This case presents a novel question: if a seaman whose income
consists mainly of tips becomes ill or injured and is unable to work,
can he recover those tips under the remedy for wages that is
provided by admiralty law? We hold that the average tip income the
seaman was earning prior to his incapacitation is to be included in
the measure of wages he is due if he becomes unable to work.
I. FACTS AND PROCEDURAL HISTORY
Mario Flores is a seaman who signed two consecutive employment
contracts to work as a cabin steward on cruise ships owned by
Carnival Cruise Lines. Flores entered his first contract with Carnival
in September 1991 to work for one year on the MS Ecstasy. [Flores
Br. 3] The contract promised Flores a salary of $45 a month, to be
paid every two weeks, and further provided:
If you have been contracted as a ... CABIN STEWARD, in addition to
your monthly salary you may expect daily tips for your services to the
passengers.... [T]he tips you may expect go as high as $1000.00 a
month. Carnival will take it upon itself to inform passengers of what
is customarily tipped for the work that you perform.
[Flores Br. 3, Carnival Br.App. B] The underlined words and figures
were typed into blank spaces on the original printed form.
Flores claims that he worked on the Ecstasy until April 27, 1992,
earning tips of $800 a week. [Flores Br. 4] Then he fell ill and went
ashore for medical treatment. While ashore, Flores received bi-
monthly checks for "unearned wages" from Carnival in the amount
of $161.97. [Flores Br. 5] That amount was the same as Flores's
vacation pay would have been, and it was equal to the wages of the
lowest-paid non-gratuity-earning crew member. [Carnival Br.App. E]
Flores stayed ashore from April 27, 1992, until his first contract
expired at the end of September 1992. [Flores Br. 4] When his first
contract expired, Flores signed a second, six-month contract to work
on the MS Fantasy. [Id. at n. 2] The second contract contained exactly
the same payment terms as the first. [Carnival Br.App. B] Flores
claims that he worked on the Fantasy from September 28, 1992, to
October 19, 1992, earning tips of $600 a week. On October 19, the
ship doctor sent him ashore again, where Flores remained until the
expiration of his second contract. [Flores Br. 4]
Flores filed a class action suit under Fed.R.Civ.P. 23 against
Carnival Cruise Lines, seeking compensatory and punitive
damages on behalf of all tip-earning crew members of the Carnival
Cruise Lines fleet who became sick or were injured in the three
years preceding the filing of Flores's suit and who did not receive
"reasonably anticipated lost tips or in the alternative, monthly
guaranteed tips." [RE2:2-5] Carnival filed a motion to dismiss the
complaint, [Carnival Br. 4] maintaining that it had no legal duty to pay
Flores anything more than his $45-per-month salary as unearned
wages.
A magistrate judge first issued an order treating Carnival's motion to
dismiss as a motion for summary judgment, [Carnival Br.App. D]
and then issued a report and recommendation concluding that "tips
which are not guaranteed, ... and not specific ... would not be
appropriately includable as wages...." [RE5:3-4] However, finding
merit in Flores's contention that he had been guaranteed tips by
Carnival, the magistrate judge determined that a genuine issue of
material fact existed to preclude summary judgment. [RE5:4]
Carnival filed an objection to the magistrate judge's report and
recommendation. [R25:1]
"After a de novo determination, and considering the Report and
Recommendation, the written objections, and the record herein,"
[RE6:1] the district court entered an order granting summary
judgment for Carnival on both the compensatory and punitive
damages claims based upon its determinations that the written
contract did not guarantee "any particular amount of tips" to Flores
[RE6:6] and that any alleged oral promise of tips made at the time
Flores signed the contract was merged into the written agreement
and barred by the parol evidence rule. [RE6:5] Flores appeals the
summary judgment ruling.
II. DISCUSSION
We review de novo a district court's grant of summary judgment,
considering the evidence in the light most favorable to Flores. First
Union Discount Brokerage Serv. v. Milos, 997 F.2d 835, 841 (11th
Cir.1993). Because we have no precedent directly addressing the
issue of whether a sick or injured seaman whose income consisted
primarily of tips may recover lost tip income as part of the wages
remedy, we consider the purposes and policy underlying the
maritime remedy for wages, the decisions of courts that have
considered similar questions under the rubric of nonmaritime
workers' compensation law, and the actual wording of Flores's
contract. These factors lead us to conclude that Flores may recover
his average tip earnings as unearned wages.
