South Dakota FLSA Case May Set Precedent

October 10, 2006 – The U.S. Court of Appeals for the Eighth Circuit has handed down a ground-breaking decision – ruling favorably for the members of Aberdeen, SD Local 446. The decision clarifies that when fire fighters trade shifts, each must be paid according to his or her regular schedule, including any applicable overtime wages. This is the first appellate court decision on the issue, and could set a positive precedent for future similar legal cases.

“This is a true victory for the members of Local 446,” says IAFF General President Harold Schaitberger.

Rob Senger, president of the Professional Fire Fighters of South Dakota and Local 446, notes, “We worked hard to negotiate time trades in the contract and we will work hard to keep it there. I applaud the efforts by the IAFF legal team in assisting us and accomplishing this goal.”

Time trades were negotiated into the Aberdeen fire fighters’ contract in 1998. In 2001, fire fighters suspected that the City of Aberdeen had not consistently provided paid them according to the Fair Labor of Standards Act (FLSA). Local 446 took action to determine if the discrepancies had anything to do with the type of leave fire fighters were trading for – vacation, personal or sick time. They did not.

“The City of Aberdeen maintained that time trades count against the scheduled employee but when they worked it back, it did not,” says Senger. A federal lawsuit against the City was subsequently.

FLSA laws allows an employer to exclude the hours worked by the substituting employee in calculating the substituting employee’s overtime. The language does not specifically mention overtime, but the Department of Labor had circulated a regulation clarifying that when employees trade time “each employee will be credited as if he or she had worked his or her normal work schedule for that shift.”

According to Woodley and McGillivary, IAFF Legal Counsel, this regulation is consistent with Committee reports and legislative history involving the trading of time provision.

The district court, however, ruled in favor of the City of Aberdeen, finding that in a trading of time situation, the employer does not need to pay overtime to either the scheduled or substitute fire fighter for the work performed.

In challenging that decision on appeal, the IAFF persuaded its contacts in the Solicitor’s Office of the Labor Department to file an amicus brief in support of its position. That brief proved useful to the appellate court in rendering a favorable decision in this case.

The Eighth Circuit Court of Appeals adopted the IAFF argument that an employee need not actually work overtime hours to receive compensation for those hours if he or she was scheduled to work the overtime hours and found a substitute to work those hours. The Court explained that the City of Aberdeen’s theory that an employee must be “engaged” in “actual work” was not supported by the purposes and language of the FLSA. The Court found that the term “engaged” was used in the context of being “engaged in commerce” and did not describe whether the employee was actually working.

The appellate court further explained that a fire fighter’s “tour of duty” was used to calculate overtime and that the statutory language did not address whether an employee needed to work hours in a tour of duty in order to receive overtime. Thus, the Court turned to the legislative history and the Department of Labor’s regulations regarding trading time.

The Court also accepted the IAFF position that the legislative history of denying overtime to the substitute employee revealed Congress’s intent for employers and employees to be allowed to continue the practice of trading time without excessive overtime owed to the substitute employee. The Court then found that the Department of Labor’s regulation requiring that fire fighters who trade time be compensated as if they had worked their regularly scheduled shift was consistent with Congress’ intent.