B-181750, JAN 24, 1975, 54 COMP GEN 617

B-181750: Jan 24, 1975

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TIME - HOME AS DUTY STATION VESSEL EMPLOYEES OF THE PANAMA CANAL COMPANY ARE PROTECTED BY THE FAIR LABOR STANDARDS ACT. ARE OFF DUTY. ARE EXPECTED TO BE AVAILABLE FOR NOTIFICATION BY TELEPHONE OF THEIR PROXIMATE DUTY ASSIGNMENT. SHIP TRAFFIC IN THE CANAL IS HANDLED ON A CONTINUAL BASIS. THEIR ASSIGNMENTS TO TRANSMIT DUTY ARE MADE BY TELEPHONE AT PRESCRIBED HOURS EACH DAY. THE PROCEDURE IS TO REQUIRE THE PILOT TO BE AVAILABLE TO RECEIVE THE TELEPHONED NOTICE BETWEEN 8 AND 9 A.M. ON ANY DAY ON WHICH THE EMPLOYEE IS SUBJECT TO CALL. THE PILOTS CONTEND THAT THEY ARE ENTITLED TO COMPENSATION FOR TIME DURING WHICH THEY ARE REQUIRED TO WAIT BY THEIR TELEPHONES FOR NOTIFICATION OF DUTY ASSIGNMENTS.

B-181750, JAN 24, 1975, 54 COMP GEN 617

PANAMA CANAL - PANAMA CANAL COMPANY - EMPLOYEES - OVERTIME - STANDBY, ETC., TIME - HOME AS DUTY STATION VESSEL EMPLOYEES OF THE PANAMA CANAL COMPANY ARE PROTECTED BY THE FAIR LABOR STANDARDS ACT, BUT UNDER THE ACT THEY NEED NOT BE COMPENSATED FOR OFF-DUTY TIME SPENT AT HOME AWAITING TELEPHONE NOTIFICATION.

IN THE MATTER OF OVERTIME COMPENSATION FOR PANAMA CANAL COMPANY PILOTS, JANUARY 24, 1975:

THE PANAMA CANAL COMPANY HAS REQUESTED THE GENERAL ACCOUNTING OFFICE TO FURNISH AN ADVISORY OPINION IN A MATTER INVOLVING COMPENSATION AND WORK SCHEDULES OF CERTAIN OF ITS EMPLOYEES. THE QUESTION THAT HAS BEEN PRESENTED CONCERNS THE COMPENSABILITY OF CERTAIN PERIODS OF TIME DURING WHICH PANAMA CANAL PILOTS, WHO PILOT VESSELS THROUGH THE CANAL, ARE OFF DUTY, BUT ARE EXPECTED TO BE AVAILABLE FOR NOTIFICATION BY TELEPHONE OF THEIR PROXIMATE DUTY ASSIGNMENT.

SHIP TRAFFIC IN THE CANAL IS HANDLED ON A CONTINUAL BASIS, 7 DAYS A WEEK, AND AN INDIVIDUAL PILOT MAY BE SCHEDULED TO COMMENCE DUTY AT ANY TIME OF THE DAY OR NIGHT. IN ORDER TO PROVIDE THE PILOTS WITH AS MUCH ADVANCE NOTICE AS CAN BE GIVEN CONSISTENTLY WITH EFFICIENT OPERATION, THEIR ASSIGNMENTS TO TRANSMIT DUTY ARE MADE BY TELEPHONE AT PRESCRIBED HOURS EACH DAY. THE PROCEDURE IS TO REQUIRE THE PILOT TO BE AVAILABLE TO RECEIVE THE TELEPHONED NOTICE BETWEEN 8 AND 9 A.M., AND IN SOME CASES BETWEEN 5 AND 6 P.M., ON ANY DAY ON WHICH THE EMPLOYEE IS SUBJECT TO CALL. THE PILOTS CONTEND THAT THEY ARE ENTITLED TO COMPENSATION FOR TIME DURING WHICH THEY ARE REQUIRED TO WAIT BY THEIR TELEPHONES FOR NOTIFICATION OF DUTY ASSIGNMENTS.

THE CANAL COMPANY TAKES THE POSITION THAT THE PILOTS HAVE NO STATUTORY ENTITLEMENT TO ANY ELEMENT OF BASIC OR PREMIUM PAY; THAT THEIR BASIC SALARY RATE IS FIXED ADMINISTRATIVELY WITHIN THE RANGE PRESCRIBED BY 35 C.F.R. SEC. 253.131(C) AS DETERMINED BY THE CANAL COMPANY; AND, THAT AS "VESSEL EMPLOYEES" WITHIN THE MEANING OF 5 U.S.C. SEC. 5348(B), PILOTS ARE EXCLUDED BY 5 U.S.C. SEC. 5541(2)(XII) FROM THE PREMIUM PAY BENEFITS APPLICABLE TO FEDERAL EMPLOYEES GENERALLY. CHRISTIAN ET AL. V. PANAMA CANAL CO., D.C.Z. CIVIL 2676.

