The Attorney General of Texas
April 15, 1986
JIM MAllOX
Attorney General
Suprmt Cow! BulldIng
Hr. Lawrence F. AlWLn, CPA Op~nloa No. Jl+475
P. 0. Box 12548 State Auditor
Atmh. lx. 7a711.250 P. 0. Box 12067 Xc: Compensatoq time endlor wtt-
512/4?52501 Austin. Texas 781’11 time psy for state employeeb after
lder 91om74.1367
lel~copler 51a47502+3
April 15, 1986
Dear Hr. Alwla:
714 Jackson. Suite 70Q
oa11as.TX. 75202-4500 You ask:
214t742-8944
What does the law require in regard to s state
4824 Albs”. Are.. SUb 160 employee’s receipt of compensatory time off or
El Paso. TX. 799052793 premium Iovertime pay for overtime earned on or
91Y533.3484 after AIsrll 15, 1986?
1001Texas. sune 700
Your letter focuses on the United States Sutmtmc Court's decision in
muston. lx. 77002.3111 Garcia v. Ssn Ant+o Metropolitan Trsnslt iuthoritp, 105 S.Ct. 1005.
713lm5aaa U.S. (1985). on the Pair Lsbor Standards Amendments of 1985.
pub.L. 99-150, Stat. (1985). and on section 2f of article V of
the current Genm>l Approstions Act, Acts 1985, 69th Leg., ch. 980.
SO6Brotdway, Suite 312
Lubbock, TX 79401-3479
at 7759. A brlc:f history of the sppllcability of the Fair Labor
e.ow47-5238 Standards Act to the states la necessary to an undcrstatdinn of the
Garcia case, these recent amendments, and how they affect section 2f.
The amendments become effrctlve cn April 15. 1986.
4309 N. Tenth. Suite B
heNen. lx. 78501-1685
SIi882d47 The Fair Labor Standards Act of 1938, 29 U.S.C.. 1201 et seq.~
[hereinafter FLSA], requires employers that are covered by the act to
pay their l mployws a mlnimum hourly vage. see 1206, and to pay then
100 k4.l” Plaza. Suite *oo
at one and cat-ho1.f times their regular ratEOf pay for hours Porked
tan Antonio.m 782052797 in excess of fcrty during a vorkveek. Sea 5207.
5w22w191 As originally
enacted, the ?I.!% of 1938 specifically excluded the states and their
political subdivisions from its provisions. See 29 U.S.C. 0203(d)
An Equal OppCwlunltYl (1940 ld.); (50 Stat. 1060). Beginning in 196rCongress tnscted a
~f~~rrnat~ve
Action Employer series of amcndme~~tawhich extended the coverage of the act to certain
types of public employees. See Pair Labor Standards Amendments of
1961. 02(c), 9, 75 Stat. 65.71; Pair Labor Standards Amendments of
1966, 51102(a), Cb), 80 Stat. 831; 1206(c), 80 Stat. 836. In 1976.
Coogrtss again broadened the coverage of the act by defining
“tmployer” to in::Lude a “public agency.” Fair Labor Standards Amend-
ments of 1974, (21(b), 88 Stst. 68. Constquently , by early 1985. the
act’s minti wg.e snd overtime provisions extended to almost all
., employtee of .the states and their political subdivisions. See
- Garcia
Mr. Lawrence P. Alvlo - Page 2 (Jx-475)
v. San Antonio Netropolltac ‘[l:ansit Authority, B. After 1974. but
prior to amendecnt in 1985, the act contained oulg the general exaxp-
tion for executive, adxinlstratlve or proftssimal parsomtl, see
5213(a)(l). and ac exemptlon for elected officeholders and cartaloof
thcfr employees. -See 5203(e) (2) (C).
The Fair Labor Standards Amendmtnts of 1985, Pub.L. 99-150, vare
enacted in response to tht United Statee Supreme Court’s decision in
Carcia. The Gsrcla case is the wst recent of a sarles of significant
cases which axed the constitutionality of applying the FLSA to
the states. Tht combined l::l:ect of tht amendments vhlch oare enacted
in the 1960’s vas initislly upheld in Haryland v. Wlrtz, 392 U.S. 183
(1968). Congress relied ta the Wirtz case when it expanded the
coverage of the act in 197’1 to includcmost public employees. H.R.
