Kennedy v. State, 03-0650.

• Decision Date: 06 October 2004
• Docket Number: No. 03-0650.,03-0650.
• Citation: 688 N.W.2d 473
• Parties: Duane KENNEDY, Michael Ashby, Dennis Phillips, Stephen Pierce, Michael Sells, and Bill Medland, Appellants, v. The STATE of Iowa and the Iowa Department of Natural Resources, Appellees.
• Court: Iowa Supreme Court

688 N.W.2d 473

Duane KENNEDY, Michael Ashby, Dennis Phillips, Stephen Pierce, Michael Sells, and Bill Medland, Appellants, v. The STATE of Iowa and the Iowa Department of Natural Resources, Appellees.

No. 03-0650.

Supreme Court of Iowa.

October 6, 2004.

Pamela J. Walker and Mark D. Sherinian of Sherinian & Walker, P.C., Des Moines, for appellants.

Thomas J. Miller, Attorney General, Gordon E. Allen, Deputy Attorney General, and Kerry K. Anderson, Assistant Attorney General, for appellees.

WIGGINS, Justice.

Current and former peace officers brought an action against the State of Iowa and the Iowa Department of Natural Resources (DNR) for overtime compensation under the Fair Labor Standards Act (FLSA). Because we agree with the district court's decision that: (1) the peace officers are not entitled to be compensated for their drive time; (2) the State adopted a 29 U.S.C. § 207(k) (1988) workweek; (3) the State's policy of requiring the peace officers to take leave for absences less than a day does not violate the FLSA's salary-basis test; (4) the peace officers are not entitled to interest on their damages from the date of filing their action; (5) the peace officers' meal time is compensable; and (6) the filing of the action in federal court tolled the statute of limitations, we affirm the district court as to those matters. We, however, conclude the State cannot reduce the peace officers' overtime claims for hours off under its work-schedule-adjustment policy and reverse the district court as to that issue. Therefore, we affirm the district court's judgment in part, reverse it in part, and remand the case to the district court to redetermine the damages, if any, consistent with this decision.

I. Background Facts and Procedure.

The parties submitted this case on a stipulated record. The record included a stipulation of facts, exhibits, depositions, and testimony given in the companion case of Raper v. State, 688 N.W.2d 29, ___ (Iowa 2004), which we filed this day. The six plaintiffs are certified peace officers who are current and former employees of the DNR. The DNR has classified these peace officers as exempt under the FLSA. The peace officers sought overtime wages, liquidated damages, and attorney fees for alleged violations of the overtime provisions of the FLSA.

The peace officers originally filed their claim in federal court on February 16, 1996. The State moved to dismiss the case for lack of subject matter jurisdiction. On June 21, 1996, the federal district court dismissed the peace officers' entire case for lack of subject matter jurisdiction, which the Eighth Circuit later affirmed. Raper v. Iowa, 115 F.3d 623 (8th Cir.1997). Before the federal district court dismissed the peace officers' case for lack of subject matter jurisdiction, they filed this action in state court in April 1996. The district court stayed this case pending the outcome of Anthony v. State, 632 N.W.2d 897 (2001), because Anthony was preclusive on the issue of liability and binding on the parties in this action. After our decision in Anthony, this case was set for trial.

On March 18, 2003, the district court issued the first part of its order. Applicable to this appeal, the district court found: (1) the State has proven the existence of a twenty-eight-day work period; (2) the peace officers' travel time should be excluded from their overtime claims; (3) the peace officers' meal time is compensable; (4) there is no liability for overtime wages after January 31, 1996, despite the peace officers' contention the State's continuing policy of requiring employees to take vacation, sick leave, or other forms of leave for absences of less than a day violates the FLSA's salary-basis test; (5) the peace officers' overtime hours should be reduced by the amount of work-schedule-adjustment hours they have used; (6) the peace officers are not entitled to interest on their damages from the date of filing their action; and (7) the statute of limitations was tolled by the filing of the federal lawsuit.

On April 14, 2003, the trial court issued its second order regarding damages and entered its judgment. It awarded the peace officers nearly $70,000 in damages. Both parties appeal.

