McGavock v. City of Water Valley

                                                     United States Court of Appeals
                                                              Fifth Circuit
                                                            F I L E D
                 UNITED STATES COURT OF APPEALS
                      For the Fifth Circuit                  June 12, 2006

                                                         Charles R. Fulbruge III
                                                                 Clerk
                            No.    05-60396




 MARK MCGAVOCK, SHERMAN GOOCH, STEWART SPENCE, TRAVIS INMAN, and
                          DONALD BYNAM,

                                              Plaintiffs-Appellees

                                  VERSUS


               CITY OF WATER VALLEY, MISSISSIPPI,


                                               Defendant-Appellant



          APPEAL FROM THE UNITED STATES DISTRICT COURT
             FOR THE NORTHERN DISTRICT OF MISSISSIPPI



Before GARWOOD, DAVIS and GARZA, Circuit Judges.

W. EUGENE DAVIS, Circuit Judge.

     This case arises out of the application of the Fair Labor

Standards Act overtime exemption for employees “engaged in fire

protection activities.” 29 U.S.C. § 207(k). Unless the exemption

applies, the Fair Labor Standards Act (“FLSA”) requires that

employees be compensated at a rate of one-and-one-half times their

hourly rate for all hours worked in excess of forty hours in one

week. 29 U.S.C. § 207(a).    The controlling issue in this case is

whether the plaintiffs are employees “engaged in fire protection
activities” and thereby exempt from coverage of the overtime

provisions even though they spend more than 20% of their time

engaged in nonexempt (non-fire protection) activities.       On summary

judgment, the district court held that because of their non-exempt

work as dispatchers the plaintiffs were not employees engaged in

fire protection activity, and therefore were not subject to the

exemption.    For the reasons that follow, we conclude that the

plaintiffs are employees engaged in fire protection activities, and

therefore REVERSE and REMAND for further proceedings.

                                  I.

     The   plaintiffs-appellees   are   five   municipal   firefighters

employed by the defendant, City of Water Valley, Mississippi (“the

City”).    The firefighters graduated from the fire academy, where

they were trained in fire suppression.           They have the legal

authority to engage in fire suppression and are actually called

upon to extinguish, control, and prevent fires and to respond to

emergency situations where life, property, or the environment is at

risk.     However, the firefighters spend more than 20% of their

workweek engaged in dispatching duties as opposed to actual fire

protection activities.1

     The firefighters filed an FLSA overtime action against the

City alleging that they work 24-hour shifts for 121 days of the



     1
     Some of the employees spend more than 50% of their work
engaged in dispatching duties.

                                  2
year—approximately 53 hours per week.   The complaint alleged that

the firefighters are entitled to overtime pay for all hours worked

in excess of 40 hours per week under § 207(a) of the FLSA.   See 29

U.S.C. 207(a).

     The firefighters and the City moved for partial summary

judgment on the issue of whether the firefighters are “employees

engaged in fire protection activities” and thus subject to the §

207(k) pay plan exemption.   The district court granted the motion

in favor of the firefighters.   It found that there was no conflict

between the Department of Labor regulation, 29 C.F.R. § 553.212,

and 29 U.S.C. § 203(y) and that “[w]hatever Congress’ intent was in

passing § 203(y), it was not to authorize municipal employers to

classify individuals as fire prevention personnel and then to

assign them tasks unrelated to firefighting while depriving them of

minimum wage protections.”   The City moved the district court to

reconsider, which the district court denied. The district court

certified the case for interlocutory appeal, which we accepted.

                                II.

                                A.

     This court reviews a grant or denial of summary judgment de

novo, and applies the same standard as the district court. See

Chaney v. New Orleans Pub. Facility Mgmt., Inc., 179 F.3d 164, 167

(5th Cir. 1999).   Additionally, we construe the FLSA liberally in

favor of employees, and exemptions “are to be narrowly construed


                                 3
against the employers seeking to assert them. . . .”   Arnold v. Ben

Kanowsky, Inc., 361 U.S. 388, 392, 80 S.Ct. 453, 465 (1960).

                                  B.

     The Fair Labor Standards Act of 1983 establishes the general

rule that employees must receive overtime compensation at one and

one-half times the regular rate for hours worked in excess of 40

hours during a seven-day workweek. 29 U.S.C. § 207(a).2 Section

207(k) provides an exemption to that rule.    Under the exemption,

the overtime provisions of the FLSA are not applicable to any

“employee in fire protection activities,” unless he or she works in

excess of 212 hours in a work period of 28 consecutive days (an

average of 53 hours per week).3

     2
      Section 207(a) states, in relevant part:
Employees engaged in interstate commerce; additional
applicability to employees pursuant to subsequent amendatory
provisions
     (1) Except as otherwise provided in this section, no
     employer shall employ any of his employees who in any
     workweek is engaged in commerce or in the production of
     goods for commerce, or is employed in an enterprise
     engaged in commerce or in the production of goods for
     commerce, for a workweek longer than forty hours unless
     such employee receives compensation for his employment
     in excess of the hours above specified at a rate not
     less than one and one-half times the regular rate at
     which he is employed.
29 U.S.C. § 207(a)(emphasis added).
     3
      Section 207(k) states:

