Adams v. City of Kansas City, Missouri

IN THE UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF MISSOURI

WESTERN DIVISION

CRAIG ADAMS and JOSEPH KNOPP, )

Individually and on Behalf of Others )

Similarly Situated, )

)

Plaintiffs, )

)

vs. ) Case No. 19-CV-00093-W-WBG

)

CITY OF KANSAS CITY, MISSOURI, )

)

Defendant. )

ORDER AND OPINION (1) GRANTING PLAINTIFFS’ MOTION FOR PARTIAL

SUMMARY JUDGMENT, (2) DENYING THE CITY’S MOTION FOR SUMMARY

JUDGMENT, AND (3) DENYING PLAINTIFFS’ MOTION FOR LEAVE

Pending are Plaintiffs’ Motion for Partial Summary Judgment (Doc. 556), Defendant’s

Motion for Summary Judgment (Doc. 558), and Plaintiffs’ Motion for Leave to File Sur-Reply

(Doc. 567). For the reasons set forth below, the Court GRANTS Plaintiffs’ Motion for Partial

Summary Judgment, DENIES Defendant’s Motion for Summary Judgment, and DENIES

Plaintiffs’ Motion for Leave to file Sur-Reply.

I. BACKGROUND

A. Procedural History

Defendant City of Kansas City, Missouri (“the City”) employs Plaintiffs Craig Adams and

Joseph Knopp as firefighters. In January 2019, Plaintiffs, on behalf of themselves and others

similarly situated, filed suit in the Circuit Court of Jackson County alleging the City breached a

contract and violated the Fair Labor Standards Act (“FLSA”) by miscalculating overtime pay.

Doc. 1-1 at 3-11.1 In February 2019, the City removed the matter to this Court. Doc. 1.

1 The Court’s page references are to the pagination applied by ECF to the parties’ filings. Doc. 544.

In January 2020, the Honorable John T. Maughmer granted Plaintiffs’ motion to

conditionally certify an FLSA collective action of current and former firefighters employed by the

City who received certification or incentive pay at any time since January 10, 2016. Doc. 45.

Pursuant to the Court’s Order, those firefighters were notified of the collective action and

instructed to submit consent forms if they wanted to join the collective action. Id. at 7. More than

450 consent forms were submitted by April 14, 2020. Docs. 49-529, 531.

In August 2020, the City moved to decertify the collective action and asked that certain

individuals be removed from the collective action. Docs. 534, 536. In addition, both parties filed

summary judgment motions. Docs. 538, 540. In mid-September 2020, the parties stipulated to

the dismissal of Plaintiffs’2 breach of contract claim, and due to a scheduled mediation, the parties

moved to stay briefing on the pending motions. Doc. 544-45. Judge Maughmer granted the

parties’ request and stayed all briefing. Doc. 546.

Although the matter was not resolved during mediation, the parties agreed to stipulate to

several facts. Doc. 550 at 1. Due to the dismissal of the breach of contract claim and the parties’

forthcoming stipulation of facts, the parties jointly asked the Court to find the pending summary

judgment motions moot and allow the parties to submit new summary judgments motions. Id. at

2. On September 23, 2020, Judge Maughmer granted the request, declared the summary judgment

motions moot, and set deadlines for the parties to file their stipulation of facts and new summary

judgment motions. Doc. 551. The City’s motions to decertify the collective action and remove

individuals from the collective action (Docs. 538, 540) remained pending, and the parties

continued to brief those motions.

2 Hereinafter, “Plaintiffs” refers to the named Plaintiffs and members of the conditionally certified collective action.

On September 28, 2020, this matter was transferred to the undersigned. Doc. 553. And on

October 19, 2020, the parties consented to the undersigned’s jurisdiction. Docs. 555, 555-1.

Shortly thereafter, on October 23, 2020, the parties filed cross-motions for summary judgment.

Docs. 556, 558. On December 8, 2020, Plaintiffs moved for leave to file a sur-reply to Defendant’s

summary judgment motion. Doc. 567. On March 30, 2021, the Court denied the City’s Motion

to Decertify the Collective Action and granted the City’s Motion to Remove Individuals from the

Collective Action. Doc. 569. The Court now turns its attention to the parties’ cross motions for

summary judgment, and Plaintiffs’ motion for leave to file a sur-reply.

B. Facts Applicable to the Summary Judgment Motions3

The City and the International Association of Fire Fighters Local No. 42, to which

Plaintiffs belong, are parties to a collective bargaining agreement (“CBA”). Doc. 554 at 1; Doc.

554-1.4 The City pays its firefighters according to the monthly wage scales appended to the CBA.

Doc. 554 at 2; Doc. 554-1 at 75-76, 112-18. Firefighters are “placed on the scales” based on “their

specific rank and tenure that is commensurate with the years the member has in rank.” Doc. 554

at 2; Doc. 554-1 at 75-76, 112-18.

In addition, firefighters may be entitled to wage augments for special duties, assignments,

and/or certifications. Doc. 554 at 2; Doc. 554-1 at 76-78. Wage augments provide additional

compensation as a percentage, ranging from three to ten percent, of a firefighter’s salary or an

additional amount of money, ranging from $25 to $75, per pay period. Doc. 554 at 2; Doc. 554-1

at 76-78. These wage augments and their pay codes are as follows:

3 Before filing dispositive motions, the parties filed a Joint Stipulation of Facts. Doc. 554. Unless otherwise noted,

this subsection incorporates the parties’ stipulated facts, exhibits attached to the parties’ stipulated facts, and facts

submitted by the parties in their summary judgment briefing that were supported by the record and undisputed.

4 The parties agree the Local 42 firefighters did not waive, reduce, or contract away any FLSA rights in the CBA.

Doc. 554 at 1.

• Members with an associate degree “in a field reasonably related to the fire service…

shall receive…$25.00 per pay period.” Doc. 554-1 at 76. This “educational incentive”

is pay code “ED1” and is identified as “FF ED1” on pay advices.5 Doc. 554 at 2.

• Members with a bachelor’s degree “in a field reasonably related to the [f]ire [s]ervice…

shall receive…$50.00 per pay period.” Doc. 554-1 at 76. This “educational incentive”

is pay code “ED2” and appears as “FF ED2” on pay advices. Doc. 554 at 2.

