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Balgowan v. State of N.J.

June 9, 1997

RICHARD M. BALGOWAN; THOMAS M. BATZ; THOMAS BETTEN; KARL L. BLUM; RAYMOND A. BURROUGHS; DENNIS CARLSON; JOHN I. CORBO; MICHAEL D. CRONIN; STEFFAN FRANKLIN; HERMAN J. KRIEG; JOSEPH J. LAGULLO; CHESTER J. LYSZCZEK; ALBERT M. MALATESTA; ARAM MARDEKIAN; IKE MARDEKIAN; WILLIAM L. MUNCZINSKI; ALAN S. NASS; THOMAS M. NORRIS; MALCOLM J. PALMER; JOHN C. POWERS; FRANCIS F. REALINI; CARL G. REBBECK; STANLEY F. RIPISH; EMIL H. ROESSLER; WAYNE A. RUMSEY; RICHARD F. SPOERL; LAWRENCE A. SROKA; JOHN W. STULTS; ROBERT L. SWAIN; DENNIS R. SYMONS; JOHN B. TAYLOR, JR.; CHARLES A. TERRITO, JR.; PETER W. TOMORY; ALFRED T. WOODROW; DANIEL YACOVINO; CHARLES W. YOUNG; RICHARD ZOLNOWSKI

APPELLANTS

v.

STATE OF NEW JERSEY, DEPARTMENT OF TRANSPORTATION



On Appeal from the United States District Court for the District of New Jersey (D.C. No. 93-cv-02209)

Before reaching this issue, however, the Court addressed the police officers' claim that "the `no disciplinary deductions' element of the salary-basis test is invalid for public-sector employees." Id. at 909. It noted that "[t]he Secretary's view that public employers are not so differently situated with regard to disciplining their employees as to require wholesale revision of his time-tested rule simply cannot be said to be unreasonable." Id. The Court further held that the officers' "complaints about the [Secretary of Labor's] failure to amend the disciplinary-deduction rule cannot be raised in the first instance in the present suit." Id. at 910.

COWEN, Circuit Judge.

Filed June 9, 1997

Argued January 22, 1996

Opinion Filed: May 16, 1996

Petition for Panel Rehearing Granted

Opinion Vacated July 9, 1996

Submitted: July 9, 1996

OPINION OF THE COURT

Plaintiff-appellants, thirty-six project engineers and one supervising engineer (DOT engineers), filed this lawsuit against the State of New Jersey, Department of Transportation (State), in the United States District Court for the District of New Jersey. The lawsuit seeks overtime compensation under the Fair Labor Standards Act of 1938 (FLSA), 29 U.S.C. Section(s) 201 et seq. (1978). The DOT engineers alleged that the State violated the FLSA by failing to pay them "time and a half" for time worked in excess of 40 hours per week. The State responded that the DOT engineers are exempt professionals under the "salary-basis" test, *fn1 promulgated by the United States Department of Labor (DOL) and codified at 29 C.F.R. Section(s) 541.118, as amended by 29 C.F.R. Section(s) 541.5d (1996). The DOT engineers replied that because their wages are subject to reduction under the DOT's disciplinary policy, they are hourly workers and are not exempt under the DOL regulations.

The district court granted the State's motion for summary judgment and dismissed the DOT engineers' complaint. It held that the "salary-basis" test is not applicable to public employees such as the DOT engineers and, even if it were applicable, the engineers are exempt because the DOT has never actually deducted pay under its disciplinary policy.

The DOT engineers appealed, and on May 16, 1996, we affirmed in part, reversed in part, and remanded the case with instructions to enter summary judgment in favor of the DOT engineers awarding back-pay for overtime for the period commencing September 6, 1991. We held that the "salary-basis" test, as amended in September 1991, applies to the DOT engineers. However, we further held that the DOT engineers fail to satisfy the "salary-basis" test because the DOT's disciplinary policy subjects them to reductions in pay for non-safety related infractions.

On March 27, 1996, the United States Supreme Court issued an opinion that abruptly changed the law regarding Eleventh Amendment immunity. See Seminole Tribe of Florida v. Florida, 116 S.Ct. 1114 (1996). Prior to Seminole, the Supreme Court had held that Congress could abrogate Eleventh Amendment immunity, subjecting states to private causes of action. See Pennsylvania v. Union Gas Co., 491 U.S. 1, 109 S.Ct. 2273 (1989). Seminole overruled Union Gas and held that the Commerce Clause did not invest Congress with the authority to waive states' Eleventh Amendment immunity and to create private causes of action against states that had not consented to such suits. 116 S.Ct. at 1127-28, 1131-32.

The State filed a petition for rehearing, relying in part on the Supreme Court's Seminole decision. By order dated July 9, 1996, we granted the State's petition for panel rehearing and vacated our May 16, 1996 opinion. See Balgowan v. State of New Jersey, Dept. of Transp., 84 F.3d 667 (3d Cir. 1996). We ordered rebriefing by the parties, addressing, among other issues, the State's claim that the Supreme Court's decision in Seminole divested us of jurisdiction. On September 23, 1996, the DOT engineers filed their opening brief, and on November 22, 1996, the State filed its responsive brief. The DOT engineers filed their reply brief on December 31, 1996. On that same day the DOT engineers filed a motion to amend ...


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