Rep. No. 93-913, ?3d Gong., 2d Stss. 6 (1974). Tbc 1974 amendments,
however. triagered
-- a challenge vhlch resulted In a severe limitatlon
on the extent to which the act could be applied to the states. See
Pstlonal League of Cities -- v. Ustry. 426 U.S. 833 (1976). In ?btloGi
League of Cities 0. Ustry-, the Supreme Cnurt held that the Commerce
Clause of the Cnlted Statts Constltutlon dots cot empover Congress to
apply the minimum wage anil overtime provisions of the FLSA to tht
states
insofar as . . . [they] operate to directly dis-
place the States’ freedom to stmcture ‘inregrsl
operations in areas of traditioual governmental
functions. . . .
426 U.S. at 852. Responding to the Pational League of Citlrs case.
the United Ststes Department of Labor promulgated regulatlocs
providing that it would not enforce the minimum vagc and overtime
provisions of the act against a stste or polirical subdivision unless
notice had first been gIvt:l that the sctivitios In question were not
integral operations in areas of traditional goverrmental functions.
29 C.F.R. 0775.2(b) (1984).
In Garcia, the Suprasu: Court reversed its decision in liatlonal
League of Cities. Like tha: National Lesguc of Cities case, the Gsrcia
decision was the result of a sharply divided court. In T-57
decision. the Court rejectc!d.
as unsound In pr~inciple and unvorkablt in prac-
tice. a rule of state immunity from federal
regulstion that turns on a judicial appraisal of
whether a part:Lcular govtrnmental function is
’integral’ or ’t~raditional. ’
105 S.Ct. at 1016. The Court held that the FLSA, as applied to the
San Antonio Metropolitan Transit Authority, does not violate stJtc
soverdgnty . The Court renBoMd broadly that oucc a paver is found to
p. 2173
Mr. Lawrence F. Alvin - Page 3 (J?l47S)
be delegated to the federal, governacnt by the Constitution. exercise
of chat specific paver by the states cannot br protected by using the
Tenth Azendrmnt or judicially created limitrtions se affirmative state
shields to federal action.
The primary impact of the Garcia decision was the removal of the
coostltutional shield which hedxcted states sad localitle6 from
potentialiy burdensow fcl&!ral legislation enacted ucder Congress’
Commerce Clause pavers. Consequently, uder Garcia the potent161
Impact of existing or proposed federal legi6lstioo and regularlone on
the states and localltics bacome no longer a constitutional issue. It
became s policy matter to ha resolved ln the course of the lcgi6latlve
process. 10s s.ct. at 1020-21.
When the Garcia declelon was handed down, the FL.SA minimum ‘sage
and overtime provisions extended to virtually all employers of the
states and their political subdivisloab. Although Csrcis dealt with s
transit authority, the broad language employed ard the express over-
ruling of the National L#clw of Cities case indicated that these
provlslons of the act ve& to be applied to the state and munlclpal
employees which Congress Intended to include when it passed the 1574
amendments. Order that rctrtding , once cm individul fslls vithin the
cctegory of covered employees, the employee6 can be excluded from
application of the act only if they are covered by an exception
clause. See Ososky v. Wck, 704 F.2d 1264, 1268 (G.C. Cir. 1983).
The Fair Labor Standard6 AE&dments of 1085 created new exceptions for
public employees. You rwe concerned about the effect of these
amendment6 on the current kpproprlations Act.
Section 2f of article V of the current Appropriations Act con-
tains two riders enacted ln response to these changes in the law and
in anticipation of amendolrnts by Congress to the FLSA. Acts 1985.
69th Leg., ch. 980;~ nt 7759-7760. Sectlon 2f provides, %rr pertinent
part:
f. OVERTIME. (1) Employees Subject to FLSA.
An employee who !Ls subject to overtime provisions
of the Fair Labcr Standards Act of 1938, 29 U.S.C.
sets. 201 et SCQ.., (FLU) IS entitled’ to compensa-
tion for overtime as provided by &is subdivision.