THE QUESTION FOR RESOLUTION HERE IS NOT THE PAY RATE AT WHICH THE PILOTS SHOULD BE COMPENSATED, BUT WHETHER THEY SHOULD BE COMPENSATED AT ALL FOR TIME SPENT AWAITING TELEPHONE NOTIFICATION. WE AGREE THAT THE OVERTIME PROVISIONS OF TITLE 5 DO NOT APPLY TO "VESSEL EMPLOYEES" OF THE PANAMA CANAL COMPANY. HOWEVER, WE NEED NOT LOOK ONLY AT THE CANAL ZONE REGULATIONS, WHICH ESTABLISH THE PAY RATE, TO DETERMINE WHETHER TELEPHONE AVAILABILITY TIME IS COMPENSABLE WORKING TIME. IN RESOLVING THIS QUESTION IT SEEMS NECESSARY TO LOOK AT THE FAIR LABOR STANDARDS ACT (FLSA), 29 U.S.C. SECS. 201-219 (1964), AND REGULATIONS PROMULGATED PURSUANT TO THAT ACT.

SECTION 3(E) OF FLSA, 29 U.S.C. SEC. 203(E), AS AMENDED BY PUBLIC LAW 93- 259 (1974), INCLUDES ALL GOVERNMENT EMPLOYEES WITHIN COVERAGE OF THE ACT:

IN THE CASE OF AN INDIVIDUAL EMPLOYED BY A PUBLIC AGENCY, SUCH TERM MEANS

(A) ANY INDIVIDUAL EMPLOYED BY THE GOVERNMENT OF THE UNITED STATES -

(II) IN ANY EXECUTIVE AGENCY (AS DEFINED IN SECTION 105 OF SUCH TITLE (TITLE 5, UNITED STATES CODE))

5 U.S.C. SEC. 105 DEFINES EXECUTIVE AGENCY AS INCLUDING GOVERNMENT CORPORATIONS (CORPORATIONS OWNED OR CONTROLLED BY U.S. GOVERNMENT - 5 U.S.C. SEC. 103). AS A GOVERNMENT CORPORATION, THE PANAMA CANAL COMPANY IS AN EXECUTIVE AGENCY WHOSE EMPLOYEES ARE PROTECTED BY COVERAGE OF FLSA AND ITS REGULATIONS.

FLSA PROVIDES FOR A MINIMUM WAGE FOR TIME WORKED (29 U.S.C. SEC. 206) AND FURTHER PROVIDES FOR OVERTIME COMPENSATION (29 U.S.C. SEC. 207) FOR TIME WORKED IN EXCESS OF 40 HOURS IN A WORKWEEK. WHETHER TELEPHONE AVAILABILITY TIME QUALIFIES AS TIME WORKED UNDER FLSA IS THE QUESTION TO BE ANSWERED.

WITH REGARD TO THE COMPENSABILITY OF WAITING TIME IN GENERAL UNDER THE ACT, 29 C.F.R. SEC. 785.14 PROVIDES:

WHETHER WAITING TIME IS TIME WORKED UNDER THE ACT DEPENDS UPON PARTICULAR CIRCUMSTANCES. THE DETERMINATION INVOLVES "SCRUTINY AND CONSTRUCTION OF THE AGREEMENTS BETWEEN PARTICULAR PARTIES, APPRAISAL OF THEIR PRACTICAL CONSTRUCTION OF THE WORKING AGREEMENT BY CONDUCT, CONSIDERATION OF THE NATURE OF THE SERVICE, AND ITS RELATION TO THE WAITING TIME, AND ALL OF THE CIRCUMSTANCES ***." (SKIDMORE V. SWIFT, 323 U.S. 134 (1944).)

WITH REGARD SPECIFICALLY TO NO-CALL TIME, 29 C.F.R. SEC. 785.17 PROVIDES:

AN EMPLOYEE WHO IS REQUIRED TO REMAIN ON CALL ON THE EMPLOYER'S PREMISES OR SO CLOSE THERETO THAT HE CANNOT USE THE TIME EFFECTIVELY FOR HIS OWN PURPOSES IS WORKING WHILE "ON-CALL". AN EMPLOYEE WHO IS NOT REQUIRED TO REMAIN ON THE EMPLOYER'S PREMISES BUT IS MERELY REQUIRED TO LEAVE WORD AT HIS HOME OR WITH COMPANY OFFICIALS WHERE HE MAY BE REACHED IS NOT WORKING WHILE ON CALL. (ARMOUR & CO. V. WANTOCK, 323 U.S. 126 (1944) ***.)

