B-200112, MAY 5, 1983

B-200112: May 5, 1983

Additional Materials:

Contact:

Shirley Jones
(202) 512-8156
jonessa@gao.gov

 

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

BACKGROUND THE DECISION IS IN RESPONSE TO A REQUEST FROM MR. IN WHICH WE HELD THAT GRADE GS-12 ELECTRONIC MAINTENANCE TECHNICIANS EMPLOYED BY THE FAA WERE ENTITLED TO OVERTIME PAYMENTS UNDER THE FAIR LABOR STANDARDS ACT RETROACTIVE TO MAY 1. THAT EXPERIENCE HAS SHOWN THAT THE AVERAGE PAYMENT WAS $67.85 AND 78 PERCENT OF THE PAYMENTS WERE FOR $100 OR LESS. THE FAA PROPOSES TO PAY EACH REMAINING EMPLOYEE $1.50 FOR EACH MONTH THE EMPLOYEE WAS COVERED BY THE FLSA INSTEAD OF PREPARING A DETAILED COMPUTATION OF EACH EMPLOYEE'S ENTITLEMENT. EACH EMPLOYEE WOULD HAVE THE OPTION OF INSISTING UPON A COMPUTATION OF HIS BACKPAY ENTITLEMENT BASED UPON AGENCY RECORDS. THE OFFICE OF PERSONNEL MANAGEMENT (OPM) IS VESTED WITH THE AUTHORITY TO ADMINISTER THE FLSA WITH RESPECT TO MOST FEDERAL EMPLOYEES.

B-200112, MAY 5, 1983

DIGEST: OPM AND FAA PROPOSE TO SETTLE APPROXIMATELY 2,500 BACKPAY CLAIMS FOR FLSA OVERTIME BY PAYING A COMPROMISE AMOUNT INSTEAD OF COMPUTING EACH EMPLOYEE'S ENTITLEMENT BASED ON AVAILABLE GOVERNMENT RECORDS. WE HOLD THAT, WHERE FAA HAS THE NECESSARY RECORDS TO COMPUTE INDIVIDUAL BACKPAY ENTITLEMENTS, IT MAY NOT COMPROMISE CLAIMS AGAINST THE UNITED STATES IN THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY TO THAT EFFECT.

FAA ELECTRONIC MAINTENANCE TECHNICIANS - ADMINISTRATIVE SETTLEMENT OF CLAIMS FOR FLSA OVERTIME:

ISSUE

THE ISSUE IN THIS DECISION INVOLVES A PROPOSAL BY THE OFFICE OF PERSONNEL MANAGEMENT (OPM) AND THE FEDERAL AVIATION ADMINISTRATION (FAA) TO MAKE A COMPROMISE SETTLEMENT COVERING ABOUT 2,500 CLAIMS FOR RETROACTIVE PAYMENTS OF OVERTIME UNDER THE FAIR LABOR STANDARDS ACT (FLSA) FILED BY CERTAIN FAA EMPLOYEES. WE HOLD THAT, WHERE FAA HAS THE NECESSARY RECORDS TO COMPUTE INDIVIDUAL BACKPAY ENTITLEMENTS, OPM AND FAA MAY NOT ADMINISTRATIVELY COMPROMISE THESE CLAIMS.

BACKGROUND

THE DECISION IS IN RESPONSE TO A REQUEST FROM MR. ANTHONY F. INGRASSIA, ASSISTANT DIRECTOR FOR AGENCY COMPLIANCE AND EVALUATION, OPM, FOR OUR APPROVAL OF A PROPOSED COMPROMISE SETTLEMENT OF CERTAIN CLAIMS FOR RETROACTIVE PAYMENTS UNDER THE FLSA. THIS ISSUE AROSE AS A RESULT OF OUR DECISION B-200112, DECEMBER 21, 1981, IN WHICH WE HELD THAT GRADE GS-12 ELECTRONIC MAINTENANCE TECHNICIANS EMPLOYED BY THE FAA WERE ENTITLED TO OVERTIME PAYMENTS UNDER THE FAIR LABOR STANDARDS ACT RETROACTIVE TO MAY 1, 1974.