A. THE INCLUSION OF TIPS IN THE MEASURE OF UNEARNED
WAGES UNDER ADMIRALTY LAW
1. The Purpose and Policy Underlying the Wages Remedy
Under general maritime law, Flores is entitled to bring an action for
"maintenance and cure," a remedy available to compensate
seamen who fall ill or become injured during their employment.
"The cause of action for maintenance and cure includes three
specific items of recovery: (1) maintenance, which is a living
allowance; (2) cure, which covers nursing and medical expenses[;]
and (3) wages." Herbert R. Baer, Admiralty Law of the Supreme
Court 6 (3d ed. 1979); see 1B Benedict on Admiralty § 43 (Aileen
Jenner ed., 7th ed. 1994); Grant Gilmore and Charles L. Black, Jr.,
The Law of Admiralty 309 (2d ed. 1975). Unearned wages are
measured from the time of the seaman's incapacity until the end of
his employment contract. See Archer v. Trans/American Serv., Ltd.,
834 F.2d 1570, 1575 (11th Cir.1988).
Although the recovery of unearned wages technically is a separate
element of recovery from those for maintenance expenses or cure
expenses, "it is settled law that wages is a basic component of an
award of maintenance and cure." Id. at 1574. For that reason, our
references to "maintenance and cure" are meant to include the
wages remedy. Maintenance and cure is a remedy with roots in the
medieval sea codes;
If it happens that sickness seizes on any one of the mariners, while
in the service of the ship, the master ought to set him ashore, to
provide lodging and candlelight for him, and also to spare him one
of the ship-boys, or hire a woman to attend him ... [.] [I]f he recover,
he ought to have his full wages, deducting only such charges as the
master has been at for him. And if he dies; his wife or next kin shall
have it.
1B Benedict on Admiralty § 41. Other ancient sea codes contain
similar provisions. See id. it is a remedy designed to protect
seamen from the perils of living and working at sea. To recover in a
maintenance and cure action, the seaman need not suffer from
illness or injury that is causally related to his duties, Calmar S.S.
Corp. v. Taylor, 58 S.Ct. 651, 653, 82 L.Ed. 993 (1938), as long as
the seaman's incapacitation did not result from his own wilful
misconduct. Garay v. Carnival Cruise Line, Inc., 904 F.2d 1527,
1530 (11th Cir.1990), cert. denied, 112 L.Ed.2d 1178 (1991).
The seaman's right to maintenance and cure was firmly endorsed
in Harden v. Gordon, a famous circuit opinion by Justice Story:
Seamen are by the peculiarity of their lives liable to sudden
sickness from change of climate, exposure to perils, and
exhausting labour. They are generally poor and friendless, and
acquire habits of gross indulgence, carelessness, and
improvidence. If some provision be not made for them in sickness
at the expense of the ship, they must often in foreign ports suffer the
accumulated evils of disease, and poverty, and sometimes perish
from the want of suitable nourishment. Their common earnings in
many instances are wholly inadequate to provide for the expenses
of sickness....
11 F.Cas. 480, 483 (C.C.D.Me.1823) (No. 6,047). The Supreme
Court has noted that "[i]t has been the merit of the seaman's right to
maintenance and cure that it is so inclusive as to be relatively
simple, and can be understood and administered without technical
considerations." Farrell v. United States, 69 S.Ct. 707, 709-10, 93 L.
Ed. 850 (1949).
The traditional breadth of the remedy, as well as its nature and
purpose, supports Flores's contention that the measure of his
unearned wages should include the tips he would have earned had
he not become disabled. The Supreme Court has repeatedly
declared that "the shipowner's liability for maintenance and cure
was among "the most pervasive' of all and that it was not to be
defeated by restrictive distinctions nor "narrowly confined.' "
Vaughan v. Atkinson, 82 S.Ct. 997, 1000, 8 L.Ed.2d 88 (1962)
(quoting Aguilar v. Standard Oil Co., 735, 63 S.Ct. 930, 933, 936, 87
L.Ed. 1107 (1943)). Moreover, "[w]hen there are ambiguities or
doubts, they are resolved in favor of the seaman." Vaughan, 82 S.Ct.
at 1000. The purposes of the maintenance and cure remedy include
protecting "poor and friendless" seamen, encouraging shipowners
to guard the safety and health of working seamen, and inducing
seamen to accept duty at sea. Calmar, 58 S.Ct. at 653.
