The opinion of the court was delivered by: CHARLES R. RICHEY
On February 3, 1994, the parties in the above-captioned case appeared before the Court for a hearing on the Federal Defendants' Motion to Dismiss ("Defendants' Motion") and the Intervenor-Defendants' Motion to Dismiss and for Summary Judgment on Jurisdictional Grounds ("Intervenor-Defendants' Motion"). After careful consideration of both Motions, the Plaintiffs' Memorandum in Opposition to Federal Defendants' and Growers' Motions to Dismiss ("Plaintiffs' Opposition"), the Federal Defendants' Reply Memorandum to Plaintiffs' Response to Federal Defendants' Motion to Dismiss ("Defendants' Reply"), the Reply in Support of Intervenor-Defendants' Motion to Dismiss and for Summary Judgment on Jurisdictional Grounds ("Intervenor-Defendants' Reply"), the oral arguments of counsel at the hearing, the applicable law, and the entire record herein, the Court finds that the Defendants' Motion to Dismiss and the Intervenor-Defendants' Motion to Dismiss and for Summary Judgment on Jurisdictional Grounds must both be denied.
As all of the parties would undoubtedly agree, this case has a long and complicated history. Litigation began in 1982 to address concerns raised in connection with the temporary foreign worker program (the "H-2" or "H-2A" program)
administered by the Department of Labor (the "Department" or "DOL"). Under this program, farmers are permitted to employ foreign workers on a temporary basis upon certification by the Department of Labor that U.S. workers are unavailable and that the use of foreign workers will not adversely affect the wages and working conditions of similarly employed U.S. workers.
In order to protect against such adverse effect, the Department of Labor has issued a series of regulations designed to govern wages and working conditions. These regulations, as set forth in 20 C.F.R. § 655, have established a special minimum hourly wage rate known as the "adverse effect wage rate" ("AEWR"). The interpretation and application of these regulations, including the Department's piece rate regulations,
have been at the heart of this lawsuit since its inception in the early 1980s.
Originally filed in 1982, this case arose as a challenge to DOL's interpretation of the H-2 piece-rate regulation, 20 C.F.R. § 655.207(c) (1983) (superseded), and its application to the payroll practices of a number of West Virginia apple growers. In 1983, the case was converted into a nationwide class action and two more years of administrative and judicial proceedings ensued. Finally, on August 15, 1985, the Court entered a final judgment interpreting § 655.207(c) to mean that H-2 piece-rate employers (1) could not increase their minimum, job-retention productivity requirements above 1977 levels and (2) were required to increase piece rates in proportion to annual increases in the AEWR. The Court's injunction thus ordered the Department to require all applicants for labor certification to conform to these requirements.
In July of 1986, almost a year after the Court entered its August 15, 1985 injunction, the Plaintiffs filed a Motion for Further Relief, alleging that the Department of Labor was out of compliance with the Court's earlier orders because DOL was not applying the proportional increase regulation to Florida sugarcane growers. In its defense, DOL contended that the "task rate" system of payment utilized in the sugar cane industry was not a "piece rate" and was thus not covered by § 655.207(c).
Plaintiffs, however, sought a declaration that the piece rate regulations did apply to the sugarcane growers' "task rate" system and an injunction prohibiting DOL from granting labor certification to growers who did not offer proportionally increased piece rates.
On the basis of the limited record before it at that time, the Court concluded in a September 25, 1986 Order that a "factual" dispute existed as to the method of payment used by the sugarcane growers. The Court thus ordered the Department to gather the data necessary to resolve this dispute, specifically directing the Department to promptly:
See September 25, 1986 Order.
By that same Order, the Court also required the Department to notify the sugarcane growers receiving temporary labor certification for that and subsequent harvesting seasons that they might be required to make additional wage payments at some point in the future should it be determined that the growers were using a piece rate system that failed to comply with the requirements of 20 C.F.R. 655.207(c):
Defendants shall promptly advise each sugar cane grower awarded temporary labor certification for the 1986-1987 harvest season or subsequent seasons that such grower may be required to make additional payments to its workers should it be determined that the grower has paid its workers according to a piece rate and such piece rate does not comply with the requirements of 20 C.F.R. 655.207(c). Defendants shall require each sugar cane grower to provide to Defendants a list of the names and addresses of all workers employed by the grower during the 1986-1987 harvest season and all subsequent seasons until this matter is finally resolved.
See September 25, 1986 Order.
In response to the Court's 1986 Order, the Department of Labor then commenced its investigation of the task-rate pay system, issuing a draft report in October of 1987. The draft report concluded, inter alia, that the task row system is "not a 'piece rate' in either the commonly accepted sense, or for purposes of Section 655.207(c), as it has neither a standardized unit of production, nor a standardized unit of compensation." See Defendant's Motion at 4-5.
