Richard A. Laforte and Rickey A. Rogers v. Constance Horner, Director, U.S. Office of Personnel Management and the United States of America

833 F.2d 977, 28 Wage & Hour Cas. (BNA) 537, 1987 U.S. App. LEXIS 687

• Court: Court of Appeals for the Federal Circuit
• Decided: November 17, 1987
• Docket: 87-1138
• Status: Published

Opinions

PER CURIAM.

DECISION

Appellants, two federal firefighters, appeal from the judgment of the United States District Court for the District of Maryland (Black, J.), granting appellee's motion for summary judgment. Correspondingly denying appellants’ motion for summary judgment, the district court ruled that the formula in Federal Personnel Manual (FPM) Letter 551-5 used by the Office of Personnel Management (OPM) to calculate the overtime pay entitlements for appellant firefighters under the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-219 (1982 & Supp. Ill 1985), was valid and in conformity with the requirements of Title 5, the FLSA, and Department of Labor regulations. We affirm.

BACKGROUND

At the time that this action was filed, appellants Richard A. LaForte and Rickey A. Rogers were civilian federal firefighters (grade GS-5, step 1) employed at Andrews Air Force Base in Maryland. Federal firefighters do not work a 40-hour workweek, but instead are employed for 144 hours per 14-day biweekly work period. The firefighters are on duty for six 24-hour shifts during each 14-day work period. Each 24-hour shift consists of 8 hours of work, and 16 hours of standby time during which the firefighters are confined to their work stations and subject to immediate duty in the event of a fire or other emergency.

Congress recognized that the work schedules of firefighters differ from those of typical general schedule (GS) government employees and provided for those differences in the statutes governing the firefighters’ pay. The firefighters receive basic general schedule pay, see 5 U.S.C. § 5332, and in addition, in accordance with 5 U.S.C. § 5545(c)(1) (1982), the firefighters receive “premium pay” of up to 25 percent of their basic GS pay in recognition of the substantial portion of their regularly scheduled duty spent in a standby status. Additionally, section 7(a) of the FLSA provides that federal employees are not to be employed for a longer workweek than 40 hours unless they receive compensation at a rate not less than one and one-half times the regular rate at which they are employed. However, federal firefighters initially were excepted from the FLSA provisions when the federal government became subject to the FLSA in 1974.

An amendment to the FLSA, taking effect on January 1, 1975, and codified as 29 U.S.C. § 207(k), provided an exception to section 207(a) for public agency employees engaged in fire protection services. The current version of 29 U.S.C. § 207(k) reads, in pertinent part, that:

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 ... 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 ... 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.

Thus, in addition to their basic pay and premium pay, federal firefighters also are entitled to receive additional compensation under the FLSA, the amount of which is calculated in accordance with the formula outlined in FPM Letter 551-5. FPM Letter 551-5 was promulgated by the Civil Service Commission, the predecessor agency to OPM, within weeks of the enactment of section 207(k) and contained detailed guidelines for computing FLSA pay for firefighters in accordance with that section. However, not satisfied with the manner in which their FLSA overtime compensation was calculated, the appellants filed suit in the district court, challenging the validity of the FPM formula and seeking to recover any compensation improperly withheld, together with interest, liquidated damages, and attorneys’ fees as provided in 29 U.S.C. § 216(b).

The appellants’ suit is not the first court challenge to the method by which federal firefighters are compensated. The leading case is Zumerling v. Devine, 769 F.2d 745 (Fed.Cir.1985), a case involving a challenge to the computation method of firefighters’ FLSA pay in which this court decided several issues that provide a backdrop for the present case. We will not repeat the entire analysis contained in the Zumerling opinion; nevertheless, an understanding of the issues presented and decided in that case is crucial to the resolution of the present case.

Under section 7 of the FLSA, federal firefighters are entitled to be compensated at a rate not less than one and one-half times their “regular rate” of pay, see 29 U.S.C. § 207(e), for a portion of their 144-hour, 2-week work period. The plaintiffs in Zumerling challenged the method in which the regular rate was calculated under FPM Letter 551-5 as used by OPM.¹ The court in Zumerling observed that OPM had the authority to interpret the FLSA statute and concluded that FPM Letter 551-5 was a valid exercise of that authority. 769 F.2d at 750 (citing Beebe v. United States, 640 F.2d 1283, 226 Ct.Cl. 308 (1981)). Citing with approval the discussion in Alexander v. United States, 1 Cl.Ct. 653 (1983), the court concluded that OPM’s administration of the FLSA overtime provisions was both reasonable and consistent with the statute, the regulations promulgated by the Secretary of Labor, and the intent of Congress. 769 F.2d at 749-52.

