Washington, DC

U.S. Office of Personnel Management
Fair Labor Standards Act Decision
Under section 204(f) of title 29, United States Code

---

Linda Kazinetz
Classification Appeals and FLSA Claims
Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance


01/26/2017

---

Date

Introduction

On May 19, 2015, OPM’s Merit System Accountability and Compliance received a  Fair Labor Standards Act (FLSA) claim from Carolina Lopez[1] requesting a review of the exemption status under the FLSA of the claimant’s current position classified as Investigative Specialist, GS-1801-13.  The agency has designated the claimant’s position as exempt (i.e., not covered) from the minimum wage and overtime pay provisions of the FLSA, but the claimant believes it should be designated as non-exempt (i.e., covered) and that the claimant is entitled to FLSA overtime pay.  The claimant’s position is located in the Los Angeles Field Office (LAFO), Western Regional Branch, Investigations Division, Office of Security and Integrity (OSI), U.S. Citizenship and Immigration Service (USCIS), U.S. Department of Homeland Security (DHS), in Los Angeles, California.  We received the agency administrative report (AAR) via email on July 28, 2015.  We have accepted and decided this claim under section 4(f) of the FLSA of 1938, as amended, codified at section 204(f) of title 29, United States Code (U.S.C.).

In reaching our FLSA decision, we have carefully reviewed all information furnished by the claimant and the agency, including information obtained during a telephonic interview with the claimant.  In addition, because the claimant’s immediate supervisor declined to be interviewed, we interviewed by telephone the Acting Chief of the Investigations Division, OSI, regarding the claim. 

Evaluation

Period of the Claim

As provided for in 5 CFR 551.702(b), all FLSA claims filed after June 30, 1994, are subject to a two-year statute of limitations (three years for willful violation).  A claimant must submit a written claim to either the employing agency or to OPM in order to preserve the claim period.  The date the agency or OPM receives the claim is the date which determines the period of possible pay back entitlement.  The record shows the claimant did not file a claim with the agency.  Therefore, we find the claim was preserved effective May 19, 2015, when it was received by OPM. 

Willful violation

The claimant contends the agency willfully violated the FLSA, thus the claim period should be extended to three years.  The claimant makes this assertion because on two occasions in fiscal year 2012, the agency changed the exemption status of the claimant’s position to non-exempt resulting in the claimant receiving FLSA overtime pay for four pay periods.  However, the record shows that subsequently the agency corrected their error and re-designated the position exempt.  The claimant also cites an agency memorandum of February 27, 2012, from the Chief, Office of Human Capital and Training, to Associate Directors and Program Office Heads, which contains a listing of non-supervisory positions which “remain exempt from FLSA coverage because the positions meet the administrative and/or professional exemption criteria.”  Because the claimant’s position is not listed in the agency memorandum, the claimant contends it should be non-exempt.  However, in a July 28, 2015, memorandum to OPM the agency states that the “Investigative Specialist, GS-1801, was inadvertently omitted from the memorandum and re-designated Non-Exempt in error.”  “Willful violation” is defined in 5 CFR 551.104 as follows: 

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. 

Clearly not all violations of the FLSA are willful as this term is defined in the regulations.  Based on our below analysis, there is no question that USCIS erred in the claimant’s exemption status determination, particularly given the fact the claimant is assigned to a standard agency-wide position description (PD) which describes duties the claimant does not perform.  However, to prove willful violation there must be evidence that USCIS showed reckless disregard of the FLSA requirements.  Instead, we find the agency simply erred in making the exemption determination by failing to fully consider and evaluate the limited nature of the claimant’s authority and responsibility regarding the claimant’s primary duties described in the claimant’s PD.  Therefore, we conclude the agency’s actions were not deliberate and do not meet the criteria for willful violation as defined in 5 CFR 551.104.  Consequently, because we received the claim on May 19, 2015, it is subject to a two-year statute of limitations commencing on May 19, 2013, and any time prior to that date falls outside the claim period. 

