The opinion of the court was delivered by: Michael A. Telesca United States District Judge
Plaintiff, Eustacio Salazar-Martinez ("Plaintiff"), brings this action for declaratory relief and monetary damages on behalf of himself and all other similarly situated employees of Defendant, Fowler Brothers, Inc*fn1 . ("Fowler"), alleging violations of the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. § 201 et seq. ("FLSA"), New York State Labor Laws, N.Y. Lab. Law §§ 191, 193, 198, 198-b and 681 (McKinney 2011), New York's Minimum Wage Order for Farm Workers, N.Y. Comp. Codes R. & Regs. tit. 12, §§ 190-1.2, 190-2.1 and 190-5.1 (2009), and breach of contract. Specifically, Plaintiff alleges that between 2003 and 2010 Defendants failed to reimburse him and other migrant farm workers, employed by Defendants through the H-2A guest worker visa program, for their pre-employment travel, visa and recruitment expenses, and that these expenses were "kickbacks" under the state and federal wage laws that reduced Plaintiff's compensation in the first work-week below the minimum wage.
Prior to answering the Complaint, Defendants moved for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure ("Rule 56"), arguing that the expenses alleged to have been borne by Plaintiff are not, as a matter of law, required to be reimbursed by Defendants and that, even if such expenses are required to be reimbursed, Defendants paid Plaintiff the applicable minimum wage in the first work-week. Defendants also move pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure ("Rule 12(b)(1)") to dismiss Plaintiff's claims for the years 2003-2007 and 2010 for lack of subject matter jurisdiction, as Plaintiff only worked for Defendants in the years 2008 and 2009, and because Fowler did not participate in the H-2A program from 2003-2005. Lastly, Defendants also move to dismiss Plaintiff's claim for declaratory relief for lack of subject matter jurisdiction.
Plaintiff opposes Defendants' motion, arguing that the alleged pre-employment expenses are reimbursable to the extent that Plaintiff's payment of such expenses reduced his first week's pay below the applicable minimum wage. Plaintiff further argues that the inclusion of class members from years in which Plaintiff was not employed by Defendants should be decided on a motion for class certification, as it is a question of whether such employees are "similarly situated" to the Plaintiff and therefore, whether he can properly represent them in a collective action law suit. He further argues that this Court has subject matter jurisdiction with respect to his claim for declaratory relief.
There is little authority in this Circuit on the issue of whether the pre-employment travel and visa expenses of H-2A workers are required to be reimbursed under federal and state wage laws. The Fifth and Eleventh Circuits are split on the issue, and the Department of Labor ("DOL") recently questioned its longstanding position that such expenses are required to be reimbursed. Ultimately, the DOL reaffirmed its position, citing, in part, the reasoning of the Eleventh Circuit in Arriaga v. Florida Pacific Farms, LLC., 305 F3d 1228 (11th Cir. 2002). See U.S. Dep't. of Lab., Wage and Hour Div., Field Assistance Bulletin No. 2009-2 ("Bulletin No. 2009-2"). For the reasons set forth below, this Court finds persuasive the 11th Circuit's reasoning in Arriaga and the most recent pronouncements of the DOL, as well as the dissent in the Fifth Circuit's decision in Castellano-Contreras v. Decatur Hotels, LLC,622 F.3d 393 (5th Circuit 2010)(en banc)(8-6 decision)(Dennis, J., dissenting). See also Teoba v. Trugreen Landcare LLC,2011 WL 573572 (W.D.N.Y. 2011)(Siragusa, J.)(similarly holding that such expenses are reimbursable, following the reasoning of the most recent DOL interpretations, the Eleventh Circuit in Arriaga and the dissent in Decatur Hotels).
Accordingly, this Court denies Defendants' Motion for Summary Judgment, and grants in part and denies in part Defendants' Motion to Dismiss. The parties have also filed discovery motions that this Court finds are now moot based on this Decision and Order.*fn2 Accordingly, Defendants' Motion for a Protective Order and Plaintiff's Cross Motion to Compel Discovery are denied as moot. The parties are directed to consult the Local Rules of Civil Procedure and conduct discovery accordingly.
