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PENNSYLVANIA RECORD

Tuesday, April 16, 2024

Motions for summary judgment denied on both sides of Philly firefighters' overtime payments lawsuit

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PHILADELPHIA – A federal judge denied respective motions for summary judgment from both a plaintiff group of Philadelphia firefighters and the defendant City of Philadelphia, in a case of overtime payments allegedly not paid to those same firefighters under the Fair Labor Standards Act (FLSA).

On June 21, U.S. Magistrate Judge Timothy R. Rice explained the plaintiffs’ motion would be denied with prejudice because “their interpretation of the FLSA prompt overtime payment requirement conflicts with [U.S.] Department of Labor (DOL) guidance, and would contravene statutory intent” – while the City’s motion was denied without prejudice because “the facts it relies on to demonstrate that its payments are made as soon as practicable are in dispute.”

“According to the City, Philadelphia pays its Fire Department employees every other Friday. Because a work week begins on Monday and ends on Sunday, every other Friday employees are paid regular wages owed through the Sunday five days earlier,” Rice said.

“Overtime, however, is only included through the second Wednesday of the pay period. Thus, although most of an employee’s overtime is included in each period’s paycheck, overtime pay for the last four days of any pay period, i.e., overtime earned during the second Thursday through Sunday of each two-week pay period, is included in the following pay period’s paycheck,” Rice added.

The timetable of overtime payments is contested vigorously by the plaintiffs.

“Plaintiffs, however, contest even that the Philadelphia Fire Department has a specific policy regarding how paychecks are issued and delivered,” Rice said. “They do not concede that City employees are paid on a biweekly basis. Plaintiffs do not agree that four days are necessary to process overtime payment, or even that four days are used for that purpose.”

Rice explained the FLSA requires employers to pay an employee “at a rate of one and one-half an employee’s regular pay rate if they are required to work more hours than a regular work week”, with overtime payment needing to be paid promptly.

Rice clarified a 1968 DOL Bulletin explained the notion of “promptly” by requiring employers to pay “overtime compensation earned in a particular work week…on the regular pay day for the period in which such work week ends – but that same DOL interpretation, however, allows that, “when the correct amount of overtime compensation cannot be determined until sometime after the regular pay period,” an employer can pay “the excess overtime compensation as soon after the regular pay period as is practicable.”

“Such guidance permits a reasonable payroll processing period, prohibiting only delaying payment ‘for a period longer than is reasonably necessary for the employer to compute and arrange for payment of the amount due,” Rice said. “The guidance also specifically prohibits extending the processing period beyond the following pay period’s paycheck.”

Rice stated courts have affirmed payroll procedures which pay overtime later than the pay date of the work period in which it was done – when that additional time was “required to calculate the overtime and as long as the employees were paid as soon as practicable.”

Further, Rice explained a court in Brooks v. Village of Ridgefield Park ruled in 1999 that though an interpretive bulletin “is not a regulation and does not have the effect of law, it was a reasonable construction of the FLSA.”

“Plaintiffs seek to interpret this reasonable construction so strictly as to render it unworkable. They ignore the reality that overtime earned at the end of a pay period, i.e., during the last four days of the week, must be documented, verified, and processed before payment can be made,” Rice stated. “Plaintiffs’ claim for immediate and unverified transfer of funds would invite fraud, impose burdens on employers that are inconsistent with sound business practices, and potentially prove financially unfeasible when weighed against the nominal efficiency in payment that plaintiffs seek.”

On this basis, Rice dismissed the plaintiffs’ motion for summary judgment – but did the very same to the defendant’s motion for summary judgment, albeit for different reasons.

“Additional discovery is needed, however, to determine whether the City’s policy of delaying payment for the final four days of a pay period’s overtime is reasonable,” Rice said. “Whether the City has accurately represented its payroll policy and whether that policy pays overtime as quickly as ‘practicable’ are questions of disputed fact. The City’s cross-motion for summary judgment is therefore denied,” Rice said.

The plaintiffs are represented by Alan S. Kaufman and Robert A. Jones of Chamberlain Kaufman & Jones in Albany, N.Y., plus Solomon Z. Krevsky of Clark & Krevsky, in Lemoyne.

The defendant is represented by Shannon D. Farmer, Christopher Todd Cognato and Meredith C. Swartz of Ballard Spahr, in Philadelphia.

U.S. District Court for the Eastern District of Pennsylvania case 2:13-cv-06635

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nickpennrecord@gmail.com

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