Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
The U.S. Department of Labor's Wage and Hour Division (WHD) issued three new opinion letters on March 14, 2019. The letters clarify diverse issues, including initiation and duration of FMLA leave, compensability of employees’ time spent on volunteer community service for which the employer offers a bonus, and compensation of residential janitors.
Initiation and Duration of FMLA Leave (Opinion Letter FMLA2019-1-A)
The Opinion Letter
The DOL opined that an employer may not delay designating leave as FMLA leave, even where the delay is to permit the employee to exhaust available paid sick or other leave prior to initiation of the FMLA-protected leave. Once an eligible employee communicates a need to take leave for an FMLA-qualifying reason, neither the employee nor the employer may decline FMLA protection for that leave. Once the employer has enough information to determine that leave is for a qualifying reason, the employer must provide notice of the determination to the employee within five business days and count the leave toward the employee’s FMLA leave entitlement. The agency stated that an employer may not delay designating the absence as FMLA-qualifying, even if the employee would prefer that the employer delay the designation.
The DOL also clarified that an employer may not designate more than 12 weeks of leave (or 26 weeks of military caregiver leave) as FMLA leave. An employer must observe any employment benefit program or plan that provides greater family or medical leave rights to employees than the rights established by the FMLA. Providing those benefits, however, does not expand the employee’s 12-week (or 26-week) entitlement under the FMLA. Therefore, if an employee substitutes paid leave for unpaid FMLA leave, the employee’s paid leave: (1) counts toward his or her 12-week (or 26-week) FMLA entitlement; and (2) does not expand that entitlement.
Explicit Disagreement with Escriba v. Foster Poultry Farms
In the opinion, the DOL noted its disagreement with Escriba v. Foster Poultry Farms,1 a 2013 appellate decision in which the Ninth Circuit (in upholding a jury verdict in favor of the defendant employer) held that “an employee may use non-FMLA leave for an FMLA-qualifying reason and decline to use FMLA leave in order to preserve FMLA leave for future use.” In Escriba, the employee (Escriba) sought two weeks of leave from her employment with Foster Farms in order to care for her ailing father (an FMLA-qualifying reason). However, testimony indicated that Escriba expressly asked Foster Farms to treat the time as vacation leave and not as FMLA leave.
Foster Farms’ written policies provided that FMLA leave would run concurrently with an employee’s accrued paid vacation time (if any). However, testimony from a member of Foster Farms’ human resources staff indicated that the company interpreted the FMLA as prohibiting employers from forcing the employee to take FMLA leave “if they’re requesting to take … vacation[,] because that would be reducing a benefit that [the employee] would have” (an approach, notably, that is contrary to that of most employers). Foster Farms complied with Escriba’s request, and designated the leave as vacation rather than FMLA leave. The employee failed to return to work after the expiration of the vacation time and, according to Foster Farms, she failed to request an extension. For that reason, her employment was terminated.
The employee later claimed Foster Farms violated the FMLA by failing to designate her leave as FMLA-protected and by terminating her. The Ninth Circuit construed the FMLA regulation stating that an employer “should inquire further of the employee if it is necessary to have more information about whether FMLA leave is being sought by the employee, and to obtain the necessary details of the leave to be taken” as indicating that there are circumstances in which employees might seek time off but intend not to exercise their FMLA rights. On that basis, the court concluded that “an employee can affirmatively decline to use FMLA leave, even if the underlying reason for FMLA leave would have invoked FMLA protection.”
Although the court’s opinion resulted in a victory for Foster Farms, it resulted in considerable uncertainty for employers faced with similar situations. The uncertainty stems from the fact that: (1) FMLA regulations left uncited by the court make clear that employers can unilaterally designate as FMLA-protected any FMLA-qualifying absence despite the employee’s contrary wishes, and (2) the court did not explicitly limit its key holding – that an employee known by the employer to be absent for an FMLA-qualifying reason “may … decline to use FMLA leave in order to preserve FMLA leave for future use” – to situations where the employer had chosen to permit employees to use other ostensibly job- and benefit-protected leave (in Escriba’s case, vacation time) before tapping into their FMLA leave.
The DOL’s opinion letter makes clear the agency’s position that an employee like Escriba cannot refuse the application of the FMLA to an FMLA-qualifying absence. It also appears to go further by indicating that – even if an employer like Foster Farms wanted to give such employees the choice to “save” FMLA leave and instead exclusively use other leave or paid time off – the FMLA does not permit that.
