Part-Time Fire Chiefs and Compensation Part II

Posted by: Bill Maccarone February 18, 2023

My friend and colleague Curt Varone recently posted a story on his Fire Law Blog entitled, “Part-Time Fire Chiefs and Compensation.” The post answered a burning question that Curt received on whether part-time fire chiefs can be classified as overtime exempt executive employees. Curt did a great job answering that question and providing some alternative options for compensating part-time fire chiefs, since many part-time fire chiefs may not meet all of the FLSA’s requirements for overtime exempt executive employees. There was another option that Curt opted not to discuss in the post. This other option is called the fluctuating workweek. Any explanation of the fluctuating workweek requires a somewhat advanced analysis and can result in a fairly long article. Since Curt’s article was already lengthy, he figured it was best to leave that discussion for another day. Here is a little bit more on the fluctuating workweek and how it may prove a viable compensation option for some fire departments that employ part-time fire chiefs.

The fluctuating workweek method of computing overtime (FWW) is designed to compensate employees that work irregular, or fluctuating hours from week to week. The FWW contains two very basic requirements. First, it requires the employee be paid a fixed salary that does not vary with the number of hours worked. Second, there must be a clear and mutual understanding that this salary is compensation for all hours worked each workweek. Despite the relatively simple requirements listed above, the FWW has historically been a highly controversial way to pay firefighters and other first responders.

This controversy is rooted in the way an employee’s regular and overtime rate is calculated under the FWW. The FLSA requires that overtime be paid at a rate not less than time and one-half of the employee’s regular rate of pay. The same is true under the FWW, only the regular rate [and overtime rate] of pay is calculated anew every workweek based on the total number of hours worked.

Under the FWW, the employee’s salary represents the straight-time component for all hours worked in the workweek. As a result, the employer only needs to pay the employee half-time [one-half of the employee’s regular rate] for any overtime hours [hours worked in excess of the maximum hours] for the workweek. Because of this unusual way to calculate overtime pay, an employee’s regular rate and overtime rate is lowered with each additional hour worked. Here is an example to help illustrate:

Employee A is paid a salary of $800 per week. A works 44 hours one week. A receives $800 plus 4 hours of overtime. A’s regular rate is calculated by dividing his weekly salary ($800) by the hours worked in the week (44). In this example, A’s regular rate is $18.18 per hour for that particular week. Under the FWW, A is entitled to one-half of his regular rate for the 4 hours of overtime worked. In this example, A would be paid an additional $36.36 for working an additional 4 hours.
The next week, A works 56 hours. A still receives the same $800 salary. The regular rate for this workweek is computed the same as above, only instead of dividing A’s $800 salary by 44 hours, the employer divides the $800 salary by 56 hours. The regular rate for this workweek is reduced to $14.29 per hour. In this second week, A will receive his $800 salary plus 16 hours of overtime pay. But because of the high number of hours worked in the week, he will only see an extra $114.29 in his paycheck.

Much of the controversy surrounding paying firefighters and other first responders under the the FWW hinges on the significant number of overtime hours first responders often work. Once again, the more hours worked, the lower the employee’s overtime rate. Utilizing the FWW to pay a part-time fire chief does not necessarily present the same controversy as compared with paying rank-and-file firefighters working 48, 72 or more hours in a single week. A part-time fire chief working an average of 20-30 hours per week and receiving a set salary for all hours worked doesn’t seem all that controversial. The good thing from the department’s perspective is that when the chief does work more hours, but stays under the statutory maximum for the workweek or work period, no additional pay is due (assuming that the chief received at least minimum wage for all hours worked). In the unusual circumstance where the chief works more than the statutory maximum, the additional pay owed is payable at a half-time rate.

Whether or not the FWW is a good option for compensating a part-time fire chief depends entirely on the facts and circumstances of each situation and would require local legal counsel’s input. In fact, this may not be an option for all employers since a few states restrict or limit the use of the FWW. Additionally, The FWW is likely the best option—aside from the executive exemption—for compensating part-time fire chiefs from non-public agency fire departments. The FLSA’s §207(k) partial overtime exemption and the small fire department exemption [both discussed further in Curt’s original post] are limited to public agency employers. Volunteer fire companies and/or non-profit corporations most likely cannot utilize these exemptions for a part-time fire chief since they are not public agencies.

Do you have questions related to the FLSA as it applies to public safety professionals, like part-time fire chiefs? If yes, join us at the upcoming FLSA for Fire Departments live webinar, or one of the other upcoming FLSA webinars. Here is the full lineup:

FLSA Bootcamp for Volunteer and Combination Fire Departments

Webinar – February 22, 2023 – 1:00 PM Eastern

Information / Register On-Line

Fair Labor Standards Act (FLSA) for Fire Departments

Live Webinar April 4, 6, 11 and 13, 2023

Information / Register On-Line

Advanced FLSA: Calculating Regular Rate for Firefighters and other First Responders