BOLGER, Justice.
A pilot who worked at a remote fishing lodge filed a claim under the Alaska Wage and Hour Act (AWHA) for unpaid overtime wages. Applying the four-part test of Dayhoff v. Temsco Helicopters, Inc.,
Chris and Linda Branham own and operate the Royal Wolf Lodge, a fishing lodge that operates seasonally from June to September. The lodge is located in Katmai National Park, a remote location without access to roads. Employees reside on the premises during the season, and all materials must be flown in by airplane. The lodge first hired Jeff Moody as a pilot for the 2002 summer season and terminated him after the 2007 season.
Moody was the only pilot who flew the lodge's de Havilland Beaver aircraft. The parties contest the details of Moody's responsibilities at the lodge, but they agree that Moody was responsible for many tasks involving the airplane. For example, Moody flew clients between the lodge and the fishing destinations, prepared and cleaned the airplane, and monitored it for potential mechanical problems. He also flew food, fuel, and other supplies to the lodge. When he was not on duty, Moody was allowed to engage in personal errands and leisure activities.
Although Moody does not have a college degree and did not receive flight training in a formal academic setting, he hired flight instructors to teach him, and he studied from manuals to take the Federal Aviation Administration's (FAA) oral and written tests. Moody holds a commercial pilot license, an airline transport pilot license, a certified flight instructor rating, an instrument rating, a multi-engine rating, a single engine land rating, a single engine sea rating, and a second class medical certificate. His experience includes over 14,000 hours of flight time.
Moody filed a complaint against Chris Branham, Linda Branham, and the Royal Wolf Lodge (together "Royal Wolf Lodge") for unpaid overtime wages from the 2006 and 2007 seasons. Moody had a written employment agreement for those seasons, and he
At trial, Royal Wolf Lodge presented evidence that Moody was paid a set monthly salary equivalent to 40 hours regular pay and 32 hours overtime pay per week. But some of Royal Wolf Lodge's evidence was inconsistent. Chris Branham testified that Moody's salary was for a 30-day period, but he also testified that Moody was paid by calendar month. Moody's employment contract specified that his salary was based on 30 days per month, but it listed hourly rates inconsistent with Chris Branham's testimony. The parties also disagreed about whether Moody worked overtime hours.
Applying the four-part test of Dayhoff v. Temsco Helicopters, Inc.,
Both sides moved to adjust the award. Royal Wolf Lodge sought attorney's fees under Alaska Civil Rules 68 and 82. Moody opposed this motion, arguing that he was the prevailing party and that, under AS 23.10.110(f), a defendant cannot be awarded attorney's fees when a plaintiff litigates his AWHA claim in good faith. Moody also reiterated his claim that Royal Wolf Lodge had violated AWHA and argued that he was entitled to mandatory liquidated damages and attorney's fees under AS 23.10.110(a) and (c). He further claimed that he was entitled to receive an additional penalty payment from Royal Wolf Lodge under AS 23.10.140.
The superior court determined that Moody was the prevailing party and that Royal Wolf Lodge was not entitled to an award of attorney's fees. But the court, noting its previous conclusion that Moody was exempt from AWHA, also rejected Moody's argument for a larger award under AS 23.10.110. And the court rejected Moody's argument for a penalty payment under AS 23.05.140 based on its findings that Moody's right to overtime compensation was unsettled when he left Royal Wolf Lodge and that Royal Wolf Lodge had not intentionally withheld compensation from him. The superior court issued a final judgment for Moody in the principal amount of $12,833.40. Moody subsequently moved for attorney's fees under Civil Rule 82, which the superior court granted.
Moody appeals the decision denying his AWHA claim. Royal Wolf Lodge cross-appeals the contract damages and attorney's fees awards.
Whether an employee is an exempt professional under AWHA is a question of fact.
AWHA requires an employer to pay overtime compensation "at the rate of one and one-half times the regular rate of pay" for hours worked in excess of eight hours per day or 40 hours per week.
In Dayhoff v. Temsco Helicopters, Inc. we adopted a four-part test to determine whether an employee was a "professional employee."
In 2005, however, the Alaska Legislature amended AWHA to adopt the federal definition of "professional employee."
Most importantly for this case, the federal regulation provides a detailed explanation of the phrase "customarily acquired by a prolonged course of specialized intellectual instruction":
This definition of "work ... [r]equiring knowledge of an advanced type ... customarily acquired by a prolonged course of specialized intellectual instruction" is narrower than the definition we used in Era Aviation, Inc. v. Lindfors, where we upheld a jury's finding that a commercial airline pilot was an exempt professional based on her "hundreds of hours of training" and flying time.
Because the federal definition of "professional employee" differs from the state regulation that informed our Dayhoff analysis, the four-part Dayhoff test no longer controls whether an employee is an exempt professional under AWHA. Instead, trial courts should look to 29 C.F.R. §§ 541.300 and .301 in making this determination. Specifically, they should apply the "primary duty test" of §§ 541.300 and .301, paying special attention to the clarifications provided by § 541.301(b) through (f).
In this case, the superior court correctly recognized that Alaska now relies on 29 C.F.R. §§ 541.300 and .301 to determine whether the professional exemption applies to an AWHA claim. But the court incorrectly paraphrased § 541.301(d) as follows:
Using this formulation and continuing to apply the Dayhoff factors, the superior court concluded that the required credentials of a lodge pilot like Moody were similar to the credentials of pilots in cases where those pilots have been found to be exempt.