Employers should consider the impact of this DOL opinion on how they administer the FMLA designation process in situations that implicate these concepts, especially where the employer’s policy or practice is to permit employees absent for FMLA-qualifying reasons to exhaust non-FMLA leave or paid time off before tapping into FMLA leave.
Compensability of Employee Volunteer Community Service (Opinion Letter FLSA2019-2)
The DOL was called on to render an opinion whether an employee’s time spent participating in an employer’s optional volunteer community service program is “hours worked” under the Fair Labor Standards Act, particularly where the employer awards a bonus to certain employees who participate in the program.
The DOL’s opinion letters are directed to the facts that the employer requesting the opinion presented to the DOL. In this instance, the DOL directed its analysis and opinion to the following type of program. Clients of the employer sponsor the program. The employees themselves or the client-sponsors select the volunteer activities the employees will perform. The employer compensates employees for the time they spend on volunteer activities during working hours or while they are required to be on the clients’ premises. However, many of the hours employees spend on volunteer activities are outside of normal working hours. At the end of the year, the client-sponsor rewards the group of employees with the greatest community impact with a monetary award. The winning group’s supervisor decides how to distribute the reward among the employees. In making this decision, the supervisor may consider how many hours each employee volunteered. Employees are not required to participate in the program. Neither the employer nor the client-sponsors direct or control the employees’ volunteer activities.
The DOL opined the time employees spend volunteering in the above program would not be considered hours worked so long as all of the following criteria are met: (1) employee participation in the program is charitable and voluntary; (2) the employer does not require or “unduly pressure” employees to participate in the program; (3) the employer does not control or direct the volunteer work; (4) not volunteering will have no adverse effect on the employee’s working conditions or employment prospects; and (5) the employee is not guaranteed a bonus for volunteering.
On the third point, whether the employer controls or directs the volunteer work, the DOL commented that an employer does not violate this requirement simply by tracking the time employees spend in volunteer activities. However, if the employer gives specific instructions about what volunteer work an employee should do, or how the work should be done, then the time the employee spends following those instructions would be considered hours worked.
Regarding the fifth point, whether the bonus is “guaranteed,” the DOL suggested this criteria would be met where, for example, the employees are organized in groups in the workplace, and the employer “only rewards the group with the most community impact and gives the winning group’s supervisor discretion to determine what amount of the bonus, if any, to award to individual employees in the group.”
In previous opinion letters, the DOL has expressed similar, but subtly different limitations on other types of volunteer programs. For example, in 2005, the DOL expressed an opinion regarding time employees of a nonprofit university spent volunteering in support of the university’s annual “run.” The DOL opined “the employer must compensate employees for the hours spent volunteering during their normal working hours or when the volunteer work performed is similar to their regular duties.” (Emphasis added.) The DOL concluded an employee’s volunteer time would not be considered hours worked only where: (1) the volunteer activities were not similar to the employee’s regular duties; (2) participation was entirely voluntarily, with no ramifications if an employee decided not to participate; and (3) the volunteer activities occurred outside of the employee’s normal working hours. (Opinion Letter FLSA2005-33)
The DOL’s more recent opinion does not examine whether the employees’ volunteer activities are similar to their regular duties. This cannot be taken as a signal that similarity between an employee’s regular duties and their volunteer activities is no longer a concern. Employers should continue to take this issue into account.
Employers operating or considering volunteer community service programs should review their existing or proposed policies and make appropriate revisions or clarifications consistent with the above guidance, with continued attention to factors expressed in past guidance.
Compensation of Residential Janitors (Opinion Letter FLSA2019-1)
The Department considered whether the FLSA guarantees minimum wage and overtime pay to residential janitors despite potentially applicable exemptions from similar state law requirements, and whether an employer that relies on state law exemptions would have a “good-faith” defense to imposition of liquidated damages or three years of back wages liability.
The Department concluded the FLSA minimum wage and overtime requirements do apply to residential janitors, because the FLSA contains no exemption for residential janitors. The Department noted “[t]his is true notwithstanding New York state law which expressly exempts … residential janitors from state minimum wage and overtime requirements.”
The Department went even further, opining it “does not believe that relying on a state law exemption from state law minimum wage and overtime requirements is a good faith defense to noncompliance with the FLSA, but a court retains discretion to make that determination on a case-by-case basis.”
As this opinion emphasizes, an employee must qualify for exemption under both the federal FLSA and applicable state law before an employer can deny payment of overtime.
1 Escriba v. Foster Poultry Farms 743 F.3d 1236 (9th Cir. 2013).