• Members with a master’s degree “in a field reasonably related to the fire service…

shall receive $65.00 per pay period.” Doc. 554-1 at 76. This “educational incentive”

is pay code “ED3” and is designated as “FF ED3” on pay advices. Doc. 554 at 2.

• Members with a doctoral degree “in a field reasonably related to the fire service …shall

receive $75.00 per pay period.” Doc. 554-1 at 76. This “educational incentive” is pay

code “ED4” and appears as “FF ED4” on pay advices. Doc. 554 at 2.

• Hazardous Materials (“HazMat”) Team members “who achieve and maintain the

operational level of training and certification shall receive additional pay of three

percent (3%) above what his/her salary would otherwise be.” Doc. 554-1 at 77. This

“certification incentive” is pay code “HZ1” and is listed as “HAZ1 FIRE” on pay

advices. Doc. 554 at 3.

• HazMat Team members “who achieve and maintain the technical level of training and

certification shall receive additional pay of five percent (5%) above what his/her salary

would otherwise be.” Doc. 554-1 at 77. This “certification incentive” is pay code

“HZ2” and is included as “HAZ2 FIRE” on pay advices. Doc. 554 at 3.6

• Aircraft Rescue and Firefighting (“ARFF”) Division members “who achieve and

maintain the required ARFF training and certification shall receive additional pay of

five percent (5%) above what their salary would otherwise be.” Doc. 554-1 at 77, 97.

This “certification incentive” is pay code “AR1” and is identified as “FF AR1 5%” on

pay advices. Doc. 554 at 3.

• “Members assigned to Pumpers 8, 9, [and] 25” and District 102 District Safety Officers

(“DSOs”) who “achieve and maintain the required ARFF training and certification shall

receive additional pay of three percent (3%) above what their salary would otherwise

be.” Doc. 554 at 3; Doc. 554-1, at 77. This “certification incentive” is pay code “AR2”

and is designated as “FF AF2 3%” on pay advices. Doc. 554 at 3.

• Members “assigned to Pumper 16 shall receive additional pay of five percent (5%)

above what their salary would otherwise be, if they have participated in ARFF

training.” Doc. 554 at 3-4; Doc. 554-1 at 77. This “assignment bonus” is pay code

“P16” and appears on pay advices as “FF P16 5%.” Doc. 554 at 3-4.

5 “Pay advices” are akin to paystubs. See Doc. 554-1 at 14; Doc. 559 at 13, 17, 23; Doc. 559-1 at 6-7; Doc. 559-16 at

1; Doc. 559-17 at 1; Doc. 559-18 at 1.

6 The parties agree Plaintiff Adams was entitled to this five percent certification incentive. Doc. 561 at 19.

• Rescue Division members “shall receive additional pay of five percent (5%) above

what their salary would otherwise be.” Doc. 554 at 4; Doc. 554-1 at 77. This

“assignment bonus” is pay code “RSC” and is identified as “RESCUE” on pay advices.

Doc. 554 at 4.

• Credentialed members “permanently assigned to a cross trained dual role ALS

[advanced life-saving]7 company…shall receive three percent (3%) bonus pay.” Doc.

554 at 4; Doc. 554-1 at 78. This “assignment bonus” is pay code “SQA” and appears

on pay advices as “Squad Ince.” Doc. 554 at 4.8

• “Members who have successfully completed a language proficiency assessment of a

foreign language or American Sign Language…shall receive $50.00 per pay period.”

Doc. 554 at 4; Doc. 554-1 at 78. This certification incentive is pay code “FOL,” and it

is designated as “Foreign La” on pay advices. Doc. 554 at 4.

• Members serving as field training officers or instructors in specified areas receive

additional pay of ten percent (10%) above what their salary would otherwise be. Doc.

554 at 4; Doc. 554-1 at 77. This “assignment bonus” is pay code “TRG,” and it is listed

as “FF TRG 10%” on pay advices. Doc. 554 at 4.

The CBA pronounces the wage augments “shall not be regarded as wages.” Doc. 554-1 at 76.

Nonetheless, the parties stipulate the wage augments are considered “remuneration” and are

included in the “regular rate” as defined by the FLSA. Doc. 554 at 4.

According to the CBA and the parties’ stipulation, firefighters assigned to 24-hour shifts

“shall average 49.5 hours per week.”9 Doc. 554 at 1; Doc. 554-1 at 40. And firefighters’ “normal

FLSA work period” is twenty-eight days. Id. Regarding overtime, both the CBA and the parties’

stipulation proclaim firefighters “shall receive overtime pay at the rate of time-and-one-half for all

hours actually worked in excess of 212 hours in any 28-day work period.” Doc. 554 at 1-2; Doc.

554-1 at 40; Doc. 564 at 12.

7 The CBA states ALS is the acronym for “Advanced Life Support” (Doc. 554-1 at 78), but the parties suggest ALS

stands for “advanced life-saving” (Doc. 554 at 4). The difference in wording is minor and does not impact the Court’s

rulings. To avoid confusion, the Court uses the parties’ phrasing.

8 The parties agree Plaintiff Knopp was entitled to this three percent assignment bonus. Doc. 561 at 20.

9 The Court’s reference to “firefighters” pertains only to those firefighters who work 24-hour shifts.

The City pays its firefighters every two weeks. Doc. 554 at 5. Initially, the City pays a

firefighter his or her “base hourly rate,”10 as calculated by the City, for all hours worked during

the preceding two-week pay period. Id. Then, at the end of every other pay period, the City

performs an FLSA “lookback” to determine if a firefighter worked more than 212 hours during

the preceding 28-day period. Id.; see also Doc. 554-2. After the City performs its FLSA lookback,

it pays a “premium rate” for hours worked in excess of 212 hours during the preceding 28-day

period. Doc. 554 at 5.

