                             No.    94-229
           IN THE SUPREME COURT OF THE STATE OF MONTANA
                                   1995



MICHAEL A. TEFFT, EDWARD C. PETERS,
JOSEPH E. GASPAR, NANCI ELLEN GREEN,
RANDY J. ARCHERY, JOSEPH M. McKAMEY,
GEORGE L. DOMME, MICHAEL D. CROSS,
MICHAEL E. HEISLER, and JACK C. STIMAC,

          Plaintiffs and Respondents,

     v.
THE STATE OF MONTANA,
          Defendant and Appellant.




APPEAL FROM:   District Court of the Eighth Judicial District,
               In and for the County of Cascade,
               The Honorable Thomas McKittrick, Judge presiding.



COUNSEL OF RECORD:
          For Appellant:
               W. D. Hutchinson, Assistant Attorney General,
               Agency Legal Services Bureau, Helena, Montana
          For Respondents:
               Lawrence A. Anderson, Attorney at Law,
               Great Falls, Montana


                             Submitted on Briefs:       January 19, 1995
                                             Decided:   May 4, 1995
Filed:
Justice Terry N. Trieweiler delivered the opinion of the Court.

      The plaintiffs, who are firefighters employed by the Montana

Air   National     Guard   in Great    Falls,      filed      this    action       in   the

District Court for the Eighth Judicial District in Cascade County

to recover wages due from the defendant,                 State of Montana,              and

liquidated       damages   for   violation    of     the      Federal       Fair    Labor

Standards Act       (FLSA).      The District      Court granted plaintiffs'

motion     for   partial   summary    judgment     and       held    that    the    State

violated the FLSA when it reduced plaintiffs' wages and that its

actions were not taken in good faith.              After a nonjury trial, the

District Court found the amount of wages and damages due,                               and

entered judgment in favor of plaintiffs for that amount.                     The State

appeals from the District Court's order granting summary judgment

and the amount of damages awarded.            We affirm the judgment of the

District Court.

      We restate the issues on appeal as follows:

      1.     Did the District Court err when it granted plaintiffs'

motion for summary judgment?

      2.     Did the District        Court   abuse    its discretion when               it
awarded liquidated damages under 29 U.S.C.               §   216(b)     (1988) of the
Fair Labor Standards Act?
      3.     Were the District Court's findings regarding the amount

of plaintiffs' damages clearly erroneous?




                                        2
                             FACTUAL BACKGROUND

     Plaintiffs      are    firefighters     who        provide    protection     for

civilian aircraft and a unit of the Montana Air National Guard at

the Great Falls International Airport.              Prior to 1975, they were

employed by the federal government.               In 1975,        when the federal

firefighting jobs were discontinued, plaintiffs were employed by

the Montana Department of Military Affairs.                  However,      through a

cooperative arrangement, the federal government still paid for most

of the costs associated with their jobs.

     After    the   State   established     the    fire     crew    jobs   in   1975,

plaintiffs'    salaries     were   based    on    the    State's    statutory     pay

matrix.       Section   2-18-312,    MCA.         The     State    initially    paid

plaintiffs biweekly for 80 hours of work during each two week

period.   However, plaintiffs' actual schedules had them working 24

hour shifts, followed by 48 hours off duty.               Therefore, they worked

substantially more hours during each two week period than the 80

hours for which they were paid.            They actually worked between 96

and 120 hours during a two week period, and 2912 hours per year,

but were paid on the basis of a 2080 hour year.                   The State failed
to pay them for the actual time worked, or to keep accurate records
of their time at work.
     In 1982,    the State began to reflect actual hours worked on

plaintiffs'    time cards,    but plaintiffs were still paid for only

80 hours of work biweekly.          During a brief period from 1985 to

1986, the State began to pay plaintiffs for the actual hours they


                                       3
             ,   ,




worked.              However, to avoid overtime requirements, the State added

an additional day off, or "Kelly day," for each pay period.                                   One

count of plaintiffs' complaint, the "straight time" claim, was a

claim for wages for those hours worked, but for which they were not

paid, between 1979 and 1985.                         In separate litigation, plaintiffs

settled claims for overtime compensation during this period.