An employee v’ho 16 required to work hours io
excess of 40 hoers Ia a vorkveek Is entitled to
compensation fol, the excess hours either by:
(A) the urgency allowing (or requiring) the
employee to take compensatory time off during
the bane pay jleriod, at the rate of l-112 hours
off for each hour of overtime; or
p. 2174
Us. Lawrence P. Alvin - Page 4 (JU-475)
(B) st ttie discretion of the evzploylng
sgcncy, in CP~IC:SIL which grsnting compensetory
time off is ~q~rectScs1, the employac receiving
pay for the overtime at the rate l qusl to l-112
times the emp:.oyea’s rcgulsr rste of pby.
. . . .
(4) Contitlgency Prov1*1cm.
employees src excluded generally ‘:rom”‘%
spplicstion of the FLSA as a result of A court
dacision or etatutory change, this subdivision
govern6 overt~lme pay and compens&tcry leave.
A regularI, full-time employee vho is re-
quired to vork hours In excess of the standard
workveek ests’D’ll6hed for the position In bccor-
dance with tbc nppllcnble statutes Is tntitled
to compenatlon for the excess hours either by:
(A) the agency aliovlng (or requlrlng) the
aaployee to t&kc lquivnlent c0mpen**t0ry the
off during the 12-mocth period follovipp the
end of the w&week; or
(B) nt the discretion of the employing
Agency, io c6ses in vhlcb granting compensatory
time off is Inpractical, the employee receivirg
pay for the ct-ertimc nt the rate of l-112 tlmaa
the employer’s rcgulsr rate of psy. ~Emphbsls
added).
The primary difference brween these NO subsections Involves the rime
period during which comperwstory tl& off mUst be t&n.
Section Zf(1) appliw to cmployaas subject to the PLSA vhile
section 2f(4) applies “[IIf stntc employees nre excluded generally
from the application of t.he FLSA AS 6 result of a ccurt declsicn or
sratutory chbnge. . . .” As indicpted In the discussion above, the
Gnrcin declsiun WAS the result of A sharply divided court. The Te%bS
Leglslsture prepnred for the possibility thst the dcclsion could be
recoPsidercd. Because of the slgnif icacce of the controversy
surrounding the decision, the Texss Leglsisture also prepsred for the
possibility that Congress vould bddress the question through the
1egiSibtiW PSOCeSS -- the solution suggested in the Carcis case. It
is clesr that section 2f (4) WAS intended to respond to legislative
change6 in the FLSA. The problem 16 that Congress reacted to the
&mdS cbse in A vby that the hngUSge Of SeCtiOn 2f(h) doe6 not
anticipate. Section 2f (4) bpplies only “[llf state tmployees are
excluded generally from th,c npplicstion of the FLSA. . . .I’
p. 2175
Fr. Lnvrence F. Alvin - Pa:&teS (m-475)
The 1985 nmepdmantr to the FLSA do not totslly exclude the
employees cf A public agency; rother, they specify th6t a public
agency may provide compensatory time off in lieu of overtime compcnsa-
tlon pAymeW In certain circumstruces. Pub.1.. 99-150, I2 (to be
codified AS 29 U.S.C. #207(o)). The time off i6 oat limited to the
SAM pay period. The emcru~wnts also provide limited exemptions for
three sp~cibl situations: (1) speclnl drtnil work for fire protection
and lnv enforcement. (2) occnsional or sporadic employment, and (3)
eubstitutlon. Pub.L. 99-153, 13 (to be codified as 29 D.S.C. EX7(p)).
Pub.L. 99-150, 14 (to be CDdlfied AS 29 U.S.C. 1203(e)). Your concern.
hovever, focuses cn the (:aneral applicability of the time off pro-
visions rather than with l,be special exceptions. The 1985 amendments
create a conditional exception for public employees from the cvertime
provisions of the FLSA. The issue to bc resolved is whether this Is a
“general exclusion” within the treenine and Intent of subsection 2fC4).
Although there are cwtain aspects of sectlcn 2f(4) vhich weigh
against finding that it WI; intended to apply to the nev amendments,
these considerations are not compelline. Section if (4) (A) authorize6
a state agency to allov 01: require *n “employat to take &vcler.t --
compensatory time off during the 12-month period follovlng the end of
the vorkveek.” (Emphasis added). The 1985 amendments do uot
authorize "equivalent" cor:pensatory time off. They require tloc cff
“at a rate not less that, one and cne-half hours for each tour of
employment for vhich overtime compensation is required by this
section.” Pub.L. 99-lSO,, 52(a)(l) (to be codified as 29 U.S.C.