Most relevant to the pending motions is the City’s treatment of wage augments. The City

pays wage augments for the first 99 hours that a firefighter works in a two-week pay period. Id.;

Doc. 564 at 10. But the City does not pay wage augments for any hours, including overtime, that

a firefighter works over 99 hours in a two-week pay period. Id. The issue raised in the parties’

summary judgment motions is the City’s calculations of Plaintiffs’ regular rate and overtime

compensation. See Docs. 556-59.11

II. DISCUSSION

A. Summary Judgment Standard

Summary judgment is proper “if the movant shows that there is no genuine dispute as to

any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a);

see also Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Torgerson v. City of Rochester, 643

F.3d 1031, 1042-43 (8th Cir. 2011) (citations omitted). To support its assertion that no genuine

10 In the joint stipulation of facts and throughout the briefing, the parties employ phrases such as base hourly rate,

hourly rate, regular hourly rate, weekly salary, weekly wage, fixed salary, flat salary, premium rate, premium portion,

and base pay. See, e.g., Doc. 554 at 5; Doc. 557 at 6-8, 10, 12, 14; Doc. 559 at 7-8, 15-25, 27-28; Doc. 560 at 6-13,

15-19; Doc. 561 at 10-13, 15-18, 20-26, 31-33; Doc. 562 at 6, 8-11, 13-14; Doc. 564 at 10, 13-14, 16. At times, the

meanings of the phrases are unclear. Here, the Court uses the parties’ terminology. However, in its discussion of the

pending motions, the Court explains the parties’ calculations and the amounts paid, applies the FLSA’s terminology

when applicable, and explains phrases susceptible to alternative meanings.

11 The City seeks summary judgment in its favor on all issues. Docs. 558-59. Plaintiffs seek summary judgment in

their favor on the issue of liability. Docs. 556-57.

dispute of material fact exists, the movant must cite “to particular parts of materials in the record.”

Fed. R. Civ. P. 56(c)(1)(A); see also Fed. R. Civ. P. 56(c)(3)-(4), (e); L.R. 56.1(a), (d). In response,

the nonmovant must set forth facts, supported by evidence, demonstrating a genuine issue for trial;

showing the movant’s cited materials “do not establish the absence…of a genuine dispute” or the

movant “cannot produce admissible evidence to support the fact”; and/or objecting “that the

material cited…cannot be presented in a form…admissible in evidence.” Fed. R. Civ. P. 56(c)(1)-

(2); see also Fed. R. Civ. P. 56(c)(3)-(4), (e); L.R. 56.1(b), (d).

When considering a summary judgment motion, the Court must view the facts and draw

reasonable inferences in the light most favorable to the nonmovant. See Kenney v. Swift Transp.,

Inc., 347 F.3d 1041, 1044 (8th Cir. 2003). The Court, however, is not permitted to make credibility

determinations or weigh evidence. Id. Rather, the Court must consider the record as a whole. If

the record “could not lead a rational trier of fact to find for the nonmoving party, there is no genuine

issue for trial.” Ricci v. DeStefano, 557 U.S. 557, 586 (2009) (quoting Matsushita Elec. Indus. Co.

v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)); see also Lissick v. Andersen Corp., 996 F.3d

876, 882 (8th Cir. 2021) (citation omitted).

B. The FLSA, its Applicability to Firefighters, and the Partial Exemption

The FLSA was enacted in 1938 “to protect all covered workers from substandard wages

and oppressive working hours….” Barrentine v. Arkansas-Best Freight Sys., Inc., 450 U.S. 728,

739 (1981). Specific to working hours, the FLSA created a forty-hour workweek with employees

receiving additional compensation for working overtime. 29 U.S.C. § 207(a)(1). To properly

compensate an employee for time worked in excess of forty hours, the employee must be paid “at

a rate not less than one and one-half times the regular rate at which he is employed.” Id. As

explained by the Supreme Court, the FLSA’s overtime provision is meant “to compensate those

who labored in excess of the statutory maximum number of hours for the wear and tear of extra

work.” Bay Ridge Operating Co. v. Aaron, 334 U.S. 446, 460 (1948).

Because fire protection services do not necessarily fit the normal pattern of a forty-hour

workweek, a partial overtime pay exemption was made available to public agencies employing

fire protection services personnel. H. Educ. & Labor Comm., Fair Labor Standards Amendment

of 1974, H. Rep. No. 93-913 (1974), reprinted in 1974 U.S.C.C.A.N. 2811, 2837; 29 U.S.C. §

207(k); see also Christian v. City of Gladstone, 108 F.3d 929, 931 (8th Cir. 1997). The partial

exemption “accommodates the inherently unpredictable nature of firefighting…by permitting

public employers to adopt work periods longer than one week.” O’Brien v. Town of Agawam, 350

F.3d 279, 290 (1st Cir. 2003) (citations omitted). A public agency employing fire protection

services personnel does not violate the FLSA if “in a work period of 28 consecutive days,” a

firefighter receives “compensation at a rate not less than one and one-half times the regular rate at

which he is employed” for all time during which the firefighter is on duty in excess of 21212 hours.

29 U.S.C. § 207(k)(1); see also 29 C.F.R. §§ 553.220(a) (defining “tour of duty”), 553.221(b)

(explaining “compensable hours of work”), and 553.232 (setting forth overtime pay requirements).

For the partial exemption to apply, the employer must be a public agency, the employees

must be engaged in fire protection services, and the employer must adopt a qualifying work period.

29 U.S.C. § 207(k); 29 C.F.R. § 553.224(a) (defining a qualifying work period as “any established

and regularly recurring period of work which…cannot be less than 7 consecutive days nor more

than 28 consecutive days.”). Neither party disputes the City is a public agency or that Plaintiffs

engage in fire protection services. Pursuant to the CBA and the parties’ stipulation, the firefighters

12 29 U.S.C. § 207(k) indicates 216 hours is the standard; however, the federal regulations state “the 216-hour standard

has been replaced…by 212 hours for fire protection employees.” 29 C.F.R. §§ 553.201(a), 553.230(a).

“normal FLSA work period” is twenty-eight days, which is a qualifying work period. Doc. 554 at

1; Doc. 554-1 at 40. Based on the foregoing, the partial exemption in section 207(k) applies.