The court in Zumerling expressly decided that the “regular rate” of pay for firefighters is equal to the employees’ total remuneration (basic pay plus premium pay) divided by the total number of hours worked in a work period (144 hours). Id. at 749-52. In reaching this conclusion, the court determined that the premium pay received by the firefighters was not excluded under 29 U.S.C. § 207(e) from being included in the regular rate calculation:

The firefighters’ premium pay is not received in return for any particular hours of work. Rather it is a function of the government’s recognition that firefighters don’t work the typical work schedule of the federal system. The annual basis payment, therefore, is not an overtime payment, but a means of generally compensating the employees given the confines of the federal pay schedule. As such, it is part of the wage typically paid for each hour of work and must be included [in the calculation of “regular rate”].

Id. at 751. Therefore, the court rejected arguments that the “total remuneration” should not include premium pay received pursuant to 5 U.S.C. § 5545. The court also rejected the argument that, in order to determine the “regular rate,” the total remuneration should not be divided by the total number of hours for which it is received, 144 hours in a 2-week pay period.² Finally, the court concluded that the formula reflected in the FPM Letter was both proper and consistent with the statute and regulations in allowing additional compensation of one-half the regular rate rather than one and one-half times the rate because the employee’s total remuneration calculation compensates the employee at 100 percent for all the hours in his tour of duty and the additional one-half thereby allows the employee to receive one and one-half times the regular rate at which he or she is employed. 769 F.2d at 752-53.

In granting the government’s motion for summary judgment in the present case, the district court ruled that issues in Zumer-ling were identical to those presented by the case before it, that the result reached there was correct, and that, in any event, it was bound by that decision since any appeal in the present case would come to this court. Not surprisingly, in appealing the district court’s decision in this court, the appellants argue that Zumerling did not decide issues identical to the present case and, to the extent that it did, it was wrongly decided. However, to the extent that the issues in the present case are identical to those decided in Zumerling, this panel is bound by that decision as only the court sitting in banc can overrule prior decisions of this court. Capital Electric Co. v. United States, 729 F.2d 743, 746 (Fed.Cir.1984). Thus, we must identify and address the issues raised in this appeal left unanswered by the court in Zumerling or alternatively conclude, as did the district court, that the issues presented are identical and that we are bound by that decision.

OPINION

Having seen a series of challenges to the method in which the firefighters’ regular rate is calculated under FPM Letter 551-5 rejected by the decisions in Zumerling and Wheeler, the appellants here do not challenge the regular rate calculation but now choose to attack the adequacy of their pay calculation from another direction by challenging what the OPM can properly use as an offset against the one and one-half times regular rate amount that constitutes their minimum compensation entitlement under 29 U.S.C. § 207(k). The appellants provide several alternative grounds in support of their position which distills into a single proposition. The appellants argue, in short, that they cannot be deemed to receive their regular rate of pay for each of the 144 hours that they are on duty because basic pay is limited by 5 U.S.C. § 5504(b) to 80 hours per week.

Thus, while conceding that Zumerling held that premium pay is earned in every hour on duty, appellants contend that the basic GS pay of a federal firefighter can only be deemed payment for 80 hours of work in a 2-week work period and therefore cannot be considered either as payment for any of the 38 hours for which they are to be compensated under 29 U.S.C. § 207(k) or as an offset against the government’s liability to pay appellants one and one-half times their regular rate for those hours.³ Thus, appellants argue that they should be deemed to receive both basic pay and premium pay for only the first 80 hours of each 2-week work period and to receive only premium pay for the last 64 hours, including the 38 hours for which they are to be compensated in accordance with 29 U.S.C. § 207(k). Since they are entitled to one and one-half times their regular rate for each of the last 38 hours worked in each 144-hour work period, appellants contend that their pay (per hour) for those hours should equal the difference between one and one-half times their regular rate and their “hourly premium pay” instead of one-half times their regular rate as instructed by FPM Letter 551-5.⁴

Appellants base their argument on the language of 5 U.S.C. § 5504(b) which stated, at the time relevant to this case:

