Washington D.C.

U.S. Office of Personnel Management
Fair Labor Standards Act Decision
Under section 204(f) of title 29, United States Code

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Damon B. Ford
Acting Classification Appeals and FLSA Claims Program Manager
Agency Compliance and Evaluation
Merit System Accountability and Compliance

05/21/2020

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Date

As provided in section 551.708 of title 5, Code of Federal Regulations (CFR), this decision is binding on all administrative, certifying, payroll, disbursing, and accounting officials of agencies for which the U.S. Office of Personnel Management (OPM) administers the Fair Labor Standards Act (FLSA).  The agency should identify all similarly situated current and, to the extent possible, former employees, and ensure that they are treated in a manner consistent with this decision, and inform them in writing of their right to file an FLSA claim with the agency or OPM.  There is no right of further administrative appeal.  This decision is subject to discretionary review only under conditions and time limits specified in 5 CFR 551.708 (address provided in section 551.710).  The claimant has the right to bring action in the appropriate Federal court if dissatisfied with the decision.

The agency is to compute the claimant’s overtime pay in accordance with instructions in this decision, then pay the claimant any amount owed him.  If the claimant believes that the agency has incorrectly computed the amount owed him, he may file a new FLSA claim with this office.  Compliance action on this decision must be completed within 60 days of the date of this decision as provided for in 5 CFR 551.708(c)(1).

Introduction

On March 27, 2019, OPM’s Merit System Accountability and Compliance received an FLSA claim from the claimant requesting a review of his position’s FLSA designation.  The claimant’s position is classified as Technician, NR-856-05, with the PACNORWEST, Installation Support, Fleet Modernization and Installation, Naval Information Warfare Systems Command in Bremerton, Washington.  The claimant believes his FLSA status should be designated as nonexempt (i.e., covered) by the overtime pay provisions of the FLSA instead of exempt (i.e., not covered).  We received the agency administrative report (AAR) on May 9, 2019, and the claimant’s comments on June 12, 2019, and August 1, 2019.  We have accepted and decided this claim under section 4(f) of the FLSA of 1938, as amended, codified at section 204(f) of title 29, United States Code (U.S.C.).

Background and general issues

The claimant accepted a management directed reassignment to the Pacific Northwest Installation Execution Branch (Branch) of the Fleet Modernization and Installation Division, effective December 24, 2017.  While he remained in a Technician, NR-856-05, position, he was assigned at that time to pay band descriptor (or position description (PD)), number 30246.  The PD describes primarily performing work as an On-site Installation Coordinator (OSIC), but states that the “[s]electee may also serve as Alteration Installation Team Manager (AIT-M).”  The agency designated the position as exempt (i.e., not covered) from the overtime pay provisions of the FLSA.  However, instead of performing the OSIC work described by his PD, the record shows the claimant performed AITM work for most, if not all, of his time upon reassignment.  He asserts to OPM that the AITM work he performed should be designated as FLSA nonexempt.

In its AAR to OPM, the agency concurred with the claimant’s statements that he performed AITM work.  The agency describes the work performed by two types of AITMs:  (1) Production AITM oversees the physical installation of a system and ensures contractors follow appropriate documentation and procedures, and (2) Technician Subject Matter Expert (SME) AITM performs software load, system configuration, and testing duties on installed systems.  The agency states the claimant served as a Technician SME, performing testing and troubleshooting duties associated with common radio room installations.  His duties and tasks included, but were not limited to, troubleshooting, testing, repairing, and maintaining complex electronic equipment (hardware) for a specific system to assure equipment performed as designed; installing software; checking for proper voltage, ohms, frequency, amps, etc.; adjusting resistors; and replacing cables.  The agency further explains:

We find the majority of duties actually performed by the incumbent during the claim period to be FLSA nonexempt.  Clearly, during the claim period, the employee did not perform the duties outlined in the [PD] for a majority of the time.

After careful consideration, we agree that the AITM work performed by the claimant should be designated as FLSA nonexempt.  Because neither the claimant nor agency disagrees, we will not address the exemption of the Technician SME AITM work any further.

