[Federal Register Volume 62, Number 246 (Tuesday, December 23, 1997)]
[Rules and Regulations]
[Pages 67238-67253]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-33429]
[[Page 67237]]
_______________________________________________________________________
Part V
Office of Personnel Management
_______________________________________________________________________
5 CFR Part 551
Pay Administration Under the Fair Labor Standards Act; Final Rule
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 /
Rules and Regulations
[[Page 67238]]
OFFICE OF PERSONNEL MANAGEMENT
5 CFR Part 551
RIN 3206-AG70
Pay Administration Under the Fair Labor Standards Act
AGENCY: Office of Personnel Management.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The U.S. Office of Personnel Management (OPM) amends the pay
administration under the Fair Labor Standards Act (referred to as ``the
Act'' or ``FLSA'') rules. We made text clearer, standardized terms,
changed to the active voice, reorganized material for added clarity,
inserted or revised headings to reflect content accurately, reduced
internal cross-referencing, corrected typographical, punctuation, and
grammatical errors, and used ``plain English.'' We included guidance
published in the sunsetted Federal Personnel Manual, added certain work
in the computer software field to the professional exemption criteria,
added an exemption for certain pilots, added the statutory exclusion of
customs officers, and included regulations on child labor and claims
and compliance.
DATES: Effective December 23, 1997.
FOR FURTHER INFORMATION CONTACT: Jeffrey D. Miller, Director,
Classification Appeals and FLSA Programs, by telephone on 202-606-2990;
by fax on 202-606-2663; or by e-mail at [email protected].
SUPPLEMENTARY INFORMATION: We received 15 submissions:
1 was from an individual and was not a comment;
4 were from individuals;
5 were from 3 agencies (3 were from 1 agency);
4 were from 5 labor organizations (1 was submitted jointly by 2 labor
organizations); and
1 was from the Office of Compliance in the Legislative Branch.
General Comments
We inserted the word ``comparable'' after the word ``other'' in the
phrase ``other white collar'' throughout the text to make the wording
consistent.
An individual commended the clarity of the supplementary
information introducing the proposed regulations as particularly
intelligible.
Another individual suggested that the modified or added portions of
the regulation published in the Code of Federal Regulations be shown in
bold face. This cannot be done in the Federal Register. However, we
will post on the OPM web site (www.opm.gov) a version of the final
regulations in which changed or added material is shown in bold face.
Individuals who do not have Internet access may request a copy by
calling 202-606-2990 or by sending a request by e-mail to
[email protected].
One labor organization commented that it was not clear which
portions of part 551 of title 5, Code of Federal Regulations, the
proposed regulations amended. Subparts A and B are amended and subparts
F and G are added. This final rule does not amend subparts C, D, or E.
The same labor organization pointed out that, in its opinion, many
Federal employees are wrongfully denied FLSA overtime pay and
recommended three guiding principles to address this problem.
First, an agency should not declare an employee to be exempt if
there is reasonable doubt about whether an employee meets any exemption
criteria.
Second, OPM's regulations should be designed to reduce ambiguity,
thereby reducing the chances that agencies will incorrectly determine
an employee to be FLSA exempt.
Third, OPM's regulations pertaining to exemptions should be
consistent with the Department of Labor's administration of the Act and
should not be susceptible to a more expansive interpretation than
comparable Department of Labor regulations.
We believe the proposed regulations published on August 25, 1997,
adequately addressed these concerns. Nonetheless, we kept these
suggested principles in mind as we made revisions. For example,
sections 551.201 and 551.202 in particular emphasize that an employee
is presumed to be nonexempt unless the agency correctly determines that
the work the employee performs clearly meets one or more of the
exemption criteria.
Another labor organization asserted that the ``salary basis test''
that is included in the Department of Labor's FLSA regulations is
applicable to Federal employees for whom OPM administers the Act.
The Department of Labor has determined that such tests do not apply
to public employees (see section 541.5d of title 29, Code of Federal
Regulations).
1. Section 551.102--Authority and Administration
The Office of Compliance in the Legislative Branch stated that
OPM's description of its responsibilities was inaccurate in three
respects.
First, the proposed regulations imply that the nine listed
employing entities and their employees are covered by the FLSA.
However, the employees of these entities are not included in the
definition of ``employee'' under section 3(e)(2) of the Act. The
Congressional Accountability Act of 1995 extends the rights and
protections of the FLSA to the employees of these entities, so it is
the Accountability Act, not the FLSA, that actually applies.
Second, the proposed regulations state that the Office of
Compliance administers the law for the listed entities. However, while
the Office of Compliance is assigned certain administrative
responsibilities under the Accountability Act, that Act does not
authorize the Office of Compliance to administer the law, as section
4(f) of the FLSA authorizes OPM to administer the FLSA.
Third, the proposed regulations refer to the Office of Technology
Assessment. While it is included in the Accountability Act, the Office
of Technology Assessment no longer exists and therefore should not be
included in a description of the responsibilities of the Office of
Compliance.
In response to these comments, we deleted the introductory language
of proposed paragraph (d) and substituted in its place the language
provided by the Office of Compliance to describe its responsibilities.
We deleted proposed paragraph (d)(9) to omit mention of the Office of
Technology Assessment.
2. Section 551.103--Coverage
An agency requested that the proposed regulations be amended to
reflect that members of the Uniformed Services are not covered by the
FLSA and ensuing regulations.
There are seven Uniformed Services. The four Uniformed Services
that comprise the Military Departments include the United States Army,
United States Navy, United States Marines, and the United States Air
Force. Additionally, three of the Uniformed Services are in Executive
Departments. The United States Coast Guard is in the Department of
Transportation. The Commissioned Corps of the National Oceanic and
Atmospheric Administration is in the Department of Commerce. The
Commissioned Corps of the Public Health Service is in the Department of
Health and Human Services.
Members of the Uniformed Services are not considered employees as
defined in section 2105 of title 5, United States Code, or other
statutes that address the pay, benefits, and duties of Federal
employees. Further, officers of the
[[Page 67239]]
Uniformed Services are appointed by the President and, in many cases,
by and with the consent of the Senate. The pay and benefits of members
of the Uniformed Services are controlled by the provisions of title 37,
United States Code.
Officers of the Uniformed Services are appointed to serve when and
where needed to meet the needs of their respective Services. Therefore,
rules regarding workweek requirements in the current and proposed
regulations are inapplicable to members of all Uniformed Services.
We adopted the agency's recommendation. In proposed paragraph
(a)(2), we inserted the words ``a civilian employee'' before the word
``appointed.'' To proposed paragraph (b), we added members of the
Uniformed Services to the list of persons not covered by the Act. We
revised proposed paragraph (b)(2) by deleting the ``or'' after the
semicolon. We revised proposed paragraph (b)(3) by deleting the period
and substituting a semicolon followed by ``or.''
3. Section 551.104--Definition of Agency
The Office of Compliance in the Legislative Branch suggested a
revision of the definition of ``agency'' if OPM's final definition of
``agency'' includes a specific exclusion of the entities in the
legislative branch whose employees are not covered under the FLSA.
The language is in keeping with the explanation of the
responsibilities of the Office of Compliance discussed in item 1 and
added to section 551.102(d), therefore, we adopted the revision.
4. Section 551.104--Definition of Claim
We added a sentence explaining that the term ``claim'' is used
generically in subpart G to include complaints under the child labor
provisions of the Act.
5. Section 551.104--Definition of De Minimis Activity or Worktime
One agency pointed out that section 785.47 of title 29, Code of
Federal Regulations, requires an employer to count as hours worked any
part, however small, of the employee's fixed or regular working time or
practically ascertainable period of time the employee is regularly
required to spend on assigned duties.
The two labor organizations pointed out that the actual amount of
time involved is only one of three factors to be considered. The other
two factors are the administrative difficulty of recording small
amounts of time and whether the work is performed on a regular basis.
In addition, one labor organization suggested that the definition be
clarified to mean fewer than a total of ten minutes in the entire
workday. The same labor organization stated that some agencies have
argued that if an employee performs a work activity for a period of
fewer than 10 minutes at the beginning of a workday and fewer than 10
minutes at the end of a workday, the de minimis doctrine can be applied
even though the total combined time for the employee exceeds 10 minutes
for the day. This labor organization outlined the three factors
discussed by the court in Lindow v. U.S., 738 F.2d 1057 (9th Cir.
1984).
In view of these comments, we deleted the proposed definition of de
minimis activity or worktime. We may address the term at a later time.
6. Section 551.104--Definition of Discretion and Independent Judgment
One labor organization stated that the proposed definition appears
to require less than is required under the Department of Labor's
regulations and suggested that the definition be made more similar to
the Department of Labor regulation at section 541.207(a) of title 29,
Code of Federal Regulations. The labor organization also suggested that
we add to proposed paragraph (3) the following sentence: ``The
discretion and independent judgment exercised must be real and
substantial, that is, they must be exercised with respect to matters of
consequence.''
After carefully weighing this comment against the need for OPM to
apply the letter and spirit of the Act in a public sector context, we
decided not to revise the proposed definition. Our proposed definition
acknowledges that in the public sector, with its responsibility and
accountability to the general public, levels of review are frequently
required. We believe that paragraph (3) of the definition, which states
that decisions made independently must be significant and then
amplifies what ``significant'' includes versus what it does not extend
to, adequately addresses the commentor's concerns.
7. Section 551.104--Definition of Employee
The agency which in item 2 pointed out that members of the
Uniformed Services are not covered by the FLSA recommended a change to
the definition of employee to reflect this.
We adopted the recommendation. In proposed paragraph (1) of the
definition of employee, we inserted the phrase ``as a civilian'' before
the phrase ``in an executive agency.''
One individual and one agency pointed out that the definition of
employee should include the Government Printing Office. The
Congressional Accountability Act of 1995, Pub. L. 104-1, amended the
FLSA at section 203(e)(2)(A) of title 29, United States Code, by
deleting the reference to ``unit[s]'' in the legislative branch in
clause (iii) and by adding a new clause (vi) identifying the Government
Printing Office as a public agency whose employees are covered by the
FLSA.
OPM's proposed regulations tracked the law's deletion, but not the
addition. This omission was unintentional. We revised the definition of
employee by deleting the ``or'' following proposed paragraph (3),
substituting a semicolon and the word ``or'' for the period following
proposed paragraph (4), and adding paragraph (5) naming the Government
Printing Office.
8. Section 551.104--Definition of Hours of Work
One labor organization suggested that the definition of hours of
work should state that all interpretations of the FLSA, including
Comptroller General decisions, OPM guidance, and agency policy and
regulations, must be consistent with the Act and Department of Labor
regulations in order to be valid.
OPM is tasked with administering the Act consistent with the
Department of Labor. Our regulations accomplish this. Therefore, we did
not find it necessary to adopt this suggestion.
9. Section 551.104--Definition of Management or General Business
Function or Supporting Service
We revised the first sentence of proposed paragraph (2) of the
definition by deleting the words ``general management, business, or
servicing functions'' and substituting in their place the words
``management or general business functions or supporting services'' to
be consistent with wording elsewhere.