The remedy has served its purposes well over the centuries. Until
recently, no luxury cruise ships, no cabin stewards, and no system
of compensation through tips from passengers existed to
complicate the disabled seaman's simple right to recover wages. It
is altogether fitting, however, that an ancient remedy born of the
reality of the seaman's position should be applied to fit the reality of
our modern times. That reality is reflected in the contract between
Carnival and Flores, which acknowledges that the bulk of Flores's
compensation would come not from the mere pittance of $45
monthly that Carnival agreed to pay, but from the hundreds of
dollars in tips Flores would receive weekly from Carnival's
passengers, at Carnival's urging. The contract itself stated the
shipowner's own expectation that Flores's tips could be as much as
twenty times more than his paltry salary, which amounted to less
than two dollars a day. That is the reality of the situation.
2. The Analogy to Workers' Compensation Law
Although we can find no admiralty cases on point, we do draw
guidance from workers' compensation cases defining "average
weekly wage" to include not only base salary but also average tip
income. Employees in certain service professions have traditionally
relied upon tips for a significant portion of their income. Waiters and
waitresses, for example, might receive only the statutory minimum
wage from their employer yet earn most of their income from tips. An
overwhelming majority of the courts that have considered this
question have determined that that tip income is recoverable as part
of an individual's "average weekly wage" under workers'
compensation laws. A recent annotation of state court opinions
addressing the specific question of whether tips or gratuities should
be included in average weekly wages for purpose of workers'
compensation remedies notes:
Every court which has considered "tip" cases under statutes
defining average weekly wage as the weekly wage earned by an
employee at the time of his or her injury has determined that such
tips constitute earnings and are to be factored into the calculation of
compensation.
Jane Massey Draper, Annotation, Workers' Compensation: Tips or
Gratuities as Factor in Determining Amount of Compensation, 16 A.
L.R. 5th 191, 205 (1993).
Other cases allow the employee to recover tips, even if the statute
expressly prohibits inclusion of gratuities, by reasoning that tips are
distinguishable from gratuities. See, e.g., Petrafeck v. Industrial
Comm'n, 191 Colo. 566, 554 P.2d 1097 (1976) (en banc) (excluding
tips would defeat purpose of workers' compensation); Sturgill v. M &
M, Inc., 329 A.2d 360 (Del.1974) ("gratuity" in dictionary sense meant
something over and above amount earned, while waitress's "tip"
was bargained-for recompense and implicit consideration in
contract for hire); Hopkins v. Fred Harvey, Inc., 92 N.M. 132, 133, 584
P.2d 179, 180 (Ct.App.) ("When it is within the contemplation of the
parties that tips are to be retained by an employee as part of his
compensation, they are to be
regarded as wages for compensation purposes."), cert. denied, 92
N.M. 180, 585 P.2d 324 (1978). Still others include tips despite the
fact that the employee did not conform to a statutory reporting
requirement, because the employer knew that the employee was
receiving tips but had failed to establish a reasonable reporting
procedure. See, e.g., Hanks v. Tom Brantley's Tire Broker, 500 So.
2d 614 (Fla.Dist.Ct.App.1986); Nash v. Holiday Inn at Calder, 395 So.
2d 306 (Fla.Dist.Ct.App.1981).
Some cases even suggest that to prevent tip-earning employees
from including tips in their wages would violate the equal protection
clause of the United States Constitution. See, e.g., Petrafeck, 554 P.
2d at 1098 (finding equal protection violation in distinction between
employees earning tips as part of contract and hourly wage
earners); Senor T's Restaurant v. Industrial Comm'n of Arizona, 131
Ariz. 360, 364, 641 P.2d 848, 852 (1982) (en banc) (interpreting
statute to include tips in wages in order to avoid addressing
question of equal protection violation). The reasons given by an
Arizona state court apply equally to Flores's situation:
[T]he loss of income from tips is as real as the loss of income from
employer disbursements. The manifest injustice of compensating
for the losses stemming from one source but not from the other has
been a persuasive force in the development of [workers'
compensation] law.
Scott v. Industrial Comm'n, 122 Ariz. 169, 171, 593 P.2d 919, 921 (Ct.