IN THE CASE OF ARMOUR & CO. V. WANTOCK, SUPRA, AT P. 133, THE SUPREME COURT, IN DETERMINING WHAT CONSTITUTED WORK UNDER THE FEDERAL EMPLOYEES PAY ACT, USED THE CRITERION OF WHETHER THE TIME IN QUESTION WAS SPENT "PREDOMINANTLY FOR THE EMPLOYER'S BENEFIT OR THE EMPLOYEE'S" AND CONCLUDED THAT THIS WAS "DEPENDENT UPON ALL THE CIRCUMSTANCES OF THE CASE." IN RAPP V. UNITED STATES, 167 CT. CL. 852 (1964) AND MOSS V. UNITED STATES, 173 CT. CL. 1169 (1965), THE COURT OF CLAIMS IN CONSIDERING OVERTIME CLAIMS OF EMPLOYEES WHO PERFORMED STANDBY DUTY AT THEIR HOMES, OUTSIDE OF REGULAR DUTY HOURS AND IN EXCESS OF THEIR REGULAR 40-HOUR WORKWEEKS, APPLIED THE TEST OF WHETHER THE TIME IN QUESTION WAS SPENT PREDOMINANTLY FOR THE EMPLOYER'S BENEFIT. IN EACH CASE THE EMPLOYEE WAS REQUIRED TO BE WITHIN HEARING DISTANCE OF HIS HOME TELEPHONE IN ORDER TO RECEIVE CALLS AND TAKE APPROPRIATE ACTION. IN EACH OF THOSE CASES THE COURT HELD THAT WHERE AN EMPLOYEE IS ALLOWED TO STAND BY IN HIS OWN HOME WITH NO DUTIES TO PERFORM FOR HIS EMPLOYER EXCEPT TO BE AVAILABLE TO ANSWER THE TELEPHONE, THE TIME SPENT IN SUCH STANDBY STATUS DOES NOT AMOUNT TO "HOURS OF WORK" WITHIN THE MEANING OF 5 U.S.C. SEC. 5542, RELATING TO OVERTIME COMPENSATION. THE COURT CONCLUDED IN EACH CASE THAT IT COULD NOT BE SAID THAT THE EMPLOYEES HAD SPENT THEIR TIME PREDOMINANTLY FOR THEIR EMPLOYER'S BENEFIT WHEN THEY PERFORMED SUCH DUTY AT HOME. IN THE MOSS CASE, THE COURT POINTED OUT THAT: "EXCEPT FOR THE REQUIREMENT THAT HE REMAIN WITHIN HEARING DISTANCE OF THE TELEPHONE, THE CLAIMANT WAS FREE TO EAT, SLEEP, READ, ENTERTAIN FRIENDS, AND OTHERWISE ENJOY HIS NORMAL PURSUITS WHILE ACTING AS A DUTY OFFICER AT HOME."

ALTHOUGH WE ARE DEALING WITH A DIFFERENT STATUTE AND REGULATION IN THE PRESENT CASE, THE WORDS BEING INTERPRETED ("TIME WORKED") ARE SUBSTANTIALLY THE SAME AS THOSE INTERPRETED IN THE ABOVE CASES ("HOURS OF WORK"). FURTHERMORE, THE REGULATION ITSELF CITES THE ARMOUR CASE. THE RAPP CASE AND THE MOSS CASE MERELY EXPAND UPON AND FURTHER REFINE THE ARMOUR CASE. THUS, IT SEEMS APPROPRIATE TO APPLY THE ABOVE REASONING TO THE PRESENT CASE.

APPLYING SUCH REASONING HERE, WE ARE COMPELLED TO CONCLUDE THAT THE CANAL COMPANY IS NOT REQUIRED BY THE FLSA TO COMPENSATE THE PILOTS FOR THE TIME IN QUESTION. SINCE THE TIME IS SPENT AT HOME, THE PILOTS ARE FREE TO EAT, SLEEP, READ, ENTERTAIN FRIENDS AND ENJOY THEIR NORMAL PURSUITS SO LONG AS THEY ARE WITHIN HEARING DISTANCE OF THE TELEPHONE. THE TIME SPENT IS PREDOMINANTLY FOR THE EMPLOYEES' OWN BENEFIT, NOT PREDOMINANTLY FOR THE EMPLOYER'S BENEFIT. THE PILOTS DO NOT FIT WITHIN THE CATEGORY OF WORKING WHILE ON-CALL AS SET FORTH IN 29 C.F.R. SEC. 785.17, SUPRA, BECAUSE THEY ARE NOT "ON THE EMPLOYER'S PREMISES OR SO CLOSE THERETO THAT (THEY) CANNOT USE THE TIME EFFECTIVELY FOR (THEIR) OWN PURPOSES."