C. Regular Rate of Pay Under the FLSA

Before addressing whether the firefighters were properly compensated for overtime, the

Court must determine the firefighters’ regular rates of pay under the FLSA. “The regular rate of

pay calculation is critical because it provides the base point from which the firefighters’ overtime

compensation is calculated.” Acton v. City of Columbia, 436 F.3d 969, 976 (8th Cir. 2006); see

also Walling v. Youngerman-Reynolds Hardwood Co., 325 U.S. 419, 424 (1945) (“The keystone

of Section 7(a) is the regular rate of compensation. On that depends the amount of overtime

payments which are necessary to effectuate the statutory purposes.”); 29 U.S.C. § 207(k)(1).

(1) What is Included in the Regular Rate of Pay?

As stated by the Supreme Court and recently reiterated by the Eighth Circuit, the regular

rate is “the hourly rate actually paid the employee for the normal, non-overtime [work period]13

for which he is employed.” Youngerman-Reynolds, 325 U.S. at 424; Zimmerli v. City of Kansas

City, 996 F.3d 857, 863 (8th Cir. 2021) (quoting Youngerman-Reynolds, 325 U.S. at 324); see also

29 C.F.R. § 778.108. The regular rate must include “all remuneration for employment paid to, or

on behalf of, the employee.” 29 U.S.C. § 207(e); 29 C.F.R. § 778.108; see also Youngerman-

Reynolds, 325 U.S. at 424. The parties agree a firefighter’s regular rate of pay includes his or her

monthly salary. Doc. 554 at 2; Doc. 554-1 at 75-76, 112-18.

Determining an employee’s regular rate of pay does not necessarily conclude with an

employee’s salary. The FLSA requires other compensation be included in the regular rate of pay

if the parties agreed the other compensation “shall be received regularly” during the work period,

13 When section 207(k) applies, “workweek” is substituted with “work period.” 29 C.F.R. § 553.233.

“exclusive of overtime payments.” Youngerman-Reynolds, 325 U.S. at 424. According to the

Eighth Circuit, “[t]here is a statutory presumption that remuneration in any form is included in the

regular rate calculation,” and the employer has the burden “to establish that the remuneration in

question falls under an exception.” Acton, 436 F.3d at 976 (quotations and citation omitted).

Most relevant to this matter, the federal regulations declare the regular rate of pay must

include non-discretionary bonuses paid to an employee, bonuses promised to the employee upon

hiring, and bonuses that are the result of collective bargaining. 29 C.F.R. §§ 778.208, 778.211(c);

see also U.S. Dep’t of Labor, Wage & Hour Div., Opinion Letter (Sept. 30, 1999); U.S. Dep’t of

Labor, Wage & Hour Div., Opinion Letter (Aug. 26, 1986). In addition to the federal regulations,

several courts have determined shift differential pay, longevity bonus or incentive, fitness pay,

career incentive, duty availability pay, educational incentive, specialty pay, assignment differential

pay, bilingual pay, and certification pay are remuneration and must be included in the regular rate

of pay. See, e.g., Bay Ridge Operating, 334 U.S. at 468-69; Albers v. Board of Cnty. Comm’rs of

Jefferson Cnty., 771 F.3d 697, 704-05 (10th Cir. 2014); Wheeler v. Hampton Twp., 399 F.3d 238,

247-48 (3d Cir. 2005); O’Brien, 350 F.3d at 294-97; Featsent v. City of Youngstown, 70 F.3d 900,

904-05 (6th Cir. 1995); Thomas v. Howard Univ. Hosp., 39 F.3d 370, 372 (D.C. Cir. 1994);

McGrath v. City of Somerville, 419 F. Supp. 3d 233, 252-53 (D. Mass. 2019); Shepard v. City of

Waterloo, No. 14-CV-2057-LRR, 2015 WL 9165915, at *13 (N.D. Iowa Dec. 16, 2015);

Carabello v. City of Chicago, 969 F. Supp. 2d 1008, 1015-17 (N.D. Ill. 2013); Moss v. City of San

Bernardino, No. EDCV 07-1027-JTM, 2011 WL 13175467, at *8 (C.D. Cal. Mar. 22, 2011);

Murphy v. Town of Natick, 516 F. Supp. 2d 153, 157 (D. Mass. 2007); Theisen v. City of Maple

Grove, 41 F. Supp. 2d 932, 938-39 (D. Minn. 1999).

Contrary to the federal regulations and the common law, the CBA declares special duty,

assignment, and certification wage augments “shall not be regarded as wages.” Doc. 554-1 at 76.

But the CBA does not supplant the FLSA. As stated by the Supreme Court, “FLSA rights cannot

be abridged by contract or otherwise waived because this would ‘nullify the purposes’ of the statute

and thwart the legislative policies it was designed to effectuate.” Barrentine, 450 U.S. at 740

(citation omitted); see also Bay Ridge Operating, 334 U.S. at 464 (holding the regular rate “cannot

be left to a declaration by the parties as to what is to be treated as the regular rate”); Youngerman-

Reynolds, 325 U.S. at 425 (finding the regular rate is “unaffected by any designation of a contrary

‘regular rate’ in the wage contracts.”); 29 C.F.R. § 778.108.

Instead, this Court must “look beyond that which the parties have purported to do” in the

CBA. Zimmerli, 996 F.3d at 863. The regular rate must “be drawn from what happens under the

employment contract.” 29 U.S.C. § 207(e); 29 C.F.R. § 778.108 (citation omitted). In this case,

the wage augments are nondiscretionary and guaranteed under the CBA, and thus, are

remuneration for employment under the FLSA. Perhaps because the law is unambiguous, the

parties agree the firefighters’ regular rate under the FLSA must include special duty, assignment,

and certification wage augments. Doc. 554 at 4. The Court agrees with the parties – the wage

augments must be included in the firefighters’ regular rate of pay.

(2) What is Excluded from the Regular Rate of Pay?

Only eight types of payment are excluded from the regular rate of pay. 29 U.S.C. § 207(e);

29 C.F.R. §§ 778.108, 778.200, 778.208-.215. The employer bears the burden of establishing any

“remuneration in question falls under an exception.” Acton, 436 F.3d at 976 (quotations and

citation omitted). The City does not contend the wage augments fit an exception. Doc. 557 at 9.