Two labor organizations contended that the proposed definition
fails to clearly explain the type of work which falls under the
administrative exemption.
One labor organization pointed out that the Department of Labor
regulation at Sec. 541.205(a) of title 29, Code of Federal Regulations,
clearly distinguishes between work involving the administrative
operations of an employer--which is exempt work--and ``production''
work which involves performing activities that carry out the day-to-day
functions of the employer--which is nonexempt work.
[[Page 67240]]
The other labor organization suggested that to clarify the
definition of management or general business function or supporting
service and make it consistent with law, the following statement should
be added: ``Employees who perform the day-to-day activities necessary
for an agency to accomplish its mission do not qualify as performing
`management or general business functions or supporting services.'
We believe the proposed definition is legally correct.
10. Section 551.104--Definition of Supervisory and Closely Related Work
One labor organization stated that the paragraph (2) of the
proposed definition of supervisory and closely related work is far more
expansive than the Department of Labor regulation and perhaps more
expansive than OPM intended. The labor organization suggested that we
add the phrase ``closely related work'' to the definitions and adopt
the definition used by the Department of Labor in Sec. 541.108 of title
29, Code of Federal Regulations.
We believe the proposed definition is legally correct.
11. Section 551.104--Definition of Temporary Work or Duties
We had an inquiry from an agency personnelist who explained that
the agency in question has a number of exempt employees whose official
position descriptions include minor, nonexempt duties. The agency has
correctly determined that the employees are exempt. The employees,
however, are being required to perform the nonexempt work included in
the official position description for a greater percentage of the time
and on a long-term, but temporary, basis. Under our proposed
regulations, the agency could argue that the work is not ``not
consistent with the employee's official position description.''
We revised the definition by inserting the words ``the primary or
grade-controlling duty of'' before the words ``the employee's official
position description.'' We made conforming changes throughout
Sec. 551.208.
12. Section 551.201--Agency Authority
Two labor organizations commented on this section.
One labor organization suggested replacing the phrase ``makes a
determination'' with ``properly determines'' to make it clear that the
presumption of FLSA coverage can be rebutted only by a proper or
correct determination that the exemption criteria have been met.
We adopted the suggestion. We revised the first sentence of
proposed paragraph 551.201 by deleting ``All employees are'' and
substituting ``Each employee is,'' deleting ``makes a determination''
and substituting ``correctly determines,'' deleting ``position'' and
substituting ``employee clearly,'' and adding ``and such supplemental
interpretations or instructions issued by OPM'' after ``subpart.'' The
word ``clearly'' is used to make this principle consistent with those
expressed in proposed paragraphs 551.202 (a) and (b). The sentence was
then moved to Sec. 551.202 as new paragraph (a).
The other labor organization stated that agencies do not need to be
told to exempt employees because they already do so more often than is
justified. The labor organization recommended that the second sentence
in this section be deleted, or modified by inserting the word
``clearly'' in the phrase ``any employee who meets * * *'' to be
consistent with proposed paragraphs (a) and (c) of Sec. 551.202 which
already use the word.
In this instance, we did not adopt the suggestion to use the word
``clearly.'' Instead, we modified the sentence to better reflect an
agency's authority to designate an employee FLSA exempt. We revised the
second sentence in proposed Sec. 551.201 by deleting ``must exempt from
the overtime provisions of the Act any employee who'' and substituting
``may designate an employee FLSA exempt only when the agency correctly
determines that the employee,'' and inserting ``one or more of'' after
``meets.''
13. Section 551.202--General Principles Governing Exemptions
As mentioned in item 12, we revised the first sentence of proposed
Sec. 551.201 and added it as the first general principle under
Sec. 551.202. Accordingly, we redesignated proposed paragraphs (a)
through (h) as paragraphs (b) through (i).
We revised the first sentence of proposed paragraph (c)
(redesignated paragraph (d)) by deleting the words ``All employees who
clearly meet'' and substituting ``An employee who clearly meets.''
One labor organization commented on proposed paragraph (d)(2)
(redesignated paragraph (e)(2)). It is the labor organization's opinion
that all nonsupervisory employees performing technician work who are
not performing predominantly administrative functions are nonexempt,
regardless of their grade level. The labor organization suggests that
this paragraph be revised to state that all employees performing
technician work are nonexempt.
Another labor organization commented on proposed paragraph (f)
(redesignated paragraph (g)). The labor organization suggested that the
example in the second sentence be changed because it has led agencies
to incorrectly designate technicians as FLSA exempt when they should be
FLSA nonexempt.
We did not adopt either suggestion. OPM has found that many higher-
graded technical employees perform work fully comparable to work
performed by professional engineers, particularly in the area of
difficult, demanding, and original equipment and facilities design.
Such employees are correctly determined to be FLSA exempt.
One individual stated that proposed paragraph (d)(3) (redesignated
(e)(3)) concerning FLSA nonexempt status of employees in the Aircraft
Operation, GS-2181, series is inconsistent with other OPM guidance in
the ``Classifier's Handbook,'' ``Introduction to the Position
Classification Standards,'' and the ``Guide to Personnel Data
Standards.'' The individual pointed out that Appendix 1 of the
``Introduction to the Position Classification Standards'' lists the GS-
2181 series as a series for which a two-grade interval pattern is
normal and the GS-2181 classification standard indicates that this
series is two-grade interval in a footnote. The individual expressed
the opinion that if a position is considered to be technical and its
occupational category is designated as technical, the position should
not be identified as a two-grade interval series. The individual
suggested that the GS-2181 position classification standard and
Appendix 1 of ``The Introduction to the Position Classification
Standards'' be revised to delete references to the GS-2181 series as
two-grade interval.
Because this comment addressed classification, rather than FLSA,
issues, we referred this comment to OPM's Office of Classification.
We revised the third sentence of proposed paragraph (g)
(redesignated paragraph (h)) by deleting the phrase ``exempting the
employee'' and substituting ``designating an employee FLSA exempt'' to
be consistent with wording elsewhere.
14. Section 551.204(a)--Exemption of Federal Wage System Employees
We revised proposed paragraphs (a) and (b) by deleting the word
``under'' and substituting ``in'' to be consistent with Sec. 551.203.
[[Page 67241]]
15. Section 551.205--Executive Exemption Criteria
Two labor organizations stated that it is a mistake to eliminate
the requirement that in order to qualify under the executive exemption
an employee must customarily and regularly direct the work of at least
three subordinate employees. The labor organizations argued that
agencies frequently classify employees who serve as lead workers as
exempt under the executive exemption criteria and that the numerical
requirement helps to clarify that employees who perform minimal
supervisory duties do not fall under this exemption. They predict that
agencies will claim the individual employees who work with other
employees and who make recommendations regarding their work will
qualify for the executive exemption simply if the employees exercise
some independence in their own work. They state that this may arise if
employees work in teams and have no direct supervisory authority over
team members but instead one of the team members acts as a team leader.
Even if the team leader assignment is rotated among members of the
team, an agency may, under the proposed regulation, claim that the
employee meets the executive exemption criteria. The labor
organizations also stated that the numerical requirement is consistent
with the Department of Labor regulations.
We did not adopt this suggestion. The original numerical
requirement of at least three subordinate employees was based on the
Supervisory Grade Evaluation Guide. That guide was replaced by the
General Schedule Supervisory Guide which does not have a numerical
requirement. We also recognized that OPM's requirement of three or more
subordinate employees was inconsistent with Department of Labor's
regulations. Instead of changing to an arbitrary number, we chose to
use the plural ``employees'' which implies ``two or more.''
16. Section 551.206--Administrative Exemption Criteria
One agency commented that the criterion in proposed paragraph
(a)(1) under the primary duty test could lead to an incorrect and
overly broad application of the exemption and be inconsistent with
Department of Labor's application of the Act to the private sector.
This comment addresses a well-established provision in the
currently published regulations. Our experience is that the provision
as currently published is sufficient.
We revised proposed paragraph (a)(2) by deleting the phrase
``general management or business functions'' and substituting in its
place ``management or general business functions'' to be consistent
with wording elsewhere.
We revised the headings of proposed paragraphs (b) and (c) by
inserting the word ``test'' before the periods.
17. Section 551.207--Professional Exemption Criteria
Several commentors pointed out that proposed paragraph(a)(3) is
more expansive than the law pertaining to employees in the computer
software field (Public Law 101-583, 104 Stat. 2871, November 15, 1990).
One labor organization suggested that in order to clarify the
limited scope of the exemption for work in computer-related
occupations, OPM's proposed regulations should include a provision
similar to Sec. 541.303(c) of title 29, Code of Federal Regulations
which provides that the professional exemption only applies to highly
skilled employees who have achieved a level of proficiency in the
theoretical and practical application of a body of highly-specialized
knowledge in computer systems analysis, programming, and software
engineering.
The same labor organization also suggested that the proposed
regulation should also include a provision analogous to Sec. 541.303(d)
of title 29, Code of Federal Regulations, which provides that the
exemption does not include ``employees engaged in the operation of
computers or in the manufacture, repair, or maintenance of computer
hardware and related equipment'' or employees whose work is dependent
on computers but who do not work in computer systems analysis or
computer programming occupations.
The labor organization further suggested that the exemption does
not include employees engaged in the operation of computers or in the
manufacture of computer hardware and related equipment, or employees
whose work is dependent on computers but who do not work in computer
systems analysis or computer programming occupations.
Public Law 101-583 (104 Stat. 2871, November 15, 1990) provides
that employees performing such work may be designated FLSA exempt as
executive, administrative, or professional employees. The law also
states that ``if such employees are paid on an hourly basis they shall
be exempt only if their hourly rate of pay is at least 6\1/2\ times
greater than the applicable minimum wage . . . .'' Section 13(a) of the
Act was amended to read ``in the case of an employee who is compensated
on an hourly basis, is compensated at a rate not less than $27.63 an
hour.'' Proposed paragraph (a)(3) essentially restates the criteria in
section 213(a)(17) of title 29, United States Code, for exempting from
the FLSA certain employees who work with computers. The regulation does
not include a salary-based test because the Department of Labor has
determined that such tests do not apply to public employees (see
Sec. 541.5d of title 29, Code of Federal Regulations).
Commentors suggested that we further explain the scope of this
exemption. We considered this suggestion, but concluded that the
language in the proposed regulation is sufficient.
The citation in proposed paragraph (a)(3)(iv) was published as
``(a)(3)(i), (3)(ii), and (3)(iii).'' We revised the citation to read
``(a)(3)(i), (a)(3)(ii), and (a)(3)(iii)'' to be consistent with the
citation in proposed paragraph 551.208(d)(2) which reads ``(d)(2)(i)
and (d)(2)(ii).
We revised the heading of proposed paragraph (b) by deleting the
words ``in nature'' and substituting in their place the words ``work
test.''
We revised the heading of proposed paragraph (c) by inserting the
word ``test'' before the period.
18. Section 551.208--Effect of Performing Temporary Work or Duties on
FLSA Exemption Status
As explained in item 11, we inserted the words ``the primary or
grade-controlling duty of'' in proposed paragraphs (a)(1), (b)(1),
(c)(1), and (c)(3).