THE FAA HAS COMPUTED NEARLY 300 PAYMENTS IN ONE ACCOUNTING OFFICE THAT SERVES TWO REGIONS, AND THAT EXPERIENCE HAS SHOWN THAT THE AVERAGE PAYMENT WAS $67.85 AND 78 PERCENT OF THE PAYMENTS WERE FOR $100 OR LESS. IN ORDER TO COMPLETE THE PAYMENTS TO AN ADDITIONAL 2,500 EMPLOYEES, THE FAA PROPOSES TO PAY EACH REMAINING EMPLOYEE $1.50 FOR EACH MONTH THE EMPLOYEE WAS COVERED BY THE FLSA INSTEAD OF PREPARING A DETAILED COMPUTATION OF EACH EMPLOYEE'S ENTITLEMENT. UNDER THIS PROPOSED SETTLEMENT, THE MAXIMUM PAYMENT TO ANY EMPLOYEE WOULD BE $108 AND THE AVERAGE PAYMENT WOULD BE $86.07. THE FOLLOWING FIGURES SHOW THE ESTIMATED COSTS OF PREPARING DETAILED CALCULATIONS VERSUS UTILIZING A SETTLEMENT CONCEPT, INCLUDING THE COST OF HAVING A CONTRACTOR ASSIST IN SORTING AND ORGANIZING THE RECORDS:

DETAILED SETTLEMENT

CALCULATION CALCULATION

PAYMENTS TO EMPLOYEES $135,700 $172,140 CONTRACT COST 100,000 50,000 PAYROLL OFFICE COST

$123,000 $ 14,000

TOTAL COST $358,700 $236,140

AVERAGE COST PER CLAIM $179.35 $118.07

THE FAA DESIRES TO ADMINISTRATIVELY COMPROMISE THESE CLAIMS NOT ONLY BECAUSE OF THE OVERALL COST SAVINGS TO THE GOVERNMENT, BUT ALSO BECAUSE OF THE INTEREST IN THE CONGRESS TO AVOID FURTHER DELAY AND PROMPTLY SETTLE THESE OUTSTANDING CLAIMS. SEE THE CONFERENCE REPORT ON THE FISCAL YEAR 1983 DEPARTMENT OF TRANSPORTATION APPROPRIATIONS ACT, PUBLIC LAW 97-369, DECEMBER 18, 1982, WHICH URGED THE FAA TO ADMINISTRATIVELY SETTLE THESE CLAIMS AND ACCELERATE CLAIM PAYMENTS, IF POSSIBLE. HOUSE REPORT NO. 97-960, DECEMBER 13, 1982, PP. 8-9. IF THE EMPLOYEES CHOOSE TO ACCEPT THIS PROPOSED SETTLEMENT, EACH EMPLOYEE WOULD SIGN A WAIVER OF A DETAILED COMPUTATION OF BACKPAY ENTITLEMENT. HOWEVER, EACH EMPLOYEE WOULD HAVE THE OPTION OF INSISTING UPON A COMPUTATION OF HIS BACKPAY ENTITLEMENT BASED UPON AGENCY RECORDS.

OPINION

UNDER THE PROVISIONS OF 29 U.S.C. SEC. 204(F), THE OFFICE OF PERSONNEL MANAGEMENT (OPM) IS VESTED WITH THE AUTHORITY TO ADMINISTER THE FLSA WITH RESPECT TO MOST FEDERAL EMPLOYEES. HOWEVER, OPM DOES NOT HAVE THE AUTHORITY TO ADJUDICATE CLAIMS OR SETTLE ACCOUNTS UNDER THE FLSA AND DETERMINATIONS ON THE LEGALITY OF THE EXPENDITURE OF APPROPRIATED FUNDS UNDER THE FLSA MUST BE DECIDED BY OUR OFFICE. SEE 31 U.S.C. SECS. 3529, 3702, AS CODIFIED BY PUBLIC LAW 97-258, SEPTEMBER 13, 1982, 92 STAT. 877 (FORMERLY 31 U.S.C. SECS. 71, 74). SEE ALSO MEAT GRADERS, B-163450.12, SEPTEMBER 20, 1978; AND B-51325, OCTOBER 7, 1976.