The record shows the claimant, at the direction of management officials, stopped performing AITM work on or around May 29, 2019.  He subsequently began on-the-job training to perform the OSIC duties described by his PD.  In its AAR to OPM, the agency restates its determination that the OSIC work meets the administrative exemption criteria of the FLSA described in 5 CFR 551.206.  Because the claimant asserts in his comments that the OSIC work should be designated as FLSA nonexempt and thus disputes the agency’s determination, our evaluation will focus on his OSIC work.

The claimant asserts that his OSIC work is identical to that performed by NR-856-05 positions found to be FLSA nonexempt at other Naval Information Warfare Systems Command locations.  However, we must make exemption decisions by comparing the actual duties performed by the claimant to criteria and guidance in FLSA regulations, laws, and guidelines (5 CFR 551.202(e)).  We cannot compare the claimant’s position to others as a basis for determining his exemption status.

Position information

OSICs serve as the principal point of contact on matters relating to installation and integration projects for the Command, Control, Communications, Computers, Intelligence, Surveillance, and Reconnaissance (C4ISR) systems on aircraft carriers, destroyers, and submarines of the U.S. Navy.  Projects include permanent and temporary alterations, software installations, equipment installations, system upgrades, etc.  It is the OSIC’s responsibility to ensure cost, schedule, and performance requirements of the assigned project are met.  The claimant is a submarine OSIC and is currently in the preparation phase of his first OSIC assignment.  The installation is scheduled for later this year.  He is responsible for the conduct of the entire project, serving as intermediary between the contractor or Government installer, AITM, and the submarine, shipyard, and Branch leadership.  He is responsible for all aspects of installation planning and execution by the contractor and/or Government team composed of specialists in submarine installations, systems engineering, and C4ISR testing.  He oversees their progress and coordinates all installer efforts during the period of planning, production, and testing.

The claimant’s OSIC work includes participating in planning meetings, maintaining an onsite presence, and attending key milestones of the installation.  He ensures the availability of all support services required for the project such as temporary power and lighting, scaffolding, crane, or rigging.  He coordinates, conducts, and participates in briefings provided to submarine leadership.  Once the alteration or installation is completed, a System Operational Verification Test is conducted by a team of two to four members who are experts on the system.  The team conducts an inspection and test of all systems that have had equipment or machinery removed and reinstalled.  The systems are subjected to appropriate testing to demonstrate operational acceptability.  The claimant ensures the resolution of any interoperability issues involving the interface of C4ISR components and systems.  He submits weekly and monthly situational reports to communicate project plans and actions, status, issues, and concerns to both internal and external stakeholders.  He also ensures all required reports and documentation are completed in a timely manner.

The claimant’s OSIC work requires application of the Afloat Installation Process Handbook, the Joint Fleet Maintenance Manual, and agency specifications, requirements, and instructions.  His work also requires knowledge of, and skill in, industry accepted standards; reviewing engineering drawings; planning, management, and execution of C4ISR projects; fleet modernization program; and safety, quality, and technical compliance standards.

The claimant’s PD and other material of record furnish much more information about his duties and responsibilities and how they are performed.  In reaching our FLSA decision, we carefully considered all information provided by the claimant and his agency including his official PD which we have incorporated by reference into this decision.  In addition, to gain more information about his work, we conducted separate telephone interviews with the claimant and his first-level supervisor, i.e., the Branch Head.

Evaluation

Period of the claim

As provided for in 5 CFR 551.702(b), all FLSA claims filed after June 30, 1994, are subject to a two-year statute of limitations, except in cases of willful violation where the statute of limitations is three years.  A claimant must submit a written claim to either the employing agency or to OPM in order to preserve the claim period.  The date the agency or OPM receives the claim is the date which determines the period of possible back pay entitlement (5 CFR 551.702(c)).  The claimant makes no assertion of willful violation, and the record shows he did not file a claim with his agency.  Therefore, we find the claim was preserved effective March 27, 2019, when it was received by OPM, and is subject to a two-year statute of limitations commencing on March 27, 2017.  Therefore, the entire period of the claim is covered.

