Not a Lexis Advance subscriber? Try it out for free.

Flores v. City of San Gabriel

United States Court of Appeals for the Ninth Circuit

February 10, 2016, Argued and Submitted, Pasadena, California; June 2, 2016, Filed

Nos. 14-56421, 14-56514

Opinion

 [*894]  DAVIS, Circuit Judge:

Plaintiffs-Appellees and Cross-Appellants Danny Flores, Robert Barada, Kevin Watson, Vy Van, Ray Lara, Dane Woolwine, Rikimaru Nakamura, Christopher Wenzel, Shannon Casillas, James Just, Steve Rodrigues, and Enrique Deanda and Plaintiff-Appellee Cruz Hernandez (collectively,  [*895]  "Plaintiffs") are current or former police officers employed by the City of San Gabriel, California ("City"). The Plaintiffs brought suit against the City for violations of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-19, alleging that the City failed to include payments of unused portions of the Plaintiffs' benefits allowances when calculating their regular rate of pay, resulting in a lower overtime rate and a consequent underpayment [**4]  of overtime compensation. The Plaintiffs asserted that the City's violation of the FLSA was "willful," entitling them to a three-year statute of limitations for violations of the Act, and sought to recover their unpaid overtime compensation and liquidated damages.

The City claimed that its cash-in-lieu of benefits payments were properly excluded from the Plaintiffs' regular rate of pay pursuant to two of the Act's statutory exclusions and argued that it qualified for a partial overtime exemption under § 207(k), which allows public agencies employing firefighters or law enforcement officers to designate an alternative work period for purposes of determining overtime. The City denied that any violation of the FLSA was willful and that the Plaintiffs were entitled to liquidated damages.

For the reasons that follow, we conclude that the City's payment of unused benefits must be included in the regular rate of pay and thus in the calculation of the overtime rate for its police officers as well. And because the City took no affirmative steps to ensure that its initial designation of its benefits payments complied with the FLSA and failed to establish that it acted in good faith in excluding those [**5]  payments from its regular rate of pay, the Plaintiffs are entitled to a three-year statute of limitations and liquidated damages for the City's violations. We also conclude, however, that the City has demonstrated that it qualifies for the partial overtime exemption under § 207(k) of the Act, limiting its damages for the overtime violations alleged here.

I. BACKGROUND

Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.

Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.

824 F.3d 890 *; 2016 U.S. App. LEXIS 10018 **; 166 Lab. Cas. (CCH) P36,448; 26 Wage & Hour Cas. 2d (BNA) 914

DANNY FLORES; ROBERT BARADA; KEVIN WATSON; VY VAN; RAY LARA; DANE WOOLWINE; RIKIMARU NAKAMURA; CHRISTOPHER WENZEL; SHANNON CASILLAS; JAMES JUST; STEVE RODRIGUES; ENRIQUE DEANDA, Plaintiffs-Appellees/Cross-Appellants, and CRUZ HERNANDEZ, Plaintiff-Appellee, and GILBERT LEE; RENE LOPEZ, Plaintiffs, v. CITY OF SAN GABRIEL, Defendant-Appellant/Cross-Appellee.

Subsequent History: US Supreme Court certiorari denied by City of San Gabriel v. Flores, 137 S. Ct. 2117, 198 L. Ed. 2d 196, 2017 U.S. LEXIS 3062 (U.S., May 15, 2017)

Motion granted by Flores v. City of San Gabriel, 2018 U.S. Dist. LEXIS 225259 (C.D. Cal., Nov. 5, 2018)

Costs and fees proceeding at, Motion granted by, Judgment entered by Flores v. City of San Gabriel, 2019 U.S. Dist. LEXIS 28652 (C.D. Cal., Feb. 22, 2019)

Prior History:  [**1] Appeal from the United States District Court for the Central District of California. D.C. No. 2:12-cv-04884-JGB- JCG. Jesus G. Bernal, District Judge, Presiding.

Flores v. City of San Gabriel, 2013 U.S. Dist. LEXIS 155694 (C.D. Cal., Oct. 29, 2013)Flores v. City of San Gabriel, 969 F. Supp. 2d 1158, 2013 U.S. Dist. LEXIS 124122 (C.D. Cal., Aug. 29, 2013)

Disposition: AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

CORE TERMS

benefits, regular rate, exemption, overtime, cash-in-lieu, employees, work period, willful, statute of limitations, liquidated damages, calculation, benefit plan, properly excluded, bona fide, contributions, Flexible, partial, district court, hours worked, third party, good faith, designation, complied, qualify, summary judgment, violations, unused, opinion letter, cash payment, fourteen-day

Business & Corporate Compliance, Wage & Hour Laws, Scope & Definitions, Overtime & Work Periods, Labor & Employment Law, Exemptions, Emergency Personnel, Regular Rate, Remedies, Private Suits, Statute of Limitations, Civil Procedure, Summary Judgment, Motions for Summary Judgment, Cross Motions, Judgments, Entitlement as Matter of Law, Appeals, Summary Judgment Review, Standards of Review, Evidence, Burdens of Proof, Allocation, Exemptions, Governments, Legislation, Administrative Law, Judicial Review, Standards of Review, Deference to Agency Statutory Interpretation, Rule Interpretation, Damages, Backpay, Liquidated Damages