Use of Compensatory Time Off for Public Employees

Wednesday, June 04, 2008

by Gary Goyette

Next time you get a public employee who believes their request for use of compensatory time off (CTO) must be granted by the employer for specific dates requested, PLEASE REMEMBER that our friends at Mastagni litigated this exact issue up to the Ninth Circuit Court of Appeal and lost (to Terence Cassidy at Porter Scott).  Along with the prevailing case law, what matters most here is the actual agreement between the employer and the employee union and/or the polices & practices of the employer which have been issued/adopted/used:

Here are the basics for the FLSA law applicable to the use of CTO:

1) The specific part of the FLSA statute which addresses the use of CTO is at 29 U.S.C. section 207(o)(5), and this statute states: “An employee of a public agency which is a State, political subdivision of a State, or an interstate governmental agency-- (A) who has accrued compensatory time off authorized to be provided under paragraph (1), and (B) who has requested the use of such compensatory time, shall be permitted by the employee’s employer to use such time within a reasonable period after making the request if the use of the compensatory time does not unduly disrupt the operations of the public agency.” (emphasis added).  THIS IS WHAT gives employees the idea the employer must grant their CTO requests for specific dates, as long as use of CTO on requested dates does not “unduly disrupt” the operations of the employer.
2) Despite the “if the use of the compensatory time does not unduly disrupt the operations of the public agency” language in the statute, however, case law interpreting the FLSA does not hold that specific dates requested must be granted.  Rather, case law and specific FLSA regulations allow and encourage unions and public employers to collectively bargain to reach agreements on what is reasonable regarding requests for use of CTO and the grant or denial of such requests.  Specifically in the Ninth Circuit, the controlling case is Collins v. Lobdell (1999) 188 F.3d 1124, 1130 which states “Although employees have a right to use comp time when it would not unduly disrupt the public employers business, the FLSA does not give employees the right of absolute control over the use of comp time. Rather, the legislative history suggests that employers and employees are required to negotiate and reach agreements over the use and preservation of comp time”.
3) More recently a Ninth Circuit case in which our competitor Mastagni lost at the Ninth Circuit Court of Appeal is Mortensen v. County of Sacramento (2004 C.A. 9) 368 F.3d 1082, 1090-1091 In this case the Court held that a public employer has a ‘reasonable period of time’ from when an employee requests use of CTO to when the requested use is granted by the employer, and held in this particular case that the FLSA does not require the employer to grant use of CTO on the exact date requested by the employee “We conclude that the text of § 207(o)(5) unambiguously states that once an employee requests the use of CTO, the employer has a reasonable period of time to allow the employee to use accrued time. Because the statutory language is unambiguous, we need not defer to the regulations and opinion letter.” THEN the Court also interpreted what constitutes a ‘reasonable period of time’ by looking at the regulation at 29 C.F.R. § 553.25 and found that “the county is not in violation of the FLSA unless it fails to follow its leave book policy or refuses to grant the use of CTO within one year of a request.” THEREFORE, an employer must follow their own agreed upon or adopted policies & practices, but once that is done, use of CTO simply must be granted within one year of the request.  Mr. Mortensen and Mastagni were trying to have the Ninth Circuit hold that an employee’s request for use of CTO on a specific date must be honored unless use of the CTO on such date would unduly disrupt the operations of the employer - - but the 9th Circuit said “no,” unless the employer has agreed to this with the employee union, the employer simply must grant the use of requested CTO within one year of the date of the request.
4) For reference, the regulations interpreting the CTO section of the FLSA statute are at 29 C.F.R. section 553.25 (interpreting ‘reasonable period of time’ and ‘unduly disrupt’).  A different regulation emphasizes that the public employer and the employee union should agree to the terms under which CTO is used; that regulation is at 29 C.F.R. section 553.23.
5) Recently one of the Labor Relations publications summarizes a Chicago case, Heitmann v. Chicago, which implied a victory for employees regarding the request and use of CTO. Some of our clients saw this that thought, ‘see, use of CTO on specific dates must be allowed by the employer.’ First, this case is from a federal District Court in Illinois, so it does not have controlling effect in the Ninth Circuit or in California, but is rather a point of reference.  Also it is not a formally published decision, so it is not case law which can be cited in Court.  As a non-citable point of reference, the case held that the Chicago police department must grant police officers’ requests for compensatory time off on a specific date, even if granting the leave requires it to pay overtime to replacement personnel, unless the department’s operations would be unduly disrupted. But the facts of that case and the agreement between the police Department and the employee union is what led to that decision. 

In sum, you have to look at provisions regarding requests for use of CTO in the MOU between the employer and employee union, as well as the policies & practices of the employer regarding granting use of CTO, and after that consider the ‘reasonable period’ and ‘unduly disrupt’ factors.  IF SUCH MOU PROVISIONS and/or employer POLICIES or PRACTICES do not establish a right to use CTO on specific dates (provided enough notice is given for the request to use CTO on such dates), THEN THE FLSA law itself merely requires that an employer grant use of CTO within one year of the request.  Yes, believe it or not, this is the case.  Ask David Mastagni.

Lastly, the only ‘black and white’ issues regarding CTO under the FLSA is that CTO must be accrued at 1.5 times the hours worked (which qualify as overtime hours under the FLSA) - - not on an hour-for-hour basis - - and that there are limits as to how much CTO can be accrued before overtime pay must be issued.  ‘Overtime hours’ under the FLSA are hours above 40.0 per week, OR for peace officer and fire employers which have adopted the 7k exemption, are hours above 171 actual hours worked (do not count sick time, vacation, CTO used, holidays, etc.) in a 28 day period for peace officers and above 212 hours in a 28 day period for fire personnel.  CTO never used to be allowed at all under the FLSA, but evolved as allowable over time.

(Gary Goyette is an Attorney with Goyette and Associates)