To avoid any possible confusion on the part of agencies or
employees, we inserted the word ``calendar'' before the word ``days''
in proposed paragraphs (b)(1)(i), (b)(2)(ii), (c)(1)(i) and (c)(2)(ii).
One labor organization took issue with proposed paragraphs
(b)(1)(i) and (b)(2)(i) which state that the period of temporary work
or duties must exceed 30 days (now referred to as the ``30-day test'').
The labor organization incorrectly believed the OPM was ignoring the
workweek basis of the FLSA and suggested that OPM should provide that
exemption determinations be made on a workweek basis for temporary
assignments of 5 workdays or more. We did not adopt the suggestion.
We believe that this suggestion, if adopted, would place an extreme
administrative burden on agencies. The Act takes a single workweek as
its standard, that is, a workweek is the unit of time used as the basis
for applying
[[Page 67242]]
overtime standards under the Act. It would be administratively
burdensome for Federal agencies to have to make this determination each
week. OPM adopted the 30-day test to ease this administrative burden on
agencies but the weekly standard still applies for pay purposes. The
30-day test is well established and has been unchanged in regulation
since January 1988. The revision of this section makes clear to
agencies and employees agencies' responsibilities regarding an employee
who must temporarily perform work or duties that are not consistent
with the primary or grade-controlling duty of the employee's official
position description.
In the heading of proposed paragraph (b)(1)(iii), we made the word
``situations'' singular to parallel proposed paragraph (c)(1)(iii).
In proposed paragraph (c)(1)(ii), we added the words ``or duty'' to
the paragraph heading to parallel paragraph (b)(1)(ii).
We italicized the heading of proposed paragraph (c)(3).
19. Section 551.209--Foreign Exemption Criteria
In proposed paragraph (a), we italicized the words ``all'' and
``any.''
We changed the period at the end of the introductory language of
proposed paragraph (b) to a colon.
20. Section 551.211--Statutory Exclusion
One labor organization pointed out that the statutory exclusion in
proposed Sec. 551.211 goes beyond the statutory provision on which it
is based. The Customs Officers Pay Reform Act (Customs Pay Act),
codified at section 267 of title 19, United States Code (U.S.C.),
provides that ``a customs officer who receives overtime pay under
subsection (a) of this section or premium pay under subsection (b) of
this section for time worked may not receive pay or other compensation
for that work under any other provision of law.'' (Emphasis added.)
Under the statute, a customs officer cannot receive FLSA overtime pay
for the same work for which the officer received overtime pay or
premium pay under the Customs Pay Act. Proposed section 551.211 goes
beyond the statute because it completely excludes customs officers from
the overtime pay and hours of work provisions of the FLSA. The labor
organization stated that there are a number of circumstances in which
the Customs Pay Act does not provide overtime pay for particular work
but the FLSA does. For example, under section 267(a)(1) of the Customs
Pay Reform Act, an employee is entitled to overtime pay only when he or
she is ``officially assigned to perform work.'' Unlike the FLSA, the
Customs Pay Act does not provide overtime pay for work that an employee
is suffered or permitted to perform. The labor organization further
stated that the United States Customs Service has taken the position
that the Customs Pay Act does not authorize overtime pay for training,
even when such training is required by the agency. It is Customs'
position that training is not ``work'' under section 267(a)(1).
According to Customs, training time is compensable only for employees
who are FLSA covered. Customs has also taken the position that certain
travel time is not compensable under the Customs Pay Act. The FLSA,
however, provides compensation for some travel time and for time spent
in training when required by the agency (see section 410.402(d) of
title 5, Code of Federal Regulations). The labor organization pointed
out that the Customs Pay Act does not exclude customs officers from
compensation for these hours under the FLSA.
We revised proposed Sec. 551.211 by quoting the Customs Pay Act. We
deleted the first sentence and in its place is substituted ``A customs
officer who receives overtime pay under subsection (a) or premium pay
under subsection (b) of section 267 of title 19, United States Code,
for time worked may not receive pay or other compensation for that work
under any other provision of law.'' We revised the second sentence by
deleting ``a customs inspector,'' inserting ``a United States Customs
Service'' before ``supervisory,'' inserting ``or nonsupervisory'' after
supervisory, deleting ``a canine enforcement officer'' before
``supervisory,'' and inserting ``or nonsupervisory'' after
``supervisory.''
21. Section 551.601--Minimum Age Standards
One agency suggested that the reference to section 3(l) in proposed
paragraphs (a) and (b) be corrected to substitute a lower-case letter L
for the Arabic numeral one inside the parentheses. We made this
correction.
22. Section 551.602--Responsibilities
One agency suggested that it would be helpful to Federal agencies
to provide a citation to the Department of Labor's child labor
regulations.
We agree. We revised the first sentence of proposed paragraph (a)
by inserting ``in part 570 of title 29, Code of Federal Regulations,''
before the phrase ``by the Secretary of Labor.''
One agency noted the reference to ``claims'' in subpart F and the
inclusion of child labor ``claims'' in subpart G. The agency stated
that this seems somewhat anomalous in that the enforcement mechanism
for the child labor provisions of the FLSA is the assessment of civil
money penalties pursuant to section 261(e) of title 29, United States
Code, payable to the Federal Government by violating employers. This is
in contrast to the assertion of wage claims under sections 16(b) and
16(c) of the FLSA by the Administrator or by an employee, resulting in
the possible payment of back wages and liquidated damages to the
employee.
We revised proposed paragraph (b) by deleting the word ``claims''
and substituting in its place the word ``complaints'' and we made
conforming changes in Secs. 551.701(a) and 551.702(a).
23. Section 551.701--Applicability
We revised proposed paragraph (a) by deleting the word ``claims''
from the phrase ``claims arising under the child labor provision'' and
substituting the word ``complaints'' in its place. As explained in item
4, the term ``claim'' is used generically in subpart G to include
complaints under the child labor provisions of the Act.
24. Section 551.702--Time Limits
We revised the first sentence of proposed paragraph (a) by deleting
the words ``may file an FLSA claim at any time'' and substituting in
their place the words ``may at any time file a complaint'' and
inserting the words ``an FLSA claim'' before the word ``challenging.''
One labor organization argued that the applicable statute of
limitations continues to be 6 years under the Barring Act (section
3702(b)(1) of title 31, United States Code), notwithstanding the
enactment of Pub. L. 104-52 (109 Stat. 468-69 (1995)) and the decision
in Adams v. Bowsher, 946 F.Supp. 37 (D.C.D.C. 1996).
It is OPM's position that the law and court decision established a
2-year statute of limitations (3-year for willful violations).
Another labor organization noted that proposed paragraph (c)
permits a claimant to file a claim either with the agency employing the
claimant during the claim period or with OPM. The labor organization
stated that there should be a provision allowing the claimant the
option to file the claim with OPM to resolve the claim if the agency
fails to issue a decision on a claim filed with it within six months.
This would preclude an agency from preventing an employee from
receiving
[[Page 67243]]
compensation by simply refusing to process the claim.
We did not adopt this suggestion. Nothing in OPM's regulations
precludes an employee from withdrawing a claim submitted to an agency
and submitting the claim to OPM, if the employee believes the agency is
taking too long to decide the claim.
25. Section 551.703--Avenues of Review
Two labor organizations noted that proposed paragraph (a) means
that a claimant who is covered by a collective bargaining agreement
that does not exclude FLSA matters for only part of a claim period, the
claimant would be precluded from filing a claim with OPM for the period
of time that the claimant was not covered by the agreement. The labor
organizations suggested that the paragraph be rewritten to state that a
claimant is limited to using the negotiated grievance procedure as the
exclusive administrative remedy for only time periods in which he or
she was a member of a bargaining unit and covered by a collective
bargaining agreement which did not exclude FLSA matters.
We did not adopt the suggestion for two reasons. First, Carter v.
Gibbs, 909 F.2d 1452 (Fed. Cir. 1990), cert. denied, 111 S.Ct. 46
(1990), established the principle that the negotiated grievance
procedure is the only administrative avenue open to an employee covered
by a collective bargaining agreement that does not exclude FLSA
matters. Second, if a claimant were permitted to split the claim period
between two avenues of review, different and conflicting decisions
might be reached, neither binding on the other.
We revised the introductory language of proposed paragraph (b) by
inserting the phrase ``but not both simultaneously'' before the word
``regarding'' to make it clear that an employee may not file the same
claim with the agency and OPM simultaneously.
One labor organization stated that the regulations should make it
clear that employees have a right to proceed to court with FLSA claims
independently of their right to file a claim with OPM.
Proposed paragraph (c) states that nothing in subpart G limits the
right of a claimant to bring an action in an appropriate United States
court, and that OPM will not decide an FLSA claim that is in
litigation. We believe the proposed paragraph is sufficient.
The same labor organization suggested that employees should be
advised that the filing of a claim with OPM or an agency will not toll
the statute of limitations governing FLSA claims filed in court.
We agree that this would be helpful to employees and added such
language as the second sentence of proposed paragraph (c).
26. Section 551.704--Claimant's Representative.
Two labor organizations interpreted the third sentence of the
introductory language to proposed Sec. 551.704 (which states ``A
representative has no right to participate in OPM fact-finding'') to
mean that a claimant would be limited to self-representation and
pointed out that this conflicts with the first sentence which permits
the designation of a representative to assist in preparing or
presenting a claim.
We intended to make the point that an employee representative may
not be present or listen in on fact-finding interviews conducted by OPM
as a matter of right. Rather OPM, at its discretion, may invite the
employee representative to participate. We revised the sentence in
question to make this clear.
27. Section 551.705--Form and Content of an FLSA Claim.
We deleted the heading of proposed section 551.705 and substituted
in its place the heading ``Filing an FLSA claim.''
One individual remarked that according to proposed paragraph (a)
``a non-unit employee can file an FLSA claim with the agency, and the
agency can either adjudicate it or forward it to OPM without taking any
action.''
This is not what we intended. Therefore, we have revised the second
sentence by deleting the phrase ``At the discretion of the agency'' and
substituting ``At the request of the claimant.''
The individual also asked whether an employee may appeal to OPM if
the agency adjudicates the claim.
We redesignated proposed paragraphs (a) and (b) as (b) and (c) and
added new paragraph (a) which states that an employee may file a claim
with either the agency or with OPM, but may not pursue the same claim
simultaneously with the agency and OPM. We encourage, but do not
require, claimants to obtain decisions on claims from their agency
before filing a claim with OPM. We also explain that a claimant may
file a claim with OPM after receiving an unfavorable decision from the
agency but may not file a claim with the agency after getting an
unfavorable decision from OPM.
Regarding the requirement in proposed paragraph (b)(7)
(redesignated as paragraph(c)(7)) that a claim must include evidence
that the claim period was preserved, one labor organization pointed out
that claimants may not realize the importance of retaining such
documentation. The labor organization recommended that the regulation
include a statement that if the claimant does not have evidence showing
the claim was filed, proof may be provided by documents in agency
records.