Instead, the City admits the regular rate under the FLSA includes the wage augments. Doc. 554

at 4. Accordingly, no remuneration for employment paid to or on behalf of an employee is

excluded from the firefighters’ regular rate of pay. 29 U.S.C. § 207(e); 29 C.F.R. § 778.200(c).

D. Calculating the Regular Rate of Pay

With the parties’ agreement that wage augments must be included, the Court now turns to

calculating the regular rate of pay. While the FLSA “does not require employers to compensate

their employees on an hourly rate basis,” the regular rate of pay “must be computed on the basis

of the hourly rate derived therefrom.” 29 C.F.R. § 778.109. Thus, “it is necessary to compute the

regular hourly rate…during each work week.” Id.

If employees, such as Plaintiffs, are paid a monthly salary, the monthly salary “must be

reduced to its workweek equivalent” before determining the regular rate of pay. Id. § 778.113(b);

Zimmerli, 996 F.3d at 865 (stating 29 C.F.R. § 778.113 “sets the standard for determining the

regular rate of an employee employed solely on a salaried basis.”). Pursuant to the federal

regulations, an employee’s monthly salary is multiplied by 12 (number of months) and divided by

52 (number of weeks) to calculate the workweek equivalent. 29 C.F.R. § 778.113(b). Then, the

employee’s “total remuneration for employment…in any workweek” is divided “by the total

number of hours actually worked by [the employee] in that workweek for which such

compensation was paid” to determine the employee’s regular rate of pay. Id. § 778.109.

According to the CBA and the parties’ stipulation, firefighters “shall average 49.5 hours

per week.” Doc. 554 at 1; Doc. 554-1 at 40. The City calculates the firefighters’ hourly rate by

multiplying an individual’s monthly salary by twelve (number of months) and dividing by 2,574

(52 weeks multiplied by 49.5 hours per week). Doc. 554 at 5. For example, in March 2019, the

City calculated Plaintiff Adams’s base hourly rate by first multiplying his monthly salary

($6,336.00)14 by 12, arriving at a total of $76,032.00. Doc. 559 at 16-17. Next, the City divided

14 In response to the City’s summary judgment motion, Plaintiffs disputed Adams’s monthly salary was limited to

$6,336 and maintained the monthly salary must include Adams’s wage augment. Doc. 561 at 19. In support, Plaintiffs

relied on the CBA, which states, “Members of the Hazardous Materials Team who achieve and maintain the technician

level of training and certification shall receive additional pay of five percent (5%) above what his/her salary would

otherwise be.” Doc. 561-2 at 77. In its reply, the City contended Plaintiffs’ representation was argument and should

$76,032.00 by 2,574, resulting in a quotient of $29.538502. Id. The City deemed $29.54 as

Adams’s “base hourly rate”15 and paid the base hourly rate for all hours worked through 212 hours

during the pay period. Doc. 554 at 5; see also Doc. 560 at 9.

In addition, the City paid Adams’s five percent wage augment for the first 99 hours worked

during the pay period. Doc. 554 at 5; Doc. 559 at 17-18. The City calculated Adams’s wage

augment by multiplying his base hourly rate by five percent, arriving at $1.476925 per hour. Doc.

559 at 17; Doc. 560 at 10. Thus, the City paid Adams $31.02 (base hourly rate plus wage augment)

per hour for the first 99 hours of the pay period. Doc. 560 at 9.16 The parties agree that, for the

pay period at issue, Adams’s regular rate of pay was $31.02.17 Doc. 560 at 9; Doc. 561 at 31; Doc.

562 at 9.

The City performed a similar calculation related to Plaintiff Knopp in June 2018. Doc. 559

at 23-24. At that time, Knopp’s monthly salary was $5,387.00. Id. at 23. The City multiplied his

monthly salary by twelve, and then divided the product by 2,574, arriving at a “base hourly rate”

be disregarded. Doc. 564 at 10. However, in response to the “argument,” the City stated, “the specialty pay should

not be regarded as wages, so it does not set a ‘new base.’” Id. Contrary to the requirements of the Federal Rules of

Civil Procedure and the Court’s Local Rules, the City did not cite anything in support of its position. Id.; see also

Fed. R. Civ. P. 56(c)(1)(A); L.R. 56.1(b)(1). Nevertheless, the City seems to rely on the CBA, which states special

duty, assignment, and certification pay “shall not be regarded as wages.” Doc. 554-1 at 76. But, as set forth supra,

section II(C)(1), neither a declaration by the parties nor a CBA may designate what the “regular rate” is under the

FLSA. See Barrentine, 450 U.S. at 740; Bay Ridge Operating, 334 U.S. at 464; Youngerman-Reynolds, 325 U.S. at

425; 29 C.F.R. § 778.108. The wage augments, as detailed by this Court, must be included in the “regular rate.”

15 The “base hourly rate” did not include wage augments, and thus, it is not the regular rate of pay under the FLSA.

16 Regarding this pay period, Adams also worked “out of class,” or at a higher job classification than the one in which

he is employed, during one of his scheduled shifts. Doc. 559 at 18. According to the City, Adams was entitled to the

difference between his base pay and the higher hourly pay of the position in which he worked. Doc. 559 at 18. The

difference was $1.63, and therefore, Adams was paid an additional $1.63 for the twenty-four hours he worked “out of

class.” Id.

17 Plaintiffs argue the City should have added Adams’s five percent wage augment to his monthly salary (for a total

of $6,652.80) before conducting further calculations to arrive at the regular rate. Doc. 561 at 31. Nonetheless, both

Plaintiffs and Defendant arrive at the same regular rate: $31.02. Doc. 559 at 17-18; Doc. 561 at 31. The Court also

reached the same regular rate but in a different fashion. Pursuant to 29 C.F.R. § 778.113(b), the Court first multiplied

Adams’s monthly salary ($6,336.00) by twelve. Then, the Court divided the resulting product ($76,032.00) by fifty-

two. The quotient, $1,462.15, represents the base weekly salary. To include “total remuneration for employment” for

the workweek, the Court then added the five percent wage augment to the weekly salary, for a total of $1,535.26. Id.