For pay computation purposes affecting an employee, the annual rate of basic pay established by or under statute is deemed payment for employment during 52 administrative workweeks of ¹40 hours. When it is necessary for computation of pay under this subsection to convert an annual rate of basic pay to a basic hourly ... rate, the following rules govern:

(1) To derive an hourly rate, divide the annual rate by 2,080.⁵

They also base their argument on two responses made by the government in the course of this litigation to requests for admissions. In response to the first request, the government responded “admit” to the query that "for pay computation purposes, non-exempt Federal Fire Fighters are deemed to receive payment of the annual rate of GS basic pay for employment during 52 basic administrative workweeks of 40 hours.” To the second request, the government also answered “admit” to the query that “for pay computation purposes, non-exempt Federal Fire Fighters are deemed to receive no payment of their annual rate of GS basic pay for employment in excess of 40 hours during any of the 52 basic administrative workweeks.” Appellants argue that these admissions confirm the plain meaning of section 5504(b) and should be deemed admissions against interest under Fed.R.Civ.P. 36(b).

Addressing the appellants’ last contention first, we note that requests for admissions are designed to secure the just, speedy and inexpensive determination of actions by avoiding the time, trouble and expense required to prove undisputed facts which should be admitted. Fed.R.Civ.P. 36(b). The government argues that its admissions were intended merely to admit that section 5504(b) “says what it says.” Since appellants’ argument is based on “the plain language” of section 5504(b), it could be presumed that they could read what section 5504(b) says without the government’s redundant assistance. Nevertheless, we do not find the government’s admissions to be determinative of the meaning of 5 U.S.C. § 5504(b) intended by Congress. That question is a legal issue which must be determined, if necessary, by the courts, and one which the appellants have addressed comprehensively and exhaustively in their briefs. Furthermore, as the government’s admissions do simply parrot the language of the statute, the true import and meaning of the government’s admissions depend upon the proper interpretation of the statute. We do not believe that the appellants have been prejudiced in advancing their arguments without reliance on the government’s admissions. See Gutting v. Falstaff Brewing Corp., 710 F.2d 1309, 1314 (8th Cir.1983); see also Hill v. United States, 571 F.2d 1098, 1103 n. 9 (9th Cir.1978).

As noted above, the court in Zumerling stated that “employees receive their regular rate of pay for each of the 144 hours they work.” 769 F.2d at 752. Thus, the government argues that the Zumerling opinion rejected the basic premise of the appellants’ case — that they do not receive their regular rate of pay for each of the 144 hours in their 2-week work period— and therefore should control this case. However, appellants argue that the court did not expressly determine whether 5 U.S. C. § 5504(b) had any relevance, in the manner urged here by appellants, to the allocation of the appellants’ pay to the various hours worked. Contrary to the government’s contentions, an awareness of section 5504(b), as indicated by citation to it by both the district court and this court in their respective Zumerling opinions, does not necessarily without more show an implicit consideration and rejection by the courts of the specific interpretation urged here.⁶

Nevertheless, having examined the appellants’ contentions carefully, we are not persuaded that their reading of section 5504(b) properly reflects the intent of Congress with respect to those federal employees engaged in fire protection services. Nor do appellants’ arguments persuade us of the need to alter the result reached in Zumerling. It is axiomatic that “a clear and unambiguous statute speaks for itself.” Selman v. United States, 498 F.2d 1354, 1356, 204 Ct.Cl. 675 (1974). See also Horner v. Jeffrey, 823 F.2d 1521, 1525 (Fed.Cir.1987). However, it is also true that “even where a statute is clear on a purely linguistic level, interpretation may be necessary if that interpretation does not do justice to the realities of the situation.” Texas State Commission for the Blind v. United States, 796 F.2d 400, 406 (Fed.Cir.1986), cert. denied, — U.S. —, 107 S.Ct. 874, 93 L.Ed.2d 828 (1987); see also Church of the Holy Trinity v. United States, 143 U.S. 457, 459, 12 S.Ct. 511, 512, 36 L.Ed. 226 (1892). The realities of the situation before us are that Congress has recognized that firefighters are not situated the same as other general schedule federal workers and that firefighters do not work standard 40-hour workweeks. As a result, the compensation scheme applicable to firefighters as devised and intended by Congress differs significantly from that of the standard GS federal employee. See Wheeler, 9 Cl.Ct. at 581.