We did not adopt this recommendation. Proposed paragraph 551.702(c)
states clearly that the claimant is responsible for proving when the
claim was received by the agency or OPM and that the claimant should
retain documentation to establish when the claim was received by the
agency or OPM, such as by filing the claim using certified, return
receipt mail, or by requesting that the agency or OPM provide written
acknowledgment of receipt of the claim. The last sentence in proposed
paragraph 551.702(c) explains why such documentation is important, that
is, if a claim for back pay is established, the claimant will be
entitled to pay for a period of up to 2 years (3 years for a willful
violation) back from the date the claim was received. Further, proposed
paragraphs 551.709(a) and (b) provide for the release of information
from an FLSA claim file to the parties concerned, that is, the
claimant, any representative designated in writing by the claimant, and
any representative of the agency or OPM involved in the proceeding.
Thus, the claimant or the claimant's representative can obtain
documents regarding the claim, including documentation of when the
claim was received by the agency or OPM.
One labor organization suggested that in cases where the employee
filed with an agency but withdrew the claim and submitted it to OPM,
the date the claim was filed with the agency should be the relevant
date for determining back pay.
This provision already exists in proposed paragraph (b)(7)
(redesignated as paragraph (c)(7)).
28. Sections 551.706--Responsibilities
Two labor organizations argued that the time limit of 15 workdays
in proposed paragraph (a)(1) is too restrictive. One of the labor
organizations objected to the claimant being subject to a penalty
(denial of the claim) if requested information is not received by OPM
within 15 workdays without a corresponding penalty for the agency
should the agency not provide requested information to OPM within 15
workdays. The labor organization pointed out that claimants may not
realize that they need to request an
[[Page 67244]]
extension if they need more time to provide requested information.
We revised the first sentence of proposed paragraph (a)(1) by
inserting ``the claimant or the claimant's representative requests
additional time and'' after ``unless.'' We made corresponding changes
in proposed Sec. 551.707.
We revised the fourth sentence of proposed paragraph (a)(1) and the
last sentence of proposed paragraph (b) by deleting the word ``denied''
and substituting in its place the word ``cancelled'' to be consistent
with changes we made to proposed Sec. 551.707.
One labor organization reasoned that much of the information
necessary to support a claim is in the exclusive control of the agency.
The labor organization suggested that OPM add a statement that upon
request, and subject to any Privacy Act restrictions, agencies will
provide a claimant with information relevant to the claimant's claim.
We agree that this would further impress upon agencies their
responsibilities in FLSA claims and have added a such a statement as a
new paragraph (b)(3). We redesignated proposed paragraph (b)(3) as
paragraph (b)(4).
We revised proposed paragraph (b)(3) (redesignated as paragraph
(b)(4)) by inserting the words ``the agency requests additional time
and'' after the word ``unless'' to be consistent with wording
elsewhere.
29. Section 551.707--Withdrawal or Denial of an FLSA Claim
We revised the section heading by deleting ``denial'' and
substituting ``cancellation'' and revised proposed paragraph (b) by
deleting ``denied'' and ``deny'' and substituting ``cancelled'' and
``cancel'' and inserting ``the claimant or the claimant's
representative requests additional time and'' before ``OPM.'' With
these changes, we believe the regulation states clearly enough that a
claimant or claimant's representative can avoid cancellation of a claim
by requesting and receiving an extension. Proposed paragraph (b) also
states that a cancelled claim may be reconsidered by OPM if the claim
shows that circumstances beyond the claimant's control prevented
pursuit of the claim.
30. Section 551.708--Finality and Effect of OPM FLSA Claim Decision
One labor organization stated that the proposed regulations do not
address the right of appeal from OPM FLSA claim determinations and
suggests that the regulations should do so.
Proposed Sec. 551.708 states that OPM may reconsider a decision
upon a showing that material information was not considered or there
was a material error of law, regulation, or fact in the original
decision.
31. Section 551.709--Availability of Information
We added the words ``before disclosing the information contained in
an FLSA claim file to the parties concerned'' to the end of the second
sentence in proposed paragraph (b) to make clear that this sanitized
information being released only to the parties concerned with the
claim.
32. Section 551.710
Under the address of the OPM Washington, DC Oversight Division, the
District of Columbia is indented.
Regulatory Flexibility Act
I certify that these regulations will not have significant economic
impact on a substantial number of small entities because they affect
only Federal employees and agencies.
List of Subjects in 5 CFR Part 551
Government employees, Wages.
U.S. Office of Personnel Management.
Janice R. Lachance,
Director.
For the reasons stated in the preamble, the Office of Personnel
Management amends 5 CFR part 551 as follows:
1. The title and authority citation for part 551 continues to read
as follows:
PART 551--PAY ADMINISTRATION UNDER THE FAIR LABOR STANDARDS ACT
Authority: 5 U.S.C. 5542(c); Sec. 4(f) of the Fair Labor
Standards Act of 1938, as amended by Pub. L. 93-259, 88 Stat. 55 (29
U.S.C. 204f).
2. Subpart A is revised to read as follows:
Subpart A--General Provisions
Sec.
551.101 General.
551.102 Authority and administration.
551.103 Coverage.
551.104 Definitions.
Sec. 551.101 General.
(a) The Fair Labor Standards Act of 1938, as amended (referred to
as ``the Act'' or ``FLSA''), provides for minimum standards for both
wages and overtime entitlement, and delineates administrative
procedures by which covered worktime must be compensated. Included in
the Act are provisions related to child labor, equal pay, and portal-
to-portal activities. In addition, the Act exempts specified employees
or groups of employees from the application of certain of its
provisions. It prescribes penalties for the commission of specifically
prohibited acts.
(b) This part contains the regulations, criteria, and conditions
that the Office of Personnel Management has prescribed for the
administration of the Act. This part supplements and implements the
Act, and must be read in conjunction with it.
Sec. 551.102 Authority and administration.
(a) Office of Personnel Management. Section 3(e)(2) of the Act
authorizes the application of the provisions of the Act to any person
employed by the Government of the United States, as specified in that
section. Section 4(f) of the Act authorizes the Office of Personnel
Management (OPM) to administer the provisions of the Act. OPM is the
administrator of the provisions of the Act with respect to any person
employed by an agency, except as specified in paragraphs (b), (c), and
(d) of this section.
(b) The Equal Employment Opportunity Commission administers the
equal pay provisions contained in section 6(d) of the Act.
(c) The Department of Labor administers the Act for the following
United States Government entities:
(1) The Library of Congress;
(2) The United States Postal Service;
(3) The Postal Rate Commission; and
(4) The Tennessee Valley Authority.
(d) Office of Compliance. The Congressional Accountability Act of
1995, as amended, sections 1301 et seq. of title 2, United States Code,
extends rights and protections of the FLSA to employees of the
following United States Government entities, and assigns certain
administrative responsibilities to the Office of Compliance:
(1) The United States House of Representatives;
(2) The United States Senate;:
(3) The Capitol Guide Service;
(4) The Capitol Police;
(5) The Congressional Budget Office;
(6) The Office of the Architect of the Capitol;
(7) The Office of the Attending Physician; and
(8) The Office of Compliance.
Sec. 551.103 Coverage.
(a) Covered. Any employee of an agency who is not specifically
excluded by another statute is covered by the Act. This includes any
person who is--
(1) Defined as an employee in section 2105 of title 5, United
States Code;
[[Page 67245]]
(2) A civilian employee appointed under other appropriate
authority; or
(3) Suffered or permitted to work by an agency whether or not
formally appointed.
(b) Not covered. The following persons are not covered under the
Act:
(1) A person appointed under appropriate authority without
compensation;
(2) A trainee;
(3) A volunteer; or
(4) A member of the Uniformed Services.
Sec. 551.104 Definitions.
In this part--
Act or FLSA means the Fair Labor Standards Act of 1938, as amended
(29 U.S.C. 201 et seq.).
Administrative employee means an employee who meets the criteria in
Sec. 551.206.
Agency, for purposes of OPM's administration of the Act, means any
instrumentality of the United States Government, or any constituent
element thereof acting directly or indirectly as an employer, as this
term is defined in section 3(d) of the Act and in this section, but
does not include the entities of the United States Government listed in
Sec. 551.102(c) for which the Department of Labor administers the Act
or Sec. 551.102(d)(1) through (8), whose employees are covered by the
Congressional Accountability Act of 1995, as amended, which makes
applicable the rights and protections of the FLSA and assigns certain
administrative responsibilities to the Office of Compliance.
Claim means a written allegation from a current or former employee
concerning his or her FLSA exemption status determination or
entitlement to minimum wage or overtime pay for work performed under
the Act. The term ``claim'' is used generically in subpart G of this
part to include complaints under the child labor provisions of the Act.
Claim period means the time during which the cause or basis of the
claim occurred.
Claimant means a current or former employee who files an FLSA
claim.
Customarily and regularly means a frequency which must be greater
than occasional but which may be less than constant. For example, the
requirement in Sec. 551.205(a)(2) will be met by an employee who
normally and recurrently exercises discretion and independent judgment
in the day-to-day performance of duties.
Discretion and independent judgment means work that involves
comparing and evaluating possible courses of conduct, interpreting
results or implications, and independently taking action or making a
decision after considering the various possibilities. However, firm
commitments or final decisions are not necessary to support exemption.
The ``decisions'' made as a result of the exercise of independent
judgment may consist of recommendations for action rather than the
actual taking of action. The fact that an employee's decisions are
subject to review, and that on occasion the decisions are revised or
reversed after review, does not mean that the employee is not
exercising discretion and independent judgment of the level required
for exemption. Work reflective of discretion and independent judgment
must meet the three following criteria:
(1) The work must be sufficiently complex and varied so as to
customarily and regularly require discretion and independent judgment
in determining the approaches and techniques to be used, and in
evaluating results. This precludes exempting an employee who performs
work primarily requiring skill in applying standardized techniques or
knowledge of established procedures, precedents, or other guidelines
which specifically govern the employee's action.
(2) The employee must have the authority to make such
determinations during the course of assignments. This precludes
exempting trainees who are in a line of work which requires discretion
but who have not been given authority to decide discretionary matters
independently.
(3) The decisions made independently must be significant. The term
``significant'' is not so restrictive as to include only the kinds of
decisions made by employees who formulate policies or exercise broad
commitment authority. However, the term does not extend to the kinds of
decisions that affect only the procedural details of the employee's own
work, or to such matters as deciding whether a situation does or does
not conform to clearly applicable criteria.
Emergency means a temporary condition that poses a direct threat to
human life or safety, serious damage to property, or serious disruption
to the operations of an activity, as determined by the employing
agency.
Employ means to engage a person in an activity that is for the
benefit of an agency, and includes any hours of work that are suffered
or permitted.
Employee means a person who is employed--
(1) As a civilian in an executive agency as defined in section 105
of title 5, United States Code;
(2) As a civilian in a military department as defined in section
102 of title 5, United States Code;
(3) In a nonappropriated fund instrumentality of an executive
agency or a military department;
(4) In a unit of the judicial branch of the Government that has
positions in the competitive service; or
(5) The Government Printing Office.
Employer, as defined in section 3(d) of the Act, means any person
acting directly or indirectly in the interest of an employer in
relation to an employee and includes a public agency, but does not
include any labor organization (other than when acting as an employer)
or anyone acting in the capacity of officer or agent of such labor
organization.
