Fire Lieutenants’ Classified as Exempt Executives and Not Entitled to Overtime Pay under FLSA

Background

The City of Montgomery (“City”) Fire Department (“MFD”) is made up of 22 fire companies. Lieutenants command a fire company, which consists of 3-4 other employees. When lieutenants are on duty, they are the highest ranking officers in charge of their assigned companies and their duty is to supervise other firefighters while at the fire station and when responding to emergency calls. MFD lieutenants typically work 104, 112, and 120 hours in pay periods. They do not receive overtime compensation.

Fifty-four MFD Fire Suppression lieutenants sued the City claiming that they were non-exempt from the FLSA’s overtime pay requirements and that they should be paid overtime. Specifically, the lieutenants argued that they were covered by the “fire protection activities” exception. The City relied on the FLSA’s executive exemption as a defense to the lieutenants’ claims. The lieutenants disputed that the executive exemption applied based on the fact that their pay was subject to deductions.

Discussion

Typically, the FLSA requires overtime be paid to employees when they work more than 40 hours in a workweek. For those engaged in fire protection activities, however, overtime is required when they work over 106 hours in a 14-day period. The lieutenants argued that when they worked in excess of this, they should receive overtime pay because they were engaged in “fire protection activities”. The Court did not agree that the lieutenants fell within the “fire protection activities” exception because the lieutenants’ primary duty was supervision of firefighters, rather than preventing, controlling, or extinguishing fires.

The City raised as its defense that the lieutenants were exempt from overtime because they were working in an ‘executive capacity’. The executive exemption requires that the employee:

  •  Is compensated on a “salary basis”,
  • Primary duty is management,
  • Customarily and regularly directs the work of two or more employees, and,
  • Has the authority to hire or fire or provide recommendations on these matters.

The lieutenants contended that their primary duty was fighting fires and waiting to fight fires, not management. The City argued that when lieutenants were dispatched, they were in charge of supervision, but while they were waiting to be dispatched, they were responsible for management tasks, such as training employees, delegating tasks to firefighters, preparing paperwork, and providing feedback on job performance of the firefighters. The Court relied on the DOL’s definition of primary duty which is the ‘principal, main, major, or most important duty the employee performs,” to conclude that the lieutenants’ primary duty was to manage the firefighters.

In addition to disputing the categorization of their primary duties, the lieutenants also challenged their treatment as executive exempt employees because they were not being paid on a ‘salary basis’, which requires that compensation not be reduced because of variations in the quality or quantity of the work performed. The Court pointed out that there are certain permissible deductions, permissible deductions, notably those that occur when there is a (1) violation of safety rules of major significance and/or (2) violation of workplace conduct rules. Both of these unpaid disciplinary suspensions must be made pursuant to a written policy.

The Court went on to note that safety rules of major significance include “those relating to the prevention of serious danger in the workplace or to other employees.” The term “workplace conduct” only covers “serious workplace misconduct like sexual harassment, violence, drug or alcohol violations, or violations of state or federal laws.” It does not cover performance or attendance issues. The Court pointed out that the 14 suspensions at issue fell into five general categories: (1) responding to the wrong address; (2) leaving before the end of a shift; (3) violations of the law; (4) disrespect towards a superior officer; and (5) violations of the City’s weight policy.

The lieutenants argued that these deductions were improper because the conduct did not fall under the permissible exceptions. The City argued that the suspensions were based on rules promulgated by the City to prevent serious danger in the workplace or to other employees and to prevent workplace misconduct. For example, the City noted that the weight policy prevented serious danger in the workplace because the leading cause of death of a firefighter on the scene of an emergency is a heart attack, which is more common in an overweight person. They posited that tending to the firefighter with the heart attack puts a strain on the suppression operation. The Court found that based on the evidence presented at trial, each of the categories of disciplinary suspensions were permissible deductions; however, it did not go into the details as to why.

Many public sector employers treat fire lieutenants as non-exempt employees ‘engaged in fire activities’ that are entitled to overtime pay. This case presents an alternative classification of fire lieutenants as exempt employees working in an ‘executive capacity.’ While the final determination, of course, depends on the “primary duty” of the fire lieutenants in question, employers should reassess whether these employees are properly classified and make appropriate adjustments based on the governing law in your jurisdiction.