        In 1985,          the United States Supreme Court reversed previous

case law which excluded state jobs from coverage under the federal

Fair Labor Standards Act.                     See Garcia v. Metropolitan Transit Authority (1985),

469 U.S. 528, 105 S. Ct. 1005, 83 L. Ed. 2d 1016.                                As a result,

FLSA provisions became binding on state and local governments.

       The FLSA provides that a                       firefighter must be paid at             the

overtime rate if the firefighter's tour of duty exceeds 212 hours

in 28 days.              29 U.S.C.     §    207     (1988); 29 C.F.R.      §   553.201 (1993).

Plaintiffs'             hours    consistently exceeded              this   number,    with    the

exception of the period from September 1985 to July 1986.

       Following Garcia, Congress passed two amendments to the FLSA.

The first amendment eased the financial burden on state and local

governments by exempting them from liability for FLSA violations

that occurred before April 15, 1986.                         Pub. L. No. 99-150, 99 Stat.

787,   §     2(c)       (29 U.S.C.     §    216 note (1988)        (Effect of Amendments by

Public       Law        99-150    on       Public    Agency    Liability       Respecting     any

Employee Covered Under Special Enforcement Policy)); see Hill v. City of

Greenville       (N.D.    Tex.   1988),       696     F.   Supp.   1123,   1126.      A second

amendment enacted an anti-discrimination provision to deter state

                                                      4
             ·   ,




and local governments from decreasing employees' wages to offset

the     increased overtime                     compensation requirement.                   Pub.    L.    No.

99-150,      §        8, 99 Stat. 791 (29 U.S.C.                   §   215 note (1988)        (Liability

of Public Agency for Discrimination Against Employee for Assertion

of Coverage)).

        In           response         to   Garcia,   the Department            of    Military Affairs

proposed changes in the manner in which firefighters were paid.

However,              the    proposal         was     rejected         by    the    State's      Personnel

Division on the basis that it deviated from the State pay matrix.

The Department, therefore, requested an exclusion from the State's

pay plan under                    §    2-18-103 (6),       MCA,     which excludes officers or

members              of    the    militia.           The    State      granted       the   exclusion      by

July 1986.                Plaintiffs were required to be members of the National

Guard     and             became       part    of    a     new    class      known    as   the    Militia

Protective Services, an exempt classification.                                       We recently held

that      the              requirement          of       National           Guard     membership         was

unconstitutional because the State could not establish a rational

basis for it.                McKameyv.State (Mont. 1994), 885 P.2d 515,51 St. Rep.

1218.
        Following this reclassification, the State reduced plaintiffs'
hourly wages.                    The Kelly day was eliminated and plaintiffs were
paid biweekly based on a reduced hourly wage multiplied by the

number       of           hours       actually \iOrked.            The      new hourly wages            were

effectively determined by dividing each plaintiff's set annual

salary by 2912 hours instead of 2080 hours.


                                                           5
     ·   .




             Plaintiffs filed a complaint, and later an amended complaint,

that demanded lost compensation for (1) unpaid "straight time," and

(2) discrimination in violation of the FLSA based on the State·s

reclassification.             Plaintiffs       contended      they were     entitled     to

unpaid wages and were entitled to liquidated damages pursuant to

the FLSA, based on the State·s reduction of their wages in response

to       the Garcia decision.          The plaintiffs moved for and received

summary judgment on the FLSA claim.                    In its order,        the District

Court held that the State had failed to raise a                            factual    issue

regarding its violation of the Act, or whether it acted in good

faith when it reduced plaintiffs· wages.                      Accordingly, the court

held that plaintiffs were entitled to liquidated damages.

             The District Court ordered a hearing on the remaining issues,

including the amount of damages,                   and the State was allowed to

submit additional proof of good faith and reasonable grounds for

its      actions.        Both parties offered expert             testimony regarding

damage            calculations.       The     State    failed    to   offer     evidence

satisfactory to the District Court that it had acted in good faith
when         it    reduced plaintiffs·       wages.     The     District    Court     found
plaintiffs· damage calculations more reliable than the State·s, and
adopted plaintiffs·               damage    figures.    On January 31,        1994,     the
District Court entered judgment against the State for $485,434.60.

                                            ISSUE 1

             Did the District Court err when it granted plaintiffs· motion

for summary judgment?


                                               6
   ,   .