§ 778.109. To arrive at Adams’s regular rate, the Court divided $1,535.26 by 49.5, which, according to the CBA, is

the average number of hours a firefighter works per week. The Court also arrived at a regular rate of $31.02.

of $25.114260. Id. The City paid Knopp the base hourly salary for all hours worked through 212

hours during the pay period. Id. at 24-25; Doc. 554 at 5.

In addition, the City paid Knopp’s three percent wage augment for the first 99 hours he

worked during the pay period. Doc. 554 at 5; Doc. 559 at 23. The City determined Knopp’s wage

augment was $0.753428. Doc. 559 at 23. So, for the first 99 hours of the pay period, the City paid

Knopp $25.87 (base hourly rate plus wage augment) per hour. Id. Plaintiffs do not dispute the

City’s calculation of Knopp’s regular rate of pay during the relevant pay period was $25.87. See

Doc. 561.

Plaintiffs admit the wage augments are included in the remuneration for the FLSA regular

rate calculations when the City pays them for the first 99 hours worked in each pay period. Doc.

561 at 5-8, 11. But Plaintiffs allege the City fails to use the regular rate and include wage augments

when calculating their compensation for overtime hours worked. Id.

E. Calculating Overtime Pay

Pursuant to the FLSA, the City will not be deemed to have violated 29 U.S.C. § 207(a) if

“in a work period of 28 consecutive days the employee receives for tours of duty which in the

aggregate exceed…21218 hours…compensation at a rate not less than one and one-half times the

regular rate at which is employed.” 29 U.S.C. § 207(k)(1). For every two-week pay period, the

City pays firefighters their “base hourly rate,” which is the hourly rate calculated by the City and

does not include wage augments, for all hours worked during the pay period. Doc. 554 at 5. As

discussed above, the City pays the wage augments for the first 99 hours worked during the pay

period. See supra, section III(D).

18 As previously noted, 29 U.S.C. § 207(k) indicates 216 hours is the standard; however, the federal regulations state

“the 216-hour standard has been replaced…by 212 hours for fire protection employees.” 29 C.F.R. §§ 553.201(a),

553.230(a).

(1) Payment of the Regular Rate for Overtime Worked

Because overtime hours must be paid at one and one-half times the regular rate, the Court

first must determine whether firefighters were paid the “one times” the regular rate for overtime

hours worked. Although 29 U.S.C. § 207(k) requires the City to pay “no[ ] less than one and one-

half times the regular rate” for hours worked in excess of 212 hours during a 28-day period, the

City does not pay the FLSA regular rate of pay for overtime hours worked. This is because the

City does not pay wage augments for any time worked over 99 hours, including overtime hours

worked, during a pay period. Doc. 554 at 5.

The City argues the firefighters are paid a salary, and the salary is intended to compensate

the firefighters for working 49.5 hours per week. Doc. 560 at 16. According to the City, if a

firefighter “chooses to work beyond those 49.5 hours in a week,” the firefighter is paid the base

hourly rate. Id. The firefighter is not paid the wage augment because the wage augment “pay is

only to be awarded in addition to the salary, not for hours worked beyond what the salary covers.”

Id. at 16-17. The City, however, cites no authority for this proposition. See id.

Instead, the City directs the Court’s attention to the CBA, which indicates the wage

augments are not to be regarded as “wages.” Id. at 17; Doc. 544-1 at 76. This argument is without

merit and ignores the precedent this Court must follow. See Barrentine, 450 U.S. at 740 (holding

“FLSA rights cannot be abridged by contract or otherwise waived because this would ‘nullify the

purposes’ of the statute and thwart the legislative policies it was designed to effectuate.”). The

City’s failure to pay the regular rate (i.e., the “one…times the regular rate”) for hours worked in

excess of 212 hours during a 28-day period violates the FLSA. 29 C.F.R. § 778.107 (“The general

overtime pay standard in section 7(a) requires that overtime must be compensated at a rate not less

than one and one-half times the regular rate at which the employee is actually employed.”); 29

C.F.R. § 778.108 (stating the “regular rate” includes “all remuneration for employment paid to, or

on behalf of, the employee”).

Because, at a minimum, the City failed to pay the regular rate (i.e., the “one…times the

regular rate”) for hours worked in excess of 212 hours during a 28-day period, and thus, violated

the FLSA, the Court DENIES the City’s motion for summary judgment on the issue of whether it

violated the FLSA and GRANTS Plaintiffs’ motion for partial summary judgment.

(2) Payment of One-Half Times the Regular Rate for Overtime Worked

The Court now turns to the “one-half times the regular rate” for overtime compensation.

The City maintains it does not violate the FLSA with regard to the “premium rate” paid for

overtime hour worked. At the end of every other pay period, the City performs an FLSA

“lookback” to determine if a firefighter worked more than 212 hours during the preceding 28-day

period. Doc. 554 at 5; see also Doc. 554-2. After the City performs its FLSA lookback, it pays a

“premium rate” for hours worked in excess of 212 hours during the preceding 28-day period. Doc.

554 at 5. The “premium rate” is calculated by dividing “all remuneration for the week” by all

hours worked in the week. Doc. 559 at 22. The City contends it includes the wage augments in

calculating the “premium rate” paid for overtime hours. Id. at 19-20.

By way of example, the City analyzed Plaintiff Adams’s pay for the 28-day work period

from February 17, 2019, through March 16, 2019. Id. at 20-22; Doc. 560 at 9-10. During this 28-

day work period, Adams worked 118.7 hours in excess of 212 hours. Doc. 559 at 21; Doc. 560 at

11. Because Adams was already paid his “base hourly rate” of $29.538502 for those 118.7 hours,

the previously paid amount of $3,506.22 ($29.538502 x 188.7) was deducted from his pay. Doc.

559 at 21-22; Doc. 560 at 10-11.

To determine Adams’s “premium rate” for overtime hours worked, the City divided “all

remuneration for the week,” which it determined was $2,974.44, “by all hours worked in the

week,” which it found was 96.9 hours. Doc. 559 at 22; Doc. 560 at 10. It is unclear as to how the

City arrived at or decided to use 96.9 hours. The calculations set forth in the City’s briefing

suggests the City was looking at one particular week to determine the “premium rate.” Doc. 559

at 22; Doc. 560 at 10. If the Court’s assumption is correct, the City does not explain why it chose

that week and why it was permitted to choose that week, particularly when it is conducting a 28-

day lookback to determine overtime hours and pay. The City also does not indicate if it

recalculates the “premium rate” for overtime hours worked by an employee each week.