But all of these cases preceded the amendment to 29 C.F.R. § 541.301 in 2004. And contrary to the superior court's determination, the word "customarily" in the primary duty test does not broaden the exemption to include entire professions where advanced training — but not academic or intellectual instruction — is required. Instead, "customarily" broadens the exemption only to individual employees who lack specialized academic training but nevertheless work in professions where such training is "a standard prerequisite for entrance into the profession."
Since the 2004 amendment of 29 C.F.R. § 541.301(d), every federal court considering whether pilots fall within the professional exemption has concluded that they do not, because commercial piloting does not require specialized academic training as a standard prerequisite.
In Howard v. Port Authority, which also involved Port Authority helicopter pilots, the federal district court adopted Pignataro's reasoning and found that "Port Authority helicopter pilots obtain the required advanced knowledge primarily through experience rather than academic study."
And in McCoy v. North Slope Borough, the federal district court determined that North Slope Borough search and rescue pilots are not exempt professionals.
The United States Department of Labor, which promulgated 29 C.F.R. §§ 541.300 and.301, also takes the position that pilots are not professional employees. As early as 1975, the Department concluded that aviation is not "work requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study."
We agree with the analysis in Pignataro, Howard, and McCoy. Under the primary duty test of 29 C.F.R. §§ 541.300 and .301, Moody is not eligible for AWHA's professional exemption. We acknowledge the superior court's findings that Royal Wolf Lodge requires its pilots to have commercial pilot licenses, to comply with the requirements of 14 C.F.R. §§ 135.61-.129, and to pass written and oral tests demonstrating their knowledge of FAA rules. And we note Chris Branham's assertion that he would only consider hiring pilots with at least 1,500 hours of total flying time. But none of these requirements involves "specialized intellectual instruction" as required by the federal regulations.
It is true that Moody had additional credentials and experience that exceeded Royal Wolf Lodge's hiring requirements. But the relevant determination is not whether Moody personally acquired specialized intellectual instruction, but whether that instruction is a standard prerequisite for entrance into the aviation profession. The record in this case shows that piloting — even commercial piloting — does not generally require academic training. Therefore we cannot say that the "primary duty" of a pilot such as Moody requires "knowledge of an advanced type ... customarily acquired by a prolonged course of specialized intellectual instruction."
Because Moody was not an exempt employee under AWHA, we remand for further proceedings on whether Moody in fact worked overtime as defined by AS 23.10.060 and whether he is entitled to recover compensation for unpaid overtime.
Although the superior court rejected Moody's AWHA claim, it nevertheless awarded him contract damages. After reviewing extensive oral testimony from witnesses and documentary evidence from both sides, the superior court found:
But the court also noted that the 2006 and 2007 contracts stated that "[o]ne day off a week is provided, or accumulated for time off" and that Moody's salary was "based on 30 days per month; or pro rated per day." Relying on Moody's work records, which the court found to be more credible than Royal Wolf Lodge's documents, the superior court determined that Moody took no days off during the 2006 and 2007 seasons. As a result, it awarded him contract damages for his unpaid work on the 31st days of July and August and on the seventh day of each week of both seasons.
Royal Wolf Lodge does not challenge the court's interpretation of Moody's employment contracts, but it argues that the superior court clearly erred in finding Moody took no days off during the 2006 and 2007 seasons.
First, Royal Wolf Lodge cites its employees' testimony that Moody did not work over 40 hours per week and that he did not contribute to tasks other than piloting and maintaining his aircraft. But this testimony concerns
Second, Royal Wolf Lodge argues that the superior court gave insufficient consideration to Chris Branham's post-decision affidavit, which attested that there were "days [Moody] did not fly at all." But this untimely affidavit was submitted more than five months after the superior court's decision. Because Royal Wolf Lodge did not submit this affidavit in conjunction with an Alaska Civil Rule 60(b) claim,
Finally, Royal Wolf Lodge points to Moody's testimony that he flew zero hours on June 26, 2006. But in his testimony, Moody did not admit taking the day off; he merely acknowledged that his work that day did not involve flying. Moody further testified that he worked 11 hours on June 26. Even Royal Wolf Lodge's log records, while contradicting Moody's claim as to the number of hours, state that he worked two hours that day.
For these reasons, we find no clear error in the superior court's finding that Moody worked every day during the 2006 and 2007 seasons. We affirm the superior court's award of contract damages.
Royal Wolf Lodge argues it did not receive adequate notice that the superior court could award contract damages because Moody pled his overtime claim solely under AWHA.
A trial court violates due process if it does not provide a party with adequate notice and an opportunity to be heard on the claims addressed by the court's decision.
Although Moody pled no contract claims in his complaint, Royal Wolf Lodge put Moody's employment contracts at issue by raising their interpretation and application as a defense against Moody's AWHA claim. Moreover, at oral argument before this court, Royal Wolf Lodge conceded it would not have litigated the case any differently had it received prior notice that Moody could be awarded contract damages. Royal Wolf Lodge thus did not suffer any prejudice from the court's decision to award Moody contract damages, and we conclude that the superior court's decision did not violate due process.
We REVERSE the determination that Moody was an exempt professional employee under AWHA and REMAND for further proceedings. We VACATE the superior court's orders declaring Moody to be the prevailing party and awarding him attorney's