A class of seafarers who were discharged from service on Maersk ships due to illness or injury sought overtime pay that they would have earned from the time of their discharge until the end of their respective voyages. After an adverse judgment from the Southern District of New York, the defendant appealed to the Second Circuit. The issue on appeal was “whether unearned wages recoverable by ill or disabled seafarers under general maritime law include overtime pay that they would have earned had they completed their voyages.” The Second Circuit concluded that these seamen were entitled to overtime pay as a component of unearned wages. It reasoned:
“Under general maritime law, seamen who have become ill or injured while in a ship’s service have the right to receive maintenance and cure from the owner of the vessel. Ammar v. United States, 342 F.3d 133, 142 (2d Cir.2003). In addition, a seaman is entitled to recover unearned wages, the wages he would have earned if not for the injury or illness . Rodriguez Alvarez v. Bahama Cruise Line, Inc., 898 F.2d 312, 315 (2d Cir.1990) (“When a seaman is injured during his employment on a ship, the ship operator is liable not only for the seaman’s maintenance and cure, but also for lost wages.”) (citing The Osceola, 189 U.S. 158, 175, 23 S.Ct. 483, 47 L.Ed. 760 (1903)); see also Grifin v. Oceanic Contractors, Inc., 664 F.2d 36, 39 (5th Cir .1981) (“The right of an injured seaman to recover unearned maintenance-wages-cure (M–W–C) under the general maritime law of the United States until either (1) the end of the voyage or (2) the end of the contractual period of employment is well established.”) (citing The Osceola, 189 U.S. at 175), rev’d on other grounds, 458 U.S. 564, 102 S.Ct. 3245, 73 L.Ed.2d 973 (1982). While Padilla bears the burden of proving his right to maintenance and cure, claims for these are construed expansively and doubts regarding a shipowner’s liability for maintenance and cure should be resolved in favor of the seamen. Vaughan v. Atkinson, 369 U.S. 527, 532, 82 S.Ct. 997, 8 L.Ed.2d 88 (1962); Breese v. AWI, Inc., 823 F.2d 100, 104 (5th Cir .1987).
“As the district court correctly recognized, while the entitlement to unearned wages arises under general maritime law, rates for unearned wages may be defined and modified in collective bargaining agreements, see Ammar, 342 F.3d at 146–47, and Maersk contends that the CBA should control our interpretation of the unearned wages issue. The CBA at issue here was between large parties well-equipped to represent and protect their respective interests. Under these circumstances, the appropriate accommodation between federal maritime law and federal common law for the enforcement of collective bargaining agreements is to allow unionized seamen to bargain for the rights and privileges they prefer in exchange for limitations on various components of compensation so long as the negotiations are legitimate and the seamen’s interests are adequately protected. Id. In light of these considerations, our responsibility is to determine the actual terms agreed to by the parties to the CBA and not to impose a limitation where none was intended or agreed to. Marcic v. Reinauer Transp. Cos., 397 F.3d 120, 131 (2d Cir.2005). Consequently, as the Ninth Circuit held in Lipscomb v. Foss Mar. Co., 83 F.3d 1106, 1109 (9th Cir.1996), only if the CBA expressly provides for a different computation of the seafarers’ remedies does it modify the general maritime law. Here, however, the CBA does not limit the availability of unearned wages and so we must apply general maritime law.
“Because much of Padilla’s income was derived from overtime compensation, the district court awarded him overtime pay as part of his unearned wages, reasoning that Padilla was entitled to recover in full the compensation that he would have earned “but for” his injury. We agree with this approach. The record reflects that it was the custom and practice for seafarers working for Maersk to derive substantial income from overtime compensation and that, consequently, such compensation was a common expectation of both the seamen and of Maersk. As noted, Padilla and other Maersk seafarers regularly earned 100% or more of their base pay in overtime wages. Significantly, the district court concluded that the calculation of the overtime Padilla would have worked was not speculative. Cf. Griffin, 664 F.2d at 40 (upholding the district court’s decision to deny overtime because “[t]he actual amount of overtime was uncertain, and hence any inclusion of such would have been purely speculative”). In fact, the calculations of the overtime pay due to the class were essentially undisputed: a Maersk manager easily calculated each seaman’s expectation of his overtime from records of past work for Maersk. Thus we agree that the district court correctly applied the “but for” test.
“In reaching this conclusion, we align ourselves with the other circuits who apply the same test. See Flores v. Carnival Cruise Lines, 47 F.3d 1120, 1122–24 (11th Cir.1995) (holding that tips should be included in the measure of unearned wages because a seaman would have earned them but for his injury); Lipscomb, 83 F.3d at 1109 (concluding that accumulated time off is part of seaman’s unearned wages under general maritime law); Aksoy v. Apollo Ship Chandlers, Inc., 137 F.3d 1304, 1306 (11th Cir.1998) (calculating unearned wages as average tip income plus guaranteed minimum wage); Morel v. Sabine Towing & Transp. Co., 669 F.2d 345, 346 (5th Cir.1982) (holding that accumulated leave time is part of total wages and payable in addition to maintenance); Shaw v. Ohio River Co., 526 F.2d 193, 199 (3d Cir.1975) (same).”
Padilla v. Maersk Line, Ltd., — F.3d —- (2d Cir. 2013).
(Note: I originally published this post on Navigable Waters: A Maritime, Longshore and Defense Base Act Blog.)
