Fourth Circuit: Baltimore County Prisoners May Qualify as Employees under FLSA
by David M. Reutter
On May 8, 2024, the U.S. Court of Appeals for the Fourth Circuit clarified the standards to determine whether Baltimore County prisoners are considered employees under the Fair Labor Standards Act (FLSA), 29 U.S.C. § 203, when working in a recycling facility overseen by the County Department of Public Works (DPW).
Until 2020, prisoners were sent to the facility from the Baltimore County Detention Center (BCDC) to sort “scrap metal, cardboard, mixed paper,” “tin,” “aluminum” and “four types” of plastic, the Court recalled; bales of the material were then sold at auction to “commercial purchasers.” DPW used two types of workers at the plant: (1) temporary workers from a staffing agency, who were paid not less than federal minimum wage, $7.25 hourly, plus overtime; and (2) prisoners from BCDC’s community corrections program, who were paid $20 per day for nine-to-ten-hour shifts—in other words, as little as $2 hourly with no overtime.
Michael Scott filed a class-action lawsuit accusing the County of violating FLSA and analogous Maryland laws, seeking “liquidated and statutory damages” for “unpaid minimum wages and overtime compensation” for his work and that of fellow class members. When the U.S. District Court for the District of Maryland granted the County’s motion for summary judgment, Scott appealed.
The Fourth Circuit began by noting that its precedents, like those of other circuits, are “generally skeptical” of FLSA claims “brought by incarcerated workers.” Yet there exists “no categorical rule” that prisoners cannot fall under FLSA “when they work outside the detention facility’s walls for someone other than their immediate detainer,” the Court allowed. Since FLSA requires minimum wage and overtime pay for all covered employees, the question Scott presented therefore was whether he and other class members were recycling center “employees” under the law.
As a matter of first impression, the Fourth Circuit initially had to decide whether FLSA applied to “off-site inmate work.” The “circular definition” of “employee” in 29 U.S.C. § 203(e)(1)—“any individual employed by an employer”—was “unhelpful,” the Court said. So it must “look to the economic realities of the relationship between the worker and the putative employer” when deciding whether a particular worker is a covered employee.
The County acknowledged that prisoners participating in work release fall under FLSA when performing work for companies. The Court found the three factors in Harker v. State Use Industries, 990 F.2d 131 (4th Cir. 1993) applied: first, “whether the relationship between the workers and their putative employer had the hallmarks of ‘a true employer-employee relationship’”; second, “whether the purposes of the [FLSA] call for its application”; and finally, “whether the putative employer had ‘a rehabilitative, rather than pecuniary, interest’ in the worker’s labor.”
In answer to the first question, the Fourth Circuit found the evidence suggested “that the recycling center exercised the kind of control typical to an employment relationship.” As to the second question, the Court noted that FLSA aims to protect the general well-being of all workers by “preventing unfair competition in commerce,” which happens when employers who “pay the minimum wage” are forced to compete against those who do not. Here the record contained evidence that the County sought to “decrease costs” by “get[ting] rid of temp workers” and replacing them with prisoners to sort its recycling. The best proof that the County used low-paid prisoners to keep non-incarcerated workers from getting the jobs—at a higher statutory minimum wage—was reflected in what happened at the onset of the COVID-19 pandemic in early 2020. BCDC locked down and the pool of prisoner works dried up, after which DPW was forced to hire more temporary workers at minimum wage.
The final question, the Court said, was one for the district court to resolve on remand: whether DPW’s primary purpose for using incarcerated workers at the recycling center was to contribute to their “rehabilitation and job training” or simply to save the County money. Thus, the district court’s order was vacated, and the case returned to the district court, where PLN will update developments as they are available. Plaintiffs are represented by attorneys Howard B. Hoffman and Jordan Song En Liew with Hoffman Employment Law, LLC in Rockville; attorney Bradford W. Warbasse in Brooklandville; and attorney Stephen J. Springer in Philadelphia. See: Scott v. Balt. Cty., 101 F.4th 336 (4th Cir. 2024).
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