The opinion of the court was delivered by: BY THE COURT; ROBERT S. GAWTHROP, III
Plaintiffs, current or former employees of defendant, brought this action seeking overtime compensation allegedly owed them by defendant under the Fair Labor Standards Act, 29 U.S.C. §§ 201-219 ("FLSA"), the Pennsylvania Minimum Wage Act of 1968, 43 P.S. §§ 333.101 et seq. ("PMWA"), and the Pennsylvania Wage Payment and Collection Law, 43 P.S. §§ 260.1 et seq. ("WPCL"). On September 3, 1991, this court entered summary judgment in favor of defendant on the FLSA claims. 787 F. Supp. 449 (E.D. Pa. 1991). Plaintiffs appealed
and the Third Circuit affirmed. 974 F.2d 409 (3d Cir. 1992). Defendant now moves for summary judgment on the remaining state law claims. Upon the following reasoning, I shall grant the motion as to plaintiffs' claims from July 9, 1990, forward and as to plaintiffs' claims with respect to "on-call" time, and shall deny the motion as to the rest of plaintiffs' claims.
Defendant supplies computer hardware and software to cable television companies. It also provides installation, maintenance, and repair services for its equipment. Plaintiffs worked as field engineers in defendant's Northeast Region Office in Broomall, Pennsylvania.
Their duties included driving to customer sites in Pennsylvania, New York, New Jersey, Delaware, Maryland, Virginia, West Virginia, and the District of Colombia to install, maintain, repair, and provide expertise on computer hardware sold by defendant. They carried with them tool kits and replacement parts and equipment. At issue in this case is whether plaintiffs received proper overtime compensation from defendant.
This court previously has held, and the Third Circuit has agreed, that (1) plaintiffs fall within the exemption to the FLSA carved out by the Motor Carrier Act of 1935 ("MCA"), and (2) the United States Department of Transportation ("DOT") retains the power to establish maximum hours of employment for plaintiffs, employees of motor private carriers who drive lightweight vehicles in interstate commerce. Because DOT has not exercised its power to establish maximum hours, and because the FLSA does not protect plaintiffs, they cannot recover from defendant under federal law. At issue now is whether plaintiffs can recover under state law.
Defendant's payment scheme worked as follows: each employee had an annual salary. That annual salary was divided by 52 to determine the employee's weekly salary. The weekly salary served as compensation for whatever hours the employee worked during a particular week. In addition, defendant paid overtime wages to the employee for any hours over 40 worked by the employee in a particular week. The overtime amount was calculated by first determining the employee's "regular rate" for the week, which was done by dividing the employee's weekly salary by the number of hours the employee had worked during the week. Then, to determine the overtime rate, the regular rate was halved. To figure the amount of overtime pay due the employee, the overtime rate was multiplied by the number of hours -- in excess of 40 -- which the employee had worked during the week. The employee's total pay was the weekly salary plus the overtime pay.
For example, suppose an employee with a $ 52,000 annual salary, i.e. a $ 1000 weekly salary. If that employee worked 50 hours in a particular week, the employee's "regular rate" would be $ 1000 / 50 hours = $ 20/hour. Thus, the overtime rate would be $ 20 / 2 = $ 10/hour, and the overtime pay due the employee would be $ 10 x 10 hours = $ 100. The employee's total pay for the week would be $ 1000 (the weekly salary) plus $ 100 (the overtime pay), for a total of $ 1100.
Before discussing the merits of the parties' arguments, the court must examine the issue of jurisdiction. This court originally found there to be jurisdiction under 28 U.S.C. § 1331 because of the presence of a federal question, although plaintiffs also asserted that the court had jurisdiction under 28 U.S.C. § 1332 because of the diversity of the parties' citizenship. Although the federal claim has now been dismissed, plaintiffs ask the court to exercise pendent jurisdiction over the remaining state law claims under United Mine Workers v. Gibbs, 383 U.S. 715, 16 L. Ed. 2d 218, 86 S. Ct. 1130 (1966).
However, the Third Circuit repeatedly has held "pendent jurisdiction should be declined where the federal claims are no longer viable, absent 'extraordinary circumstances.'" Shaffer v. Board of School Directors of Albert Gallatin Area School Dist., 730 F.2d 910, 912 (3d Cir. 1984) (quoting Weaver v. Marine Bank, 683 F.2d 744, 746 (3d Cir. 1982) and Tully v. Mott Supermarkets, 540 F.2d 187 (3d Cir. 1976)). In Shaffer, the Third Circuit dismissed the plaintiff's federal claims and remanded the case to the district court. The district court exercised pendent jurisdiction because, it said, "'failure to retain jurisdiction will result in inconvenience, undue delay, additional expense, [and] loss of judicial economy and effort.'" Shaffer, 730 F.2d 910. The Third Circuit reversed, holding that no "particular prejudice would result from a delay in the adjudication of plaintiff's claims" and that "'the fact that some investment of time has already been made' should not be given dispositive weight." Id. Here, no particular prejudice would come to plaintiffs from some additional delay in the resolution of this not-young case. Nor would there be much additional expense, since the parties could easily file essentially the same briefs in a state court as they have filed here. Finally, as the Third Circuit has said, the amount of time invested by the parties and this court is not a factor. In Shaffer, the Third Circuit observed that "where the underlying issue of state law is a question of first impression with important implications . . . in Pennsylvania, factors weighing in favor of state court adjudication certainly predominate." Id. at 913. Upon the same reasoning, this court shall not exercise pendent jurisdiction.
Plaintiffs also argue that diversity jurisdiction exists. Defendant acknowledges that complete diversity of citizenship exists, but defendant disputes that any of the plaintiffs has a claim exceeding $ 50,000, the monetary hurdle which diversity cases must clear. The Supreme Court has held that in class actions and other cases involving multiple plaintiffs, it is essential that the demand of each plaintiff be of the requisite jurisdictional amount. See, e.g., Zahn v. International Paper Co., 414 U.S. 291, 38 L. Ed. 2d 511, 94 S. Ct. 505 (1973); Troy Bank v. G.A. Whitehead & Co., 222 U.S. 39, 56 L. Ed. 81, 32 S. Ct. 9 (1911). In the complaint, each plaintiff claims in excess of $ 50,000. Based on the figures submitted in plaintiffs' brief in opposition to the current motion for summary judgment, the court has calculated that each plaintiff's claim reasonably could exceed the $ 50,000 threshold.
Thus, diversity jurisdiction exists.
Summary Judgment Standard
Under Federal Rule of Civil Procedure 56(c), summary judgment is proper if "there is no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." The inquiry for the court is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson v. Liberty Lobby, 477 U.S. 242, 251-52, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). A party opposing summary judgment must marshal sufficient facts to show that there is a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986).
Applicability of 34 Pa. Code § 231.43(b)
Defendant argues that its overtime compensation scheme complies with 43 P.S. § 333.104(c), which states: "employes shall be paid for overtime not less than one and one-half times the employe's regular rate as prescribed in regulations promulgated by the secretary: Provided, . . . That the secretary shall promulgate regulations with respect to overtime subject to the limitations that no pay for overtime in ...