Here, FPM Letter 551-5 was issued by the Civil Service Commission within 2 weeks of the effective date of the amendment to the FLSA which became 29 U.S.C. § 207(k) and is a comprehensive document covering all aspects of the pay entitlements of federal employees engaged in firefighting and law enforcement activities under the FLSA and Title 5. See United States v. Clark, 454 U.S. 555, 565, 102 S.Ct. 805, 811-12, 70 L.Ed.2d 768 (1982) (“construction of a statute by those charged with its administration is entitled to great deference, particularly when that interpretation has been followed consistently over a long period of time”). As recognized in Zumer-ling, OPM had “the power to interpret the FLSA statute and to set forth the guidelines and policy of the agency” and the court concluded that FPM Letter 551-5 was a valid exercise of the authority delegated to it by Congress. 769 F.2d at 750. As stated by this court recently in Slugocki v. United States, 816 F.2d 1572, 1578 (Fed.Cir.), cert. denied, — U.S. —, 108 S.Ct. 486, 98 L.Ed.2d 484 (1987):

This court [in Zumerling ] held that “OPM’s administration of the FLSA overtime provisions [was] both reasonable and consistent with the statute, the regulations promulgated by the Secretary of Labor, and the intent of Congress.” ... Moreover, one of our predecessor courts, the Court of Claims, held in Beebe v. United States, 640 F.2d 1283, 226 Ct.Cl. 308 (1981), that FPM Letter 551-5 was a proper exercise of authority delegated to OPM and that it was proper for an agency to rely on it in implementing the FLSA provisions. Zumerling, 769 F.2d at 750. We are bound by the Zumerling and Beebe decisions....

In keeping with the Supreme Court’s instructions, this court has consistently stressed that its review of an agency regulation is restricted in that “[t]he long-standing interpretation placed on a statute by the agency charged with its administration should be followed unless there are compelling reasons that it is wrong.” Money v. Office of Personnel Management, 811 F.2d 1474, 1477 (Fed.Cir.1987) (citing Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 837, 843-44, 104 S.Ct. 2778, 2782, 81 L.Ed.2d 694 (1984); see also Minnesota Power & Light Co. v. United States, 782 F.2d 167, 170 (Fed.Cir.1986). As this court stated in Consumer Products Division, SCM Corp. v. Silver Reed America, Inc., 753 F.2d 1033, 1039 (Fed.Cir.1985):

[I]t is a cardinal principle that the Secretary’s interpretation of the statute need not be the only reasonable interpretation or the one which the court views as the most reasonable. See, e.g., Fulman v. United States, 434 U.S. 528, 534-36 [98 S.Ct. 841, 845-46, 55 L.Ed.2d 1] (1978) (regulation which had a “reasonable basis” in the statutory history upheld, even though taxpayer’s challenge had “logical force”). See also United States v. Cornell, 389 U.S. 299, 307 [88 S.Ct. 445, 450, 19 L.Ed.2d 537] (1967) (“[I]f found to ‘implement the Congressional mandate in some reasonable manner,’ [the regulation] must be upheld.”).

(Emphasis and bracketed material in original.)

In the case before us, the computation formula proposed by appellants appears to be confusing, to say the least, and perhaps unworkable. Even if it was deemed logical or reasonable in its own right, the issue before us is not the reasonableness of the appellants’ method, but whether the method employed by OPM to calculate the appellants’ pay is reasonable and in accordance with the statute. We believe that the interpretation given by OPM to the relevant statutes, as reflected in FPM Letter 551-5, is entirely reasonable. Furthermore, we believe that the deference to be paid to a consistent agency interpretation of a statute that it is charged with interpreting is even more compelling when that interpretation has been upheld several times by the reviewing court. While appellants’ argument poses a challenge to FPM Letter 551-5 in a slightly different light from the previous challenges, acceptance of its rigid adherence to the printed statute without taking into consideration Congress’s overall compensation scheme for federal firefighters would necessarily mean that the challenges previously considered were at least in part incorrectly rejected by this court. We do not agree with such a result, even if we were empowered to reach it.