           The nature of our inquiry when we review a district court's

summary judgment decision is identical to the trial court's.                            Cooper

v. Sisters of Charity (1994), 265 Mont. 205, 207, 875 P.2d 352, 353 (citing

Minniev. City of Roundup (1993), 257 Mont. 429, 431, 849 P.2d 212, 214).

Summary judgment is proper only when no genuine issue of material

fact       exists and the moving party is entitled to judgment as a

matter of law.             Rule 56 (c),   M.R.Civ.P.    i   Spain-Morrow Ranch, Inc. v. West

(1994), 264 Mont. 441, 444, 872 P.2d 330, 331-32.

           In 1985, the United States Supreme Court decided Garcia, which

applied the minimum-wage and overtime provisions of the FLSA to

state employees.            In order to minimize financial impact on state

and local governments,            Congress enacted amendments to the FLSA.

Hil(   696 F. Supp. at 1125.          Congress also enacted what is referred

to as      §   8 to prohibit governmental discrimination against employees

who    are      entitled    to   financial       benefits   as   a       result   of   Garcia.

29 U.S.C.        §   215 note (1988), Pub. L. No. 99-150,            §    8, 99 Stat. 791.

Section 8 provided:

                  A public agency which is a State, political
           subdivision of a State, or an interstate governmental
           agency and which discriminates or has discriminated
           against an employee with respect to the employee's wages
           or other terms or conditions of employment because on or
           after February 19, 1985, the employee asserted coverage
           under section 7 of the Fair Labor Standards Act of 1938
           [29 U.S.C. § 207] shall be held to have violated section
           15 (a) (3) of such Act [29 U.S.C. § 215 (a) (3)] .   The
           protection against discrimination afforded by the
           preceding sentence shall be available after August I,
           1986, only for an employee who takes an action described
           in section 15(a) (3) of such Act.


                                             7
               ·   ,




Section 7 sets forth the number of hours after which firefighters

must be paid overtime.                       29 U.S.C.        §   207 (1988).            Section 215 (a) (3)

makes      it           unlawful      for     any       person     to       discriminate         against   an

employee because the employee has filed a complaint or instituted

a proceeding under the FLSA.                             29 U.S.C.          §    215(a) (3)    (1988).

          The District Court's order correctly noted that the State

conceded,               in its brief in opposition to plaintiffs'                                motion for

summary            judgment,         that     it       reduced plaintiffs'                hourly wages     in

response to Garcia and to avoid increasing annual pay.                                          Other courts

have concluded that discrimination in violation of the FLSA occurs

under these circumstances.                         See Drollingerv. Stateo/Arizona (9th Cir. 1992),

962 F.2d 956; Blantonv. Cityo/Murfreesboro (6th Cir. 1988), 856 F.2d 731;

Hill,   696 F.               Supp.   1123.      In Drollinger,      the Ninth Circuit Court of

Appeals concluded that Arizona violated                                 §       8 as a matter of law when

it lowered hourly wage rates for firefighters as a response to

Garcia.        Drollinger, 962 F. 2 d at 957 - 5 9 .

        The State argues that the District Court erroneously decided

that the State's "reclassification" plan violated                                          §   8 of the FLSA

amendments,                  and 29 U.S.C.         §   215(a) (3).              First,    the State claims

that      it           did    not    discriminate         against           plaintiffs         because   they
asserted coverage under the FLSA.                             Instead, the State contends that

it lawfully responded to budgetary constraints.                                          The District Court

rejected the State's "economic necessity" defense.

        Other courts have rejected an "economic necessity" defense in

similar circumstances.                       See Blanton, 856 F.2d at 735; Hill, 696 F. Supp.

                                                          8
at 1126.   The court in Hill recognized that congressional amendments

were designed to delay the impact of the FLSA overtime provisions

to give state and local governments sufficient time to rearrange

their budgets in order to comply with the FLSA.           Hill, 696 F. Supp.

at 1126.   In Blanton,   the Eighth Circuit Court of Appeals rejected

an   economic   necessity    defense    where   a   city    decreased    its

firefighters' wages.

     Actions by public employers to reduce employee pay and
     benefits, taken as the sole and direct result of fiscal
     pressures created by the mandated extension of Fair Labor
     Standard Act benefits, run afoul of the strictures of
     section 8.

