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Texas Exempt Employee Status

by Michael A. Keller GMI

FBI NA176

  If you are a police officer in Texas, not under Civil Service or contract that specifically sets out your work hours, then it is the opinion of the authors that you probably should not have an exempt status.

   The logic that fuels the exempt status for managerial-professional employees as dictated by FLSA is confusing at best. Common sense tells us that if you work you should get paid, regardless of your rank or position. It appears that the exempt status is a way for employers to get more hours from an employee without having to compensate them. This is contrary to equal pay for equal work.

   The Fair Labor Standards Act of 1938 (FLSA) was President Franklin D. Roosevelt’s second attempt to regulate broad hours of workers. (FLSA of 1938, ch 676,52 Stat 1060) This Act included nationwide minimum wage, prohibited oppressive “child labor” and required employers to pay a premium overtime wage for each hour worked beyond the standard workweek. The overtime was amounted to no less than one and one-half times the employee’s regular, hourly wage. (FLSA of 1938, ch 676, ss 6,7,12,52 Stat at 1062-64, 1067)

The purpose of the overtime provision was to;

     (1) Reduce unemployment by encouraging employers to hire more workers instead of requiring their current employees to work excessive hours, and

     (2) Compensate employees for the burden of working excessive hours.

       (Walling v Youngerman-Reynolds Hardwood Co., 325 U.S. 419, (1945) 423,24)

   However, the FLSA did not apply to all employees. The Managerial-Professional exemption excluded from coverage, “any employee employed in a bona fide executive, administrative or professional capacity. (FLSA of 1938, ch 676, ss 13, 52 Stat at 1065) The most commonly expressed justification for the FLSA’s managerial-professional exemption is simply that managerial and professional employees did not need the government to regulate their work hours.

   There are three major issues, one specific to Texas that can be shown to no longer justify the managerial-professional exemption of FLSA. First is the idea that “managerial and professional employees do not need government regulation because they have sufficient bargaining power of their own to withstand demands from their employers to work excessive hours” (Rubhuhn, Harry, 965). “Due to equal bargaining power between the two parties, Congress saw no need to invade the right of employer and manager to fix contracts of employment.” (DeChiara, Peter D.). Second is the idea that the excessive hours do not constitute a problem for managerial and professional employees because they enjoy certain privileges on the job; that have a certain amount of discretion to manage their time and do not have to punch a time clock. (Rubhuhn, Harry 974)

   “It appears clear that most managers and professionals lack sufficient bargaining power to resist employer demands for longer hours. Indeed, the very fact that such employees work excessive hours attests to their lack of bargaining power. The threat of unemployment makes managers and professionals eager to comply with, or even exceed, their employers’ demands; fearing for their jobs, many managers and professionals now work longer hours simply to demonstrate their value to the company. Professor Rosabeth Kanter has explained that recent changes in American businesses have ‘multiplied the pressures they feel to prove they are contributing – to prove that their job adds value in case the company plays musical chairs with the structure.’ In such an environment, an employer can easily replace any given managerial or professional employee according to Juliet Schor, ‘For every aspiring manager determined to limit his or her hours, there are usually many more willing to give the company whatever time it demands’. Utilizing the logic as dictated by FLSA, an exempt employee, who works overtime and does not receive compensation, when calculated, could be making per hour less than one of his/her subordinates.

   The third issue is what should be of interest to all currently “exempt” classified police officers in the great State of Texas. It appears that the FLSA standard for exemption does not apply to police officers because of a law, already interpreted by the courts, that indicates all police officers in a municipality with a population greater that 10,000 must be paid overtime for hours worked in excess of 40 in a week.

   Section 142.0015 of the Texas Local Government Code “Hours of labor and vacation of members of Fire and Police Departments in municipalities with population of more than 10,000.”

   Subsection (f): A police officer may not, except as provided by Subsection (g) or (j), be required to work more hours during a calendar week than the number of hours in the normal work week of the majority of employees of the municipality, other than firefighters and police officers.

   Subsection (g): In the event of an emergency, a police officer may be required to work more hours that permitted in Subsection (f). An emergency is an unexpected happening or event or an unforeseen situation or crisis that calls for immediate action and requires the chief or head of the police department to order a police officer to work overtime.

