U.S. Second Circuit - The FindLaw 2nd Circuit Court of Appeals Opinion Summaries Blog

Baseball Concession Workers Strike Out With Overtime Claims

When the Baltimore Orioles go into overtime, the workers in Camden Yards don't exactly celebrate. That's because the men and women who sell you your peanuts and crackerjacks don't get paid overtime.

Those workers sued in 2011, alleging that the lack of overtime ran afoul of federal labor laws. But the Second Circuit disagreed last Monday, ruling that the concession workers were exempt from overtime protection.

Not All Sports Careers Are Glamorous

Maryland Sportservice Inc., a subsidiary of Delaware North Companies Sportservice, operates the concession and vending stands throughout Camden Yards, selling food, beverages, and merchandise throughout the ballpark. In addition to concessioneering, DNC also operates clubs, lounges, and a team store that stays open during non-game hours.

Though workers at those concession stands regularly work over 40 hours a week, DNC does not pay overtime. It claims that the Fair Labor Standards Act's exemption of any "amusement or recreational establishment that operates on a seasonal basis" from overtime laws extends to the companies operating at those establishments. DNC's workers disagreed, filing a class action seeking overtime coverage and back pay.

FLSA-Free Concessions

When the Department of Labor investigated those claims, it found no FLSA violation. Neither did the district court, who dismissed the case on summary judgement, a ruling the Second Circuit agreed with.

Though the FLSA doesn't define an "amusement or recreational establishment," the court noted that the laws legislative history "treats concessionaires as core examples of amusement or recreational establishments." That characterization is supported by the Department of Labor as well, whose interpretive rules list "concessionaires at amusement parks and beaches" as "typical examples" of seasonal, recreational businesses exempt from overtime rules.

Based on that background, the Second Circuit defined concessionaires as "establishments whose purpose is to sell goods and services on the premises of an amusement or recreational host facility to the host's customers for their use or consumption on the host's premises as they participate in the host's amusement or recreational activities." Those concessionaires, like their hosts, are entitled to the FLSA overtime exemption.

But was Camden Yards really seasonal? Several concessions remained open all year, including the Orioles Team Store and Dempsey's Brew Pub. The court looked at two tests, a seasonal operations test and an average receipts test. The DNC obviously did not pass the seasonal operations test, which requires an establishment to engage in no activity at all for at least five months. But it did pass the receipts test, the court ruled, where its lowest earning six months did not average out to more than a third of the average receipts of its highest earning six months.

Of course, the court's work on "a three strikes and you're out system too," and there's always the chance that the workers could appeal, but given how easily both the district and appellate court found against them, we don't think that's a likely outcome.

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