Blanton, 856 F.2d at 735.    In order to justify a reduction based on

economic necessity, an employer must prove that wages were reduced

from fiscal concern which was not attributable to the extra cost of

complying with the FLSA.      Blanton, 856 F.2d at 735.

     We too reject the State's assertion of an economic necessity

defense.   The State argues that the federal government provided

funding for plaintiffs' salaries, and after Garcia the State did not

receive additional funding.      However, the District Court stated,

and we agree, that the State failed to establish that it could not

augment federal funds with state funds, or implement a different

plan, without violating the FLSA.

     The State also argues that plaintiffs did not assert FLSA

violations until 1988, and therefore, that the State could not have

reclassified plaintiffs in response to their assertion of coverage



                                    9
under    the    Act       in violation         of    §§     8   and   215 (a) (3)   .1   Section

215(a)   (3)   makes it unlawful for the State to discriminate against

an   employee       because        the       employee       has   filed     a   complaint    or

instituted or caused to be instituted any proceeding under the

FLSA.     29 U. S . C .    §   215 (a) (3)    ( 1988)   .

        In Drollinger, the Ninth Circuit rej ected an argument similar to

the State's when it held that:

         [T] he FLSA prohibits not only FLSA violations in response
        to employee assertions of coverage, but also FLSA
        violations in anticipation of assertions of coverage: any
        other interpretation would nullify the Act's protections.
        Section 8 would be meaningless if an employer were
        permitted to reduce hourly wages in response to Garcia and
        thereby avoid the FLSA's pay-and-a-half provisions as
        long as he did so before his employees learned of their
        statutory entitlements and had a chance to request that
        they be afforded the benefits due them.

Drollinger, 962 F. 2 d at 958, n . 2 .

        Likewise,     the Eighth Circuit in Blanton resolved this                         issue

against a city which asserted a similar argument.                           That court cited

legislative history for the proposition that employers' actions to

decrease wages            that are       intended to avoid the              FLSA constitute

discrimination under § 8, whether or not they are in response to




      1 While this contention may be technically correct, it is not
correct as a practical matter. It is true that on March 21, 1988,
the District Court first granted plaintiffs' motion to amend their
complaint    in  Stimac v. State of Montana, Cascade County   Cause
No. BDV-84-1570, regarding overtime and allege a claim based on the
FLSA.   However, the motion to allow that amendment was filed on
June 6, 1986.   The reduction in wages was authorized on June 19,
1986, and was actually implemented during July 1986.

                                                10
employee assertions of coverage.                      Blanton,   8 5 6 F. 2 d at 73 6 .        The

Eighth Circuit added that:

        [I]t is not necessary to prove the employer intended to
        retaliate to prove a violation of section 8 if an
        employer, such as the City of Murfreesboro, reduced its
        employees' rates of pay so as to nullify the effect of
        extending the Act's coverage.

Blanton, 856 F. 2d at 736.             Finally, in Hill, the court recognized that

an assertion of coverage need only be some act that would give the

employer notice that employees are covered by the FLSA.                            That court

added that where the employer already had notice that employees

were covered by the FLSA, it would be superfluous to require the

employees to affirmatively notify their employer that they are

covered by the FLSA.              Hill,    696 F. Supp. at 1125.

        The State has conceded that it had actual notice that the FLSA

covered plaintiffs as early as July 1985.                        Therefore, as the court

stated     in Hill,    further         notice    in   the   form    of     a    claim by      its

employees was unnecessary.

        Finally, the State asserts that the plaintiffs "ratified" the

wage cuts when they signed agreements that reduced their hourly

wage.      However,      the United States Supreme Court has held that

employees' rights under the FLSA cannot be abridged by contract or

otherwise because it would defeat the purpose of the FLSA.                               Barrentine

v. Arkansas-Best Freight System    (1981),      450 u.S.     728,    739-40,      101 S. Ct.

1437, 1444-45, 67 L. Ed. 2d 641, 652-53.

        For   these     reasons,          we   conclude     that     the       uncontroverted

evidence      established          a      violation    of   the     federal       Fair     Labor

                                                11
Standards Act by the State of Montana, and that the District Court

did not err when it granted plaintiffs I motion for summary judgment

on that issue.

                                      ISSUE 2

     Did the District Court abuse its discretion when it awarded

liquidated damages under 29 U.S.C.              §   216 (b)   (1988)   of the Fair

Labor Standards Act?