WITH REGARD TO OUR CLAIMS SETTLEMENT AUTHORITY, OUR OFFICE HELD PRIOR TO THE ENACTMENT OF THE CLAIMS COLLECTION ACT, 31 U.S.C. SEC. 3711 (FORMERLY 31 U.S.C. SECS. 951-953), THAT OUR AUTHORITY TO SETTLE CLAIMS BY OR AGAINST THE GOVERNMENT DID NOT PERMIT COMPROMISE. B-133616, OCTOBER 25, 1957; AND B-122319, AUGUST 21, 1956. THE FEDERAL CLAIMS COLLECTION ACT OF 1966, PUBLIC LAW 89-508, PERMITS AGENCIES, UNDER STANDARDS PROMULGATED BY THE COMPTROLLER GENERAL AND THE ATTORNEY GENERAL TO COMPROMISE OR SUSPEND COLLECTION OF CLAIMS OF THE UNITED STATES. SEE 4 C.F.R. PART 101 (1982). HOWEVER, WE KNOW OF NO SIMILAR AUTHORITY WITH RESPECT TO CLAIMS AGAINST THE UNITED STATES, EXCEPT THAT RESERVED TO THE ATTORNEY GENERAL IN THE CONDUCT OF LITIGATION. SEE 28 U.S.C. SEC. 516.

THE PROPOSAL BY THE FAA INCLUDES EXAMPLES OF HOW A SETTLEMENT WOULD HAVE AFFECTED PAYMENTS TO THE NEARLY 300 EMPLOYEES WHO HAVE ALREADY BEEN PAID BACKPAY FOR FLSA OVERTIME. IN SOME INSTANCES THE PROPOSED SETTLEMENT BY FAA WOULD HAVE RESULTED IN AN UNDERPAYMENT TO EMPLOYEES. HOWEVER, IN OTHER SITUATIONS THE PROPOSED SETTLEMENT WOULD RESULT IN OVERPAYMENTS TO EMPLOYEES IN COMPARISON TO THEIR ENTITLEMENTS AS COMPUTED BY FAA. WHERE RECORDS ARE AVAILABLE TO COMPUTE EXACT ENTITLEMENTS AND IN THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY TO COMPROMISE OR WAIVE SUCH CLAIMS, WE CANNOT AGREE TO THIS PROPOSAL WHICH MAY RESULT IN PAYMENTS IN EXCESS OF THAT PROVIDED UNDER THE STATUTES AND REGULATIONS.

OUR OFFICE HAS RECOGNIZED SITUATIONS WHERE, IN THE ABSENCE OF OFFICIAL RECORDS, APPROXIMATIONS OR ESTIMATES ARE USED FOR THE PAYMENT OF CLAIMS AGAINST THE UNITED STATES. SEE B-135212, DECEMBER 28, 1961. HOWEVER, WE KNOW OF NO INSTANCE IN WHICH ESTIMATES OR APPROXIMATIONS WERE USED WHEN GOVERNMENT RECORDS WERE AVAILABLE TO DETERMINE THE PRECISE ENTITLEMENTS.

WE RECOGNIZE THAT THE COMPUTATION OF BACKPAY ENTITLEMENTS OF THIS SCALE INVOLVES A LARGE ALLOCATION OF GOVERNMENT RESOURCES AND THAT A COMPROMISE SETTLEMENT OF CLAIMS WOULD BE MORE COST-EFFECTIVE AND WOULD RESULT IN MORE PROMPT PAYMENT OF THESE OUTSTANDING CLAIMS. HOWEVER, IN THE ABSENCE OF SPECIFIC STATUTORY AUTHORITY, WE ARE UNABLE TO AGREE TO THIS PROPOSAL TO COMPROMISE CLAIMS AGAINST THE UNITED STATES.

Jan 14, 2021

Jan 13, 2021

Looking for more? Browse all our products here