A view of the judge's chair in a court room. Picture taken February 3, 2012. Picture taken February 3, 2012. REUTERS/Chip East
Aug 25 (Reuters) - A U.S. appeals court on Thursday said participants in a court-ordered drug and alcohol rehabilitation program in Arkansas were not owed the minimum wage for performing work for local businesses and tossed out a $1.5 million award in their class action lawsuit.
A unanimous three-judge panel of the 8th U.S. Circuit Court of Appeals said people who took part in the residential program to avoid jail time were not the employees of DARP Inc, which operated the program, or Hendren Plastics Inc, where they worked for up to one year.
Hendren paid the participants' wages of $9 per hour directly to DARP, which used the money to operate the program. The 8th Circuit said the participants derived more of a benefit from the program than DARP or Hendren, and so were not employees under federal and Arkansas wage laws.
The ruling reversed an Arkansas federal judge who ruled in 2019 that the plaintiffs were DARP's employees because they received compensation in the form of housing, food and transportation, and that Hendren was their "joint employer" because it controlled their work at a plastics factory.
The judge had awarded the class, which includes about 180 people, more than $1.5 million in damages and legal fees.
Lawyers at Cross, Gunter, Witherspoon & Galchus who represent DARP and Hendren did not immediately respond to a request for...
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