Essential part of administrative or professional functions means
work that is included as an integral part of administrative or
professional exempt work. This work is identified by examining the
processes involved in performing the exempt function. For example, the
processes involved in evaluating a body of information include
collecting and organizing information; analyzing, evaluating, and
developing conclusions; and frequently, preparing a record of findings
and conclusions. Often collecting or compiling information and
preparing reports or other records, if divorced from the evaluative
function, are nonexempt tasks. When an employee who performs the
evaluative functions also performs some or all of these related steps,
all such work (for example, collecting background information,
recording test results, tabulating data, or typing reports) is included
in the employee's exempt duties.
Executive employee means an employee who meets the criteria in
Sec. 551.205.
Exempt area means any foreign country, or any territory under the
jurisdiction of the United States other than the following locations:
(1) A State of the United States;
(2) The District of Columbia;
(3) Puerto Rico;
(4) The U.S. Virgin Islands;
(5) Outer Continental Shelf Lands as defined in the Outer
Continental Shelf Lands Act (67 Stat. 462);
(6) American Samoa;
(7) Guam;
(8) Midway Atoll;
(9) Wake Island;
(10) Johnston Island; and
(11) Palmyra.
FLSA exempt means not covered by the minimum wage and overtime
provisions of the Act.
[[Page 67246]]
FLSA exemption status means an employee's designation by the
employing agency as either FLSA exempt or FLSA nonexempt from the
minimum wage and overtime provisions of the Act.
FLSA exemption status determination claim means a claim from a
current or former employee challenging the correctness of his or her
FLSA exemption status determination.
FLSA nonexempt means covered by the minimum wage and overtime
provisions of the Act.
FLSA overtime pay, for the purpose of Sec. 551.208, means overtime
pay under this part.
FLSA pay claim means a claim from a current or former employee
concerning his or her entitlement to minimum wage or overtime pay for
work performed under the Act.
Foreign exemption means a provision of the Act under which the
minimum wage, overtime, and child labor provisions of the Act do not
apply to any employee who spends all hours of work in a given workweek
in an exempt area.
Formulation or execution of management programs or policies means
work that involves management programs and policies which range from
broad national goals expressed in statutes or Executive orders to
specific objectives of a small field office. Employees make policy
decisions or participate indirectly, through developing or recommending
proposals that are acted on by others. Employees significantly affect
the execution of management programs or policies typically when the
work involves obtaining compliance with such policies by other
individuals or organizations, within or outside of the Federal
Government, or making significant determinations furthering the
operation of programs and accomplishment of program objectives.
Administrative employees engaged in such work typically perform one or
more phases of program management (that is, planning, developing,
promoting, coordinating, controlling, or evaluating operating programs
of the employing organization or of other organizations subject to
regulation or other controls).
Hours of work means all time spent by an employee performing an
activity for the benefit of an agency and under the control or
direction of the agency. Hours of work are creditable for the purposes
of determining overtime pay under subpart D of this subpart. Section
551.401 of subpart D further explains this term. However, whether time
is credited as hours of work is determined by considering many factors,
such as the rules in subparts D and E of this subpart, provisions of
law, Comptroller General decisions, OPM policy guidance, agency policy
and regulations, negotiated agreements, the rules in part 550 of this
chapter (for hours of work for travel), and the rules in part 410 of
this chapter (for hours of work for training).
Management or general business function or supporting service, as
distinguished from production functions, means the work of employees
who provide support to line managers.
(1) These employees furnish such support by--
(i) Providing expert advice in specialized subject matter fields,
such as that provided by management consultants or systems analysts;
(ii) Assuming facets of the overall management function, such as
safety management, personnel management, or budgeting and financial
management;
(iii) Representing management in such business functions as
negotiating and administering contracts, determining acceptability of
goods or services, or authorizing payments; or
(iv) Providing supporting services, such as automated data
processing, communications, or procurement and distribution of
supplies.
(2) Neither the organizational location nor the number of employees
performing identical or similar work changes management or general
business functions or supporting services into production functions.
The work, however, must involve substantial discretion on matters of
enough importance that the employee's actions and decisions have a
noticeable impact on the effectiveness of the organization advised,
represented, or serviced.
Nonexempt area means any of the following locations:
(1) A State of the United States;
(2) The District of Columbia;
(3) Puerto Rico;
(4) The U.S. Virgin Islands;
(5) Outer Continental Shelf Lands as defined in the Outer
Continental Shelf Lands Act (67 Stat. 462);
(6) American Samoa;
(7) Guam;
(8) Midway Atoll;
(9) Wake Island;
(10) Johnston Island; and
(11) Palmyra.
Participation in the executive or administrative functions of a
management official means the participation of employees, variously
identified as secretaries, administrative or executive assistants,
aides, etc., in portions of the managerial or administrative functions
of a supervisor whose scope of responsibility precludes personally
attending to all aspects of the work. To support exemption, such
employees must be delegated and exercise substantial authority to act
for the supervisor in the absence of specific instructions or
procedures, and take actions which significantly affect the
supervisor's effectiveness.
Perform work in connection with an emergency means to perform work
that is directly related to resolving or coping with an emergency, or
its immediate aftermath, as determined by the employing agency.
Preserve the claim period means to establish the period of possible
entitlement to back pay by filing a written claim with either the
agency employing the claimant during the claim period or with OPM. The
date the agency or OPM receives the claim is the date that determines
the period of possible entitlement to back pay.
Primary duty typically means the duty that constitutes the major
part (over 50 percent) of an employee's work. A duty constituting less
than 50 percent of the work may be credited as the primary duty for
exemption purposes provided that duty--
(1) Constitutes a substantial, regular part of a position;
(2) Governs the classification and qualification requirements of
the position; and
(3) Is clearly exempt work in terms of the basic nature of the
work, the frequency with which the employee must exercise discretion
and independent judgment, and the significance of the decisions made.
Professional employee means an employee who meets the criteria in
Sec. 551.207.
Reckless disregard of the requirements of the Act means failure to
make adequate inquiry into whether conduct is in compliance with the
Act.
Recognized organizational unit means an established and defined
organizational entity which has regularly assigned employees and for
which a supervisor is responsible for planning and accomplishing a
continuing workload. This distinguishes supervisors from leaders who
head temporary groups formed to perform assignments of limited
duration.
Situations 1 through 4 means the four basic situations described
under Factor I, Nature of Supervisory Responsibility, in the Federal
Wage System Job Grading Standard for Supervisors. The situations depict
successively higher levels of supervisory responsibility and authority
for scheduling work operations, planning use of resources to accomplish
work, directing subordinates in
[[Page 67247]]
performing work assignments, and carrying out administrative duties.
Statute of limitations means the time frame within which an FLSA
pay claim must be filed, starting from the date the right accrued. All
FLSA pay claims filed on or after June 30, 1994, are subject to a 2-
year statute of limitations, except in cases of willful violation where
the statute of limitations is 3 years.
Suffered or permitted work means any work performed by an employee
for the benefit of an agency, whether requested or not, provided the
employee's supervisor knows or has reason to believe that the work is
being performed and has an opportunity to prevent the work from being
performed.
Supervisory and closely related work means work that is included in
the calculation of exempt work for supervisory positions.
(1) Work is considered closely related to exempt supervisory work
if it contributes to the effective supervision of subordinate workers,
or the smooth functioning of the unit supervised, or both. Examples of
closely related work include the following:
(i) Maintaining various records pertaining to workload or employee
performance;
(ii) Performing setup work that requires special skills, typically
is not performed by production employees in the occupation, and does
not approach the volume that would justify hiring a specially trained
employee to perform; and
(iii) Performing infrequently recurring or one-time tasks which are
impractical to delegate because they would disrupt normal operations or
take longer to explain than to perform.
(2) Activities in which both workers and supervisors are required
to engage themselves are considered to be closely related to the
primary duty of the position, for example, physical training during
tours of duty for firefighting and law enforcement personnel.
Temporary work or duties means work or duties an employee must
temporarily perform that are not consistent with the primary or grade-
controlling duty of the employee's official position description. The
period of temporary work or duties may or may not involve a different
geographic duty location.
Title 5 overtime pay, for the purpose of Sec. 551.208, means
overtime pay under part 550 of this chapter.
Trainee means a person who does not meet the definition of employee
in this section and who is assigned or attached to a Federal activity
primarily for training. A person who attends a training program under
the following conditions is considered a trainee and, therefore, is not
an employee of the Government of the United States for purposes of the
Act:
(1) The training, even though it includes actual operation of the
facilities of the Federal activity, is similar to that given in a
vocational school or other institution of learning;
(2) The training is for the benefit of the individual;
(3) The trainee does not displace regular employees, but, rather,
is supervised by them;
(4) The Federal activity which provides the training derives no
immediate advantage from the activities of the trainee; on occasion its
operations may actually be impeded;
(5) The trainee is not necessarily entitled to a job with the
Federal activity at the completion of the training period; and
(6) The agency and the trainee understand that the trainee is not
entitled to the payment of wages from the agency for the time spent in
training.
Volunteer means a person who does not meet the definition of
employee in this section and who volunteers or donates his or her
service, the primary benefit of which accrues to the performer of the
service or to someone other than the agency. Under such circumstances
there is neither an expressed nor an implied compensation agreement.
Services performed by such a volunteer include personal services that,
if left unperformed, would not necessitate the assignment of an
employee to perform them.
Willful violation means a violation in circumstances where the
agency knew that its conduct was prohibited by the Act or showed
reckless disregard of the requirements of the Act. All of the facts and
circumstances surrounding the violation are taken into account in
determining whether a violation was willful.
Work of an intellectual nature means work requiring general
intellectual abilities, such as perceptiveness, analytical reasoning,
perspective, and judgment applied to a variety of subject matter
fields, or work requiring mental processes which involve substantial
judgment based on considering, selecting, adapting, and applying
principles to numerous variables. The employee cannot rely on
standardized application of established procedures or precedents, but
must recognize and evaluate the effect of a continual variety of
conditions or requirements in selecting, adapting, or innovating
techniques and procedures, interpreting findings, and selecting and
recommending the best alternative from among a broad range of possible
actions.
Work of a specialized or technical nature means work which requires
substantial specialized knowledge of a complex subject matter and of
the principles, techniques, practices, and procedures associated with
that subject matter field. This knowledge characteristically is
acquired through considerable on-the-job training and experience in the
specialized subject matter field, as distinguished from professional
knowledge characteristically acquired through specialized academic
education.
Workday means the period between the commencement of the principal
activities that an employee is engaged to perform on a given day and
the cessation of the principal activities for that day. The term is
further explained in Sec. 551.411.
Worktime, for the purpose of determining FLSA exemption status,
means time spent actually performing work. This excludes periods of
time during which an employee performs no work, such as standby time,
sleep time, meal periods, and paid leave.
Worktime in a representative workweek means the average percentages
of worktime over a period long enough to even out normal fluctuations
in workloads and be representative of the job as a whole.
Workweek means a fixed and recurring period of 168 hours--seven
consecutive 24-hour periods. It need not coincide with the calendar
week but may begin on any day and at any hour of a day. For employees
subject to part 610 of this chapter, the workweek shall be the same as
the administrative workweek defined in Sec. 610.102 of this chapter.
