Comp Time Agreements and the FLSA

Today’s FLSA Question: I am a union firefighter for a mid-sized municipal fire department. Our labor contract with the city allows firefighters to receive FLSA comp time instead of FLSA overtime. Despite this option our firefighters have always chosen overtime pay. To my knowledge, the city has never provided any firefighter with comp time. Recently, several firefighters including myself requested that we receive comp time instead of overtime pay. The city denied the request. The city’s payroll department stated that it prefers to pay overtime and doesn’t want to deal with managing an FLSA comp time program. When it comes to FLSA comp time, who decides whether you receive overtime or comp time?

Answer: I hate to use the phrase “it depends” when answering any question… But the answer to your question is “it depends.” It is impossible to cover all the ins-and-outs of FLSA comp time in a simple website post like this. But let’s look at some of the basic requirements of FLSA comp time, some general rules pertaining to comp time usage, the facts needed to answer your specific question, and finally some best practices in this unique public agency only provision of the FLSA.  

The Department of Labor (DOL) defines FLSA compensatory time (i.e., FLSA comp time) as “paid time off the job that is earned and accrued by an employee instead of immediate cash payment for working overtime hours.” To word this another way, the FLSA allows public agency employers provide employees with paid time off at some future time instead of paying overtime provided certain conditions are satisfied. These conditions can be found in the FLSA itself, regulations and opinions drafted by the DOL, and legal precedent [court’s interpretation of the law] from a variety of jurisdictions.

As a general rule, an employee cannot require that his or her employer provide FLSA comp time in lieu of receiving FLSA overtime pay. Therefore, generally speaking you cannot demand your city provide you and your fellow firefighters with FLSA comp time instead of FLSA overtime. However, the usage of FLSA comp time requires an agreement between the employer and the individual employee [or the employee’s representative] prior to the performance of work.

The terms and conditions of any comp time agreement should determine which party gets to decide whether an employee receives overtime or comp time. Here, in order to answer your specific question, your labor representatives and/or legal counsel need to review the specific provisions contained in your labor contract along with any applicable state laws, department policy and possibly even past practices to make the ultimate determination as to who decides. The answer will “depend” on what is found after reviewing these factors.

The use of FLSA comp time in lieu of overtime is relatively commonplace in the fire service. For many folks, comp time represents a “win-win” for both the employer and employee. The employer saves money on the payment of overtime wages, while the employee receives paid time off from work. Despite this “win-win” appearance, not all organizations utilize FLSA comp time. This is partly because managing FLSA comp time accruals and payouts can prove challenging. Administering a comp time program can be especially challenging when the agreement to utilize comp time is incomplete, ambiguous, or confusing.

Best practice requires that any agreement to utilize FLSA comp time in lieu of FLSA overtime be clearly written, complete, and understood by all the parties involved. For example, a comp time agreement should clearly articulate who decides whether overtime is paid, or comp time is accrued after an employee works overtime. In the absence of this vital information, the parties are forced to look outside of the agreement for an answer. That answer could depend on collective bargaining laws, past practices between the parties, city policy, or the FLSA, regulations, and DOL opinion. Regardless of the eventual answer, the process of looking outside of the agreement creates fertile ground for dispute and eventual litigation and should be avoided whenever possible.