     What constitutes good faith and reasonable grounds, as those

notions relate to the issue of liquidated damages, involves mixed

questions of law and fact.          To the extent that legal principles are

involved, the standard of review is de novo, but to the extent that

factual issues are involved, we will reverse the district court

only for clear error.         Brattv. County of Los Angeles (9th Cir. 1990), 912

F.2d 1066, 1071,     cert~nkd   (1991), 498 U.S. 1086.          The State argues

that the District Court erred when it awarded liquidated damages

and decided that the State did not prove it acted in good faith or

on reasonable grounds.        We note that despite its summary judgment

decision,   which awarded liquidated damages,                 the District   Court

allowed the State to submit evidence of good faith and reasonable

grounds at the hearing, but found that it either had not done so,

or that its evidence was insufficient.

     As set forth above,        §   8 violations are deemed violations of

29 U.S.C.   §   215(a) (3).   The damage provision for these violations

provides in relevant part:



                                        12
       Any employer who violates the provisions of section
       15(a) (3) of this Act shall be liable for such legal or
       equitable relief as may be appropriate to effectuate the
       purposes   of   section  15 (a) (3) , including  without
       limitation employment, reinstatement, promotion, and the
       payment of wages lost and an additional equal amount as
       liquidated damages.

29 U.S.C.     §   216 (b)    (1988)         However, 29 U.S.C.             §   260 states that in

claims to recover damages under the FLSA:

        [I]f the employer shows to the satisfaction of the court
       that the act or omission giving rise to such action was
       in good faith and that he had reasonable grounds for
       believing that his act or omission was not a violation of
       the Fair Labor Standards Act . . . the court may, in its
       sound discretion, award no liquidated damages .

See also Bratt,    912    F. 2 d    at   1 0 71 .        The State acknowledges               that    an

employer has the burden of proving that its violation of the FLSA

was in good faith and that the employer had reasonable grounds to

believe it did not violate the FLSA.                            See   E.E.o.c.   v. First Citizens Bank of

Billings (9th Cir. 1985), 758 F.2d 397, 403, cert. denied (1985), 474 U.S.

902.

       Courts have utilized different standards to determine what

constitutes good faith and reasonable grounds.                                 Compare Kinney v. District

of Columbia   (D.C.      Cir.      1993),    994 F.2d 6,         12, and Bratt,         912 F.2d at

1072, with Walton, 786 F.2d at 312.                      As discussed below, we conclude

that    the       Fifth     Circuit's         test        to   determine         good     faith      and

reasonable grounds based on an objective standard is more reliable.

       Judge Easterbrook, writing for the court in Walton, stated that

the correct standard is the one provided by the statute:



                                                    13
        [W]hether the employer's conduct--objectively viewed
       through the lens of the "reasonable man" famous in tort
       law--acted "in good faith and           had reasonable
       grounds for believing that his act or omission was not a
       violation" of the FLSA.

Walton,    78 6    P . 2d    at     3 12 .     The    Walton    court    concluded       that    the

objective standard was especially appropriate in claims against

corporate or governmental employers which do not have an actual

mental state.             Walton,     78 6 F. 2 d at 3 12 .          That court added that a

decision made aboveboard and justified in public is more likely to

satisfy the test.                 Walton,     78 6 F. 2 d at 3 12 .      Double damages are

meant to be the norm and not the exception.                               Walton,     786 F. 2d at

310.      In addition, double damages are partly designed to compensate

for concealed violations.                     Utilizing these damages when concealed

violations are detected presents employers with the full costs of

their actions, a goal stressed in the legislative history of the

double damage provision.                     Walton, 786 F. 2d at 312.

       We have already concluded that overwhelming evidence supported

"the conclusion that the [State's military service] requirement's

sole purpose         [was]     to circumvent the wage and overtime standards

set forth in the Fair Labor Standards Act                                       "     McKamey,   885

P.2d at 522.

       In its summary judgment order, the court mentioned that the

State's decision to reduce plaintiffs' wages and eliminate them

from the State's pay plan was not made aboveboard nor justified to

the    pUblic.         The     court         added    that     the    militia       exception    was

frivolous         and a     subterfuge designed to avoid legal obligations

                                                     14
           ·.

imposed by the FLSA.          Other factors the court found persuasive are:

the    State    was   aware    of   Garcia's    ramifications,      other    available

alternatives were not pursued,                 the State unilaterally declared

plaintiffs exempt from the State pay plan, and the State did not

inform plaintiffs of its decision to do so.                     The record supports

the District Court's findings.