Workweek basis means the unit of time used as the basis for
applying overtime standards under the Act and, for employees under
flexible or compressed work schedules, under 5 U.S.C. 6121(6) or (7).
The Act takes a single workweek as its standard and does not permit
averaging of hours over two or more weeks, except for employees engaged
in fire protection or law enforcement activities under section 7(k) of
the Act.
3. Subpart B is revised to read as follows:
Subpart B--Exemptions and Exclusions
Sec.
551.201 Agency authority.
551.202 General principles governing exemptions.
551.203 Exemption of General Schedule employees.
[[Page 67248]]
551.204 Exemption of Federal Wage System employees.
551.205 Executive exemption criteria.
551.206 Administrative exemption criteria.
551.207 Professional exemption criteria.
551.208 Effect of performing temporary work or duties on FLSA
exemption status.
551.209 Foreign exemption criteria.
551.210 Exemption of employees receiving availability pay.
551.211 Statutory exclusion.
Sec. 551.201 Agency authority.
The employing agency may designate an employee FLSA exempt only
when the agency correctly determines that the employee meets one or
more of the exemption criteria of this subpart and such supplemental
interpretations or instructions issued by OPM.
Sec. 551.202 General principles governing exemptions.
In all exemption determinations, the agency must observe the
following principles:
(a) Each employee is presumed to be FLSA nonexempt unless the
employing agency correctly determines that the employee clearly meets
one or more of the exemption criteria of this subpart and such
supplemental interpretations or instructions issued by OPM.
(b) Exemption criteria must be narrowly construed to apply only to
those employees who are clearly within the terms and spirit of the
exemption.
(c) The burden of proof rests with the agency that asserts the
exemption.
(d) An employee who clearly meets the criteria for exemption must
be designated FLSA exempt. If there is a reasonable doubt as to whether
an employee meets the criteria for exemption, the employee should be
designated FLSA nonexempt.
(e) There are groups of General Schedule employees who are FLSA
nonexempt because they do not fit any of the exemption categories.
These groups include the following:
(1) Nonsupervisory General Schedule employees in equipment
operating and protective occupations, and most clerical occupations
(see the definition of participation in the executive or administrative
functions of a management official in subpart A of this part);
(2) Nonsupervisory General Schedule employees performing technician
work in positions properly classified below GS-9 (or the equivalent
level in other comparable white-collar pay systems) and many, but not
all, of those positions properly classified at GS-9 or above (or the
equivalent level in other comparable white-collar pay systems); and
(3) Nonsupervisory General Schedule employees at any grade level in
occupations requiring highly specialized technical skills and
knowledges that can be acquired only through prolonged job training and
experience, such as the Air Traffic Control series, GS-2152, or the
Aircraft Operations series, GS-2181, unless such employees are
performing predominantly administrative functions rather than the
technical work of the occupation.
(f) Although separate criteria are provided for the exemption of
executive, administrative, and professional employees, those categories
are not mutually exclusive. All exempt work, regardless of category,
must be considered. The only restriction is that, when the requirements
of one category are more stringent, the combination of exempt work must
meet the more stringent requirements.
(g) Failure to meet the criteria for exemption under what might
appear to be the most appropriate criteria does not preclude exemption
under another category. For example, an engineering technician who
fails to meet the professional exemption criteria may be performing
exempt administrative work, or an administrative officer who fails to
meet the administrative criteria may be performing exempt executive
work.
(h) Although it is normally feasible and more convenient to
identify the exemption category, this is not essential. An exemption
may be based on a combination of functions, no one of which constitutes
the primary duty, or the employee's primary duty may involve two
categories which are intermingled and difficult to segregate. This does
not preclude designating an employee FLSA exempt, provided the work as
a whole clearly meets the other exemption criteria.
(i) The designation of an employee as FLSA exempt or nonexempt
ultimately rests on the duties actually performed by the employee.
Sec. 551.203 Exemption of General Schedule employees.
(a) GS-4 or below. Any employee in a position properly classified
at GS-4 or below (or the equivalent level in other comparable white-
collar pay systems) is nonexempt, unless the employee is subject to the
foreign exemption in Sec. 551.209.
(b) GS-5 or above. Any employee in a position properly classified
at GS-5 or above (or the equivalent level in other comparable white-
collar pay systems) is exempt only if the employee is an executive,
administrative, or professional employee as defined in this subpart,
unless the employee is subject to Sec. 551.208 (the effect of
performing temporary work or duties on FLSA exemption status) or
Sec. 551.209 (the foreign exemption).
Sec. 551.204 Exemption of Federal Wage System employees.
(a) Nonsupervisory. A nonsupervisory employee in the Federal Wage
System or in other comparable wage systems is nonexempt, unless the
employee is subject to Sec. 551.208 (the effect of performing temporary
work or duties on FLSA exemption status) or Sec. 551.209 (the foreign
exemption).
(b) Supervisory. A supervisory employee in the Federal Wage System
or in other comparable wage systems is exempt only if the employee is
an executive employee as defined in Sec. 551.205, unless the employee
is subject to Sec. 551.208 (the effect of performing temporary work or
duties on FLSA exemption status) or Sec. 551.209 (the foreign
exemption).
Sec. 551.205 Executive exemption criteria.
An executive employee is a supervisor or manager who manages a
Federal agency or any subdivision thereof (including the lowest
recognized organizational unit with a continuing function) and
customarily and regularly directs the work of subordinate employees and
meets both of the following criteria:
(a) Primary duty test. The primary duty test is met if the
employee--
(1) Has authority to make personnel changes that include, but are
not limited to, selecting, removing, advancing in pay, or promoting
subordinate employees, or has authority to suggest or recommend such
actions with particular consideration given to these suggestions and
recommendations; and
(2) Customarily and regularly exercises discretion and independent
judgment in such activities as work planning and organization; work
assignment, direction, review, and evaluation; and other aspects of
management of subordinates, including personnel administration.
(b) 80-percent test. In addition to the primary duty test that
applies to all employees, the following employees must spend 80 percent
or more of the worktime in a representative workweek on supervisory and
closely related work to meet the 80-percent test:
(1) Employees in positions properly classified in the General
Schedule at GS-5 or GS-6 (or the equivalent level in other comparable
white-collar pay systems);
(2) Firefighting or law enforcement employees in positions properly
classified in the General Schedule at GS-7, GS-8, or GS-9 who are
subject to
[[Page 67249]]
section 207(k) of title 29, United States Code; and
(3) Supervisors in positions properly classified in the Federal
Wage System below situation 3 of Factor I of the Federal Wage System
Job Grading Standard for Supervisors (or the equivalent level in other
comparable wage systems).
Sec. 551.206 Administrative exemption criteria.
An administrative employee is an advisor or assistant to
management, a representative of management, or a specialist in a
management or general business function or supporting service and meets
all four of the following criteria:
(a) Primary duty test. The primary duty test is met if the
employee's work--
(1) Significantly affects the formulation or execution of
management programs or policies; or
(2) Involves management or general business functions or supporting
services of substantial importance to the organization serviced; or
(3) Involves substantial participation in the executive or
administrative functions of a management official.
(b) Nonmanual work test. The employee performs office or other
predominantly nonmanual work which is--
(1) Intellectual and varied in nature; or
(2) Of a specialized or technical nature that requires considerable
special training, experience, and knowledge.
(c) Discretion and independent judgment test. The employee
frequently exercises discretion and independent judgment, under only
general supervision, in performing the normal day-to-day work.
(d) 80-percent test. In addition to the primary duty test that
applies to all employees, General Schedule employees in positions
properly classified at GS-5 or GS-6 (or the equivalent level in other
comparable white-collar pay systems) must spend 80 percent or more of
the worktime in a representative workweek on administrative functions
and work that is an essential part of those functions to meet the 80-
percent test.
Sec. 551.207 Professional exemption criteria.
A professional employee is an employee who meets all of the
following criteria, or any teacher who is engaged in the imparting of
knowledge or in the administration of an academic program in a school
system or educational establishment.
(a) Primary duty test. The primary duty test is met if the
employee's work consists of--
(1) Work that requires knowledge in a field of science or learning
customarily and characteristically acquired through education or
training that meets the requirements for a bachelor's or higher degree,
with major study in or pertinent to the specialized field as
distinguished from general education; or is performing work, comparable
to that performed by professional employees, on the basis of
specialized education or training and experience which has provided
both theoretical and practical knowledge of the specialty, including
knowledge of related disciplines and of new developments in the field;
or
(2) Work in a recognized field of artistic endeavor that is
original or creative in nature (as distinguished from work which can be
produced by a person endowed with general manual or intellectual
ability and training) and the result of which depends on the invention,
imagination, or talent of the employee; or
(3) Work that requires theoretical and practical application of
highly-specialized knowledge in computer systems analysis, programming,
and software engineering or other similar work in the computer software
field. The work must consist of one or more of the following:
(i) The application of systems analysis techniques and procedures,
including consulting with users, to determine hardware, software, or
system functional specifications; or
(ii) The design, development, documentation, analysis, creation,
testing, or modification of computer systems or programs, including
prototypes, based on and related to user or system design
specifications; or
(iii) The design, documentation, testing, creation, or modification
of computer programs related to machine operating systems; or
(iv) A combination of the duties described in paragraphs (a)(3)(i),
(a)(3)(ii), and (a)(3)(iii) of this section, the performance of which
requires the same level of skills.
(b) Intellectual and varied work test. The employee's work is
predominantly intellectual and varied in nature, requiring creative,
analytical, evaluative, or interpretative thought processes for
satisfactory performance.
(c) Discretion and independent judgment test. The employee
frequently exercises discretion and independent judgment, under only
general supervision, in performing the normal day-to-day work.
(d) 80-percent test. In addition to the primary duty test that
applies to all employees, General Schedule employees in positions
properly classified at GS-5 or GS-6 (or the equivalent level in other
comparable white-collar pay systems), must spend 80 percent or more of
the worktime in a representative workweek on professional functions and
work that is an essential part of those functions to meet the 80-
percent test.
Sec. 551.208 Effect of performing temporary work or duties on FLSA
exemption status.
(a) Applicability.
(1) When applicable. This section applies only when an employee
must temporarily perform work or duties that are not consistent with
the primary or grade-controlling duty of the employee's official
position description. The period of temporary work or duties may or may
not involve a different geographic duty location. The FLSA exemption
status of employees during a period of temporary work or duties must be
determined as described in this section.
(2) When not applicable. This section does not apply when an
employee is detailed to an identical additional position as the
employee's position or to a position of the same grade, series code,
basic duties, and FLSA exemption status as the employee's position.
(b) Effect on nonexempt employees.
