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Elias Bobadilla-German v. Bear Creek Orchards

April 12, 2011

ELIAS BOBADILLA-GERMAN; JACOBO BOBADILLA-GERMAN; VICENTE FIMBRES ROMERO; MAURO GERMAN- SANCHEZ; GILBERTO PADILLA-ORTIZ; VICTOR VILLANUEVA-HERNANDEZ; DARIO ANGEL VILLEGAS-MEZA, AND JOSE DE JESUS GAETA BAUTISTA; PLAINTIFFS-APPELLANTS, BENJAMIN URBALEJO-RODRIGUEZ, PLAINTIFFS,
v.
BEAR CREEK ORCHARDS, INC., A DELAWARE CORPORATION, DEFENDANT-APPELLEE.
ELIAS BOBADILLA-GERMAN; JACOBO BOBADILLA-GERMAN; VICENTE FIMBRES ROMERO; MAURO GERMAN-SANCHEZ; GILBERTO PADILLA-ORTIZ; VICTOR VILLANUEVA-HERNANDEZ; DARIO ANGEL VILLEGAS-MEZA, PLAINTIFFS-APPELLEES,
v.
BEAR CREEK ORCHARDS, INC., A DELAWARE CORPORATION, DEFENDANT-APPELLANT.



Appeals from the United States District Court for the District of Oregon Owen M. Panner, Senior District Judge, Presiding D.C. No. 1:07-cv-03058-PA D.C. No. 1:07-cv-03058-PA

The opinion of the court was delivered by: Thomas, Circuit Judge:

FOR PUBLICATION

OPINION

Argued and Submitted March 11, 2011-Portland, Oregon

Before: Sidney R. Thomas and Susan P. Graber, Circuit Judges, and James V. Selna,*fn1 District Judge.

Opinion by Judge Thomas

OPINION

In these appeals, we consider whether certain on-site housing costs of seasonal farm workers can be credited toward the minimum wage set by Oregon statute. Under the circumstances presented by this case, we conclude that they may not. We also conclude that the workers in this case were entitled to be paid on the last workday, rather than the following day.

I

Bear Creek Orchards, Inc., operates peach and pear orchards in Medford, Oregon. It hires seasonal workers to pick the orchards over the course of a month-long harvest. Bear Creek typically hires about 50 workers to pick peaches and 300 to pick pears.

In recent years, at least three-fourths of Bear Creek's seasonal workers have been recruited from the San Luis, Arizona, area. Once recruited, these workers traveled from their permanent homes in Arizona to Oregon for the month-long harvest.

As part of their compensation, workers were offered optional on-site housing and meals. Bear Creek charged between five and seven dollars a day for housing and deducted this amount from the workers' paychecks and credited it toward their minimum wage. The company, though, deducted housing costs from a worker's paycheck only if he or she completed a deduction-authorization form. In many instances, if housing costs were not credited toward the workers' minimum wage, their wage would have been below the lawful minimum wage.

During the 2004-2006 harvests, workers were generally given their final paychecks on the morning after their last day of work.

II

Several workers filed a class-action lawsuit against Bear Creek. The class, represented by 12 named plaintiffs, alleged violations of the Migrant and Seasonal Agricultural Worker Protection Act, 29 U.S.C. §§ 1801-1872, as well as Oregon's minimum wage laws.*fn2 Several plaintiffs, suing individually, also claimed that Bear Creek violated Oregon law by failing to pay their wages when due after their employment ended. The district court held a bench trial and issued its Findings of Fact and Conclusions of Law.

The district court ruled in favor of the workers on some claims and in favor of Bear Creek on others. The workers appeal only one claim. They argue that Bear Creek violated Oregon's minimum wage laws by crediting on-site housing costs toward the workers' minimum wage. The district court disagreed, concluding that Bear Creek lawfully credited the costs because on-site housing was optional and was provided for the workers' private benefit. The workers argue on appeal that the district court misapplied Oregon state law in reaching this conclusion.

Bear Creek cross-appeals on a different claim. The district court concluded that Bear Creek violated Oregon law by paying its workers the day after their last workday. Under Oregon law, the court concluded, employers must pay seasonal farm workers on the last workday. The district court awarded the individual plaintiffs one day's pay as damages. Bear Creek argues on appeal that the district court misapplied Oregon state law in reaching this conclusion.

The district court had jurisdiction over the workers' federal claims under 29 U.S.C. § 1854. It had supplemental jurisdiction over the state-law claims under 28 U.S.C. § 1367. We have jurisdiction over the appeals under 28 U.S.C. § 1291.

III

Following a bench trial, we "review[ ] the district court's findings of fact for clear error and its conclusions of law de novo." United States v. Bell, 602 F.3d 1074, 1079 (9th Cir. 2010) (citing Crockett & Myers, Ltd v. Napier, Fitzgerald & Kirby, LLP, 583 F.3d 1232, 1236 (9th Cir. 2009)), cert. denied, 131 S. Ct. 653 (2010).

The district court erred when it concluded that Bear Creek lawfully credited on-site housing costs toward the workers' minimum wage. The district court properly concluded that Bear Creek violated Oregon law by paying its workers the day after their last workday.

A

[1] Oregon law allows employers to deduct from a work-er's minimum wage the "fair market value of lodging, meals or other facilities or services furnished by the employer for the private benefit of the employee." Or. Rev. Stat. § 653.035(1) (emphasis added). "Private benefit" is defined in Oregon's Administrative Rules:

Lodging or other facilities or services are furnished for the private benefit of the employee when such lodging or other facilities or services are not required by the employer. For purposes of this rule, lodging or other ...


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