Position Information

The agency has certified to the accuracy of the claimant’s PD # D0568Q, but the claimant believes it is inaccurate because it describes some duties the claimant does not perform.  For example, under the “Introduction” section of the PD, the claimant does not “assist with administration of the OSI Investigations Program, providing expert advice and direction to management and field staff as appropriate and required.”  Under the “Major Duties and Responsibilities” section of the PD, the claimant does not contribute “to formulation of OSI and USCIS policy and implementation strategies.”  The claimant states the assigned work does not include forecasting “the potential effects of issued USCIS and DHS policy, as well as program and procedural changes in overall regulatory, compliance, and enforcement operations.”  The claimant contends the work does not involve responsibility “for analyzing key policy questions in the enforcement and compliance areas,” and making “recommendations and significant agency decisions related thereto.”  In addition, the claimant indicates the work does not include developing “significant new enforcement program strategies.”  Under the “Controls Over the Work” section, the claimant states the duties do not include defining and revising program approaches.  Our fact-finding, including the interview with the Acting Chief of the Investigations Division, confirmed the claimant does not perform the preceding duties described in the PD of record. 

The claimant performs investigations of alleged misconduct by USCIS employees and agency contractor employees throughout the geographic area covered by the LAFO.  The Investigations Operations Branch (IOB), Investigations Division, OSI, initially processes all incoming allegations of employee and contractor misconduct received online, via telephone, email or letter.  Allegations are received from CIS employees and those of other DHS bureaus; the Joint Intake Center administered by Immigration and Customs Enforcement (ICE) and Customs and Border Protection (CBP); applicants for CIS services; advocacy groups, attorneys, contractors, and the general public.  Upon receipt of an allegation, or declination by the DHS Office of Inspector General (OIG), the IOB organizes and assigns allegations to the field offices for investigation. 

The claimant primarily performs investigations of allegations designated as Class II covering serious non-criminal misconduct, and Class III covering conduct that is non-criminal in nature, but sufficiently serious to warrant a formal review.  Occasionally, the claimant also investigates Class I allegations covering potential criminal misconduct.  All Class I allegations are first reviewed by the DHS OIG for disposition, and depending on the seriousness may be referred to the IOB for assignment to the field offices for investigation.  Class I allegations include accepting or soliciting bribes; conflicts of interest and violations of ethical standards; unauthorized use of TECS (Treasury Enforcement Communications System) automated database or other law enforcement resources; theft of government property, etc.  Class II allegations include threatening, intimidating, harassing or provoking another; violent, reckless, or disorderly conduct; alcohol possession or consumption on duty; misstatements or misrepresentations; falsification or concealment of facts; use of position or authority, or use of government identification, for non-official purposes; inappropriate associations; Hatch Act violations; reprisal actions; ethics violations and prohibited personnel practices; misuse or unauthorized use of government vehicles; concealing loss, damage, or missing government property; failure to report misconduct, etc.  Class III allegations include unauthorized absence; hostile work environment; unauthorized outside employment; interference with other employee’s official duties; negligent performance of duty; security procedure violations, etc. 

In conducting investigations, the claimant prepares an Investigative Work Plan summarizing the allegations and outlining the investigative approach; independently performs electronic and paper records searches; identifies relevant laws and regulations; administers oaths and interviews complainants, witnesses, victims, and the subject of the investigation; and prepares a detailed, accurate, and objective written Report of Investigation (ROI) describing investigative tasks performed and findings.  In compliance with internal agency policy, ROIs may not contain any opinions, conclusions, proposed resolutions or recommendations concerning the results of the investigation.  They are limited to stating the facts resulting from the investigation, and it is left up to the senior management deciding official in the subject’s organization to take appropriate action on the findings.  Completed ROIs are reviewed by the claimant’s first- and second-level supervisors, and upon approval are forwarded to the senior management deciding official in the subject’s organization for appropriate disciplinary action, if warranted. 

