FLSA rules vs. Contract

[Leonidas]

Maybe someone here is familiar with FLSA and can help me with this. It’s a pretty unique situation, so if none of this makes any sense to you, please just ignore it. I’m living it and I don’t quite understand it.

I’m still considered an active employee (final retirement is supposed to be Friday), but a catch has arisen. As a public agency employee, my overtime is governed by FLSA Section 7(o), but I’m also a member of a collective bargaining unit that has negotiated a contract that includes provisions about overtime payment, accumulation of compensatory overtime, and how and when accumulated overtime is paid upon retirement.

The FLSA says that public agency employees shall be compensated for the value of their accumulated compensatory overtime at the time of termination of employment. But my contract says that I can use any remaining unused leave (including accumulated compensatory overtime), after retirement, to fund five years of health and dental insurance premiums at the discounted active employee rate. I had planned to take advantage of that option, but while I’ve been off on a long vacation these many months, the city has been paying me by using every kind of leave except compensatory overtime. The Fiscal Affairs folks looked at my remaining leave and said I didn’t have enough time to pay for five years worth of premiums and denied my request. When I pointed out my 480 hours of comp time, they said FLSA requires them to pay me upon termination and it can’t be part of the five year delayed payments.

My union’s opinion is that they think I'm right, and they told me that the contract governs the payout (vs FLSA) and they are going to call the city’s attorneys tomorrow to see what they can work out. Apparently, I'm either the only person in this situation or the first one they've encountered. When I read the referenced section of the FLSA I see mention of collective bargaining as one of two options for how overtime for public agency employees is governed, but I’m not sure I see where it says that the contract's provision trump the “payout upon termination” clause.

Is there anybody out there who knows the FLSA that can provide me with some insight?

[bosco]

I don't know the FLSA that well, or at least that part of it.

I do know, however, that public agencies are not necessarily bound by it, and its provisions can be superseded by contract or agreement. The State of Alaska ignores whatever provisions of it they feel like, and only require private employees to follow it. If you are in a union, however, your ability to reach an individual agreement with your employer may be hampered as the union will worry about precedents for other members and likely has to be involved in any agreement.

[Brat]

Leonidas, the goal of that section of the statute is to assure that public employees who are permitted the comp-time option do not loose the value of that time upon termination. Because there is an agreement between the employer and the union permitting the use of the accrued time to pre-pay benefits the intent of The Act will be satisfied. The key element is that the employee has the option of taking it in cash.

I sent you a more formal discussion by PM.

For all you lurkers out there, the option for comp time for overtime is very limited. I have seen many an employer accrue significant liabilities as the result of comp time agreements. Be sure to seek the advise of an attorney with an employment law practice.

[Leonidas]

Quote:

Originally Posted by bosco I do know, however, that public agencies are not necessarily bound by it, and its provisions can be superseded by contract or agreement.

The specifics of that are what I'm trying to figure out, but thanks for your help. Regarding public agencies and the FSLA, the courts and DOL have made changes trying to bring us more closely under the law. One of the landmark cases actually involves police officers suing my city back in the 80's.

It's not quite catch 22, maybe 21 1/2, but because of that lawsuit we had to revamp our overtime policies. I helped write it back in 86-87, and we have one of the best (from employee viewpoint) in the nation. That liberal policy played a big role in helping me accumulate so much time. But another result was that the city got very sensitive to FSLA issues and they are very cautious in interpretation so they can avoid future lawsuits.

Quote:

Originally Posted by bosco If you are in a union, however, your ability to reach an individual agreement with your employer may be hampered as the union will worry about precedents for other members and likely has to be involved in any agreement.

You're right that they won't try to negotiate something seperate, but I'm only asking them to enforce the provisions of the contract. From conversation with HR this morning I confirmed that I am the first to bring up this issue, but when we discussed it this morning they couldn't find fault with my interpretation of the contract. The line of questioning/argument they followed was the same that the Union VP and attorney threw at me last night, and when I was done they were also agreeing with me.

The HR people had the same reaction as the Union "I wonder why we never saw this before?"

If the city says it is enforcing FLSA and that the law doesn't allow the right of compensation upon termination to be negotiated away, then I'm not sure if the Union will want to spend the money to go to arbitration for a point that only affects one guy. I told HR if it goes that way I'll just delay my retirement and go back on vacation until May or June when my time is completely exhausted.

[Brat]

I probably know the folks in DOL who handled that case.

I think this can be managed in a way to meet the requirements of the law and the desires of the employees. By PM I sent you the name of an attorney who is among the best in the business in this area. Set this process up right and you will leave a legacy for your peers.

[wabmester]

I'm sure the insurance you're fighting for is worth it, but have you already priced individual health insurance?