Nevertheless, the City determined Adams’s premium rate was $30.70 per hour ($2,974.44

divided by 96.9). Doc. 559 at 22; Doc. 560 at 10-11. Because Adams was already paid the base

hourly rate for his overtime hours, the City multiplied his 118.7 overtime hours by 0.5 (for the

one-half premium) and then multiplied by $30.70 for a total of $1,821.80. Doc. 559 at 22-23; Doc.

560 at 10-11. According to the City, this amount represents Adams’s premium pay for overtime

hour worked. Doc. 559 at 22-23; Doc. 560 at 10-11. Given the lack of clarity and information in

the City’s briefing, the Court is unable to determine if the City’s calculations with regard to the

“one-half times” the regular rate are correct. Nevertheless, the Court has already determined the

City violated the FLSA by miscalculating the first portion (i.e., the regular rate) of the overtime

compensation to be paid to the firefighters.

(3) The Fluctuating Workweek Method of Calculating Overtime

The City contends its overtime pay calculations are correct because it uses the fluctuating

workweek method. The United States Department of Labor provides different methods, including

the fluctuating workweek method, to calculate overtime compensation while still complying with

the FLSA. 29 C.F.R. § 778.114. Before delving into the specifics of the method, the Court must

first address the parties’ disagreement as to whether Plaintiffs may raise arguments about the City’s

method of calculating overtime pay.

(a) Plaintiffs’ Arguments About the City’s Calculation Method

In its summary judgment motion, the City explained it employed a fluctuating workweek

when calculating overtime, and thus, “all time (including overtime hours) is paid at the base hourly

rate and then, during the lookback, overtime hours are paid at a premium rate.” Doc. 559 at 14-15

(citing 29 C.F.R. § 778.114(a)). In response, Plaintiffs argued the City improperly uses the

fluctuating workweek to calculate their overtime and examined why the fluctuating workweek

could not be utilized. Doc. 561 at 27-37. In its reply, the City maintained Plaintiffs could not raise

arguments about the fluctuating workweek because they did not plead the City impermissibly

employed the fluctuating workweek, and thus, cannot inject a new claim in response to a summary

judgment motion. Doc. 564 at 18-22. While it cited several cases for the proposition that a party

may not raise new claims during summary judgment briefing, the City did not identify a single

case supporting its proposition that Plaintiffs’ purported failure to plead the City impermissibly

employed the fluctuating workweek prohibited them from raising any argument related to the

City’s use of the fluctuating workweek. See id.

Upon receipt of the City’s reply, Plaintiffs moved for leave to file a sur-reply to address,

among other things, the City’s argument that Plaintiffs failed to plead the fluctuating workweek

method was impermissible, and therefore, could not raise a dispute as to the City’s use of the

method. Doc. 567. Plaintiffs also emphasized the City, in its reply, identified new legal arguments,

which were not raised in its summary judgment motion. Id. Contrary to the Court’s Local Rules,

Plaintiffs failed to attach their proposed sur-reply to their motion for leave. See L.R. 15.1(a)(2).

For this reason, the Court DENIES Plaintiffs’ motion for leave to file a sur-reply. Regardless, the

sur-reply is not necessary for the Court to address the issue at hand.

In their Petition, Plaintiffs alleged the City failed to pay overtime wages “of at least one

and one-half times” their pay rates, and the City improperly calculated their overtime rate. Doc.

1-1 at 3-4, 6-9. While Plaintiffs did not identify an overtime calculation method by name, they

claim, no fewer than six times, that the City improperly calculated and failed to pay their overtime

compensation at one and one-half times the regular rate. Id. at 3, 5-9. Similar to the City, the

Court cannot locate authority to support the City’s argument that Plaintiffs cannot raise an

argument as to City’s method of calculating overtime compensation, particularly in light of the

allegations in their Petition that the City improperly determined and did not pay the proper

overtime compensation rate.

In its reply, the City also argued it “is severely prejudiced in its defense by the conditional

class injecting the ‘illegality’ of the use of the fluctuating work week at this later date.” Doc. 564

at 21. But this argument ignores Plaintiffs’ allegation that the City improperly calculated their

overtime pay. It also overlooks that there is more than one method for calculating overtime

compensation. See 29 C.F.R. §§ 788.110-.122. And, as discussed below, the City has the burden

of establishing it properly employed the fluctuating workweek method. For these reasons, the

Court rejects the City’s contention that Plaintiffs cannot raise arguments as to the legality of the

fluctuating workweek method in this matter.

(b) Requirements for Using the Fluctuating Workweek Method

The City does not ask the Court to enter summary judgment in its favor with regard to its

use of the fluctuating workweek method. See Docs. 558-59. Nor do Plaintiffs move for summary

judgment the issue. See Doc. 556-57. Nonetheless, because much time was spent on the issue in

the parties’ briefing and the issue inevitably will resurface in this matter, the Court will briefly

address the issue. To use the fluctuating workweek method to compute overtime compensation,

the employer must establish the following:

(1) The employee works hours that fluctuate from week to week;

(2) The employee receives a fixed salary that does not vary with the number of

hours worked in the workweek, whether few or many;

(3) The amount of the employee’s fixed salary is sufficient to provide

compensation to the employee at a rate not less than the applicable

minimum wage rate for every hour worked in those workweeks in which

the number of hours the employee works is greatest;

(4) The employee and the employer have a clear and mutual understanding that

the fixed salary is compensation (apart from overtime premiums and any

bonuses, premium payments, commissions, hazard pay, or other additional

pay of any kind not excludable from the regular rate under section 7(e)(l)

through (8) of the Act) for the total hours worked each workweek regardless

of the number of hours, although the clear and mutual understanding does

not need to extend to the specific method used to calculate overtime pay;

and

(5) The employee receives overtime compensation, in addition to such fixed

salary and any bonuses, premium payments, commissions, hazard pay, and

additional pay of any kind, for all overtime hours worked at a rate of not

less than one-half the employee’s regular rate of pay for that workweek.

