A federal appeals panel won’t resolve the question of whether a man hired to build livestock stalls in Wisconsin and Indiana should be classified in the construction or agricultural field for the purposes of calculating overtime under federal law.
In an opinion issued Aug. 19, the U.S. Seventh Circuit Court of Appeals reversed a ruling of U.S. District Judge James Peterson, of the Western District of Wisconsin. Peterson dismissed the complaint of Jose Ageo Luna Vanegas, who alleged Signet Builders owed him time-and-a-half under the Fair Labor Standards Act. According to Peterson, the FLSA exempts agricultural work.
“But the question whether this is so is a fact-intensive inquiry that rarely can be decided solely on the face of a complaint,” Seventh Circuit Judge Diane Wood wrote in the appellate opinion. “Because the facts properly in the record do not demonstrate the applicability of the exemption beyond debate, we reverse.”
Circuit judges Ilana Rovner and Amy St. Eve concurred in the ruling.
Signet hired Luna Vanegas, a Mexican citizen, on a guest worker visa authorizing temporary agricultural work. The panel said the U.S. Department of Labor issued about 79,000 such visas in 2010 and 258,000 in 2019. As the program expanded, Wood wrote, “so have complaints from oversight agencies and advocacy groups that it is plagued with abuse.”
Luna Vanegas said he only built livestock structures, never contacted animals and routinely exceeded 40 hours per week. Signet moved to dismiss his FLSA complaint, arguing only for exemption because the work was agricultural. Wood explained Judge Peterson thought Luna Vanegas’ complaint “was one of the rare ones in which the plaintiff had pleaded himself out of court” through use of facts that defeat its own claims.
However, Wood continued, the panel rejected a determination “the complaint unambiguously shows that Luna Vanegas fell within FLSA’s exemption for agricultural workers.” While all sides agree constructing livestock buildings isn’t “primary agriculture” under the 1938 law, the panel said the question is if the complaint established his work as “secondary agriculture” by showing his “work was ‘an incident to or in conjunction with’ the farming operations of the live-stock farmers on whose property he built the enclosures.”
The panel said the burden of proof is on the employer and noted the dispositive issue is a clause in an interpretive rule opening exemption for work that “does not amount to an independent business.” It further explained Judge Peterson agreed with Signet’s comparison to building a granary or silo, despite a regulatory passage stipulating construction work isn’t “agricultural” if building is “a separately organized productive activity.”
The DOL has a list of factors to help resolve such a question, which Wood described as “a nuanced, fact-intensive inquiry that is ill-suited for resolution based only on the allegations of a complaint.” The DOL also explains the definition as farm work has evolved, citing as an example how farmers used to produce their own fertilizer, but it now is mass produced at factories, and such factories perform an “independent productive function, not agriculture.”
Also relevant, the panel said, is whether farmers typically complete a certain task or hire a contractor. But whether farmers usually hire out for livestock enclosure construction isn’t addressed in the complaint. Neither is whether Signet usually competes with agricultural business or construction firms, or if Luna Vegas’ duties had any overlap with farm workers. Those gaps left enough room for the panel to determine Luna Vegas didn’t make allegations that unequivocally defeat his claims.
“The complaint says little about most of the regulatory factors,” Wood wrote. “We do not even know what farms Luna Vanegas worked on. His case, in short, was not a candidate for disposition.”
The panel remanded the complaint for further proceedings.
Vanegas has been represented by attorneys Jennifer J. Zimmermann and Erica L. Sweitzer-Beckman, of Legal Action of Wisconsin, of Madison, Wisconsin; Edward J. Tuddenham, of Paris, France; and Lorraine Gaynor, of Iowa Legal Aid, of Iowa City, Iowa.
Signet has been represented by attorneys N. Boehm Jr., Joshua H. Viau and Ann Margaret Pointer, of the firm of Fisher & Phillips, of Atlanta.