II. Issues.

The peace officers ask us to review the following: (1) whether the peace officers are entitled to be compensated for their drive time; (2) whether the State adopted a 207(k) workweek; (3) whether the State is required to reduce the peace officers' overtime claims for hours off under its work-schedule-adjustment policy; (4) whether the State's policy of requiring the peace officers to take leave for absences for less than a day violates the FLSA's salary-basis test; and (5) whether the peace officers are entitled to interest on their damages from the date of filing their action in state court.

The State raises for review: (1) whether the peace officers' meal time is compensable; and (2) whether the filing of the action in federal court tolled the statute of limitations. We will discuss the facts as they relate to the issues.

III. Scope of Review.

We set out the standard of review in Raper, 688 N.W.2d at 36, where we stated:

Our review is for errors at law. The trial court's factual findings are binding on appeal if supported by substantial evidence. When a party challenges a district court's ruling for lack of substantial evidence, we view the evidence in the light most favorable to the judgment. When a reasonable mind would accept the evidence as adequate to reach a conclusion, the evidence is substantial. Evidence is not insubstantial merely because we may draw different conclusions from it; the ultimate question is whether it supports the finding actually made, not whether the evidence would support a different finding. However, neither the district court's conclusions of law nor its application of its legal conclusions is binding on appeal. The burden of proving exempt status is on the employer.

(Citations omitted.)

IV. Are the Peace Officers Entitled to be Compensated for Their Drive Time?

Drive time is normally non-compensable. Raper, 688 N.W.2d at 45. The regulations applicable to peace officers provide:

A police officer, who has completed his or her tour of duty and who is given a patrol car to drive home and use on personal business, is not working during the travel time even where the radio must be left on so that the officer can respond to emergency calls. Of course, the time spent in responding to such calls is compensable.

29 C.F.R. § 553.221(f) (1991).¹

The two exceptions to the general rule that drive time is non-compensable are when drive time is an integral and indispensable part of the employment, or when there is a custom or practice between the employer and employee to compensate the employee for their drive time. Raper, 688 N.W.2d at 45.

A. Was the peace officers' drive time an integral or indispensable part of their employment?

The district court found the peace officers are not entitled to compensation for their drive time. It concluded even though the peace officers drive state-owned vehicles that contain police equipment, the drive to and from home is still just a commute under the FLSA. The peace officers argue when they are driving their vehicles, they are watching for law violators, assisting the public, removing debris from the highway, and remaining in contact with other law enforcement officers.

Several federal courts have addressed this issue. In Aiken v. City of Memphis, plaintiffs sought compensation for the time spent commuting to work in their vehicles. 190 F.3d 753, 759 (6th Cir.1999). Similar to the case at hand, the plaintiffs in Aiken argued the city should compensate the police officers for their drive time because they must respond to emergencies they observe or receive notification of by dispatch while driving to work. Id. The court determined "monitoring a police radio does not convert commute time into compensable work" and "the amount of work involved in monitoring a police radio during a commute is simply de minimis." Id.

Similarly, in Hellmers v. Town of Vestal, a police officer sought compensation, among other things, for his commute time. 969 F.Supp. 837, 843 (N.D.N.Y.1997). The court noted police officers are not entitled to FLSA compensation for commuting time spent in marked police cars. Id. The court noted, however, the town would likely be required to compensate the officer for any time he was required to respond to a police emergency or other police activity not incidental to his commute to work. Id. at 843 n. 2.

The stipulated record in this case notes incidents when a peace officer would stop on the officer's commute to perform law enforcement duties. As certified peace officers, these officers may take any enforcement action permitted by any sworn officer. Nevertheless, substantial evidence supports the district court's conclusion that any law enforcement duties performed on the commute did not change the commute into an integral or indispensable part of their employment. The record indicates two of the six peace officers did not include their drive time in their hours worked for payroll purposes. Further, the six officers rarely performed any law enforcement duties outside of enforcing the hunting and fishing laws. Most of the time, they left the enforcement of the laws not dealing with hunting and fishing violations to other law enforcement officers. A reasonable mind would find this evidence adequate to reach the conclusion these officers' drive time was no more than a non-compensable commute under the FLSA.

B. Was there a custom or practice between the State and peace officers to compensate the peace officers for their drive time?

The district court did not rule on whether there was a custom or practice to compensate the peace officers for their drive time in its original findings of fact, conclusions of law, and order. The peace officers filed a motion to enlarge ...