App.1978). Just as it does not matter for maintenance and cure
purposes whether Carnival had any hand in causing Flores's
illness, so it should not matter whether Flores's income came
directly from Carnival or indirectly, in the form of tips given by
Carnival's passengers at Carnival's urging.
Carnival argues that the analogy to state workers' compensation
laws is not apt, because of the differences between that system of
compensation and the recovery rights of seamen. It notes that
maritime labor unions have jealously guarded their "basket of
remedies"-maintenance and cure actions, Jones Act negligence
claims, and general maritime law claims of unseaworthiness-
against legislative attempts to replace those remedies with a
maritime equivalent to state workers' compensation schemes.
Unlike seamen, who have remedies both for injuries completely
unrelated to their employment and for those arising from negligence
or other breaches of an employer's duties, employees under
workers' compensation laws generally trade their ability to claim
enhanced damages for the security of a no-fault liability system.
[Carnival Br. 23] Carnival contends that this Court therefore should
not "engraft" the definition of wages from state workers'
compensation schemes onto the maritime remedy of maintenance
and cure. [Id. 22]
We are not persuaded by Carnival's arguments. While different
remedies apply in the workers' compensation and admiralty areas,
the fact remains that the wage remedy in each seeks to
compensate the injured or disabled employee for compensation
lost because of absence from the job. Both measure the
compensation due in terms of the worker's or seaman's lost
"wages." The two situations are analogous to that extent, and we
find the reasoning of the workers' compensation cases persuasive.
“Wages" includes average tip income, at least where, as here, the
employer and employee anticipate that tips will be a substantial part
of the compensation received.
More of discussion to come
consists mainly of tips becomes ill or injured and is unable to work,
can he recover those tips under the remedy for wages that is
provided by admiralty law? We hold that the average tip income the
seaman was earning prior to his incapacitation is to be included in
the measure of wages he is due if he becomes unable to work.
I. FACTS AND PROCEDURAL HISTORY
Mario Flores is a seaman who signed two consecutive employment
contracts to work as a cabin steward on cruise ships owned by
Carnival Cruise Lines. Flores entered his first contract with Carnival
in September 1991 to work for one year on the MS Ecstasy. [Flores
Br. 3] The contract promised Flores a salary of $45 a month, to be
paid every two weeks, and further provided:
If you have been contracted as a ... CABIN STEWARD, in addition to
your monthly salary you may expect daily tips for your services to the
passengers.... [T]he tips you may expect go as high as $1000.00 a
month. Carnival will take it upon itself to inform passengers of what
is customarily tipped for the work that you perform.
[Flores Br. 3, Carnival Br.App. B] The underlined words and figures
were typed into blank spaces on the original printed form.
Flores claims that he worked on the Ecstasy until April 27, 1992,
earning tips of $800 a week. [Flores Br. 4] Then he fell ill and went
ashore for medical treatment. While ashore, Flores received bi-
monthly checks for "unearned wages" from Carnival in the amount
of $161.97. [Flores Br. 5] That amount was the same as Flores's
vacation pay would have been, and it was equal to the wages of the
lowest-paid non-gratuity-earning crew member. [Carnival Br.App. E]
Flores stayed ashore from April 27, 1992, until his first contract
expired at the end of September 1992. [Flores Br. 4] When his first
contract expired, Flores signed a second, six-month contract to work
on the MS Fantasy. [Id. at n. 2] The second contract contained exactly
the same payment terms as the first. [Carnival Br.App. B] Flores
claims that he worked on the Fantasy from September 28, 1992, to
October 19, 1992, earning tips of $600 a week. On October 19, the
ship doctor sent him ashore again, where Flores remained until the
expiration of his second contract. [Flores Br. 4]
Flores filed a class action suit under Fed.R.Civ.P. 23 against
Carnival Cruise Lines, seeking compensatory and punitive
damages on behalf of all tip-earning crew members of the Carnival
Cruise Lines fleet who became sick or were injured in the three
years preceding the filing of Flores's suit and who did not receive
"reasonably anticipated lost tips or in the alternative, monthly
guaranteed tips." [RE2:2-5] Carnival filed a motion to dismiss the
complaint, [Carnival Br. 4] maintaining that it had no legal duty to pay
Flores anything more than his $45-per-month salary as unearned
wages.