Evaluation of FLSA Coverage

Sections 551.201 and 551.202 of title 5 CFR require an employing agency to designate an employee FLSA exempt only when the agency correctly determines that the employee meets one or more of the exemption criteria.  In all exemption determinations, the agency must observe the following principles:  (a) Each employee is presumed to be FLSA nonexempt. (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 which asserts the exemption.  (d) If there is a reasonable doubt as to whether an employee meets the criteria for exemption, the employee should be designated FLSA nonexempt.  (e) The designation of a position’s FLSA status ultimately rests on the duties actually performed by the employee.  Our analysis of the claimant’s duties follows.  Neither the claimant nor the agency asserts the claimant’s work was covered by the executive or professional exemption criteria as detailed in 5 CFR 551.205 and 551.207 respectively, and based on careful review of the record, we agree.  Therefore, our analysis is limited to the administrative exemption in effect during the period of the claim.

Administrative Exemption Criteria 

The current regulation under 5 CFR 551.206 describes the administrative exemption criteria, in relevant part, as follows: 

An administrative employee is an employee whose primary duty is the performance of office or non-manual work directly related to the management or general business operations, as distinguished from production functions, of the employer or the employer’s customers and whose primary duty includes the exercise of discretion and independent judgment with respect to matters of significance. 

(a) In general, the exercise of discretion and independent judgment involves the comparison and the evaluation of possible courses of conduct, and acting or making a decision after the various possibilities have been considered.  The term “matters of significance” refers to the level of importance or consequence of the work performed. 

(b) The phrase discretion and independent judgment must be applied in light of all the facts involved in the particular employment situation in which the question arises.  Factors to consider when determining whether an employee exercises discretion and independent judgment with respect to matters of significance include, but are not limited to, whether the employee:

(1)   Has authority to formulate, affect, interpret, or implement management policies or operating practices;

(2)   Carries out major assignments in conducting the operation of the organization;

(3)   Performs work that affects the organization’s operations to a substantial degree, even if the employee’s assignments are related to operation of a particular segment of the organization;

(4)   Has the authority to commit the employer in matters that have significant financial impact;

(5)   Has authority to waive or deviate from established policies and procedures without prior approval;

(6)   Has authority to negotiate and bind the organization on significant matters;

(7)   Provides consultation or expert advice to management;

(8)   Is involved in planning long-or short-term organizational objectives;

(9)   Investigates and resolves matters of significance on behalf of management;

(10) Represents the organization in handling complaints, arbitrating disputes, or resolving 

        grievances. 

(c)  The exercise of discretion and independent judgment implies the employee has authority to make an independent decision, free from immediate direction or supervision.  However, an employee can exercise discretion and independent judgment even if the employee’s decisions or recommendations are reviewed at a higher level.  Thus, the term discretion and independent judgment does not require that decisions made by an employee have a finality that goes with unlimited authority and a complete absence of review.  The decisions made as a result of the exercise of discretion and independent judgment may consist of recommendations for action rather than the actual taking of action.  The fact that an employee’s decision may be subject to review and that upon occasion the decisions are revised or reversed after review does not mean that the employee is not exercising discretion and independent judgment. 

(d)  An organization’s workload may make it necessary to employ a number of employees to perform the same or similar work.  The fact that many employees perform identical work or work of the same relative importance does not mean that the work of each such employee does not involve the exercise of discretion and independent judgment with respect to matters of significance. 

(e)  The exercise of discretion and independent judgment must be more than the use of skill in applying well-established techniques, procedures, or specific standards described in manuals or other sources. 

