ARB CASE NO. 01-011
ALJ CASE NO. 99-CLA-18
DATE: November 27, 2002
In the Matter of:
ADMINISTRATOR,
WAGE AND HOUR DIVISION,
UNITED STATES DEPARTMENT
OF LABOR,
PLAINTIFF,
v.
LYNNVILLE TRANSPORT, INC.,
RESPONDENT.
BEFORE: THE ADMINISTRATIVE REVIEW BOARD
Appearances:
For the Plaintiff:
Steven J. Mandel, Esq., Paul L. Frieden, Esq., Claire Brady White, Esq., U.S. Department of Labor, Washington, DC
For the Respondent:
John R. Sandre, Esq., Michael J. Carroll, Esq., Coppola, Sandre, McConville & Carroll, P.C., West Des Moines, Iowa
FINAL DECISION AND ORDER
Pending before the Administrative Review Board ("Board") is Respondent Lynnville Transport's petition for review of a Department of Labor Administrative Law Judge's Decision and Order ("D. & O.") finding that Lynnville violated child labor provisions of the Fair Labor Standards Act of 1938 ("FLSA"), as amended, 29 U.S.C.A § 212 (West 1998) and implementing regulations, 29 C.F.R. Part 570, and approving the assessment of civil money penalties. Having considered the applicable law and the submissions of the parties, we affirm the Administrative Law Judge's Decision and Order.
[Page 2]
At all relevant times, Martin Vander Molen and his wife, Betty, owned and operated Lynnville Transport, a closely-held corporation based in Sully, Iowa. D. & O. at 2-3. Using trailers, Lynnville transported livestock, owned largely by other individuals and companies, across state lines. Id.
1 Lynnville paid the back wages for the minimum wage and overtime violations and the Wage and Hour Division assessed no penalties for those violations. D. & O. at 4.
2 Hazardous Order No. 7 specifically prohibits minors between the ages of 16 and 18 years of age from operating, among other devices, a high-lift truck. 29 C.F.R. § 570.58. This prohibition also applies to minors between 14 and 16 years of age. 29 C.F.R. § 570.33(e).
3 In Administrator v. Thirsty's Inc., ARB No. 96-143, ALJ No. 94-CLA-65, (ARB May 14, 1977), aff'dsub nom., Thirsty's, Inc., v. United States Dep't of Labor, 57 F. Supp. 2d 431 (S.D. Tex. 1999), we held that the Form WH-266 schedule "is an appropriate tool to be used by a field Compliance Office to recommend penalties through the enumeration and determination of the gravity of factual violations." Slip op. at 5. We further emphasized, "It is important to note that the initial determination of the investigator on Form WH-266 is subject to review and may be modified by the District Director." Id. In this case the ALJ, based upon District Director Chleborad's testimony found, "[I]t is obvious, however, that the district director had no discretion because he was required to follow the instructions set forth in the [WH-266] penalty report." D. &. O. at 11-12. However, it is unnecessary for us to reconcile this apparent inconsistency, in this case, because as we discuss, infra, the ALJ independently reviewed the evidence and evaluated the required statutory and regulatory factors before affirming the Administrator's penalty assessment. See Administrator v. Elderkin, ARB Nos. 99-033, 99-048, ALJ No. 95-CLA-31, slip op. at13 (ARB June 30, 2000).
5 The Administrator states in her brief that she does not "endorse" the ALJ's statement that "one of the purposes of civil money penalties is ‘punishing violators.'" Statement of the Acting Administrator in Opposition to Petition for Review at 18 n.22. We agree with the Administrator that civil money penalties are not a form of punishment, in the criminal sense. However, the Supreme Court has recognized that "the imposition of . . . [civil] money penalties . . . will deter others from emulating petitioners' conduct, a traditional goal of criminal punishment." Hudson v. United States, 522 U.S. 93, 105 (1977).
6 The ALJ also stated that that the resolution of this issue was not relevant to the disposition of the penalty issue in this case because, "[he] only ha[d] jurisdiction to determine whether the penalties assessed are reasonable given the gravity of the violations." D. & O. at 14. Given the ALJ's well-supported finding that Vander Molen's belief that the Department would not assess civil money penalties was mistaken, it is unnecessary for us to consider, and we do not address, the ALJ's assertion that he did not have "jurisdiction" to consider whether, in any event, the Department could be estopped from assessing a penalty based upon the unauthorized assertion by an employee (H. T. 108). We do note however, that Lynnville has cited no legal authority in support of its position that the Department should be estopped from assessing the penalty. Instead, Lynnville simply argues, "[T]he employer should not be further penalized by the Department's conduct and the deal that the employer believed had been struck should be allowed to stand." Respondent's Appeal Brief at 16-17 (emphasis supplied).