O'Brien v. Town of Agawam

Decision Date02 December 2003
Docket NumberNo. 03-1685.,03-1685.
Citation350 F.3d 279
PartiesGary O'BRIEN, Donald Gallerani, Anthony Cichetti, Gerald O'Keefe, Ralph Grady, Richard Curry, Mark Ceccarini, James Donovan, Eric Gillis, Eric Fairchild, Paul Chenevert, Anthony Malone, John Konasek, Jennifer Blanchette, Christopher Brunelle, William Sliech, Anthony Grasso, Brian Strong, Eric Lottermoser, James Wheeler, Andrew Parrelli, Ronald Brown, Theresa Moccio, Richard Conlon, Daniel Ciak, Keith Bopko, Robert Marsh, Richard Light, Karen Langevin, Eric Camerlin, Gary Nardi, Steven Draghetti, John Field, Thomas Marmo, Robert Burke, Richard Riccio, Peter Bertera, Edward McGovern, Richard Niles, Edward Connor, Richard McDonnell, Paul Murphy, John Moccio, Stanley Chmielewski, Roland Dymon, Mark Pfau, Steven Grasso, Wayne Macey, Michael Gruska, Donald Loncto, Mark Poggi, Joseph Santore, Plaintiffs, Appellants, v. TOWN OF AGAWAM; Agawam Police Department, Defendants, Appellees.
CourtU.S. Court of Appeals — First Circuit

John Connor for appellants.

David A. Robinson for appellees.

Before LYNCH, Circuit Judge, LIPEZ, Circuit Judge, and OBERDORFER, Senior District Judge.*

LYNCH, Circuit Judge.

Current and former police officers of the Town of Agawam, Massachusetts brought suit under the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201 et seq., alleging that the Town's compensation scheme for police officers violates the FLSA by omitting certain wage augments from the calculation of the officers' overtime rate.1 The district court granted summary judgment for the Town, holding that the officers were required to exhaust the binding grievance and arbitration procedures in their collective bargaining agreements, and that in any event the Town had paid the officers in accordance with the FLSA. We hold that arbitration was not required, but we affirm summary judgment as to the officers of supervisory rank, whom we conclude are not covered by the FLSA. As to the remaining officers, we reverse and remand.

I.
A. Factual Background

On review of an order for summary judgment, we describe the facts in the light most favorable to the non-moving party (here, the officers). Rocafort v. IBM Corp., 334 F.3d 115, 119 (1st Cir.2003).

Appellants are current and retired police officers who are, or were at relevant times, employed by the Town of Agawam.2 The majority are patrol officers in the Agawam police force. The remainder are supervisory officers, a category that includes those holding the rank of special sergeant, sergeant, lieutenant, or captain.

Employment terms for both patrol and supervisory officers in the Agawam Police Department are established through collective bargaining. Appellants are members of the International Brotherhood of Teamsters, Local Union No. 404, which acts as their exclusive bargaining agent. On May 14, 1999, the Union and the Town negotiated two collective bargaining agreements (CBAs), one for the patrol officers and another for the supervisors, establishing the pay rates, hours of work, and other terms of employment for Agawam police officers. Both CBAs were effective from July 1, 1998 through June 30, 2001. Although no successor contract has been negotiated, it is undisputed that the officers continue to work and receive pay under the terms of the CBAs. Apart from differences in pay rates, the two agreements are essentially identical for purposes of this appeal.3

Under the CBAs, all officers work 1950 straight-time hours per year, or an average of 37.5 such hours per week. They do so on a standard "four days on, two days off" work schedule — that is, a repeating cycle of four consecutive days on duty followed by two consecutive days off duty.4 Each scheduled day on duty involves an eight-hour shift, plus ten additional minutes to attend roll-call. Due to the officers' six-day shift rotation, the number of hours each officer is scheduled to work varies from week to week.5

The CBAs also anticipate that officers will be called upon to work outside of their scheduled hours, as threats to the public health and safety do not necessarily coincide with shift rotations. If an officer works longer than a single shift on any given day, or otherwise must be on-duty when he was scheduled to be off-duty, he is entitled by contract to "overtime" pay at the rate of "time and one-half."6 In addition various minimum levels of compensation apply to such extra work — for example, any officer who is called to work on an off-duty day is guaranteed at least four hours of overtime pay, regardless whether he actually does four hours of labor.