       Based on our decision in AfcKamey, and evidence cited by the

District Court, we conclude that the District Court was not clearly

erroneous,      did not abuse its discretion,                 and did not err as a

matter of law when it found and concluded that plaintiffs were

entitled to liquidated damages under                 §   216, and that the State did

not objectively demonstrate good faith or reasonable grounds under

§   260.

                                         ISSUE 3

       Were the District Court's findings regarding the amount of

plaintiffs' damages clearly erroneous?

       "A district court's damage determination is a factual finding

which must be upheld if it is supported by substantial evidence; we
will not overturn a district court unless its determination was

clearly erroneous."       Semenzav.Bowman (Mont. 1994), 885 P.2d 451, 455,

51 St. Rep.     1209, 1212      (citing Columbia Grain Int'I v. Cereck (1993),      258

Mont. 414, 417, 852 P.2d 676, 678).                  We rely on a three-part test

to determine if a finding is clearly erroneous.                    First, we review

the record to ensure the findings are supported by substantial

evidence.       Second,   if     there    is    an       evidentiary basis    for   the

                                           15
finding, we consider whether the district court misapprehended the

effect of the evidence.             Third,    if the other two criteria are

satisfied,      we   may   still   determine    that   a     finding      is   clearly

erroneous when a review of the record leaves the Court with a firm

conviction that a mistake has been made.                   Interstate Prod Credit Ass'n v.

DeSaye (1991), 250 Mont. 320, 323, 820 P.2d 1285, 1287.

      The District Court's findings were based on conflicting expert

testimony.      The trial judge has the duty to resolve conflicts in

evidence and this Court gives due regard to the trial                          judge's

superior opportunity to judge the credibility of witnesses.                      Williams

v. DeVinney (1993), 259 Mont. 354, 359, 856 P.2d 546, 549.                 A district

court is "not bound by the opinion of a particular party or expert

but   remains    free      to   adopt   any   reasonable      valuation        that    is

supported by the record."           Goodoverv.Lindey's (1992), 255 Mont. 430,

440, 843 P.2d 765, 771 (citing In reMarriage oJ Dzivi (1991), 247 Mont.

165, 167, 805 P.2d 567, 568).

      In its brief,        the State concedes that substantial evidence

supports   the District Court's           "straight    time"     wage     award,      but
argues that a review of the record leads to a conclusion that the
District Court misapprehended the evidence and made a mistake.
Specifically, the State attacks the adequacy of the foundation for

the   testimony of      the plaintiffs'       damage   expert.         However,       the

foundation was made difficult by the State's failure to maintain

accurate records of the hours worked by the plaintiffs.



                                         16
        The District Court recognized that the State breached its duty

to properly account for the hours plaintiffs actually worked, and

therefore,      that plaintiffs were entitled to substantiate their

claim without precise time records.                    See Wage Claim of Holbeck v. Stevi-West,

Inc.   (1989), 240 Mont. 121, 125-26, 783 P.2d 391, 394 (citing Garsjo

v. Department of Labor and Industry ( 1977), 172 Mont. 182 , 188 - 89, 562 P. 2 d

473, 476).

        Gar~o   relied on language from a United States Supreme Court

case    discussing       the   difficulty        an    employee     confronts       when    an

employer keeps insufficient records.                   Garsjo, 562 P.2d at 476 (citing

Anderson v. Mt. Clemens Pottery Co. ,   (1946),       328 U. S . 680,     687,   66 S. Ct.