Plaintiff, a Mexican citizen, was employed by Defendants as an apple harvester in 2008 and 2009 under the H-2A visa program, which allows employers in the United States to hire foreign agricultural workers for a limited time, after complying with the regulations promulgated by the Secretary of the DOL . See 20 C.F.R. 655.100 et seq.; (Martinez Dec. ¶ 14.) Plaintiff had worked for other H-2A employers prior to working for Fowler and, in order to navigate the complicated H-2A visa application process in those years and in the years he worked for Fowler, Plaintiff utilized the services of Angelica Maria Nava Pina ("Nava Pina"). (Martinez Dec. ¶ 4, 14.) Nava Pina owns and operates a travel agency, Navpisa Viajes, in Rio Verde, San Luis Potos , Mexico, that assists Mexican citizens and American H-2A and H-2B*fn3 employers with the process of recruiting and completing the visa application process. (Nava Pina Dec. ¶ 2-3.)
For her services, Nava Pina charges her Mexican clients a single lump-sum fee that includes visa processing fees payable to the U.S. Government and to the company that conducts the visa interviews on behalf of the U.S. Consulate in Mexico, round trip transportation from their point of origin and expenses incurred by Nava Pina in traveling to the prospective worker's point of origin to assist the worker in completing the visa application. (Nava Pina Dec. ¶ 5.) Nava Pina stated that her fee for 2008 was 4,000 pesos (approximately $400 U.S. dollars in August 2008*fn4 ) and for 2009 it was $500 U.S. dollars. Id. Plaintiff, however, stated that he paid Nava Pina $500 U.S. dollars in both 2008 and 2009. (Martinez Dec. ¶ 17.)
Nava Pina stated that in 2008 Defendants contacted her with a list of employees they sought to hire through the H-2A program. (Nava Pina Dec. ¶ 6.) She contacted these workers and also informed Plaintiff about the opportunity. Id. Plaintiff stated that Nava Pina offered him the job and instructed him to give her $500 U.S. dollars, which he understood to be a visa processing fee. (Martinez Dec. ¶ 17.) The same process occurred in 2009. Id.; (Nava Pina Dec. ¶ 7.)
For her services to Fowler, Nava Pina charged Fowler $150 U.S. dollars per worker. (Nava Pina Dec. ¶ 11). Nava Pina also paid for a bus to transport the workers from Mexico to the Fowler farm in Wolcott, New York and was reimbursed for this cost ($210/worker in 2008 and $255/worker in 2009) by Fowler. (Nava Pina Dec. ¶ 8-9); Def. Brief. at 24, Docket #17-5.
Plaintiff alleges that Nava Pina acts as an agent to Fowler in Mexico for the purpose of recruiting seasonal labor, and that he paid Nava Pina the fees described above "in order to secure an offer of employment with one or more of the Fowler defendants." Compl. ¶54-60. He further states that the fees were paid as "a condition of being considered for any position of employment as an H-2A worker for one or more of the Fowler defendants." Id.
During his first work-week for Fowler in 2008, Plaintiff worked 33 hours at a rate of $9.70 per hour ($320.10) and was also paid $19.80 in meal reimbursements for his travel from Mexico and $70.00 in a "visa-related" reimbursement. See Def. Local Rule 56.1 Statement at ¶3-4. Plaintiff was also reimbursed an additional $80.00 in visa-related expenses at the end of the 2008 work season. Id. at ¶4. During the first work-week in 2009, Plaintiff worked 16 hours at a rate of $9.70 per hour ($155.00). He was paid $24.75 for meal reimbursements and he was reimbursed for visa-related expenses in the same manner as in 2008 ($70 in the first week and $80.00 at the end of the season). Id. at ¶5-6. Plaintiff was not reimbursed for any other pre-employment expenses paid by the Plaintiff to Nava Pina or for miscellaneous travel and subsistence costs incurred during the visa application process or his travel to the United States.
I. Defendants' Motions to Dismiss
A. Alleged Violations in 2003 through 2007 and 2010 Defendants move to dismiss Plaintiff's claims for the years 2003 through 2007 and 2010 for lack of subject matter jurisdiction. Defendants argue that they did not participate in the H-2A program at all for the years 2003-2005 (Fowler Dec. at ¶3, 5) and, because Plaintiff was employed by Defendants in 2008 and 2009 only, he does not have standing to assert claims that relate to alleged violations in 2006, 2007 and 2010. Defendants do not contest that Plaintiff has standing to pursue his claims for the years 2008 and 2009.
