Five California firefighters filed a lawsuit last week alleging their employer, the City of Santa Clara, violated the Fair Labor Standards Act (FLSA). Christopher Gaffney, Andre Jerome Soto, John C. O’Leary, Guido Quartaroli, and Jeff Provancher filed the collective action (lawsuit) on behalf of themselves and other similarly situated individuals against the city in federal court on October 24, 2018.
The crux of the firefighters’ complaint is that the city failed to include specific wage augments and other payments in their regular rate of pay for FLSA overtime purposes. In particular, they allege the city failed to include money paid directly to firefighters in-lieu of employer sponsored medical benefits, out of class pay, paramedic pay, and hazardous duty pay in the firefighters’ regular rate of pay. All FLSA overtime must be at least time and one-half of the firefighter’s regular rate. Failure to include all remuneration in the regular rate, which is the leading cause of FLSA lawsuits in the fire service today, results in firefighters being shorted on FLSA overtime pay.
Regular readers of FirefighterOvertime.org will find these types of allegations commonplace. It seems that a week cannot go by absent a lawsuit filed by firefighters over potential regular rate violations. For more information on these types of claims click here.
However, the firefighters’ complaint also contains an usual allegation. The firefighters allege the city provided a partial settlement to some of the firefighters named in the suit without the approval of the court or the Department of Labor (DOL). Here is the relevant portion of the complaint:
Settlement for Partial Damages
The City of Santa Clara has provided payment for a portion of the FLSA damages arising in this case to some of the Plaintiffs. As a prerequisite for such payment, the City required employees to sign a Settlement Agreement that was not approved by the Court or Department of Labor as required by the FLSA to be enforceable.
This raises an interesting question. As employers, what can you do if an employee, or group of employees, make claims for unpaid overtime? While settlement offers are common-place in civil litigation, FLSA litigation follows a different set of rules.
The FLSA was enacted in part, to protect workers from unscrupulous employers. There can be an inherent inequity in bargaining power between an employer and employee. As a result, FLSA settlements must be approved by either a court or the DOL. The court or the DOL will examine the settlement for fairness and reasonableness.
As general rule, employers must be very careful when proposing settlement offers.
Here is a copy of the firefighters’ complaint.
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