1187, 1192, 90 L. Ed. 1515, 1523.                 In    Ande~on,   328 U.S. at 687-88,

the United States Supreme Court reasoned:

        [W]here the employer's records are inaccurate or
       inadequate and the employee cannot offer convincing
       substitutes, a more difficult problem arises.         The
       solution, however, is not to penalize the employee by
       denying him any recovery on the ground that he is unable
       to prove the precise extent of uncompensated work. Such
       a result would place a premium on an employer's failure
       to keep proper records in conformity with his statutory
       duty; it would allow the employer to keep the benefits of
       an employee's labors without paying due compensation as
       contemplated by the Fair Labor Standards Act. In such a
       situation we hold that an employee has carried out his
       burden if he proves that he has in fact performed work
       for which he was improperly compensated and if he
       produces sufficient evidence to show the amount and
       extent of that work as a matter of just and reasonable
       inference.   The burden then shifts to the employer to
       come forward with evidence of the precise amount of work
       performed or with evidence to negative the reasonableness
       of the inference to be drawn from the employee's
       evidence.    If the employer fails to produce such


                                            17
        evidence, the court may then award damages to the
        employee, even though the result be only approximate.

In Garsjo, we also quoted similar reasoning from the Michigan Supreme

Court, which held that:

        "When the employee shows, as he did here, 'that he did in
        fact perform overtime work for which he was not properly
        compensated and produces sufficient evidence to show the
        extent and amount of such work as a matter of just and
        reasonable inference, the burden shifts to the employer
        to come forward with evidence of the precise amount of
        the work performed or with evidence to negate the
        reasonableness of the inference to be drawn from the
        evidence of the employee. And if the employer fails to
        produce such evidence, it is the duty of the court to
        enter judgment for the employee, even though the amount
        be only a reasonable approximation. '"

Garsjo, 562 P.2d at 476-77 (quoting Purcellv.Keegan (Mich. 1960), 103

N.W.2d 494, 497).

        Each party used a different approach to determine the unpaid

"straight time" claim based on the available data.             Plaintiffs'

expert assumed that each plaintiff worked a standard schedule of

2912 hours per year and used this figure as a ceiling to compute

unpaid "straight time" for each year.           He used the total hours

worked, minus total overtime paid from settlement of the previous

suit,    minus   "straight   time"   hours   paid,   to   determine   unpaid

"straight time"     hours.    Plaintiffs'    expert then multiplied the

unpaid "straight time" with the hourly pay rate for the year in

question to determine the amount of damages.

        The State's expert challenged the use of a 2912 hour average

ceiling and noted that in later years when more accurate time cards

were used,    records indicated some plaintiffs took leave without


                                     18
pay.    As a result, the total for each plaintiff may not have been

exactly 2912 hours.

       The trial court criticized this approach, stating that if the

State was going to use this approach it should have used the most

reliable records, which were after 1986.          However,      the State did

not explain its failure to use these records.           The records used by

the State showed that plaintiffs averaged approximately 2700 hours

per year.     However, after 1986, records reflected that plaintiffs

averaged    approximately    2900   hours   per year.     The    court   found

plaintiffs'    formula    "reasonable     in light of   the   lack of    other

records to come to more accurate figures."

       The other damage issue involves the FLSA claim.              As noted

above, in 1986 the State recomputed each plaintiff's hourly wage by

dividing his or her annual salary by 2912,              instead of 2080 as

required by statute.       Sections 2-18-306, -312, MCA.        The District

Court's Conclusion of Law No.7 noted that the State's method was

illegal.

       Plaintiffs' expert compared 2080 hours to 2912 hours to arrive

at a factor of     .714, which he then used to arrive at the total
amount by which plaintiffs were underpaid.         The State argues that

plaintiffs' expert should have audited actual records, instead of

using the formula.       Plaintiffs respond that this could not be done

because of inaccurate record keeping by the State.

       The State's expert testified that he based his calculations on

an audit of payroll records.         However,   the District Court noted


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numerous errors in his method, several of which the State's expert

admitted during cross-examination.

      Plaintiffs   introduced evidence that       they worked hours    for

which they were not properly compensated.             Plaintiffs produced

sufficient evidence of the amount of uncompensated work, based on

reasonable    inferences,   to    entitle   them to   damages   based on   a

reasonable approximation.        The District Court found that the State

failed to produce sufficient evidence of the precise amount of work

performed, or to negate the inference produced by the plaintiffs.

The District Court is in a better position than this Court to

reconcile contradictory expert testimony.         Based on our review of

the record, we are not convinced the District Court misapprehended

the   evidence,   nor   are we   convinced the   District   Court   made   a

mistake.     Therefore, we conclude that the District Court's damage

calculations were not clearly erroneous.

      The judgment of the District Court is affirmed.




We concur:




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