Law360, Los Angeles (May 08, 2014, 8:38 PM ET) — The U.S. Court of Federal Claims handed the United States a win Wednesday in a proposed class action by U.S. Postal Service workers in Puerto Rico who claimed the agency hadn’t properly paid overtime under the Fair Labor Standards Act, ruling the USPS’ overtime pay formula conforms to the rule.
Judge Victor J. Wolski granted the U.S.’s cross-motion for summary judgment on claims brought by 278 current and former employees of the USPS residing in Puerto Rico, while denying the plaintiffs’ motion for partial summary judgment on liability, resolving a nearly 12-year-old suit.
“The payroll records identified as typical show that the USPS has followed its stated formula in calculating overtime compensation as one and one-half times the regular rate plus a [territorial cost of living adjustment] add-on,” Judge Wolski wrote. “This formula is the most reasonable interpretation of the FLSA.”
An attorney for the plaintiffs said that “the decision will be carefully studied and that the possibility of an appeal will be considered” but declined further comment. An attorney who represented the U.S. declined comment on the ruling.
The plaintiffs initially filed suit in May 2002 in the U.S. District Court for the District of Puerto Rico, claiming the USPS didn’t pay them sufficient overtime under the FLSA. The district court then transferred the case to the Court of Federal Claims.
In moving for partial summary judgment on liability, the plaintiffs claimed official USPS payroll records showed they were paid less than one and a half times the regular rate for overtime hours worked. They also cited an expert report purporting to show that the formula used by the USPS to calculate overtime pay undercompensates the plaintiffs due to its use of a basic rate of pay connected with overtime hours.
The government countered in its cross-motion for summary judgment that the plaintiffs misrepresented or misunderstood the payroll records.
In reality, the government argued, the records show that the USPS not only paid the plaintiffs what the FLSA requires for overtime but also exceeded that amount by adding the territorial cost of living adjustment portion of the regular rate as established the Ninth Circuit’s ruling in the case of Frank v. McQuigg. TCOLA is an amount payable to USPS employees who are working outside the continental U.S.
While he said the plaintiffs’ payroll records can be “maddeningly difficult to decipher,” Judge Wolski ultimately agreed with the government’s position.
“Based on careful analysis of all the submitted evidence, the court finds that the USPS calculates overtime by paying one and one-half times the regular rate for each hour of overtime worked, plus the TCOLA premium, and minus certain creditable premium payments (mainly contractual overtime pay),” Judge Wolski wrote. “This method accords with the statutory requirements (as well as with McQuigg).”
The plaintiffs are represented by Santiago F. Lampon of Lampon & Associates.
The U.S. is represented by U.S. Department of Justice attorneys Paul Davis Oliver, Stuart F. Delery, Jeanne E. Davidson and Todd M. Hughes and USPS counsel David B. Ellis.
The case is Jorge A. Delpin Aponte et al. v. U.S., case number 05-1043C, in the U.S. Court of Federal Claims.