Abundis v. United States

18 Cl. Ct. 657, 29 Wage & Hour Cas. (BNA) 1651, 1989 U.S. Claims LEXIS 231, 1989 WL 135611
CourtUnited States Court of Claims
DecidedNovember 9, 1989
DocketNo. 22-88C
StatusPublished
Cited by5 cases

This text of 18 Cl. Ct. 657 (Abundis v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Abundis v. United States, 18 Cl. Ct. 657, 29 Wage & Hour Cas. (BNA) 1651, 1989 U.S. Claims LEXIS 231, 1989 WL 135611 (cc 1989).

Opinion

OPINION

BRUGGINK, Judge.

Pending before the court is plaintiffs’ motion for partial summary judgment on the issue of liability. After oral argument, the court directed the parties to narrow the fact issues by resubmitting proposed findings of fact. Additional briefing was also allowed. After considering the parties’ submissions and argument, the motion is denied.

I. BACKGROUND

Ruben S. Abundis and over 500 others who have filed their written consent to be party plaintiffs in accordance with 29 U.S.C. § 216(b) (1982), are, or were, employed by the United States Government in engineering, technical, or related job categories at various locations. They are or were employees within the meaning of section 7(a) of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 207(a). This action seeks backpay, liquidated damages, interest, and attorney’s fees, pursuant to 5 U.S.C. § 5596 (1988), 28 U.S.C. §§ 1346(a)(2), 1492, 2201, 2202 (1982), and 29 U.S.C. § 216(b). The original complaint was filed on January 13, 1988. This was followed by the first-amended complaint on March 9, 1988, and the second-amended complaint on June 21,1988. Discovery has been limited pending the outcome of the present motion.

Plaintiffs allege that they have been unlawfully exempted from entitlement to overtime compensation under section 7(a), due to plaintiffs’ employing agencies’ adherence to regulations promulgated by the Office of Personnel Management (“OPM”), the Government agency charged with administering the FLSA with respect to federal employees. See id. § 204(f).

Section 7(a) provides that an employer shall compensate its “nonexempt” employees at a rate not less than one and one-half times their regular rate of pay for each hour employed in excess of 40 hours per week. Section 13 then creates several categories of work which exempt employers from an obligation to pay overtime wages. [658]*65829 U.S.C. § 213. Relevant to this action is the following language:

(a) The provisions of section 206 ... and section 207 of this title shall not apply with respect to—
(1) any employee employed in a bona fide executive, administrative, or professional capacity____

Id. § 213(a).

On October 25, 1983, OPM published a notice of final rules and regulations which-modified criteria for determining a federal employee’s exemption status under the FLSA. 48 Fed.Reg. 49,494 (Oct. 25, 1983). The regulations purported to define those classes of employees who would be considered exempt from overtime eligibility. 5 C.F.R. pt. 551 (1986). The specific regulation relevant to the case at bar is 5 C.F.R. § 551.203(c). By its terms all employees classified at pay grades of GS-11 and above were to “be presumed to be exempt” from the overtime protection of the FLSA. Id. § 551.203(c) (“presumption regulation”). Agencies were permitted to request OPM to remove specific positions graded GS-11 or above from the exemption presumption. Id. § 551.207.

Implementation of these regulations was delayed, however, due primarily to riders on congressional appropriation bills that prevented OPM from using funds to issue the rules and due to the litigation concerning these riders. See National Treasury Employees Union v. Devine, 733 F.2d 114, 115-16 (D.C.Cir.1984). On August 30, 1985, OPM republished the regulations for implementation and they became effective on November 1, 1985. 50 Fed.Reg. 35,529 (1985).

Soon after the regulations took effect, their legality was challenged. In American Fed’n of Gov’t Employees, AFL-CIO v. Office of Personnel Management, 821 F.2d 761 (D.C.Cir.1987) (“AFGE”), the United States Court of Appeals for the District of Columbia Circuit vacated and invalidated 5 C.F.R. § 551.203(c) along with various other OPM regulations. The court held that because the presumption regulation shifted the burden of proving exemption from the employer to the employee, it was inconsistent with the FLSA. AFGE, 821 F.2d at 771.

On September 18, 1987, OPM issued an Interagency Advisory Group Memorandum advising personnel directors of other federal agencies of its concurrence with the Department of Justice’s decision not to seek further review of the decision of the D.C. Circuit. OPM instructed agencies to apply the detailed exemption criteria that predated the presumption regulation in determining whether employees holding positions graded at GS-11 or above should be exempted from the overtime provisions, of the FLSA. See Federal Personnel Manual System Letter (“FPM Letter”) 551-7 (July 1, 1975). By an interim rule published on January 22, 1988, 53 Fed.Reg. 1739, OPM confirmed its previous advice and formally withdrew the presumption regulation.

Plaintiffs allege that they were exempted from the overtime provisions of the FLSA after November 1985 solely by operation of the presumption regulation. Further, they allege that their nonexempt FLSA status which predated the invalid regulations has not been restored, nor have they been paid any FLSA compensation for the overtime hours they have worked since November 1985.

On March 10, 1988, defendant filed a motion to dismiss, premised on the application of 29 U.S.C. § 259. That section protects an employer from liability if its failure to pay overtime was due to good-faith reliance on a regulation promulgated by “the Administrator of the Wage and Hour Division of the Department of Labor,” even if the regulation is later invalidated. In an opinion dated September 13,1988, the court rejected defendant’s argument. The Federal Circuit declined to consider the question after it was certified pursuant to 28 U.S.C. § 1292(d)(2) (1982).

Plaintiffs’ motion for partial summary judgment presents three independent arguments for why liability should be determined in their favor. First, they contend that the presumption regulation was the sole basis for conversion of these plaintiffs to exempt status, and that when that regulation was nullified, their status reverted to [659]*659“nonexempt.” A corollary of this argument is plaintiffs’ position that defendant cannot now argue that the 1985 decisions to convert them to “exempt” status were appropriate under 29 U.S.C.

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18 Cl. Ct. 657, 29 Wage & Hour Cas. (BNA) 1651, 1989 U.S. Claims LEXIS 231, 1989 WL 135611, Counsel Stack Legal Research, https://law.counselstack.com/opinion/abundis-v-united-states-cc-1989.