Plaintiff argues that the allegations in the Complaint relating to the years 2003-2007 and 2010 represent the potential claims of the class of H-2A workers he seeks to represent. Accordingly, he argues that, because he has standing to pursue his own claims for 2008 and 2009, his ability to represent workers who were employed in years prior and subsequent to his own employment is best resolved by a motion for class certification. On such a motion, Plaintiff argues, the issue under the FLSA collective action statute would be whether such employees are "similarly situated" and, pursuant to Rule 23 of the Federal Rules of Civil Procedure, whether Plaintiff and the putative class members satisfy the "commonality" and "typicality" requirements of Rule 23. This Court agrees.
While this Court recognizes that a representative plaintiff must have individual standing in order to assert claims on behalf of a class, the fact that Plaintiff seeks to represent a class of individuals whose claims may have accrued at different times is an issue of "typicality" and is more properly addressed in connection with Plaintiff's pending motion for conditional class certification. See Defer v. Raymond James Financial, Inc., 654 F.Supp.2d 204, 210 (S.D.N.Y. 2009)("As a threshold matter, defendants contend that plaintiff does not have standing to represent a class of all individuals who purchased any [stock] from defendants, but may assert only claims relating to the specific securities that she purchased. Whether plaintiff can represent class members is not a question of standing, however. The issue goes to the typicality of plaintiff's claims as representative of those of other alleged Class members. There is no dispute that plaintiff has standing to bring securities fraud claims arising out of her own purchase of [stock] from defendants. The typicality question is addressed more properly on a motion for class certification.") (internal citations omitted). See also Presbyterian Church of Sudan v. Talisman Energy, Inc., 244 F.Supp.2d 289, 335 (S.D.N.Y. 2003) ("To the extent that [defendant] is arguing that the named plaintiffs were injured at different times than other members of the class, the question is one of typicality which should be raised when plaintiffs seek to have the class certified.").
Accordingly, this Court will address the issue of whether a class should be conditionally certified, and the potential scope of that class, in its consideration of Plaintiff's pending motion for class certification. However, to the extent Plaintiff seeks to represent a class of putative plaintiffs who allegedly worked for Fowler in the years 2003-2005, these claims must be dismissed, as Fowler did not participate in the H-2A program in those years and therefore, claims by employees during those years could not be typical to those of the Plaintiff, who is specifically asserting claims based on his status as an H-2A employee. Therefore, Defendants' Motion to Dismiss any claims that allegedly accrued in the years 2003, 2004 and 2005 is granted, and their Motion to Dismiss claims which allegedly accrued in the years 2006, 2007 and 2010 is denied.
Defendants also seek to dismiss Plaintiff's claim for declaratory relief for lack of subject matter jurisdiction. See Def. Brief at 12 (Docket #17-5). This Court's jurisdiction under the Declaratory Judgment Act is limited by the "cases" and "controversies" requirement of Article III of the Constitution. See Summers v. Earth Island Institute, 129 S.Ct. 1142 (2009). "A federal court may only be called upon 'to adjudge the legal rights of litigants in actual controversies,'accordingly, a necessary prerequisite to the exercise of judicial power is the presence of a 'claim of substantive right' that triggers the adjudicative function of the court." See S. Jackson & Son, Inc. v. Coffee, Sugar & Cocoa Exchange Inc., 24 F.3d 427, 431 (2d Cir. 1994) (internal citations omitted). A demand for declaratory relief does not, by itself, create the requisite controversy required for this Court to exercise jurisdiction. Thus, "where the remedy sought is a mere declaration of law without implications for practical enforcement upon the parties, the case is properly dismissed." Id.
Federal courts are not reluctant to grant declaratory relief, but must be alert to avoid imposition upon their jurisdiction through obtaining futile or premature interventions,...[particularly] where a ruling is sought that would reach far beyond the particular case. The disagreement must not be nebulous or contingent but must have taken on fixed and final shape so that a court can see what legal issues it is deciding, what effect its decision will have on the adversaries, and some useful purpose to be achieved in deciding them. Where the relief sought would not resolve the entire case or controversy as to any [party]..., but would merely determine a collateral ...