Bakkestuen v. Lepke Holdings LLC
Bakkestuen v. Lepke Holdings LLC
Opinion of the Court
¶1 Lepke Holdings and Bill Lepke Trucking LLC (collectively, Lepke) appeal an order of the circuit court granting summary judgment in favor of Greg Bakkestuen, David Winchell, and Brian Jensen (collectively, the drivers). The drivers, who were all employed by Lepke as dump truck drivers, sued Lepke seeking compensation for time that the drivers devoted to particular tasks, for which the drivers argue Lepke should have, but did not, pay them ("the unpaid time"). The circuit court determined that the unpaid time was compensable work time for which the drivers are owed additional wages. This ruling included the court's rejection of Lepke's argument that the drivers are not entitled to this compensation because Lepke met minimum wage requirements. Separately, the court determined that certain overtime hours for which the drivers were not paid should be paid at the then-prevailing hourly wage, which was higher than the drivers' regular hourly wage. For the reasons discussed below, we affirm on each issue.
BACKGROUND
¶2 The following facts are taken from the summary judgment submissions and are undisputed. In 2013 and 2014, the drivers were employed by Lepke as dump truck drivers. They were responsible for transporting loads of material from one location to another.
¶3 The drivers were compensated by Lepke at an hourly wage for hours worked between the initial loading and the final unloading of their trucks on each work day. However, Lepke did not compensate the drivers for any time spent on work tasks prior to the initial loading, despite the fact that the drivers were obligated to prepare the trucks to be driven and then to wait at loading sites for the trucks to be loaded for the first time. Similarly, the drivers were generally not paid for any time spent on work tasks after the final unloading of the trucks each work day, which included time spent driving back to the truck storage location and filling out paperwork required by Lepke.
¶4 The drivers sued Lepke for the unpaid time. The drivers claimed that Lepke unlawfully failed to pay them for time spent performing work-related activities before initial loading and after final unloading. Both the drivers and Lepke moved the circuit court for summary judgment on the issue of whether the unpaid time in dispute was compensable work time.
¶5 The circuit court granted the drivers' motion for summary judgment and denied Lepke's motion for summary judgment.
¶6 Lepke filed a motion for reconsideration, which the circuit court denied. The parties subsequently entered into a stipulation whereby Lepke agreed to pay specified damages to the drivers, subject to Lepke's right to appeal the circuit court's summary judgment decision. The court entered judgment in favor of the drivers. Lepke appeals.
DISCUSSION
¶7 Lepke contends that the circuit court erred in granting summary judgment in favor of the drivers. For purposes of clarity, we restate and reorganize Lepke's arguments, as best we can tell what those arguments are. Lepke contends that the court erred in determining that the drivers should have been compensated for the following unpaid time devoted to work-related activities before initial loading and after final unloading: warming up trucks, allowing air pressure to build up in the trucks, conducting pre-trip inspections of the trucks, traveling to the initial loading location, and waiting in the truck queue, all prior to the initial loading; and, after the final unloading, traveling back to the truck storage location, refueling the trucks, and filling out paperwork required by Lepke. Lepke makes two additional arguments. First, Lepke contends that, even if the unpaid time is compensable work time, the circuit court erred in concluding that the drivers are entitled to additional wages for that time, because Lepke met minimum wage requirements. Second, Lepke argues that unpaid time that was overtime work on prevailing wage projects should not be paid at the prevailing wage rate.
¶8 We review the grant or denial of a motion for summary judgment de novo. Hardy v. Hoefferle ,
A. Unpaid Time
¶9 The drivers contend that Lepke violated Wisconsin wage and hour laws by failing to pay the drivers for the unpaid time performing the tasks described above in ¶7. They argue that, pursuant to WIS. ADMIN. CODE § DWD 272.12(1)(a) (through Jan. 2019),
¶10 In Hormel Foods , our supreme court concluded that time spent putting on and taking off clothing and equipment at a canning plant, which was required by Hormel Foods and was done necessarily and primarily for the benefit of Hormel Foods, was compensable work time and not non-compensable preliminary and postliminary activities under WIS. ADMIN. CODE § DWD 272.12(2)(e). Hormel Foods ,
¶11 Applying those principles to the facts in Hormel Foods , a majority of the justices concluded that putting on and taking off clothing and equipment were integral and indispensable to the employees' primary activities.