Since the salary is fixed, the regular rate of the employee will vary from

week to week and is determined by dividing the amount of the salary and

any non-excludable additional pay received each workweek by the number

of hours worked in the workweek. Payment for overtime hours at not less

than one-half such rate satisfies the overtime pay requirement because such

hours have already been compensated at the straight time rate by payment

of the fixed salary and non-excludable additional pay. Payment of any

bonuses, premium payments, commissions, hazard pay, and additional pay

of any kind is compatible with the fluctuating workweek method of

overtime payment, and such payments must be included in the calculation

of the regular rate unless excludable under section 7(e)(1) through (8) of the

Act.

29 C.F.R. § 778.114(a).

Plaintiffs assert the fifth “condition” “is not at issue in this case” (Doc. 561 at 29 n.6), but

it is the fifth requirement that gives the Court pause. This requirement states the regular rate “is

determined by dividing the amount of the salary and any non-excludable additional pay received

each workweek by the number of hours worked in the workweek.” Id. § 778.114(a)(5). It also

emphasizes “[p]ayment of any bonuses, premium payments, commissions, hazard pay, and

additional pay of any kind…must be included in the calculation of the regular rate.” Id. Contrary

to this requirement, the firefighters are not paid the regular rate of pay for overtime hours worked

because their wage augments are never included in the regular rate of pay for overtime hours

worked. Doc. 554 at 5 (“The City does not pay the augment for hours worked over 99 hours in a

pay period.”). In addition, as the City indicated, section 778.114 was amended on August 7, 2020;

thus, it is unclear of the impact, if any, the amendment has on this matter. Nevertheless, based on

the record before it at this time, the Court is unable to determine whether the City met the

requirements to use the fluctuating workweek method to calculate overtime compensation.

Given its rulings in this Order and the procedural posture of this, the Court finds it

unnecessary to examine the other requirements for using a fluctuating workweek and/or whether

the City was permitted to use the method.

F. Willfulness

The City contends it is entitled to summary judgment on the issue of whether its actions

were willful. Doc. 559 at 29-30. Under the FLSA, the statute of limitations is “two years after the

cause of action accrued…except that a cause of action arising out of a willful violation may be

commenced within three years after the cause of action accrued.” 29 U.S.C. § 255(a). A “willful”

violation of the FLSA occurs when “the employer either knew or showed reckless disregard for

the matter of whether its conduct was prohibited by the statute.” McLaughlin v. Richland Shoe

Co., 486 U.S. 128, 133 (1988) (citing Trans World Airlines, Inc. v. Thurston, 469 U.S. 111, 128

(1985)); see also Jarrett v. ERC Props., Inc., 211 F.3d 1078, 1082 (8th Cir. 2006). To be

considered willful, the employer’s conduct must be more than negligence. McLaughlin, 486 U.S.

at 133. Plaintiffs oppose the City’s request for summary judgment on the issue. Doc. 561 at 44-

46. When considering the record before it and construing the facts and reasonable inferences in

the light most favorable to the nonmovant, the Court finds genuine disputes as to material facts

exist with regard to the nature of the City’s conduct. Accordingly, the Court DENIES the City’s

request to enter summary judgment in its favor on the issue of whether its actions were willful.

G. Liquidated Damages

The City also moves for summary judgment in its favor on the issue of liquidated damages.

Doc. 559 at 29-30. If an employer violates 29 U.S.C. § 207, the employer is liable to the affected

employees in the amount of unpaid overtime compensation, and it may also be liable for “an

additional equal amount as liquidated damages.” 29 U.S.C. § 216(b). If the employer “shows to

the satisfaction of the court” that its actions were “in good faith” and it “had reasonable grounds

for believing” its actions were not violating the FLSA, “the court may, in its sound discretion,

award no liquidated damages or award any amount thereof not to exceed the amount specified in

section 216 of this title.” Id. § 260. According to the Eighth Circuit, “[t]he employer bears the

burden of proving both good faith and reasonableness.” Chao v. Barbeque Ventures, LLC, 547

F.3d 938, 941 (8th Cir. 2008) (citing Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 142 (2d Cir.

1999)). This burden “is a difficult one, with double damages being the norm and single damages

the exception.” Id. at 941-42 (quoting Herman, 172 F.3d at 142).

“Good faith” is a subjective standard. Id. at 142. The employer “must establish ‘an honest

intention to ascertain and follow the dictates of the FLSA.’” Id. (quoting Hultgren v. County of

Lancaster, 913 F.2d 948, 509 (8th Cir. 1990)). To do so, the employer must demonstrate it “took

affirmative steps to ascertain the Act’s requirements, but nonetheless, violated its provisions.” Id.

(quoting Martin v. Cooper Elec. Supply Co., 940 F.2d 896, 908 (3d Cir. 1991)). The Eighth Circuit

has found the employer’s lack of knowledge, a lack of employee complaints about overtime, and

the employer’s delegation of the payroll function to a subordinate do not establish good faith. Id.

at 942-43 (citations omitted).

The Court has carefully considered and reviewed the record. Based on the record before it

and construing the facts and reasonable inferences in the light most favorable to the nonmovant,

the Court finds genuine disputes as to material facts exist as to whether the City acted in good faith

and acted reasonably. Accordingly, the Court DENIES the City’s request to enter summary

judgment in its favor on the issue of liquidated damages.

III. CONCLUSION

Based on the foregoing discussion and analysis, the Court GRANTS Plaintiffs’ Motion for

Partial Summary Judgment (Doc. 556), DENIES the City’s Motion for Summary Judgment (Doc.

558), and DENIES Plaintiffs’ Motion for Leave to File Sur-Reply (Doc. 567). Pursuant to the

parties’ stipulation of dismissal (Doc. 544) and Rule 41(a)(1)(A) of the Federal Rules of Civil

Procedure, Plaintiffs’ breach of contract claim is dismissed without prejudice.

IT IS SO ORDERED.

DATE: September 29, 2021 /s/ W. Brian Gaddy

W. BRIAN GADDY

UNITED STATES MAGISTRATE JUDGE