The claimant’s work does not meet the administrative exemption criteria.  Although during the claim period the claimant performed office or non-manual work, and performed a staff support function by providing factual investigative information to assist agency managers in making decisions on individual allegations of employee/contractor misconduct, the claimant did not perform a support function of substantial importance to the organizations serviced as envisioned in the FLSA.  Rather, the claimant’s primary duties were limited to developing facts without the responsibility for making conclusions, or proposing resolutions or recommendations.  In addition, while the claimant exercised discretion and independent judgment, under only general supervision in planning and conducting investigations, including evaluating possible courses of action and identifying necessary investigative techniques to develop factual information, this did not involve the application of discretion and independent judgment to matters of significance with respect to the management or general business operations of the agency.  Unlike the administrative exemption, the claimant’s investigative responsibilities were not viewed as an extension of the management process, and the impact of the claimant’s work was limited to that which the claimant personally performed as it related to subjects of individual investigations, rather than helping to manage or affecting the management of significant matters within the claimant’s agency.

Although the claimant exercised discretion and independent judgment in conducting investigations, as discussed above this was not applied with respect to matters of significance as addressed in the ten factors of the regulation previously listed.  For example, the claimant had no authority to formulate, affect, interpret, or implement management policies or operating practices at the claimant’s level.  Such authority is found at the Investigations Division Chief level and above.  The claimant carried out individual investigations rather than major assignments in conducting the operations of the organization, and the claimant’s investigations and work products (i.e., ROIs) did not affect the organization’s operations to a substantial degree.  The claimant had no authority to commit the USCIS in matters having significant financial impact, or to waive or deviate from established investigative policies and procedures without prior approval.  As a line investigator, the claimant lacked authority to negotiate and bind OSI on significant matters; did not consult with and provide expert advice to Investigations Division and OSI management; and was not involved in planning long- or short-term organizational objectives for the Investigations Division and/or OSI.  In contrast to the administrative exemption criteria, the appellant did not investigate and resolve mattes of significance on behalf of management.  On the contrary, the claimant’s work was limited to routinely conducting individual investigations of employee/contractor misconduct, and according to agency policy the claimant was neither tasked nor required to resolve such matters.  Finally, the claimant was not authorized and did not represent the LAFO, the Investigations Division or OSI in handling complaints, arbitrating disputes, or resolving grievances against these organizations.  Indeed, the Acting Chief of the Investigations Division indicated that any complaints or grievances filed against members of the Investigations Division would be handled by staff of the Division’s Special Investigations Branch representing agency management.

Based on the preceding analysis, the claimant did not meet the administrative exemption.

Decision on FLSA Coverage

The claimant’s work does not meet the executive, administrative, or professional exemption criteria.  Therefore, the claimant’s work is nonexempt and covered by the overtime pay provisions of the FLSA.  The claimant is entitled to compensation for all overtime hours worked at the FLSA overtime rate.  The claim was received by OPM on May 19, 2015, and the claimant can receive back pay for two years prior to that date.  The record shows that for six months during the claim period covering May 19, 2013, to November 19, 2013, the claimant was paid administratively uncontrollable overtime (AUO).  In addition, the claimant indicates that from November, 2013, the claimant and other employees assigned to the claimant’s PD in the LAFO received premium pay for overtime worked under the provisions of 5 U.S.C. 5542 (a).  Non-exempt employees who receive AUO pay and who are not engaged in law enforcement activities are entitled to additional FLSA overtime pay equal to 0.5 times their hourly regular rate of pay for all hours of work in excess of 40 hours in a week, not including meal periods.  See https://www.chcoc.gov/content/attachment-guidance-adminstratively-uncontrollable-overtime-auo-pay.  Receipt of title 5 premium pay for overtime worked when an employee is found to be FLSA nonexempt also affects an employee’s overtime pay entitlement calculation.  The agency must follow the compliance requirements on page ii of this decision. 

The agency must reconstruct the pay records for the claimant for the period of the claim and compute:  (1) the back pay for the FLSA overtime pay owed and any interest on the back pay, as required under 5 CFR 550.805 and 550.806, respectively; and (2) the title 5 overtime pay already paid.  The back pay owed is the difference between what should have been paid for FLSA overtime pay plus interest, and what was actually paid.  If the claimant believes the agency incorrectly computed the amount, the claimant may file a new FLSA claim with this office.   

Back to Top