¶12 While the particular facts in Hormel Foods are not squarely on point with the facts here, we conclude that the reasoning of the case dictates the outcome here. The undisputed facts establish that the drivers could not operate the dump trucks without first warming them up and building up the trucks' air pressure. To ensure the safe operation of the trucks, the drivers were obligated to make pre-trip inspections of the trucks. Only after completing these tasks could each driver safely drive his truck to the initial loading location, which itself was also integral and indispensable to the drivers' primary activities. Then, after arriving at the initial location, the drivers were obligated to join a queue of trucks waiting to be loaded, which occurred on a first-come, first-served basis. The drivers' obligations continued after the final unloading, when the drivers would drive the trucks to a storage location designated by Lepke; were required by Lepke to ensure that the trucks were full of fuel when the trucks were returned to the storage location; and filled out paperwork required by Lepke.
¶13 We conclude that the time spent by the drivers performing all of these initial and concluding tasks was time spent on activities that were integral to their primary activities as drivers for Lepke. Thus, we conclude that, under Hormel Foods , the drivers' unpaid time is compensable.
¶14 Lepke does not dispute on appeal that performance of the above-stated tasks during the unpaid time was integral to the drivers' employment. Rather, Lepke argues that Hormel Foods is not controlling in this case because, according to Lepke, Hormel Foods "only addressed claims for overtime pay under" WIS. STAT. § 103.02 and WIS. ADMIN. CODE ch. DWD 274.
B. Minimum Wage Issue
¶15 Lepke argues that, even if the drivers are otherwise entitled to wages for the unpaid time, they are not entitled to those wages because Lepke paid them in amounts that exceeded minimum required amounts. In support, Lepke relies on DWD's decision in Jacobson v. Fischbach, Inc. , Case No. LS2012 00479 (DWD June 19, 2013). We reject this argument.
¶16 In the Jacobson administrative proceeding, DWD dismissed wage complaints filed by employees who sought additional pay for unpaid work time. DWD determined that the employees were not entitled to additional wages because the employees were not entitled to hourly pay that exceeded Wisconsin's minimum hourly wage and each employee's total pay in a pay period, when divided by the total number of hours the employee worked that pay period, both paid and unpaid, was more than Wisconsin's hourly minimum wage.
¶17 Lepke asserts that we should accord DWD's decision great weight deference. However, deference is not permitted. See Tetra Tech EC, Inc. v. DOR ,
¶18 Lepke argues that additional wages are not owed for unpaid, compensable work time if the drivers' "hourly wage was high enough to ensure at least minimum wage for every pay period." Restated, Lepke argues that, for any pay period, when the quotient of the division of a driver's total pay by the total number of hours worked (both paid and unpaid) is greater than the state-mandated minimum hourly rate, Lepke is not required under the pertinent regulation to pay that driver additional wages for the unpaid, compensable time. In support of this argument, Lepke points to WIS. ADMIN. CODE § DWD 272.03(7), which provides: "The payroll period shall be taken as the unit of determining compliance with the minimum rates prescribed in this order." Lepke argues that § DWD 272.03(7) does not require that every employee receive a specific hourly rate, only that the "employee receive at least $ 7.25 per hour for all hours worked in a given pay period." Lepke argues that the drivers' average hourly wage in each pay period, when both paid time and unpaid time are considered, is greater than the minimum wage Lepke is required to pay the drivers and, therefore, the drivers are not entitled to any additional wages for the unpaid compensable time. We are not persuaded.
¶19 We interpret statutory language not in isolation but as part of a whole; in relation to the language of surrounding or closely related statutes; and reasonably, to avoid absurd or unreasonable results. State v. Warbelton ,
¶20 WISCONSIN ADMIN. CODE § DWD 272.03(1) establishes the minimum hourly rate an employer may pay an employee. However, WIS. ADMIN. CODE § DWD 272.025 provides that "[n]othing contained in [§] DWD 272.03 prohibits an employer from paying [an employee] more than" the minimum hourly rates set forth in § DWD 272.03(1). WISCONSIN ADMIN. CODE § DWD 272.12(1), in turn, requires an employer to pay an employee for all time worked.
¶21 Giving effect to each relevant provision contained in WIS. ADMIN. CODE ch. DWD 272, we conclude that the most reasonable interpretation of that section is that an employee must be paid for each and every hour worked by that employee, at the higher rate agreed to by the employer and employee, or if there has been no such agreement, at a rate no less than the minimum specified in WIS. ADMIN. CODE § DWD 272.03(1). Were we to adopt Lepke's suggested interpretation, an employer could agree to pay an employee an hourly wage exceeding the minimum hourly wage, and then require that employee to work any number of additional unpaid hours and not pay the employee for those hours at the agreed-upon hourly rate, so long as the employee's average hourly wage remained above the minimum wage in the pay period. Such a result would be an absurdity, which we must avoid.