Following the issuance of DOL's draft report, both Plaintiffs and sugar cane growers were invited to submit comments on the report. The growers apparently indicated that they had no objections to the report as it appeared in draft form but the Plaintiffs requested additional time for discovery, eventually submitting their comments in the summer of 1992.
During this same period, however, other developments relating to this case were also unfolding. As noted above, in 1987 the Department instituted a new rulemaking proceeding which resulted in the issuance of 20 C.F.R. § 655.202(b)(9). In November of 1989, the Plaintiffs were then granted leave to file a Second Supplemental Complaint challenging DOL's interpretation of this new regulation along with 20 C.F.R. § 655.207(c). Thereafter, in February of 1990, the United States Sugar Corporation ("USSC") and the Sugar Cane Growers Cooperative ("SCGC") of Florida were permitted to intervene in this suit.
The Court also notes that in 1989, another lawsuit relating to the payment practices and contractual obligations of Florida sugarcane growers was filed in Florida state court, Bygrave et al. v. Sugar Cane Growers Cooperative, et al., No. CL-89-8690-AI (15th Cir. Ct., Palm Beach Co., Fla.). The Plaintiffs in the Bygrave action alleged that the defendant sugarcane companies breached their clearance order contracts with workers by failing to pay the Adverse Effect Rate per ton of cane cut. Finding that the clearance order clearly established an 8 ton/day minimum productivity standard, the Bygrave Court (Judge Lucy Brown) held that the task rate could not be less than the AEWR per ton. On August 21, 1993 judgment was entered in favor of the Bygrave plaintiffs and over $ 50 million in back wages for the 1987-88 through 1990-91 seasons were awarded. That judgment is now on appeal to the 4th District Court of Appeal of Florida and the money has been placed in escrow.
Finally, and perhaps most importantly for purposes of the instant motions, on November 12, 1993 the Department issued its Final Report Regarding Methods of Payment in Sugar Cane ("Final Report") and filed it with the Court. The Department has indicated that in completing the Final Report, DOL considered the comments and submissions of both plaintiffs and the sugar cane growers along with the results of an independent analysis performed by an expert the Department retained. Defendants' Motion to Dismiss at 5. The Report concluded that:
DOL had acted reasonably in approving the pay systems used for sugar cane workers during the years relevant to this dispute, that there was no disguised piece rate paid to workers that was subject to DOL regulations, and that the growers did not violate either 20 C.F.R. § 655.207(c) or 20 C.F.R. § 655.102(b)(9) (the regulations that superseded § 655.207(c) in 1987).
Following the issuance of the Department's Final Report, Plaintiffs moved to reopen this case on November 22, 1993, seeking to have the Court review the Department's conclusions. More specifically, Plaintiffs have raised objections to the Department's conclusion that the regulations in question apply only to simple piece rates. Plaintiffs strongly contest the notion they perceive to be embodied in the Departmental Report, namely that "complex piece rates, like the task rate, are beyond . . . [the Department's] purview, and, indeed, beyond all administrative control, since DOL's regulations only apply to hourly rates and 'piece rates'." Plaintiffs' Opposition at 6. Plaintiffs further quarrel with the Final Report's alleged contention that the "8 ton" provision in the sugarcane clearance order does not constitute a productivity standard. Id. at 6-7. Lastly, Plaintiffs also claim that the administrative record compiled by the Department demonstrates that the growers failed to proportionally increase their wage rates in compliance with the Department's regulations and that they should therefore be required to make restitution to their workers. Id. at 7.
Given the contentious history of this case, it is perhaps not surprising that the Federal Defendants and the Intervenor-Defendants both objected to the Plaintiffs' request that the case be reopened following the issuance of the Final Report. Both the Department and the Sugar Cane Growers claimed that the matter should be dismissed on jurisdictional grounds, albeit for different reasons. The Court thus directed the parties to brief the remaining issues presented by this lawsuit, beginning with the jurisdictional questions that are the basis for the instant motions to dismiss filed by the Federal Defendants and the Intervenor-Defendants.
Before turning to the merits of these motions, however, it is also important to briefly examine certain recent developments in the sugar cane industry that relate to some of the issues presented by this case. Perhaps most importantly, prior to the 1992 harvesting season, United States Sugar Corporation and representatives of the farmworkers reached a "labor peace" agreement under which USSC abandoned the task rate system and adopted a per-ton payment system. Under this procedure, workers are to be paid on a per-ton basis, using estimates of tonnage cut with subsequent adjustments made after weighing.
During the 1992-93 season, DOL then conducted wage surveys which resulting in a finding that the "per ton" system constituted the prevailing method of payment in the industry. Defendants' Motion at 6. As such, this piece-rate system became mandatory for ...