A magistrate judge first issued an order treating Carnival's motion to
dismiss as a motion for summary judgment, [Carnival Br.App. D]
and then issued a report and recommendation concluding that "tips
which are not guaranteed, ... and not specific ... would not be
appropriately includable as wages...." [RE5:3-4] However, finding
merit in Flores's contention that he had been guaranteed tips by
Carnival, the magistrate judge determined that a genuine issue of
material fact existed to preclude summary judgment. [RE5:4]
Carnival filed an objection to the magistrate judge's report and
recommendation. [R25:1]
"After a de novo determination, and considering the Report and
Recommendation, the written objections, and the record herein,"
[RE6:1] the district court entered an order granting summary
judgment for Carnival on both the compensatory and punitive
damages claims based upon its determinations that the written
contract did not guarantee "any particular amount of tips" to Flores
[RE6:6] and that any alleged oral promise of tips made at the time
Flores signed the contract was merged into the written agreement
and barred by the parol evidence rule. [RE6:5] Flores appeals the
summary judgment ruling.
II. DISCUSSION
We review de novo a district court's grant of summary judgment,
considering the evidence in the light most favorable to Flores. First
Union Discount Brokerage Serv. v. Milos, 997 F.2d 835, 841 (11th
Cir.1993). Because we have no precedent directly addressing the
issue of whether a sick or injured seaman whose income consisted
primarily of tips may recover lost tip income as part of the wages
remedy, we consider the purposes and policy underlying the
maritime remedy for wages, the decisions of courts that have
considered similar questions under the rubric of nonmaritime
workers' compensation law, and the actual wording of Flores's
contract. These factors lead us to conclude that Flores may recover
his average tip earnings as unearned wages.
A. THE INCLUSION OF TIPS IN THE MEASURE OF UNEARNED
WAGES UNDER ADMIRALTY LAW
1. The Purpose and Policy Underlying the Wages Remedy
Under general maritime law, Flores is entitled to bring an action for
"maintenance and cure," a remedy available to compensate
seamen who fall ill or become injured during their employment.
"The cause of action for maintenance and cure includes three
specific items of recovery: (1) maintenance, which is a living
allowance; (2) cure, which covers nursing and medical expenses[;]
and (3) wages." Herbert R. Baer, Admiralty Law of the Supreme
Court 6 (3d ed. 1979); see 1B Benedict on Admiralty § 43 (Aileen
Jenner ed., 7th ed. 1994); Grant Gilmore and Charles L. Black, Jr.,
The Law of Admiralty 309 (2d ed. 1975). Unearned wages are
measured from the time of the seaman's incapacity until the end of
his employment contract. See Archer v. Trans/American Serv., Ltd.,
834 F.2d 1570, 1575 (11th Cir.1988).
Although the recovery of unearned wages technically is a separate
element of recovery from those for maintenance expenses or cure
expenses, "it is settled law that wages is a basic component of an
award of maintenance and cure." Id. at 1574. For that reason, our
references to "maintenance and cure" are meant to include the
wages remedy. Maintenance and cure is a remedy with roots in the
medieval sea codes;
If it happens that sickness seizes on any one of the mariners, while
in the service of the ship, the master ought to set him ashore, to
provide lodging and candlelight for him, and also to spare him one
of the ship-boys, or hire a woman to attend him ... [.] [I]f he recover,
he ought to have his full wages, deducting only such charges as the
master has been at for him. And if he dies; his wife or next kin shall
have it.
1B Benedict on Admiralty § 41. Other ancient sea codes contain
similar provisions. See id. it is a remedy designed to protect
seamen from the perils of living and working at sea. To recover in a
maintenance and cure action, the seaman need not suffer from
illness or injury that is causally related to his duties, Calmar S.S.
Corp. v. Taylor, 58 S.Ct. 651, 653, 82 L.Ed. 993 (1938), as long as
the seaman's incapacitation did not result from his own wilful
misconduct. Garay v. Carnival Cruise Line, Inc., 904 F.2d 1527,
1530 (11th Cir.1990), cert. denied, 112 L.Ed.2d 1178 (1991).