6207 (0) (1)). Section 21(4)(S) grants the employing agency the
discretion, in crises in ,vhich granting compensatory tine off 1s
impractical, to pay the ea!ployee for overtime at the rate of ode and
one-half times the employw’s regular rnte pf pay. It Ccts not seem
likely that the 1eglslature intended to grent state agencies the dis-
cretion to choose brtveen g;iving equal time off snd time and cnc--half
PAY. Thus, the term “equivalent” in section 2f (&)(A) need not be road
as a limit on time off to one hour of leave for one bour of overtinc.
The legislature intended subsection 2f(4) to bpply if Congress
enacted legislation exclwiing state employees; they did not hove the
benefit of knoving exact:ly vhet that legislation vould provide.
Accordingly, state agencies may allov or require employees to take
time off during the 12-month period following the end of the workweek.
but the time off must be nt s rate of not less than one and one-half
hours for each hour of overt-.
In contrbst, sact%ou 2f(l) authorizes an agency to allov or
require Its Lmployees “to take c~pensatory time off during the sama
JJ Y period, at the rnte of l-1/2 hour6 off for each hour of ovcrtlme.~
(;mphssis added). This rc!qulrement VAS included only in an effort to
comply vlth the FLSA as It existed vhen Garcia vbs decided last
spring. Court jnterpretations of the lT.SA indicate thst the act
allowed compensatory time off In lieu of payment only if time off vns
P. 2176
Mr. Lawrence F. Alvin - Page 6 (JtI-475)
granted during the ssw pimp period. see Dunlop v. Few Jersey. 522
F.2d 504. Sll (3d Cir. 1075). vacated a remanded for consideration
of National League of CltleL sub nom New Jersey v. 0s~~. 427 U.S. 909
(1976). The 1985 amendment6 do not contain this requirement. Thus,
the requlrrmcnt that cvert1u.e time off be taken during the same pay
period is Inconsistent both ulth the 1985 smendments and vlth the
leglslatlve lnteut behind sectlcn 2f (4).
Ey enacting bection 2,f!l), the Texas Legislature has clearly
evldenccd the intent to comply with the FLSA. For trample, the l&St
paragraph of section 2f(l) indicates simply that exceptions to the
workweek overtime cslcula~::~ons for certsin cstcgorirs of employeas
“shall be made in accordawe with the FLSA.” Py enactitg the slter-
nste section, section 2f(4). hovever, the legislature just as clearly
expressed the intent that state agencies be able to take advantage of
excluslcns granted hy Congress. ThUS, neither section is strictly
enforceable. Nevertheless, heccior~6 2f (1) (A) and 2f (4)(A), when taken
together, express a state poilcy that state agencit-s have sufflcltnt
authorlry to comply with 6nd to take sdvantage of the exclusions to
the FLSA enacted in 1985. State agencies may therefore allw or
require bn employee to take time off, nt the rate of one and one-lrslf
hours for each hour of ove.rtlre, during the l?-month period following
the end of the workweek.
The legislative intent behind sections 2f (1) (A)
and 2f(4)(A) of article V of the current General
h~,XOpSiOtiOUS Act, Acts 1485. 69th Leg., ch. 980.
when taken tcgec:her, express s state policp that
state sgencies have sufficient authority to comply
with and to take advantage of the exclusions to
the Fair Labor Standards Act enacted in 1985.
Accordingly, state agencies may allw or require
on employee to tske time off, at the rate of one
and one-half hours for each hour of overtime,
during the 12-u:anth period folloving the end of
the workweek.
JIkl HATTOX
Attorney General of TeXaS
p. 2177
Er. tu~~cncc F. hlvln - Pqe i (Jfl475)
.lAcr l!ICHfOuER
First Arislktent Attorney General
HARYKF.LLER
Executive Assistant Attorney General
ROBERTGRAY
Special Assistant Attoroty General
RICK CILPIN
Cbail-maa. Opinion Comlctec
Prepared by Jennifer Riggs
Assistant Attorney General
p. 2178