Today’s FLSA Question: I am the fire chief for a small combination fire department. In addition to myself, we employ fifteen full-time employees. Twelve firefighter/medics, two lieutenants, and one captain all assigned to 24-hour shifts (24 hours on, 48 hours off) working a 56-hour average workweek. We use a 14-day work period and pay overtime for all hours worked over 106 every two weeks. We pay our full-time firefighters between $20 and $25 per hour depending upon their rank and seniority and the officers as much as $35 per hour.
We also employ a small group of paid-on-call (POC) firefighters that respond to calls when available and participate in weekly/monthly trainings. The POC firefighters are paid between $12 and $15 per hour. The full-time firefighters participate in trainings with their POC counterparts when on-duty, but as a general rule, we can’t afford to pay the full-time firefighters to attend training while off-duty. However, most if not all, full-time firefighters want to participate in more of the trainings. Additionally, they want the ability to respond back to various calls when off-duty, which again we can’t always allow due to budgetary concerns. The firefighters are willing to work at the POC rate for the hours they come back to calls and attend trainings. Does the FLSA allow paying the full-time firefighters a lower hourly rate for voluntarily responding to calls and attending training during off-duty hours?
Answer: Your question is rather common in the fire service today. Few organizations are fortunate enough to have daily staffing capable of effectively handling common everyday emergency situations. Allowing off-duty personnel to respond back for alarms is often a necessity. But few organizations have endless economic resources available to pay off-duty firefighters’ overtime to respond back to help at unusual incidents and/or participate in training off-duty. To add to the complexity of this common problem, many firefighters would gladly respond to such events without expecting any compensation for their time. However, a fire department would be liable for FLSA violations if it failed to pay firefighters for all the hours they are “suffered or permitted” to work. Neither the FLSA nor Department of Labor (DOL) regulations contain a “this is how we have always done it” or “everybody is happy doing it this way” exception for paying firefighters.
The FLSA does not prohibit paying firefighters two different rates of pay during the same workweek or work period, provided that all wages paid are at least the federal minimum wage and that overtime is paid when required by law. There could be collective bargaining or even state laws that prohibit this type of pay plan, however the FLSA does not. Also, you are wise to run this plan by your local counsel prior to implementation. As an employer, you want to avoid any appearance that your newly proposed pay plan is a ruse or guise designed to cheat the firefighters out of their federally guaranteed overtime. If your firefighters are represented by a union, you will need to negotiate this change with them prior to implementation. This new pay plan would also need to be clearly spelled out within the labor agreement.
With that stated, there are two additional factors that you must be aware of before considering this option. First, the additional hours worked (at the lower pay rate) must be counted towards the firefighters’ overtime eligibility for the workweek or work period. Second, you must include all wages paid, not just the wages paid during the firefighters’ scheduled work shifts, when calculating the firefighters’ regular rate of pay for the work period.
Factor # 1 : Hours Worked
All hours worked must be counted towards a firefighter’s overtime eligibility for each work period. For example, if one of your firefighters works all of his or her scheduled 24-hour shifts in a fourteen-day work period, he or she will have worked either 120 or 96 hours in the work period. If that firefighter also attends training sessions and responds while off-duty for an additional 12 hours over the two-week work period, those additional hours must be included in the firefighter’s hours worked for the work period. Therefore, a firefighter that works 120 scheduled hours in a 14-day work period, will now be entitled to an additional 12-hours of overtime pay (for the training and off-duty call-backs). Additionally, the firefighter that only worked 96 hours over the 14-day work period will now see his or her hours worked increase to 108. This firefighter will now be eligible for 2 hours of FLSA overtime due to the additional hours worked attending the trainings and responding back to calls while off-duty.
Factor # 2 : Regular Rate
Paying firefighters two different hourly rates within the same work period will also have implications on the firefighter’s regular rate of pay. As a general rule, when a firefighter is paid at two or more different rates of pay during the same work period, the FLSA requires the employer use the weighted average of such rates to determine the firefighter’s regular rate for the work period. For example, if a firefighter earns $25 per hour for 96 scheduled work hours and in addition receives $12 per hour for 12 hours of training or call-back, the fire department must calculate the weighted average of these pay rates in order to determine the firefighter’s regular rate (and overtime rate) for the work period. There will likely be an unintended consequence from this newly proposed pay plan which may prove unpopular with your firefighters. On average, the firefighter’s regular rate for each work period will be reduced by working additional hours at a lower hourly rate of pay. This will cause the firefighter’s overtime rate to decrease as well. Keep this fact in mind, since what may be popular now, may not be so popular once paychecks start coming out.
Again, in theory this new pay plan can work, however you are wise to cover all of our bases and consider all of the different ramifications that may result from such a plan prior to implementation. You should sit down with local counsel to iron out all of the details prior to implementation.