In my case, I was able to do much better than my COBRA offering. No idea how sweet your 5-year healthplan deal is, of course.

[donheff]

Leonides:

If push comes to shove the union would have to arbitrate to enforce a provision HR (and their lawyers) won't enforce. That may be unlikely. A better approach might be to get with the union and try to get HR/Payroll to settle the matter by restoring some of your conventional leave and covering the absence with comp time.

[Leonidas]

Thanks to all for the responses - especially to Brat - look for a PM that explains the details.

Okay, turns out that I am quite likely the only case they will ever have like this. Simply put, when the contract changed I didn't like some of the new provisions and I saw that if I stayed I would lose a lot of money - so, as Goonie said once, I jumped while still strapping on my parachute. The contract was ratified after I stopped working and began burning time.

During the implementation phase, the Union saw some of the complications in the new contract and made sure that everyone who left after me came by and got an in-depth explanation. Though not anticipating what would happen in my case, they did counsel everyone to do things differently because it made sense for other reasons. Nobody ever thought to call up the people who were already in the process.

Two years later I came along and pointed out the Emperor's lack of clothing.

From what Brat and her colleagues pointed out, from reading the contract, and from working with all the parties involved for years and years, I realized that whoever wrote some of the provisions of the new contract screwed it up. They complied with FSLA in the area where just about everyone except me will fall, and then set up the payroll system to agree with the assumption that everyone was going to do the same thing. They focused so much on that one area that they never paid attention to something I saw and relied upon. In effect, they put themselves in violation of the FSLA if they were to actually enforce the contract as it is written and applies to me.

Being the inventive types they are, they have come up with something that I think will work and make everything legal. At least in my case and all they have to do is apply the same fix to anyone else in my spot and it's all good.

A meeting with the chief, the applicable executive assistant chief and the chief's attorney is taking place as I write this. The proposed fix, that everyone except the head honcho has signed off on, is that Finance Administration (Payroll Dept) travels back in time and makes the payroll records reflect that I have already used all of my compensatory time. Then, they travel back to our time and voila, I now have 480 hours of unused sick/vacation time that can be used for my purposes. It's actually a simple payroll adjustment to correct an error as they do thousands of times a year already. If I was still working there and my mind was used to dealing with such things I would have probably come up with the solution myself. That, or I would still have the authority to pick up the phone and call the person in charge of this sort of thing and do what the asst. chief did "Hey, we need to fix this. How do we do it?"

Donheff scored a bullseye:

Quote:

Originally Posted by donheff Leonides: If push comes to shove the union would have to arbitrate to enforce a provision HR (and their lawyers) won't enforce. That may be unlikely. A better approach might be to get with the union and try to get HR/Payroll to settle the matter by restoring some of your conventional leave and covering the absence with comp time.

If the proposal is accepted, the provisions of the contract have been upheld and no violation of FSLA took place. It's magic!

Quote:

Originally Posted by wab I'm sure the insurance you're fighting for is worth it, but have you already priced individual health insurance? In my case, I was able to do much better than my COBRA offering. No idea how sweet your 5-year healthplan deal is, of course.

Actually, it's a lifetime health plan with 100% spouse survivability- at least that's the deal at the moment. There was never a question about not continuing the insurance - even when I'm eligible for Medicare I still have the insurance. But you do bring up an interesting point. The difference in rates is not that great - at the moment. But health care costs are the 800 pound gorilla right now. Everybody is predicting that things will change - rates will rise, benefits could be cut, and nobody is willing to make any bets on what changes will be made specifically regarding retired employees. All the city administration has said is that there will be changes, and all the Union or the Pension System can say is "be prepared". As I told a sergeant in HR this morning, "I wouldn't be complicating everyone's day with the problem if I knew there would be no future major disparity between retiree insurance and active duty insurance. But if I get into this program I can be reasonably certain I'll have five years of the better of the two deals."

Thanks again everyone. I'm going to have to come up with a better way to express this, but this board is just phenomenal in the scope and depth of expertise present in its membership.

Modified to add:

Quote:

Originally Posted by Brat Leonidas, the goal of that section of the statute is to assure that public employees who are permitted the comp-time option do not loose the value of that time upon termination. Because there is an agreement between the employer and the union permitting the use of the accrued time to pre-pay benefits the intent of The Act will be satisfied. The key element is that the employee has the option of taking it in cash.

I think I responded to that in my last PM, but I'll hit it again. That was the ultimate sticking point. They wrote the provisions believing that everyone would chose the option that leads them to the FSLA saving clause they stuck in there. They thought everyone would take the same path and wind up receiving the check for comp time and being forced to comply with how the city wanted to compensate them for any remaining value in sick and vacation time.