It is clear that appellants could not advance their current argument based on the language of section 5504(b) as it now reads because, as noted above, the Consolidated Omnibus Budget Reconciliation Act of 1985 deleted the sentence from section 5504(b) relied on by appellants. We do not believe that Congress intended that amendment to make a significant and substantive change to the pay computation method of federal firefighters. The section in the Act enacting the amendment to section 5504(b) was entitled “Computation of Hourly Rates of Pay,” which appears to confirm that section 5504(b) was never intended to do anything more than provide a method to enable employees receiving annual pay to calculate a corresponding hourly, daily, or weekly rate. In fact, the lack of any specific legislative history accompanying the 1986 amendments to section 5504(b) indicates that Congress was unaware of any arguable effect the amendments might have on firefighters’ pay and is an even better indication that Congress did not amend section 5504(b) with the precise issue of the firefighters’ FLSA pay in mind. This confirms our result since where “Congress has not directly addressed the precise question at issue,” the question for the reviewing court is only whether the interpreting agency’s answer “is based on a permissible construction of the statute.” Chevron U.S.A., 467 U.S. at 843, 104 S.Ct. at 2782.

We believe that the OPM’s interpretation is permissible and reasonable in light of the statutes. We find the appellants’ proposed pay computation method to be just one more attempt by federal firefighters to gain a pay windfall through creative mathematics rather than from the intentions of Congress. Therefore, we conclude, as did the district court in this case, that 5 U.S.C. § 5504(b) is “simply not relevant to a determination of overtime wages” for federal firefighters. The judgment of the district court is affirmed.

AFFIRMED.

1 . The district court in the Zumerling case noted that "[pllaintiffs do not challenge F.P.M. Letter 551-5.” Zumerling v. Marsh, 591 F.Supp. 537, 540 n. 4 (W.D.Pa.1984). Appellants here rely on that footnote as grounds for this panel to review FPM Letter 551-5 on a clean slate. However, it is clear from an examination of the prior opinion of this court in the appeal from that decision in that case that FPM Letter 551-5 was indeed "squarely at issue" and addressed by this court. 769 F.2d at 747.

2 . Specifically, the plaintiffs in Zumerling had proposed that the regular rate be calculated as the employees’ GS basic pay for the 2-week work period divided by 80 hours or, alternatively, as the employees’ total remuneration (basic pay plus premium pay) divided by the statutory average tour of duty (the statutory nonovertime hours) as calculated under 29 U.S.C. § 207(k). See also Wheeler v. United States, 9 Cl.Ct. 579 (1986).

3 . Under 29 U.S.C. § 207(k), the appellants in this case were apparently entitled to such compensation after 106 hours in their 144-hour, 2-week work shift. In Zumerling, the firefighters were entitled to be compensated at one and one-half times their regular rate after 108 hours of duty. 769 F.2d at 747. See also Lanehart v. Homer, 818 F.2d 1574, 1576 n. 4 (Fed.Cir.1987).

4 . The appellants’ arguments necessarily require that a federal firefighter such as one of the appellants be deemed to receive his overall pay during his regularly scheduled 144-hour work period in the following manner. In each of the first 80 hours, he would receive Vsoth of his basic GS pay for the 2-week period and Vmth of his premium pay for the 2-week period. For each of the next 26 hours, he would only receive !/i44th of his premium pay. Finally, for the last 38 hours, he would be deemed to receive '/144th of his premium pay and sufficient additional pay to bring the total compensation for each of those 38 hours to equal his regular rate of pay times one and one-half. Thus, since the appellants have already received one-half their regular rate of pay for each of the last 38 hours in the 2-week work period, their proposed calculation would mean that they have been underpaid for each of the last 38 hours of each 2-week work period by an amount equal to the difference between their regular rate of pay and 'Amth of their premium pay for the 2-week period.

5 .In 1986, among other changes, the entire first sentence quoted in the text was deleted from the statute language. See Consolidated Omnibus Budget Reconciliation Act of 1985, Pub.L. No. 99-272, § 15203, 100 Stat. 82, 334 (1986) (codified at 5 U.S.C. § 5504(b) (Supp. IV 1986)).

6 . On the other hand, we note that the Claims Court in Wheeler apparently was not struck by the "plain language” of section 5504(b) when rejecting an assertion based on section 5504(b) that calculation of the regular rate should be based on 80 hours, rather than 144 hours. 9 Cl.Ct. at 583-84 (relying on Zumerling).

1 . I further note that the ramifications resulting from the adoption of my view might not be confined to Zumerling as the conclusions contained therein with which I disagree have been relied on in subsequent decisions of this court and of the Claims Court. See, e.g., Slugocki v. United States, 816 F.2d 1572 (Fed.Cir.), cert. denied, — U.S. —, 108 S.Ct. 486, 98 L.Ed.2d 484 (1987); Wheeler v. United States, 9 Cl.Ct. 579 (1986).