The seaman's right to maintenance and cure was firmly endorsed
in Harden v. Gordon, a famous circuit opinion by Justice Story:
Seamen are by the peculiarity of their lives liable to sudden
sickness from change of climate, exposure to perils, and
exhausting labour. They are generally poor and friendless, and
acquire habits of gross indulgence, carelessness, and
improvidence. If some provision be not made for them in sickness
at the expense of the ship, they must often in foreign ports suffer the
accumulated evils of disease, and poverty, and sometimes perish
from the want of suitable nourishment. Their common earnings in
many instances are wholly inadequate to provide for the expenses
of sickness....
11 F.Cas. 480, 483 (C.C.D.Me.1823) (No. 6,047). The Supreme
Court has noted that "[i]t has been the merit of the seaman's right to
maintenance and cure that it is so inclusive as to be relatively
simple, and can be understood and administered without technical
considerations." Farrell v. United States, 69 S.Ct. 707, 709-10, 93 L.
Ed. 850 (1949).
The traditional breadth of the remedy, as well as its nature and
purpose, supports Flores's contention that the measure of his
unearned wages should include the tips he would have earned had
he not become disabled. The Supreme Court has repeatedly
declared that "the shipowner's liability for maintenance and cure
was among "the most pervasive' of all and that it was not to be
defeated by restrictive distinctions nor "narrowly confined.' "
Vaughan v. Atkinson, 82 S.Ct. 997, 1000, 8 L.Ed.2d 88 (1962)
(quoting Aguilar v. Standard Oil Co., 735, 63 S.Ct. 930, 933, 936, 87
L.Ed. 1107 (1943)). Moreover, "[w]hen there are ambiguities or
doubts, they are resolved in favor of the seaman." Vaughan, 82 S.Ct.
at 1000. The purposes of the maintenance and cure remedy include
protecting "poor and friendless" seamen, encouraging shipowners
to guard the safety and health of working seamen, and inducing
seamen to accept duty at sea. Calmar, 58 S.Ct. at 653.
The remedy has served its purposes well over the centuries. Until
recently, no luxury cruise ships, no cabin stewards, and no system
of compensation through tips from passengers existed to
complicate the disabled seaman's simple right to recover wages. It
is altogether fitting, however, that an ancient remedy born of the
reality of the seaman's position should be applied to fit the reality of
our modern times. That reality is reflected in the contract between
Carnival and Flores, which acknowledges that the bulk of Flores's
compensation would come not from the mere pittance of $45
monthly that Carnival agreed to pay, but from the hundreds of
dollars in tips Flores would receive weekly from Carnival's
passengers, at Carnival's urging. The contract itself stated the
shipowner's own expectation that Flores's tips could be as much as
twenty times more than his paltry salary, which amounted to less
than two dollars a day. That is the reality of the situation.
2. The Analogy to Workers' Compensation Law
Although we can find no admiralty cases on point, we do draw
guidance from workers' compensation cases defining "average
weekly wage" to include not only base salary but also average tip
income. Employees in certain service professions have traditionally
relied upon tips for a significant portion of their income. Waiters and
waitresses, for example, might receive only the statutory minimum
wage from their employer yet earn most of their income from tips. An
overwhelming majority of the courts that have considered this
question have determined that that tip income is recoverable as part
of an individual's "average weekly wage" under workers'
compensation laws. A recent annotation of state court opinions
addressing the specific question of whether tips or gratuities should
be included in average weekly wages for purpose of workers'
compensation remedies notes:
Every court which has considered "tip" cases under statutes
defining average weekly wage as the weekly wage earned by an
employee at the time of his or her injury has determined that such
tips constitute earnings and are to be factored into the calculation of
compensation.
Jane Massey Draper, Annotation, Workers' Compensation: Tips or
Gratuities as Factor in Determining Amount of Compensation, 16 A.
L.R. 5th 191, 205 (1993).
Other cases allow the employee to recover tips, even if the statute
expressly prohibits inclusion of gratuities, by reasoning that tips are
distinguishable from gratuities. See, e.g., Petrafeck v. Industrial
Comm'n, 191 Colo. 566, 554 P.2d 1097 (1976) (en banc) (excluding
tips would defeat purpose of workers' compensation); Sturgill v. M &
M, Inc., 329 A.2d 360 (Del.1974) ("gratuity" in dictionary sense meant
something over and above amount earned, while waitress's "tip"
was bargained-for recompense and implicit consideration in
contract for hire); Hopkins v. Fred Harvey, Inc., 92 N.M. 132, 133, 584
P.2d 179, 180 (Ct.App.) ("When it is within the contemplation of the
parties that tips are to be retained by an employee as part of his
compensation, they are to be
regarded as wages for compensation purposes."), cert. denied, 92
N.M. 180, 585 P.2d 324 (1978). Still others include tips despite the
fact that the employee did not conform to a statutory reporting
requirement, because the employer knew that the employee was
receiving tips but had failed to establish a reasonable reporting
procedure. See, e.g., Hanks v. Tom Brantley's Tire Broker, 500 So.