(1) A nonexempt employee who must temporarily perform work or
duties that are not consistent with the primary or grade-controlling
duty of the employee's official position description remains nonexempt
for the entire period of temporary work or duties unless all three of
the following conditions are met:
(i) 30-day test. The period of temporary work or duties exceeds 30
calendar days; and
(ii) Exempt work or duty. The employee's primary duty for the
period of temporary work or duties is exempt work or duty as defined in
this part; and
(iii) Positions at GS-7 or above, or at situation 3 or 4. The
employee's position (including a position to which the employee is
temporarily promoted) is properly classified in the General Schedule at
GS-7 or above (or the equivalent level in other comparable white-collar
pay systems) or properly classified in the Federal Wage System as a
supervisor at situation 3 or 4 of Factor I of the Federal Wage System
Job Grading Standard for Supervisors (or the equivalent level in other
comparable wage systems).
(2) If a nonexempt employee becomes exempt under the criteria in
paragraph (b)(1) of this section--
[[Page 67250]]
(i) The employee must be considered exempt for the entire period of
temporary work or duties; and
(ii) If the employee received FLSA overtime pay for work performed
during the first 30 calendar days of the temporary work or duties, the
agency must recalculate the employee's total pay retroactive to the
beginning of that period because the employee is now not entitled to
the FLSA overtime pay received but may be owed title 5 overtime pay.
(c) Effect on exempt employees.
(1) An exempt employee not covered by the special provision of
paragraph (c)(3) of this section who must temporarily perform work or
duties that are not consistent with the primary or grade-controlling
duty of the employee's official position description remains exempt for
the entire period of temporary work or duties unless all three of the
following conditions are met:
(i) 30-day test. The period of temporary work or duties exceeds 30
calendar days; and
(ii) Not exempt work or duty. The employee's primary duty for the
period of temporary work or duties is not exempt work or duty as
defined in this part; and
(iii) Positions at GS-7 or above, or at situation 3 or 4. The
employee's position (including a position to which the employee is
temporarily promoted) is properly classified in the General Schedule at
GS-7 or above (or the equivalent level in other comparable white-collar
pay systems) or properly classified in the Federal Wage System as a
supervisor at situation 3 or 4 of Factor I of the Federal Wage System
Job Grading Standard for Supervisors (or the equivalent level in other
comparable wage systems).
(2) If an exempt employee becomes nonexempt under the criteria in
paragraph (c)(1) of this section--
(i) The employee must be considered nonexempt for the entire period
of temporary work or duties; and
(ii) If the employee received title 5 overtime pay for work
performed during the first 30 calendar days of the temporary work or
duties, the agency must recalculate the employee's total pay
retroactive to the beginning of that period because the employee may
now not be entitled to some or all of the title 5 overtime pay received
but may be owed FLSA overtime pay.
(3) Special provision for exempt employees at GS-5 or GS-6, or
below situation 3. The exemption status of certain exempt employees who
must temporarily perform work or duties that are not consistent with
the primary or grade-controlling duty of their official position
description must be determined on a workweek basis for the period of
temporary work or duties. Such employees are exempt employees whose
positions (including a position to which the employee is temporarily
promoted) are properly classified in the General Schedule at GS-5 or
GS-6 (or the equivalent level in other comparable white-collar pay
systems), or are properly classified in the Federal Wage System below
situation 3 of Factor I of the Federal Wage System Job Grading Standard
for Supervisors (or the equivalent level in other comparable wage
systems). The exemption status determination of these employees will
result in the employee either remaining exempt or becoming nonexempt
for that workweek, as described in paragraphs (c)(3)(i) and (c)(3)(ii)
of this section.
(i) Remain exempt. An exempt employee remains exempt for a given
workweek only if the employee performs exempt work or duties for 80
percent or more of the worktime in that workweek.
(ii) Become nonexempt. An exempt employee becomes nonexempt for a
given workweek only if the employee performs nonexempt work or duties
for more than 20 percent of the worktime in that workweek.
(d) Emergency situation. Notwithstanding any other provisions of
this section, and regardless of an employee's grade level, the agency
may determine that an emergency situation exists that directly
threatens human life or safety, serious damage to property, or serious
disruption to the operations of an activity, and there is no recourse
other than to assign qualified employees to temporarily perform work or
duties in connection with the emergency. In such a designated
emergency--
(1) Nonexempt employee. The exemption status of a nonexempt
employee remains nonexempt whether the employee performs nonexempt work
or exempt work during the emergency; and
(2) Exempt employee. The exemption status of an exempt employee
must be determined on a workweek basis. The exemption status
determination of exempt employees will result in the employee either
remaining exempt or becoming nonexempt for that workweek, as described
in paragraphs (d)(2)(i) and (d)(2)(ii) of this section.
(i) Remain exempt. An exempt employee remains exempt for any
workweek in which the employee performs exempt work or duties for 80
percent or more of the worktime in a given workweek.
(ii) Become nonexempt. An exempt employee becomes nonexempt for any
workweek in which the employee performs nonexempt work or duties for
more than 20 percent of the worktime in a given workweek.
Sec. 551.209 Foreign exemption criteria.
(a) Application. When the foreign exemption applies, the minimum
wage, overtime, and child labor provisions of the Act do not apply to
any employee who spends all hours of work in a given workweek in an
exempt area. When an employee meets one of the two criteria in
paragraph (b) of this section, the foreign exemption applies until the
employee spends any hours of work in any nonexempt area as defined in
Sec. 551.102.
(b) Foreign exemption applies. If an employee meets one of the two
following criteria, the employee is subject to the foreign exemption of
the Act and the minimum wage, overtime, and child labor provisions of
the Act do not apply:
(1) The employee is permanently stationed in an exempt area and
spends all hours of work in a given workweek in one or more exempt
areas; or
(2) The employee is not permanently stationed in an exempt area,
but spends all hours of work in a given workweek in one or more exempt
areas.
(c) Foreign exemption does not apply. For any given workweek, the
minimum wage, overtime, and child labor provisions of the Act apply to
an employee permanently stationed in an exempt area who spends any
hours of work in any nonexempt area. For that workweek, the employee is
not subject to the foreign exemption, and the agency must determine the
exemption status of such an employee as described paragraphs (c)(1) and
(c)(2) of this section. The foreign exemption does not resume until the
employee again meets one of the criteria in paragraph (b) of this
section.
(1) Same duties. If the duties performed during that workweek are
consistent with the primary or grade-controlling duties of the
employee's official position description, the agency must designate the
employee the same FLSA exemption status as if the employee were
permanently stationed in any nonexempt area.
(2) Different duties. If the duties performed during that workweek
are not consistent with the primary or grade-controlling duties of the
employee's official position description--
(i) The agency must first designate the employee the same FLSA
exemption status as the employee would have been designated based on
the duties included
[[Page 67251]]
in the employee's official position description if the employee were
permanently stationed in any nonexempt area; and
(ii) The agency must determine the employee's exemption status for
that workweek by applying Sec. 551.208.
(d) Resumption of foreign exemption. When an employee returns to
any exempt area from performing any hours of work in any nonexempt
area, the employee is not subject to the foreign exemption until the
employee meets one of the criteria in paragraph (b) of this section.
Sec. 551.210 Exemption of employees receiving availability pay.
The following employees are exempt from the hours of work and
overtime pay provisions of the Act:
(a) A criminal investigator receiving availability pay under
Sec. 550.181 of this chapter; and
(b) A pilot employed by the United States Customs Service who is a
law enforcement officer as defined in section 5541(3) of title 5,
United States Code, and who receives availability pay under section
5545a(i) of title 5, United States Code.
Sec. 551.211 Statutory exclusion.
A customs officer who receives overtime pay under subsection (a) or
premium pay under subsection (b) of section 267 of title 19, United
States Code, for time worked may not receive pay or other compensation
for that work under any other provision of law. As used in section 5,
the term ``customs officer'' means a United States Customs Service
supervisory or nonsupervisory customs inspector or a supervisory or
nonsupervisory canine enforcement officer.
4. Subpart F is added to read as follows:
Subpart F--Child Labor
Sec.
551.601 Minimum age standards.
551.602 Responsibilities.
Sec. 551.601 Minimum age standards.
(a) 16-year minimum age. The Act, in section 3(l), sets a general
16-year minimum age, which applies to all employment subject to its
child labor provisions, with certain exceptions not applicable here.
(b) 18-year minimum age. The Act, in section 3(l), also sets an 18-
year minimum age with respect to employment in any occupation found and
declared by the Secretary of Labor to be particularly hazardous for the
employment of minors of such age or detrimental to their health or
well-being.
Sec. 551.602 Responsibilities.
(a) Agencies must remain cognizant of and abide by regulations and
orders published in part 570 of title 29, Code of Federal Regulations,
by the Secretary of Labor regarding the employment of individuals under
the age of 18 years. These regulations and orders govern the minimum
age at which persons under the age of 18 years may be employed and the
occupations in which they may be employed. Persons under the age of 18
years must not be employed in occupations or engage in work deemed
hazardous by the Secretary of Labor.
(b) OPM will decide complaints concerning the employment of persons
under the age of 18 years. Complaints must be filed following the
procedures set forth in subpart G of this part.
5. Subpart G is added to read as follows:
Subpart G--FLSA Claims and Compliance
Sec.
551.701 Applicability.
551.702 Time limits.
551.703 Avenues of review.
551.704 Claimant's representative.
551.705 Filing an FLSA claim.
551.706 Responsibilities.
551.707 Withdrawal or cancellation of an FLSA claim.
551.708 Finality and effect of OPM FLSA claim decision.
551.709 Availability of information.
551.710 Where to file an FLSA claim with OPM.
Sec. 551.701 Applicability.
(a) Applicable. This subpart applies to FLSA exemption status
determination claims, FLSA pay claims for minimum wage or overtime pay
for work performed under the Act, and complaints arising under the
child labor provisions of the Act.
(b) Not applicable. This subpart does not apply to claims or
complaints arising under the equal pay provisions of the Act. The equal
pay provisions of the Act are administered by the Equal Employment
Opportunity Commission.
Sec. 551.702 Time limits.
(a) Claims. A claimant may at any time file a complaint under the
child labor provisions of the Act or an FLSA claim challenging the
correctness of his or her FLSA exemption status determination. A
claimant may also file an FLSA claim concerning his or her entitlement
to minimum wage or overtime pay for work performed under the Act;
however, time limits apply to FLSA pay claims. All FLSA pay claims
filed on or after June 30, 1994, are subject to a 2-year statute of
limitations (3 years for willful violations).
(b) Statute of limitations. An FLSA pay claim filed on or after
June 30, 1994, is subject to the statute of limitations contained in
the Portal-to-Portal Act of 1947, as amended (section 255a of title 29,
United States Code), which imposes a 2-year statute of limitations,
except in cases of a willful violation where the statute of limitations
is 3 years. In deciding a claim, a determination must be made as to
whether the cause or basis of the claim was the result of a willful
violation on the part of the agency.
(c) Preserving the claim period. A claimant or a claimant's
designated representative may preserve the claim period by submitting a
written claim either to the agency employing the claimant during the
claim period or to OPM. The date the agency or OPM receives the claim
is the date that determines the period of possible entitlement to back
pay. The claimant is responsible for proving when the claim was
received by the agency or OPM. The claimant should retain documentation
to establish when the claim was received by the agency or OPM, such as
by filing the claim using certified, return receipt mail, or by
requesting that the agency or OPM provide written acknowledgment of
receipt of the claim. If a claim for back pay is established, the
claimant will be entitled to pay for a period of up to 2 years (3 years
for a willful violation) back from the date the claim was received.