FLSA coverage

Sections 551.201 and 551.202 of 5 CFR require that an employing agency designate an employee FLSA exempt only when the agency correctly determines the employee’s work meets one or more of the exemption criteria.  In all exemption determinations, the agency must observe the following principles:  (1) each employee is presumed to be FLSA nonexempt unless the employing agency correctly determines that the employee clearly meets the requirements of one or more of the exemptions; (2) exemption criteria must be narrowly construed to apply only to those employees who are clearly within the terms and spirit of the exemption; (3) the burden of proof rests with the agency that asserts the exemption; and (4) if there is a reasonable doubt as to whether an employee meets the criteria for exemption, the employee should be designated FLSA nonexempt.  The designation of a position’s FLSA status ultimately rests on the duties actually performed by the employee.  There are three exemption categories applied to Federal employees:  executive, administrative, and professional and learned professional.

The claimant’s agency asserts that based on the duties and responsibilities described by his PD, the OSIC work meets the administrative exemption criteria of the FLSA.  The agency determined his duties do not meet the executive or professional exemption criteria, and the claimant does not contest that determination.  To confirm this conclusion, we have applied the criteria for executive exemption (5 CFR 551.205), administrative exemption (5 CFR 551.206), and professional and learned professional exemptions (5 CFR 551.207 and 551.208) provided in OPM’s FLSA regulations. 

Executive Exemption Criteria

Under the provisions of 5 CFR 551.205, an executive employee is an employee whose primary duty is management (as defined in 5 CFR 551.104) of a Federal agency or any subdivision thereof (including the lowest recognized organizational unit with a continuing function) and who:

(1) Customarily and regularly directs the work of two or more other employees; and

(2) Has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring, firing, advancement, promotion, or any other change of status of other employees, are given particular weight.

The claimant’s work does not meet the executive exemption criteria.  Unlike the criteria, the record shows he does not occupy a management position and does not carry out the management authorities described in the regulation.  He has no authority to hire, fire, advance, promote, or any other change of status.

Administrative Exemption Criteria

Under the provisions of 5 CFR 551.206, administrative exemption criteria are as follows:

An administrative employee is an employee whose primary duty is the performance of office or non-manual work directly related to the management or general business operations, as distinguished from production functions, of the employer or the employer’s customers and whose primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.

(a) In general, the exercise of discretion and independent judgment involves the comparison and the evaluation of possible courses of conduct, and acting or making a decision after the various possibilities have been considered. The term “matters of significance” refers to the level of importance or consequence of the work performed.

(b) The phrase discretion and independent judgment must be applied in light of all the facts involved in the particular employment situation in which the question arises. Factors to consider when determining whether an employee exercises discretion and independent judgment with respect to matters of significance include, but are not limited to, whether the employee:

1.) Has authority to formulate, affect, interpret, or implement management policies or operating practices;

2.) Carries out major assignments in conducting the operation of the organization;

3.) Performs work that affects the organization’s operations to a substantial degree, even if the employee’s assignments are related to operation of a particular segment of the organization;

4.) Has authority to commit the employer in matters that have significant financial impact;

5.) Has authority to waive or deviate from established policies and procedures without prior approval;

6.) Has authority to negotiate and bind the organization on significant matters;

7.) Provides consultation or expert advice to management;

8.) Is involved in planning long- or short-term organizational objectives;

9.) Investigates and resolves matters of significance on behalf of management; and

10.) Represents the organization in handling complaints, arbitrating disputes, or resolving grievances.

(c) The exercise of discretion and independent judgment implies that the employee has authority to make an independent choice, free from immediate direction or supervision. However, an employee can exercise discretion and independent judgment even if the employee’s decisions or recommendations are reviewed at a higher level.  Thus, the term discretion and independent judgment does not require that decisions made by an employee have a finality that goes with unlimited authority and a complete absence of review.  The decisions made as a result of the exercise of discretion and independent judgment may consist of recommendations for action rather than the actual taking of action.  The fact that an employee’s decision may be subject to review and that upon occasion the decisions are revised or reversed after review does not mean that the employee is not exercising discretion and independent judgment.

(d) An organization’s workload may make it necessary to employ a number of employees to perform the same or similar work. The fact that many employees perform identical work or work of the same relative importance does not mean that the work of each such employee does not involve the exercise of discretion and independent judgment with respect to matters of significance.

(e) The exercise of discretion and independent judgment must be more than the use of skill in applying well-established techniques, procedures, or specific standards described in manuals or other sources.