C. Overtime Pay
¶22 In their brief in support of their motion for summary judgment regarding the unpaid time, the drivers asserted that they are entitled to overtime wages for work time that exceeds ten hours per day or forty hours per week. As noted above in ¶3, the drivers' hourly rate of pay varied, depending on whether they were working on a project that was subject to the then-prevailing wage law. See WIS. STAT. §§ 103.49 (2013-14); 103.50 (2013-14); and 84.062 (2015-16). To repeat, the circuit court agreed that the drivers are entitled to overtime wages and determined that if the drivers "work[ed] more than ten hours per day, or [forty] hours per week overall," they are entitled to overtime wages at the prevailing wage rate "if they worked on a prevailing wage project after they had worked forty full hours during the week," "even if they worked fewer than ten hours per day or [forty] hours per week on a prevailing wage project during [that] week."
¶23 Lepke contends that the drivers are not entitled to overtime wages because Lepke is exempt under
¶24 The drivers concede that they are subject to the motor carrier exemption and, therefore, Lepke was not required to pay them overtime under the Fair Labor Standards Act. The drivers argue, instead, that Lepke agreed to pay them overtime wages and that for that reason, Lepke is contractually obligated to do so. Lepke concedes in its brief that Lepke "promised to pay overtime [wages to the drivers] when their compensable hours exceeded forty in a workweek," and that the drivers are entitled to such wages.
¶25 Turning to the rate at which the overtime wages at issue should be calculated, Lepke contends that the circuit court erred in determining that the drivers' overtime wages should be calculated at the prevailing wage rate if any hours worked over forty hours in any given week were on a prevailing wage project.
¶26 Lepke does not cite to any legal authority supporting its argument. Lepke asserts that "[c]ompliance with the prevailing wage requirement ... is strictly monitored and enforced" and that, if the drivers "were incorrectly paid on prevailing wage projects, it is fair to assume that the state auditors would have directed [Lepke] to issue additional pay and to change [its] pay practices." However, Lepke does not point to any evidence in the summary judgment submissions indicating that the drivers' pay records were reviewed by state auditors during the time periods at issue in this case. Moreover, Lepke ignores the fact that the unpaid time was not treated as work time and that the drivers were, therefore, not paid at all for that time. Accordingly, we conclude that Lepke has failed to present this court with any persuasive argument establishing that the circuit court erred in its determination.
By the Court. -Judgment affirmed.
This opinion will not be published. See WIS. STAT. RULE 809.23(1)(b)5.
On one subset of projects, Lepke paid the drivers slightly more. As to this subset, drivers were allowed to count a small amount of additional end-of-the-work-day time. However, neither side argues that the exception for this subset of projects matters on any issue that we resolve on appeal, and we address it no further.
Wisconsin Stat. §§ 103.49 and 103.50(2) (2013-14) required paying a prevailing wage to employees on municipal and state work projects, including highway projects. Section 103.49 was partially repealed and was renumbered as
The Hon. Michael Rosborough issued the initial summary judgment ruling. Subsequent actions were taken by the Hon. Darcy Rood.
All references to Wis. Admin. Code § DWD are through January 2019 unless otherwise noted.
Wisconsin Stat. § 103.02 provides that "[t]he department shall, by rule, classify [hours of beginning and ending work] ... into periods to be paid for at regular rates and periods to be paid for at the rate of at least one and one-half times the regular rates."
Four justices agreed on this point. The lead opinion in United Food & Com. Workers Union, Local 1473 v. Hormel Foods Corp. ,
Lepke also contends that we should resolve the unpaid time issue based on the concept that Lepke met minimum wage standards, following statements of the Department of Workforce Development in another matter See Jacobson v. Fischbach, Inc. , case No. LS2012 00479 (DWD June 19, 2013). We address, and reject, this argument in a separate discussion section below.
Despite this concession, Lepke also opposes on appeal the drivers' claim that they are entitled to compensation for their overtime unpaid time based on breach of contract. Because we conclude that they are entitled to that compensation under Wisconsin law, we do not reach this issue. See Sweet v. Berge ,
Lepke limits its arguments pertaining to the rate of pay for the drivers' unpaid time to only those hours that result in overtime pay. Lepke does not raise any argument on appeal that the drivers are not entitled to the prevailing wage rate for unpaid work time that is not entitled to be paid at the overtime hourly rate. Accordingly, our analysis is similarly limited in scope.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.