2d 614 (Fla.Dist.Ct.App.1986); Nash v. Holiday Inn at Calder, 395 So.
2d 306 (Fla.Dist.Ct.App.1981).
Some cases even suggest that to prevent tip-earning employees
from including tips in their wages would violate the equal protection
clause of the United States Constitution. See, e.g., Petrafeck, 554 P.
2d at 1098 (finding equal protection violation in distinction between
employees earning tips as part of contract and hourly wage
earners); Senor T's Restaurant v. Industrial Comm'n of Arizona, 131
Ariz. 360, 364, 641 P.2d 848, 852 (1982) (en banc) (interpreting
statute to include tips in wages in order to avoid addressing
question of equal protection violation). The reasons given by an
Arizona state court apply equally to Flores's situation:
[T]he loss of income from tips is as real as the loss of income from
employer disbursements. The manifest injustice of compensating
for the losses stemming from one source but not from the other has
been a persuasive force in the development of [workers'
compensation] law.
Scott v. Industrial Comm'n, 122 Ariz. 169, 171, 593 P.2d 919, 921 (Ct.
App.1978). Just as it does not matter for maintenance and cure
purposes whether Carnival had any hand in causing Flores's
illness, so it should not matter whether Flores's income came
directly from Carnival or indirectly, in the form of tips given by
Carnival's passengers at Carnival's urging.
Carnival argues that the analogy to state workers' compensation
laws is not apt, because of the differences between that system of
compensation and the recovery rights of seamen. It notes that
maritime labor unions have jealously guarded their "basket of
remedies"-maintenance and cure actions, Jones Act negligence
claims, and general maritime law claims of unseaworthiness-
against legislative attempts to replace those remedies with a
maritime equivalent to state workers' compensation schemes.
Unlike seamen, who have remedies both for injuries completely
unrelated to their employment and for those arising from negligence
or other breaches of an employer's duties, employees under
workers' compensation laws generally trade their ability to claim
enhanced damages for the security of a no-fault liability system.
[Carnival Br. 23] Carnival contends that this Court therefore should
not "engraft" the definition of wages from state workers'
compensation schemes onto the maritime remedy of maintenance
and cure. [Id. 22]
We are not persuaded by Carnival's arguments. While different
remedies apply in the workers' compensation and admiralty areas,
the fact remains that the wage remedy in each seeks to
compensate the injured or disabled employee for compensation
lost because of absence from the job. Both measure the
compensation due in terms of the worker's or seaman's lost
"wages." The two situations are analogous to that extent, and we
find the reasoning of the workers' compensation cases persuasive.
“Wages" includes average tip income, at least where, as here, the
employer and employee anticipate that tips will be a substantial part
of the compensation received.
More of discussion to come
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| Carnival Cruise Line Wage Case |
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United States Court of Appeals,
Eleventh Circuit.
No. 93-5209.
Mario FLORES, Plaintiff-Appellant,
v.
CARNIVAL CRUISE LINES,
Defendant-Appellee.
March 21, 1995.
Appeal from the United States District
Court for the Southern District of
Florida. (No. 92-2766-CIV-KMM), K.
Michael Moore, Judge.
Before KRAVITCH and CARNES, Circuit
Judges, and HILL, Senior Circuit Judge.
CARNES, Circuit Judge:
Eleventh Circuit.
No. 93-5209.
Mario FLORES, Plaintiff-Appellant,
v.
CARNIVAL CRUISE LINES,
Defendant-Appellee.
March 21, 1995.
Appeal from the United States District
Court for the Southern District of
Florida. (No. 92-2766-CIV-KMM), K.
Michael Moore, Judge.
Before KRAVITCH and CARNES, Circuit
Judges, and HILL, Senior Circuit Judge.
CARNES, Circuit Judge:
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