[Leonidas]

Update - I spoke too soon about it being magic.

The PD's payroll department cannot make the adjustments because the control over my account was transferred to the city's payroll dept. Apparently their interpretation of the contract is that the First In First Out clause on how time is burned meant that compensatory time off is earned last and therefore should be the last to go.

Or at least that is how they think it is supposed to work.

Reality is that 240 hours was frozen in 1986 and the other 240 hours were gained between 86 and 2001, when that was frozen also. Half my time is 20 years old, and the rest is at least 6 years old. Vacation and sick time are accumulated every two weeks.

"Oh, I hadn't thought about that. Okay, I'll call the director tommorrow and see if we can get it worked out. But I've got to go to the dentist in the morning so it'll be 11 before I can start making calls."

I guess I won't be retired tommorrow after all.

[Brat]

Payroll accounting folks are an interesting lot. They are very earnest and want to do everything correctly.

When I had an employee who butted heads with one my recommended approach was to sit down next to their desk and ask, "Help me understand this." over and over again.

Payroll person would respond to the employee's need for education. Eventually the issue was distilled and both parties understood the core issue. Sometimes the employee was correct.

[Leonidas]

Quote:

Originally Posted by Brat Payroll accounting folks are an interesting lot. They are very earnest and want to do everything correctly. Payroll person would respond to the employee's need for education. Eventually the issue was distilled and both parties understood the core issue. Sometimes the employee was correct.

When I first delved into this issue I worried that I had missed some key clause in the contract, and most of my conversations started with "I'm sure you can tell me where I made my mistake, but the way I read the contract it says..."

Early in my career I got tired of being beat by some defense attorney who knew more than I did about a particular law, or some administrative person telling me I couldn't do something because it was not allowed according to regulation 32(A)(XIV)(s)(iii). Every assignment I ever had, or problem I ever faced, I made it a point to go find the rule book or the applicable code and sit down and learn it. Then I started asking questions until I found the smartest guy or gal who I could con into teaching me the ins and outs. Then I went back and hit the books and looked for the mistakes and the hidden "gotchas"- before I went back to my tutors to see if I could stump them.

I don't try to become an expert in somebody else's game, just the parts of it that affect me. That's what happened with the contract, I studied it well enough to know it generally, and then I sat down and really learned the sections that applied to my situation. I made my plans according to what I understood and moved on. Two years later, when they told me "no, you can't do that", my first thought was that I had screwed up and missed something. I tore through the contract again and finally found the section that did not apply to me, but it was the one they were relying on.

I talked with the city's attorney today, and he told me what I had suspected was the case. "I know the director called the DOL when we wrote that section because we wanted to get it right and we didn't want to rely on what the city payroll people said. We did the right thing, but we screwed up and put it in the wrong place."

At the level of people I'm dealing with now I know I'm talking to the real decision makers finally. It's not adversarial, but while I'm confident they will try to fix the problem I know that the final solution will not violate FLSA nor will it break any provision of the contract. My job is to understand my situation and be prepared to politely point out their mistakes as I did today with the FIFO clause.

[Brat]

You are my kind of guy!

[Leonidas]

The phrase twisting in the wind is the phrase that seems to apply to my situation.

An update in case anyone's interested and because I'm bored sitting here waiting for the telephone to ring with "the call".

On the 26th all the honchos were in the same place in a retreat and the details had been completely worked out. I think everyone except the mayor was involved in the decision. Apparently the great debate everyone had was "how does this affect other people and are we going to have to reprogram the accounting software to fix this?" It would be the following week (now last week) before the word would snake it's way down to someone in budget and finance to actually do the keystrokes and make hours move around magically.

No word comes and nobody returns my calls as of Friday. Bright and early this AM I call B&F and find out that the very helpful woman has been reassigned for the next several months to a team implementing some SAP software. The next point of contact is the director, and I would rather set my hair on fire than talk to her. So I call the union and ask what's up. "It's supposed to be fixed and when it happens that sergeant in HR is supposed to call you."

A call to said very helpful sergeant reveals he is waiting on the letter from the city attorney. I was only half joking when I said "Things like this are the reason why I don't work there anymore." He promised to start calling around to legal and B&F and see if he can find where the letter is.

[Brat]

The problem for the City Attorney is that this area of law may be outside his/her area of expertise. If either need a referral PM me. Oft it is not what you do but how you do it.

[Leonidas]

The red tape has been sliced through and I strolled into Mega PD's headquarters this morning to start the retirement process!

Zipped through most of it today, and will do some more tomorrow and do the final checkout on Friday.

[REWahoo]

Quote:

Originally Posted by Leonidas Zipped through most of it today, and will do some more tomorrow and do the final checkout on Friday.

Then we get to hear the rest of the story?