The claimant’s work does not meet the administrative exemption criteria.  His OSIC duties include, but are not limited to, performing Contracting Officer’s Representative (COR) duties by monitoring contactors on behalf of the Contracting Officer (CO), providing assessments related to contractor work performance, ensuring contractors are completing assigned tasks on time and on budget, ensuring and reporting when project milestones are met, monitoring installation efforts, and working with the AITM assigned to technically lead the work execution.  There is a distinction between employees whose primary duty is administering the business affairs of the enterprise from those whose primary duty is producing the goods or services that the enterprise exists to produce and market.  Because the claimant’s position is a “staff function” (i.e., he provides specialized advisory, planning, and support services to the line staff engaged in the actual performance of the alteration and installation tasks), we conclude he performs office or non-manual work directly related to the management or general business operations as distinguished from production functions.  However, in contrast to the administrative exemption criteria, the claimant does not exercise discretion and independent judgment with respect to “matters of significance.”  In keeping with our preceding assessment, as discussed below we compare the work of the claimant to the ten factors listed in the regulation addressing typical authorities and responsibilities found where independent discretion and judgment is applied to matters of significance. 

(1) The claimant does not have authority to formulate, affect, interpret, or implement management policies or operating practices.  Work that significantly affects the formulation or execution of policies or practices generally refers to employees who either actually make policy or develop proposals acted on by others.  The claimant neither makes nor implements policies or practices.  Instead, as a Branch-level OSIC, his work requires applying established policies and practices to perform administrative and technical tasks of his assigned projects to ensure proper alterations and installations on submarines.  The Branch Head, the Submarine Platform Execution Manager (PEM), and others are delegated with the express authority to formulate, to affect, to interpret, and/or to ensure proper implementation of the Branch’s management policies and operating practices along with the Afloat Installation Process Handbook, the Joint Fleet Maintenance Manual, and other agency specifications, requirements, and instructions.

(2) The claimant does not carry out major assignments in conducting  the operations of the organization.  The C4ISR projects managed by the Branch cost, on average, one to two million dollars.  The claimant plays an integral part in carrying out the Branch’s mission by managing the costs, schedules, and performance of the contractors or Government installers performing work on submarines.  However, as previously stated, he does not exercise discretion and independent judgment with respect to “matters of significance.”  The claimant’s work solely deals with contract compliance on system installation and upgrades of the C4ISR systems on submarines, which is only one component of a major assignment within an organization that covers multiple other types of technical work performed on a variety of aircraft carriers and destroyers serviced by the overall Branch.

(3) The claimant does not perform work affecting the organization’s operations to a substantial degree.  It is his responsibility to ensure the C4ISR project meets cost, schedule, and performance requirements.  He coordinates personnel and resources to ensure the successful and timely completion of alterations and installations.  However, as previously stated, he does not exercise discretion and independent judgment with respect to “maters of significance.”  Because the elements of contract compliance, including meeting cost, performance, and schedule requirements, are specific to the C4ISR project for submarines, his situation falls short of affecting the organization’s overall operations to a substantial degree.

(4) The claimant does not have authority to commit the Branch to matters having significant financial impact.  The CO awards all project-related contracts.  As COR, the claimant ensures cost, schedule, and performance requirements are met.  He balances the need to get the project work done properly, in the period of time allotted, and within budget.  To ensure project milestones are met, he identifies all potential risks to the successful completion of the work that may require additional staff, money, or resources.  For example, if additional money is required, he completes a cost overrun report for review and action by the Branch Head and PEM.  The claimant has not been vested the authority to commit the Branch to matters involving significant financial impact.

(5) The claimant does not have authority to waive or deviate from established policies and procedures without prior approval.  His authority is limited to stopping a project without prior approval only if he identifies an imminent danger to the people, submarine, or equipment.  Work stoppages are rare; instead, the claimant regularly deals with problems or situations involving the need to reschedule projects due to the unavailability of the submarine, technical issues resulting from the work, obtaining cooperation from shipyard leadership if a crane or other support services are required for the project, etc.  However, the problems and issues he regularly deals with do not require waiving or deviating from established policies and procedures without prior approval.