Sec. 551.703 Avenues of review.
(a) Negotiated grievance procedure (NGP) as exclusive
administrative remedy. If at any time during the claim period, a
claimant was a member of a bargaining unit covered by a collective
bargaining agreement that did not specifically exclude matters under
the Act from the scope of the negotiated grievance procedure, the
claimant must use that negotiated grievance procedure as the exclusive
administrative remedy for all claims under the Act. There is no right
to further administrative review by the agency or by OPM. The remaining
sections in this subpart (that is, Secs. 551.704 through 551.710) do
not apply to such employees.
(b) Non-NGP administrative review by agency or OPM. A claimant may
file a claim with the agency employing the claimant during the claim
period or with OPM, but not both simultaneously, regarding matters
arising under the Act if, during the entire claim period, the
claimant--
(1) Was not a member of a bargaining unit, or
(2) Was a member of a bargaining unit not covered by a collective
bargaining agreement, or
[[Page 67252]]
(3) Was a member of a bargaining unit covered by a collective
bargaining agreement that specifically excluded matters under the Act
from the scope of the negotiated grievance procedure.
(c) Judicial review. Nothing in this subpart limits the right of a
claimant to bring an action in an appropriate United States court.
Filing a claim with an agency or with OPM does not satisfy the statute
of limitations governing FLSA claims filed in court. OPM will not
decide an FLSA claim that is in litigation.
Sec. 551.704 Claimant's representative.
A claimant may designate a representative to assist in preparing or
presenting a claim. The claimant must designate the representative in
writing. A representative may not participate in OPM interviews unless
specifically requested to do so by OPM. An agency may disallow a
claimant's representative who is a Federal employee in any of the
following circumstances:
(a) When the individual's activities as a representative would
cause a conflict of interest or position;
(b) When the designated representative cannot be released from his
or her official duties because of the priority needs of the Government;
or
(c) When the release of the designated representative would give
rise to unreasonable costs to the Government.
Sec. 551.705 Filing an FLSA claim.
(a) Filing an FLSA claim. A claimant may file an FLSA claim with
either the agency employing the claimant during the claim period or
with OPM, but a claimant cannot pursue the same claim with both at the
same time. OPM encourages a claimant to obtain a decision on the claim
from the agency before filing the claim with OPM. However, a claimant
is not required to do this. This a matter of personal discretion and a
claimant may use either avenue. A claimant who receives an unfavorable
decision on a claim from the agency may still file the claim with OPM.
However, a claimant may not file the claim with the agency after
receiving an unfavorable decision from OPM. An OPM decision on a claim
is final and is not subject to further administrative review.
(b) FLSA claim filed with agency. An FLSA claim filed with an
agency should be made according to appropriate agency procedures. At
the request of the claimant, the agency may forward the claim to OPM on
the claimant's behalf. The claimant is responsible for ensuring that
OPM receives all the information requested in paragraph (b) of this
section.
(c) FLSA claim filed with OPM. An FLSA claim filed with OPM must be
made in writing and must be signed by the claimant or the claimant's
representative. Relevant information may be submitted to OPM at any
time following the initial submission of a claim to OPM and prior to
OPM's decision on the claim. The claim must include the following:
(1) The identity of the claimant (see Sec. 551.706(a)(2) regarding
requesting confidentiality) and any designated representative, the
agency employing the claimant during the claim period, the position
(job title, series, and grade) occupied by the claimant during the
claim period, and the current mailing address, commercial telephone
number, and facsimile machine number, if available, of the claimant and
any designated representative;
(2) A description of the nature of the claim and the specific
issues or incidents giving rise to the claim, including the time period
covered by the claim;
(3) A description of actions taken by the claimant to resolve the
claim within the agency and the results of any actions taken;
(4) A copy of any relevant decision or written response by the
agency;
(5) Evidence available to the claimant or the claimant's designated
representative which supports the claim, including the identity,
commercial telephone number, and location of other individuals who may
be able to provide information relating to the claim;
(6) The remedy sought by the claimant;
(7) Evidence, if available, that the claim period was preserved in
accordance with Sec. 551.702. The date the claim is received by the
agency or OPM becomes the date on which the claim period is preserved;
(8) A statement from the claimant that he or she was or was not a
member of a collective bargaining unit at any time during the claim
period;
(9) If the claimant was a member of a bargaining unit, a statement
from the claimant that he or she was or was not covered by a negotiated
grievance procedure at any time during the claim period, and if
covered, whether that procedure specifically excluded the claim from
the scope of the negotiated grievance procedure;
(10) A statement from the claimant that he or she has or has not
filed an action in an appropriate United States court; and
(11) Any other information that the claimant believes OPM should
consider.
Sec. 551.706 Responsibilities.
(a) Claimant.
(1) Providing information to OPM. For all FLSA claims, the claimant
or claimant's designated representative must provide any additional
information requested by OPM within 15 workdays after the date of the
request, unless the claimant or the claimant's representative requests
additional time and OPM grants a longer period of time in which to
provide the requested information. The disclosure of information by a
claimant is voluntary. However, OPM may be unable to render a decision
on a claim without the information requested. In such a case, the claim
will be cancelled without further action being taken by OPM. In the
case of an FLSA pay claim, it is the claimant's responsibility to
provide evidence that the claim period was preserved in accordance with
Sec. 551.702 and of the liability of the agency and the claimant's
right to payment.
(2) Requesting confidentiality. If the claimant wishes the claim to
be treated confidentially, the claim must specifically request that the
identity of the claimant not be revealed to the agency. Witnesses or
other sources may also request confidentiality. OPM will make every
effort to conduct its investigation in a way to maintain
confidentiality. If OPM is unable to obtain sufficient information to
render a decision and preserve the requested confidentiality, OPM will
notify the claimant that the claim will be cancelled with no further
action by OPM unless the claimant voluntarily provides written
authorization for his or her name to be revealed.
(b) Agency.
(1) In FLSA exemption status determination claims, the burden of
proof rests with the agency that asserts the FLSA exemption.
(2) The agency must provide the claimant with a written
acknowledgment of the date the claim was received.
(3) Upon a claimant's request, and subject to any Privacy Act
requirements, an agency must provide a claimant with information
relevant to the claim.
(4) The agency must provide any information requested by OPM within
15 workdays after the date of the request, unless the agency requests
additional time and OPM grants a longer period of time in which to
provide the requested information.
[[Page 67253]]
Sec. 551.707 Withdrawal or cancellation of an FLSA claim.
(a) Withdrawal. A claimant or the claimant's representative may
withdraw a claim at any time prior to the issuance of an OPM FLSA claim
decision by providing written notice to the OPM office where the claim
was filed.
(b) Cancellation. OPM may, at its discretion, cancel an FLSA claim
if the claimant or the claimant's designated representative fails to
provide requested information within 15 workdays after the date of the
request, unless the claimant or the claimant's representative requests
additional time and OPM grants a longer period of time in which to
provide the requested information. OPM may, at its discretion,
reconsider a cancelled claim on a showing that circumstances beyond the
claimant's control prevented pursuit of the claim.
Sec. 551.708 Finality and effect of OPM FLSA claim decision.
OPM will send an FLSA claim decision to the claimant or the
claimant's representative and the agency. An FLSA claim decision made
by OPM is final. There is no further right of administrative appeal. At
its discretion, OPM may reconsider a decision upon a showing that
material information was not considered or there was a material error
of law, regulation, or fact in the original decision. A decision by OPM
under the Act is binding on all administrative, certifying, payroll,
disbursing, and accounting officials of agencies for which OPM
administers the Act. Upon receipt of a decision, the agency employing
the claimant during the claim period must take all necessary steps to
comply with the decision, including adherence with compliance
instructions provided with the decision. All compliance actions must be
completed within the time specified in the decision, unless an
extension of time is requested by the agency and granted by OPM. The
agency should identify all similarly situated current and, to the
extent possible, former employees, ensure that they are treated in a
manner consistent with the decision, and inform them in writing of
their right to file an FLSA claim with the agency or OPM.
Sec. 551.709 Availability of information.
(a) Except when the claimant has requested confidentiality, the
agency and the claimant must provide to each other a copy of all
information submitted with respect to the claim.
(b) When a claimant has not requested confidentiality, OPM will
disclose to the parties concerned the information contained in an FLSA
claim file. When a claimant has requested confidentiality, OPM will
delete any information identifying the claimant before disclosing the
information in an FLSA claim file to the parties concerned. For the
purposes of this subpart, the parties concerned means the claimant, any
representative designated in writing, and any representative of the
agency or OPM involved in the proceeding.
(c) Except when the claimant has requested confidentiality or the
disclosure would constitute a clearly unwarranted invasion of personal
privacy, OPM, upon a request which identifies the individual from whose
file the information is sought, will disclose the following information
from a claim file to a member of the public:
(1) Confirmation of the name of the individual from whose file the
information is sought and the names of the other parties concerned;
(2) The remedy sought;
(3) The status of the claim;
(4) The decision on the claim; and
(5) With the consent of the parties concerned, other reasonably
identified information from the file.
Sec. 551.710 Where to file an FLSA claim with OPM.
An FLSA claim must be filed with the OPM office serving the area
where the cause or basis of the claim occurred. Following are OPM
addresses and service areas.
OPM Atlanta Oversight Division
75 Spring Street SW., Suite 972, Atlanta, GA 30303-3109
Alabama, Florida, Georgia, Mississippi, North Carolina, South
Carolina, Tennessee, Virginia (except the Virginia locations listed
under the Washington, DC Oversight Division)
OPM Chicago Oversight Division
230 S. Dearborn Street, DPN 30-6, Chicago, IL 60604-1687
llinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota,
Missouri, Nebraska, North Dakota, Ohio, South Dakota, West Virginia,
Wisconsin
OPM Dallas Oversight Division
1100 Commerce Street, Room 4C22, Dallas, TX 75242-9968
Arizona, Arkansas, Colorado, Louisiana, Montana, New Mexico,
Oklahoma, Texas, Utah, Wyoming
OPM Philadelphia Oversight Division
600 Arch Street, Room 3400, Philadelphia, PA 19106-1596
Connecticut, Delaware, Maine, Maryland (except the Maryland
locations listed under the Washington, DC Oversight Division),
Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania,
Rhode Island, Vermont, Puerto Rico, Virgin Islands
OPM San Francisco Oversight Division
120 Howard Street, Room 760, San Francisco, CA 94105-0001
Alaska, California, Hawaii, Idaho, Nevada, Oregon, Washington,
Pacific Ocean Area
OPM Washington, DC Oversight Division
1900 E Street NW., Room 7675, Washington, DC 20415-0001
The District of Columbia
In Maryland: the counties of Charles, Montgomery, and Prince
George's.
In Virginia: the counties of Arlington, Fairfax, King George,
Loudoun, Prince William, and Stafford; the cities of Alexandria,
Fairfax, Falls Church, Manassas, and Manassas Park; and any overseas
area not listed in the service area of another Oversight division.
[FR Doc. 97-33429 Filed 12-22-97; 8:45 am]
BILLING CODE 6325-01-P