     No public agency shall be deemed to have violated
     subsection (a) of this section with respect to the
     employment of any employee in fire protection
     activities or any employee in law enforcement
     activities (including security personnel in

                                  4
     Before 1999, the term “employee in fire protection activities”

was defined only by Department of Labor (“DOL”) regulation 29

C.F.R. § 553.210.        The regulation provided a four-part test to

determine    which    employees      qualified     as    “employees      in     fire

protection activities.”          According to the regulation, the term

refers to any employee,

     (1) who is employed by an organized fire department or
     fire protection district; (2) who has been trained to the
     extent required by State statute or local ordinance; (3)
     who has the legal authority and responsibility to engage
     in the prevention, control or extinguishment of a fire of
     any type; and (4) who performs activities which are
     required   for,   and   directly  concerned   with,   the
     prevention, control or extinguishment of fires, including
     such    incidental    non-firefighting    functions    as
     housekeeping, equipment maintenance, lecturing, attending
     community fire drills and inspecting homes and schools
     for fire hazards.



     correctional institutions) if--

            (1) in a work period of 28 consecutive days the
            employee receives for tours of duty which in the
            aggregate exceed the lesser of (A) 216 hours, or
            (B) the average number of hours (as determined by
            the Secretary pursuant to section 6(c)(3) of the
            Fair Labor Standards Amendments of 1974) in tours
            of duty of employees engaged in such activities in
            work periods of 28 consecutive days in calendar
            year 1975; or

            (2) in the case of such an employee to whom a work
            period of at least 7 but less than 28 days
            applies, in his work period the employee receives
            for tours of duty which in the aggregate exceed a
            number of hours which bears the same ratio to the
            number of consecutive days in his work period as 216
            hours (or if lower, the number of hours referred to in clause (B)
            of paragraph (1)) bears to 28 days, compensation at a rate not
            less than one and one-half times the regular rate at which he is
            employed.
29 U.S.C. § 207(k)(emphasis added).

                                        5
29 C.F.R. § 553.210.

     In addition, DOL regulation 29 C.F.R. § 553.212                 puts a gloss

on the § 553.210's definition stating that, “employees in fire

protection activities,” “as described in §§ 553.210” can engage in

nonexempt    work    (activities     not     related   to   fire   suppression);

however, if the employee performs nonexempt work more than 20% of

his total working time then he is not an “employee engaged in fire

protection activity” and thus is not subject to the 207(k) special

pay plan.4

     In 1999, Congress amended the FLSA and for the first time

provided a statutory definition of “employee in fire protection

activities.”      The amendment added § 203(y) and currently states:

     “an employee, including a firefighter, paramedic,
     emergency medical technician, rescue worker, ambulance
     personnel, or hazardous materials worker, who--

         (1) is trained in fire suppression, has the legal
         authority and responsibility to engage in fire


     4
     Section 553.212 (often referred to as the 20% rule, or
20/80 rule) provides:
             Employees engaged in fire protection or law enforcement
             activities as described in §§ 553.210 and 553.211, may also
             engage in some nonexempt work which is not performed as an
             incident to or in conjunction with their fire protection or law
             enforcement activities. For example, firefighters who work for
             forest conservation agencies may, during slack times, plant trees
             and perform other conservation activities unrelated to their
             firefighting duties. The performance of such nonexempt work will
             not defeat either the section 13(b)(20) or 7(k) exemptions unless
             it exceeds 20 percent of the total hours worked by that employee
             during the workweek or applicable work period. A person who
             spends more than 20 percent of his/her working time in nonexempt
             activities is not considered to be an employee engaged in fire
             protection or law enforcement activities for purposes of this
             part.

     29 C.F.R. § 553.212 (emphasis added).

                                         6
       suppression, and is employed by a fire department
       of a municipality, county, fire district, or State;
       and

       (2) is engaged in the prevention, control, and
       extinguishment of fires or response to emergency
       situations where life, property, or the environment
       is at risk.

The purpose of the amendment was to “clarify the overtime exemption

for employees engaged in fire protection activities.”           Pub. L. No.

106-151, 113 Stat. 1731 (codified as amended at 29 U.S.C. §

203(y)).

     The DOL has not revised its regulations since the legislative

change, even though one circuit has observed the need to revise at

least § 553.210. See Lockwood v. Prince George’s County, 217 F.3d

839, *1 n.1 (4th Cir. 2000)(unpublished)(“Still, we note that, in

light of the definition of ‘employee in fire protection activities’

provided   by   29   U.S.C.A.   §   203(y),   the   four-part   regulatory

definition provided by 29 C.F.R. § 553.201(a) will need to be

revised.”).

                                     C.

