San Joaquin County, California has reached a $279,000 settlement with a group of sheriff deputies following a 2020 lawsuit for alleged FLSA violations. The settlement, which was approved by a federal judge on August 15, 2022, settles a lawsuit filed by forty sergeants from the San Joaquin Sheriff’s Office. The sergeants claimed that the county failed to properly calculate their regular rate of pay correctly in violation of the FLSA.
Determining an employee’s regular rate is not always an easy straight-forward calculation. The U.S. Supreme Court has written that proper calculation of an employee’s regular rate can even be “perplexing.” An employee’s regular rate is not necessary the employee’s hourly rate. The FLSA requires that all “remuneration” paid to an employee is included in that employee’s regular rate of pay. Very often people are surprised to learn that additional money paid to firefighters for longevity, medic stipends, educational incentives, working out-of-rank or grade, and even money paid in lieu of receiving health benefits must be include in a firefighter’s regular rate of pay.
Proper calculation of the regular rate is critical for two reasons. First, all FLSA overtime must be paid at a rate that is at least one and one-half times the employee’s regular rate of pay. Failure to include all remuneration in an employee’s regular rate results in that employee getting short-changed on their overtime rate. Second, the proper calculation of an employee’s regular rate is also necessary when an employer opts to provide FLSA compensatory time (comp time) in lieu of providing FLSA overtime. The FLSA requires that FLSA comp time be paid at the employee’s regular rate.
Here, the sergeants alleged the county failed to include money paid in lieu of receiving employer-sponsored health benefits in their regular rate of pay. In 2016, a federal circuit court of appeals found for the first time, that money paid to an employee in lieu of receiving employer sponsored health benefits cannot be excluded from that employee’s regular rate of pay. Here, the forty sergeants will each receive a share of approximately $210,000 for back wages and damages. Additionally, the attorneys that represented the sergeants will receive approximately $70,000 in fees and expenses as part of the settlement.
Here are copies of both the settlement and complaint.