In an effort by airlines to increase revenue, they began charging customers fees for checking their baggage in curbside. These fees have led to a decrease in the tips that “skycaps” used to receive from airline passengers checking in their bags curbside. In DiFiore v. American Airlines Inc., 454 Mass. 486 (2009), a group of “skycaps” who worked for American Airlines and a group who worked for an agency hired by American Airlines to perform curbside check in at Logan Airport filed suit as a violation of the Massachusetts Wage & Hour act, M. G. L. c. 149 § 152, alleging that the instituted fees which were collected by American Airlines and G2 belonged to them.

American Airlines argued that since they were not the “employer” of the “skycaps” hired by G2 they did not owe fees to those “skycaps.” This was because in the Massachusetts Wage & Hour act the term “employer” is used indicating that service fees charged by someone other than the employer did not have to be given to the employees performing the service. This led the Supreme Judicial Court to determine what is meant by a “service charge” in the text of the statute. In August 2009, the SJC determined that while the statute does include the term “employer” that the legislature did not intend to allow employers, such as American Airlines, to contract with an outside agency and gain the power to keep service fees earned by service employees. Rather, the SJC found that the purpose of the statute is to ensure that service employees were given the service fees charged for their services and allowing a company to hire an outside agency to hire service employees would nullify the central purpose of the protection given to service employees in the first place.

Subsequent to the SJC’s ruling both parties filed motions in U.S. District Court which they ruled on December 23, 2009. American Airlines filed a motion for relief from judgment arguing that Massachusetts Tips Law is preempted by the Airline Deregulation Act of 1978. The Court ruled that the motion for relief from judgment must be denied because the Airline Deregulation Act does not preempt Massachusetts Tip Law. The Plaintiff’s filed a motion to amend the judgment arguing that (1) they should receive treble damages under the amended M. G. L. c. 149 § 150 (2) that all of the collected fees were not included in the original judgment. The Court found that since the legislature did not expressly state that the amendment should be applied retroactively treble damages are discretionary and are not to be applied in this case. However, the Plaintiff’s were able to obtain additional feed collected between March 1, 2008 and April 7, 2008.