     The City argues that the DOL’s 20% rule in § 553.212,           which

applies to employees “engaged in fire protection activities” “as

defined in § 553.210,” is now obsolete because the recently enacted

§ 203(y) supplants § 553.210's definition.          The City also asserts

that Congress purposefully did not include the 20% rule in §

203(y), as reflected by the plain language of the statute and by




                                     7
legislative history.5

       The firefighters, on the other hand, concede that they meet

the § 203(y) definition, but argue that § 553.212's 20% rule

remains in effect because it is not in conflict with § 203(y).

They       argue    that   the      regulation   continues    to   limit   employees

considered engaged “in fire protection activities” to employees who

spend      80%     or   more   of    their   time   engaged   in   fire    protection

activities.         Because the plaintiffs spend more than 20% of their

time working as dispatchers, they contend they are not “employees

in firefighting activities” and therefore not subject to the 207(k)



       5
      The City relies on the Congressional debates to support its
contention that the legislature intended to do away with the 20%
rule. During congressional debates, Representative Boehner
observed:
     In recent years, however, some courts have narrowly
     interpreted the 7(k) exemption and held that emergency
     medical services personnel do not come within the
     exemption because the bulk of their time is spent
     engaged in nonfire protection activities. These
     lawsuits have resulted in State and local governments
     being liable for millions of dollars in back pay,
     attorneys’ fees and court costs. So there is a real
     need to modernize this area of the Fair Labor Standards
     Act and to clearly specify who can be considered a fire
     protection employee for purposes of the exemption.
145 Cong. Rec. H11,499-02, H11500 (daily ed. Nov. 4,
1999)(statement of Rep. Boehner). Representative Ehlich, the
sponsor of § 203(y), further stated:
     [F]rom its inception, the Fair Labor Standards Act has
     exempted fire protection employees from the traditional
     40-hour workweek. Historically, any emergency responder
     paid by a fire department was considered to be a fire
     protection employee. However, recent court
     interpretations of Federal labor statutes have rendered
     this definition unclear. [Section 203(y)] seeks to
     clarify the definition.
Id. (statement of Rep. Ehlich).

                                             8
pay plan.

      It is clear, and all parties concede, that § 553.210 is

supplanted by the new definition in § 203(y).           The only purpose of

Congress in amending the statute that is clear to us, is that it

intended    all   emergency   medical     technicians   (EMTs)    trained   as

firefighters and attached to a fire department to be considered

employees engaged in fire protection activities even though they

may spend one hundred percent of their time responding to medical

emergencies.      Congress did not otherwise address the 20% rule.

      However, § 553.212's 20% rule is an extension of § 553.210 in

that § 553.212 provides an explanation of the requirement of prong

four of the § 553.210 definition. This prong requires the employee

to “perform” firefighting related duties.          Section 553.212 places

a gloss on that requirement by making it clear that the employee

meets the test so long as his firefighting duties comprise more

than 80% of his total work time in a work week.            It is therefore

evident that the 20% rule in § 553.212 was intended to refine the

now obsolete § 553.210 definition.

      For the last three years, the DOL has recognized the need for

further rulemaking to interpret the amended statute by announcing

that it proposed to begin the rulemaking process.                71 Fed. Reg.

22902 (proposed April 24, 2006); 70 Fed. Reg. 27170 (proposed May

16,   2005);      69   Fed.Reg.   73457     (proposed   Dec.     13,   2004).

Unfortunately, no specific new rules have been proposed.               On the

other hand, the Office of Personnel Management (“OPM”) recently

                                     9
issued Proposed Rules (which apply to federal employees) amending

its regulations to the FLSA in an effort to “update and harmonize”

their regulations with revisions made to DOL regulations.            71 Fed.

Reg. 30301 (proposed May 26, 2006)(to be codified at 5 C.F.R. §

551.212).    The OPM has proposed the following regulation, which is

relevant to the facts of this case:         “The following employees are

engaged in fire protection activities for the purpose of pay under

section 7(k) of the Act...:          (1) Employees in positions properly

classified in the Fire Protection and Prevention series, including

any qualified firefighter who is assigned to perform support

functions (e.g., communications or dispatching functions...).            Id.

(emphasis added).

      In sum, we conclude that § 553.212 is no longer in effect.6

The   new   statute,   §   203(y),    provides   a   definition   previously

provided by § 553.210 and its subsidiary regulation § 553.212.

Both of these regulations are therefore now obsolete and without

effect.     The 20% rule no longer applies to the Plaintiffs, and it

therefore does not remove them from the statutory definition of

“employees engaged in fire protection activities.” Thus, they fall

within the § 207(k) exemption.         We therefore reverse the district

court judgment and remand this case to the district court for

further proceedings.


      6
     Section 553.212's 20% rule remains in effect as it applies
to employees engaged in law enforcement activities covered by 29
C.F.R. § 553.211. See 29 C.F.R. § 553.212.

                                      10
REVERSED and REMANDED.




                         11