-106.) The Plaintiffs who worked seasonally also claim they were denied the straight-time wage they should have received under the Migrant and Seasonal Agricultural Worker Protection Act. (Id. ¶¶ 50-74, 129-87.)

         In January 2016, Plaintiffs contacted Defendants to assert that they had been denied rightful compensation. (Id. ¶¶ 89, 95.) According to Plaintiffs, Defendants then “undertook a self-imposed, internal audit of work authorization documents, ” through which they “determined that the year-round worker Plaintiffs lacked legal authority to be employed.” (Id. ¶¶ 90, 91.) The year-round Plaintiffs say they were terminated in March 2016 in retaliation for asserting their rights. (Id. ¶¶ 93-94.) The seasonal workers allegedly suffered the same fate the following month. (Id. ¶¶ 14-17, 95-97.)

         III. ANALYSIS

         A. Relevant Statutory Language

         The parties' competing summary judgment motions turn on the interaction of two portions of the CWCA, namely, Colo. Rev. Stat. § 8-4-103(1)(a) (for ease of reading, “§ 103”) and Colo. Rev. Stat. § 8-4-109(1)(a) (“§ 109”). Section 103 establishes that earned wages and other compensation usually become “due and payable” ten days after the end of a pay period:

All wages or compensation, other than those mentioned in section 8-4-109 [i.e., § 109], earned by any employee in any employment, other than [those due under a deferred compensation plan], shall be due and payable for regular pay periods of no greater duration than one calendar month or thirty days, whichever is longer, and on regular paydays no later than ten days following the close of each pay period unless the employer and the employee shall mutually agree on any other alternative period of wage or salary payments.

Section 109, for its part, applies “[w]hen an interruption in the employer-employee relationship by volition of the employer occurs” (generally, when the employer terminates the employee) and makes “wages or compensation for labor or service earned, vested, determinable, and unpaid at the time of such discharge . . . due and payable immediately.”

         Up until 2003, § 103 had been codified two sections later in the statute, i.e., at § 8-4-105; and § 109 had been codified five sections earlier, i.e., at § 8-4-104. See 2003 Colo. Legis. Serv. ch. 286, § 1 (H.B. 03-1206). Along with the re-codification, § 103's “other than those mentioned in” cross-reference was amended to keep it connected to what had been § 104 and was now codified at § 109. Id. In other words, the only textual difference between the pre-amendment and post-amendment versions of § 103 was a single digit (changing a 4 to a 9). As for § 109, the phrase “vested, determinable, ” was inserted. Id. The significance of these amendments will be discussed in detail below.[2]

         The Court notes two other portions of the CWCA relevant to the present dispute. First, § 8-4-110(2) provides that “[a]ny person claiming to be aggrieved by violation of any provisions of this article or regulations prescribed pursuant to this article may file suit in any court having jurisdiction over the parties without regard to exhaustion of any administrative remedies.” Second, § 8-4-122 (“§ 122”) requires that “[a]ll actions brought pursuant to [the CWCA] shall be commenced within two years after the cause of action accrues and not after that time; except that all actions brought for a willful violation of this article shall be commenced within three years . . . .”

         The parties here agree that (1) § 103 and § 109 each create a cause of action under the CWCA, (2) each is governed by the two- or three-year statute of limitations stated in § 122, and (3) the wages one may sue for under the CWCA include compensation to which one is entitled by statute, such as FLSA overtime pay. The parties disagree over whether § 109 encompasses all unpaid compensation that had accrued up to the point of termination, including unpaid amounts that accrued more than two (or three) years prior; or whether § 109 applies only to the amounts owed for the employee's final pay period, and § 103 governs all prior compensation. Stated differently, the question is whether § 109 revives injuries for which the employee could no longer sue under § 103.

         B. Effect of FLSA Statute of Limitations

         Before the Court reaches that question directly, it must address an argument raised in Defendants' Motion to Dismiss that could moot the question. Defendants' argument begins with the proposition that the CWCA creates no substantive right to wages. (See ECF No. 33 at 4-5.) Rather, it establishes standards that employers must follow when paying wages, and remedies for employees who have not been timely paid. But the right to the wages must come from some other source, such as an employment contract or a statute. Plaintiffs agree: “[The CWCA] does not supply the substantive right to the overtime compensation Plaintiffs seek-the Fair Labor Standards Act does.” (ECF No. 40 at 2.)

         Having established this premise, Defendants further argue that “any ‘earned, vested, and determinable' wages due to Plaintiffs under [§ 109] are limited by what is recoverable under the FLSA.” (ECF No. 33 at 5.) By this, Defendants mean that the FLSA's statute of limitations is incorporated into § 109. The FLSA's statute of limitations, like the statute of limitations in the CWCA (§ 122), is normally two years, but can be extended to three upon a showing of willfulness:

Any action . . . to enforce any cause of action for unpaid minimum wages, unpaid overtime compensation, or liquidated damages, under the Fair Labor Standards Act * * * 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 ...

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