In this column, members of the FDIC legal expert panel will respond to reader-submitted written questions related to legal issues. We will try to answer as many questions as possible, and in some instances, we will refer readers directly to attorneys in their home states. To submit a legal question, CLICK HERE. Every reader is reminded that the answers the attorneys in this column provide are generic in nature, and do not constitute specific legal advice, since each state may have different legal standards that apply. Always consult a licensed attorney in your home state.
My fire protection district in the western Chicago suburbs is a combination department consisting of 30 full-time and 30 part-time paid on-call and paid on-premise personnel. All are paid at an hourly rate. There is no volunteering unless strictly stated, such as a situation in which the municipality within our district needs a first-aid tent and is requesting volunteers. Our district has many divisions within the organization, such as maintenance, computers, public education, and so on. These positions are filled by full-time personnel who come in on their day off to conduct business at a different pay rate. This pay rate is called "7G" and is less than your normal hourly (salary) rate. It is not overtime, which is, of course, time and a half.
What is 7G? Is it legal to conduct business in this manner? Are 7G employees able to get raises, or does the rate stay the same forever? Can the district say you're a part-time employee under the 7G program?
Curt Varone & Brad Pinksy:The U.S, Department of Labor defines the 7G requirement as it relates to overtime.
Nothing in the FLSA prohibits an employer from paying an employee at different rates for various types of work as long as no rate is less than the statutory minimum wage. Ordinarily, when an employee in a single workweek works at two or more different types of work for which different hourly rates of pay have been established, his or her regular rate for that week is the weighted average of those rates. However, if the employer meets certain conditions, Section 7(g)(2) permits an employer to pay an employee overtime compensation at one and one-half times a different hourly rate than the employee's regular hourly rate. If an employer wishes to use the Section 7(g)(2) alternative compensation calculation, the employer must satisfy the following four requirements:
- The employee must perform two or more kinds of work;
- The employer must establish a bona fide different hourly rate for those different kinds of work;
- The compensation must be paid pursuant to an agreement or understanding arrived at between the employer and the employee in advance of the performance of the work; and
- the compensation must be computed at rates not less than one and one-half times such rates applicable to the same work when performed during non-overtime hours.
Accordingly, the Wage and Hour Division would agree that Section 7(g)(2) may apply in the situation you describe, so that the employees are compensated at the overtime rate that corresponds to the job performed during their overtime hours. 29 U.S.C. § 207(g)(2); 29 CFR § 778.419.
The following general requirements must be met in every case before the overtime computation authorized under section 7(g)(1) or (2) may be used:
(a) First, to ensure that the method of computing overtime pay permitted in this section will not in any circumstances be seized on as a device for avoiding payment of the minimum wage due for each hour, it is required that the employee's average hourly earnings for the workweek (exclusive of overtime pay and of all other pay which is excluded from the regular rate) are not less than the minimum. This requirement ensures that the employer cannot pay subminimum, non-overtime rates with a view to offsetting part of the compensation earned during the overtime hours against the minimum wage due for the workweek.
(b) Second, to ensure that the method of computing overtime pay permitted in this section will not be used to circumvent or avoid the payment of proper overtime compensation due on other sums paid to employees (such as bonuses that are part of the regular rate), the section requires that extra overtime compensation must be properly computed and paid on other forms of additional pay required to be included in computing the regular rate.
This definition may create more questions than answers, but 7g overtime pay raises some significant FLSA issues. More detail is needed, but if the work performed on the member's normal day off is mandatory or is deemed to be in the nature of the employee's normal work, it would be an FLSA violation if the combined hours exceed 52 hours per week (average). If the extra hours are mandatory, they count toward total hours worked. In addition, if the extra work is in the nature of the same type of work performed for the same employer, then even if they are completely voluntary, they still count toward hours worked.
An easy example of voluntary hours that don't count would be a firefighter who volunteers to coach a local youth baseball team on his off time. Some of the confounding issues are the following: Is the extra work substantially similar to the normal work? For example, can a paid firefighter volunteer to work on an EMS unit that is operated by a separate city department without the hours counting toward overtime, or will working the extra hours (voluntarily) be taken into account for promotional or other purposes? This is a very fact-intensive analysis. The department cannot conveniently change your employment status from full time to part time to escape the overtime requirement. The fire district's legal counsel can determine the legality of this.
The bottom line is that if your department is cloaking additional work in dissimilar areas, it may be liable for the full amount of overtime at the employee's current and prevailing hourly rates.
Bradley M. Pinsky is an attorney in Syracuse, New York, and a captain in the Manlius (NY) Fire Department. His law practice represents approximately 200 fire departments, fire districts, and ambulance services throughout the state. He is the author of the N.Y.S. Fire Department Law & Management Resource Manual. He served on the legal panel at FDIC 2008.
Curt Varone has served in the fire service for more than 35 years, with experience as a volunteer, paid on-call, and career firefighter. He has more than 22 years of experience as a practicing attorney representing firefighters and fire departments. Varone recently retired as a deputy assistant chief (shift commander) with the Providence (RI) Fire Department, and is now the director of the Public Fire Protection Division at the National Fire Protection Association (NFPA). He is also an adjunct faculty member with the National Fire Academy in its Executive Fire Officer Program, and teaches in the fire science program at Providence College. Varone is the author of Fire Officer's Legal Handbook and Legal Considerations for Fire and Emergency Services, both from Cengage-Delmar Publishing.
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Subjects: Fire service legal issues, firefighters and the law, liability, firefighter overtime