The CBAs also establish the amounts of the officers' wages. The agreements set annual "salary" figures for officers of each grade and rank. Each officer receives exactly 1/52 of that salary each week as base pay, regardless of the number of hours actually worked during that week. In addition, the CBAs guarantee certain additional compensation to the officers, including shift-differential compensation,7 longevity pay,8 and career-incentive pay under the Quinn Bill, Mass. Gen. Laws ch. 41, § 108L.9 The Town does not include these wage "augments" in the calculation of the officers' "time and one-half" overtime rate. Instead, the Town calculates each officer's overtime rate simply by dividing the officer's annual salary by 1950, which is the expected number of regular shift hours during the calendar year, and then multiplying the resulting hourly rate by 1.5. This is the only overtime calculation method that the Town employs; it does not use a different formula or pay a different rate for hours worked in excess of forty in a week. In addition to straight-time pay, overtime pay, and the contractual wage "augments," the officers receive a fixed lump-sum payment each December to compensate them for the time spent at roll-call before each shift.10

Both of the CBAs provide binding grievance and arbitration procedures. These procedures are the exclusive avenue of redress for any claim that the Town violated an obligation under the agreement. Neither arbitration provision refers to statutory claims, and neither CBA contains any other arbitration provision. None of the appellants filed a grievance or sought arbitration concerning any of the issues in this case.

B. Procedural History

On July 3, 2001, three days after the expiration of the CBAs, appellants filed this action against the Town. The complaint alleged that the Town's method of calculating overtime wages violates the FLSA because it fails to include the officers' contractually guaranteed wage augments in their "regular rate" of pay—that is, the rate to which the FLSA's time-and-a-half overtime multiplier is applied.11 See 29 U.S.C. § 207(a) (overtime compensation must be paid "at a rate not less than one and one-half times the regular rate at which [the employee] is employed"). In addition, appellants claimed that the Town violates the FLSA by compensating officers for roll-call attendance in an annual lump-sum payment, rather than as weekly overtime.

After discovery, the parties filed cross-motions for summary judgment. On January 7, 2003, the district court granted summary judgment for the Town. On May 1, the court issued a memorandum declaring that the officers' FLSA claim failed for three reasons, each sufficient to support summary judgment. First, the district court held that despite the officers' invocation of the FLSA, they had in fact pleaded "a classic contract-anchored dispute over calculation of overtime, gussied up as a statutory claim." Accordingly, the court held that appellants were obligated to exhaust their grievance and arbitration remedies under the CBAs. Second, the court held that the Town adequately compensates — indeed, overpays — the officers under the FLSA because it properly employs the "fluctuating workweek" calculation method in 29 C.F.R. § 778.114, which requires only half-time (rather than time-and-one-half) overtime premiums. Finally, the district court held that the Town was entitled to summary judgment because the officers are subject to the partial overtime exemption for law enforcement officers in 29 U.S.C. § 207(k), and given that partial exemption, the officers were adequately compensated under the FLSA. The officers timely appealed.

II.

We review the district court's grant of summary judgment de novo. V. Suarez & Co., Inc. v. Dow Brands, Inc., 337 F.3d 1, 4 (1st Cir.2003).

Because the legal issues in this case are both numerous and complex, a brief preview of the analysis may be helpful. First, we examine the district court's three grounds for summary judgment in turn and conclude that each was in error. Second, we consider whether the district court's decision may be affirmed on any alternative basis that is manifest in the record. See Torres-Rosado v. Rotger-Sabat, 335 F.3d 1, 13 (1st Cir.2003). We hold that summary judgment was proper as to the supervisory officers because they are exempt from the overtime requirements of the FLSA. Finally, we reach the merits of the non-supervisory officers' FLSA claims and conclude that shift-differential pay, longevity pay, and career-incentive pay must all be included in the calculation of the officers' "regular rate" under the FLSA. We also conclude that roll-call time must be included in the officers' weekly hours-worked under the FLSA and be compensated accordingly.

A. The District Court's Grounds for Summary Judgment
1. Arbitration under the CBA

The district court held that the officers' FLSA claims are barred from federal court because they are essentially contract claims for unpaid overtime, and contract claims are subject to the CBA's mandatory grievance and arbitration procedures. On appeal, the officers argue that their statutory and contractual rights are distinct, and that nothing in the CBAs waives their statutory right to a judicial forum for their FLSA claims. They also contend that even if such a waiver were...

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