   Subsection (j): If a majority of police officers working for a municipality sign a written waiver of the prohibition in Subsection (f), the municipality may adopt a work schedule for police officers requiring a police officer to work more hours than permitted by Subsection (f). The officer is entitled to overtime pay if the officer works more hours in a calendar month than the number of hours in the normal work month of the majority of the employees of the municipality other than firefighters and police officers.

   The U.S. District Court for Eastern Texas ruled on January 6th, 1997, in Karr v City of Beaumont, E.D. Texas, No. 96-CV-213, that the City of Beaumont was required to pay police officers for the time they worked over 40 hours per week. The City of Beaumont was trying to claim exemption from overtime under 207(k) of the Fair Labor Standards Act. The exemption of 207(k) computes overtime during a 28-day period, rather than the 40-hour workweek.

   “However, the exemption is limited by 29 U.S.C. 218, which states that the FLSA shall not excuse noncompliance with any federal or state law or municipal ordinance that provides a maximum work week shorter than the one established under FLSA.

   The court held that the city could not claim an exemption under 207(k), because the Texas Local Government Code provides that a police officer may not be required to work more hours during a calendar week than the majority of municipal employees who are not firefighters or police officers.

   Moreover, a subsection of the Texas provision states that a police officer is entitled to overtime pay if the officer works more hours during a calendar month than the number of hours in the normal work month of the majority of the municipal employees other than firefighters and police officers. Civilian employees working for the city are paid for time worked in excess of 40 hours per week, the court found.

   The court therefore ruled that in order to comply with the Texas code, the city was required to pay police officers for the time they worked over 40 hours per week.” (Fair Labor Standards Handbook, Issue No. 138, March 1997, (italics added).

   The vast majority of police administrators in the State of Texas are licensed police officers by TCLEOSE. Therefore, the Texas Local Government Code, as illustrated above takes precedence over the FLSA law. The final result is that if you are a police officer (regardless of rank), working in a municipality with a population greater that 10,000, you cannot hold an exempt status per state law. If you are working overtime greater than 40 hours per week you must be compensated.

   There is an additional point to be made regarding Subsection (j). If your agency is utilizing a schedule that requires police officers to work more than 40 hours in a workweek, the majority of the officers must have signed a waiver. There are various alternative work schedules where you may work 50 hours one week, 30 the next, etc. Failure to meet the waiver requirement, as indicated in Subsection (j), makes the scheduling illegal.

   The caveat to administrators is that employees who are being worked in violation of these statutes can ask for back wages for the past two years. This could be a real financial burden on municipalities. It is suggested that agencies become compliant, seek legal council, and prepare to compensate those that have legal standing. It should also be noted that Section 142.001, Subsection (e) A municipal official having charge of a fire department or police department, commits an offense if the official violates Section 142.0013, 142.0015, or 142.0017. An offense under this subsection is punishable by a fine of not less than $10 or more than $100. Each day on which the municipal official causes or permits the section to be violated constitutes a separate violation.

   Many officials have failed to review the Texas Local Government Code which clearly indicates that the work hours of police officers is regulated by these state statutes. Too many have considered FLSA to be the governing rule. This is not the case, as indicated in Karr v. City of Beaumont. The court in essence stated that FLSA was pre-empted by Texas law.




About the Authors:

Michael A. Keller has been in the public safety profession since 1973 attaining the position of Chief of Police & Director of Public Safety. He retired as Chief of Police of the Webster Texas Police Department. He is the CEO of the Keller Consulting Group, Government Consulting Services. He has consulted with police agencies on issues involving Police Management and Planning, Leadership, Employee Discipline, Internal Investigations, Criminal Investigations, and investigations regarding the Sexual Exploitation of Children. He holds a Bachelor’s of Arts Degree in Police Administration from Western Illinois University, is a graduate of the Leadership Command College, and a graduate of the FBI National Academy 176th Session. He has written numerous articles on Leadership and Policing for various publications. He has been an instructor at the Law Enforcement Management Institute of Texas at Sam Houston State University. He has extensive media experience and has been a guest on ABC’s “Good Morning America” and CBS’s “Today Show”. He is committed to “ethical, professional leadership” and assisting other organizations in meeting the demands of the 21st Century. He lives on the coast of Texas and is an avid saltwater fisherman.

Patsy Edwards, Captain (retired) Webster Police Department. She is a graduate of the Law Enforcement Management Institute of Texas (LEMIT).





    

 





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