Carmelo Reyes Morales, et al. v. Bryant Concrete Construction, Inc., et al.

Summary

The Appellate Court of Maryland held that sufficient evidence supported a jury question on whether a company co-owner was an employer personally liable under the FLSA, MWHL, and MWPCL. The court further held that liquidated damages under the FLSA and MWHL are determined by the judge, and that the good-faith defense need not be separately pleaded. The court vacated the circuit court’s judgments and remanded for further proceedings.

Holdings

1. The circuit court erred in granting judgment for Subrena because the evidence, viewed in the Employees' favor, was legally sufficient to generate a jury question concerning whether she was an employer under the FLSA, MWHL, and MWPCL.
2. The error was not harmless because it deprived the Employees of a jury determination on Subrena's personal liability and probably affected the outcome.
3. The good-faith defense to liquidated damages is an affirmative defense, but it is not one of the defenses enumerated in Maryland Rule 2-323(g), and neither the FLSA nor the MWHL requires it to be specifically pleaded. The defendants therefore did not waive the defense by failing to plead it separately.
4. To reduce or eliminate liquidated damages, an employer must objectively establish both good faith and reasonable grounds for believing that its conduct did not violate the applicable wage law. The defense requires serious and informed efforts to comply; payroll delegation, industry practice, or absence of employee complaints alone is insufficient.

Questions Presented

1. Whether the circuit court erred by granting judgment for Subrena Bryant on the ground that the evidence was legally insufficient to permit a jury to find that she was an employer under the FLSA, MWHL, and MWPCL.
2. Whether the error in excluding Subrena from the case and the verdict sheet was harmless.
3. Whether the good-faith defense to FLSA and MWHL liquidated damages is an affirmative defense that must be separately pleaded under Maryland Rule 2-323(g).
4. What legal standards govern the good-faith and reasonable-grounds defense to liquidated damages under the FLSA and MWHL.

Disposition

vacated