(6) The claimant does not have authority to negotiate and bind the organization on significant matters.  Only the CO is delegated with authority to negotiate and bind the organization to project contracts.  Projects are scheduled based on the availability of submarines, i.e., when at dock.  If the time at dock is insufficient to complete the project, the claimant is responsible for identifying that risk and taking steps to, for example, notify the PEM so that a baseline change request can be initiated, coordinate with installers to determine if the work can be completed faster to accommodate the schedule, etc.  He refers situations requiring additional money, people, or other resources to the Branch Head and PEM for review and action.  The claimant is not vested with authority to negotiate and bind the Branch on significant matters.

(7) The claimant does not provide consultation or expert advice to management on matters relating to the management or general business operations of the Branch.  In managing the costs, schedules, risks, and performance of highly complex C4ISR projects, he advises senior-level leadership on issues that arise and recommends courses of action throughout all phases of the project including planning, execution, monitoring, and closing out.  He also provides technical advice, assistance, and instruction on assigned projects.  For example, he is skilled at reviewing engineering drawings to identify errors or problems (e.g., incorrect install locations) before the contractor or Government installer begins work.  However, the focus and scope of the claimant’s work is on onsite assessment of contract compliance, providing advance and support services to contractors and line staff performing the technical work.  In that capacity, he provides specific contract-oriented information and advice to contractors, CO, and submarine leadership on project status and technical accomplishments, and monitors all phases of project planning and execution.  This situation falls short of element (7), where the employee serves as an expert consultant advising management on broad matters relating to overall management or the general business operations of the unit.

(8) The claimant is not involved in the planning of long- or short-term organizational objectives.  He participates in project planning and execution meetings, maintains the current project status, and provides situational reports based on his own surveillance or on daily reports received from the project team.  The claimant reports on project costs, schedule, performance, risks, and milestones to internal and external stakeholders.  He identifies issues categorized as yellow or red, which identify potential or real risks to project completion and thus receive heightened attention from the Branch Head and other management officials.  Regardless, it is clear his planning involvement is limited to the submarine OSIC project to which he is assigned.  Unlike criterion (8), the claimant is not involved in the planning of organizational (Branch) objectives, i.e., he is not involved in the strategic planning efforts that will serve as a blueprint or guide to establish, achieve, or otherwise impact either the long- or short-term objectives or goals of his Branch.

(9) The claimant does not investigate and resolve matters of significance on behalf of management.  For example, OSICs participate in the safety investigations resulting from work stoppages.  However, the Branch Head is responsible for conducting and ultimately resolving safety investigations.

(10) The claimant does not represent the organization in handling complaints, arbitrating disputes, or resolving grievances.

Under the provisions of 5 CFR 551.206(b), the phrase “discretion and independent judgment” must be applied in light of all the facts involved.  Because the claimant does not perform any of the preceding ten factors demonstrating discretion and independent judgment, we must conclude that he does not exercise discretion and independent judgment on matters of significance to the degree required by 5 CFR 551.206.

Based on the preceding analysis, the claimant’s work does not meet the administrative exemption criteria.

Professional and Learned Professional Exemption Criteria

Under 5 CFR 551.207, the professional exemption criteria is as follows:

To qualify for the professional exemption, an employee’s primary duty must be the performance of work requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction or requiring invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.

Under 5 CFR 551.208, the learned professional exemption criteria are as follows:

(a) To qualify for the learned professional exemption, an employee’s primary duty must be the performance of work requiring advanced knowledge in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction. The work must include the following three elements:

1.) The employee must perform work requiring advanced knowledge. Work requiring advanced knowledge is predominantly intellectual in character and includes work requiring the consistent exercise of discretion and judgment, as distinguished from performance of routine mental, manual, mechanical or physical work.  An employee who performs work requiring advanced knowledge generally uses the advanced knowledge to analyze, interpret or make deductions from varying facts or circumstances.  Advanced knowledge cannot be attained at the high school level;

2.) The advanced knowledge must be in a field of science or learning which includes the traditional professions of law, medicine, theology, accounting, actuarial computation, engineering, architecture, teaching, various types of physical, chemical and biological sciences, pharmacy, and other similar occupations that have a recognized professional status as distinguished from the mechanical arts or skilled trades where in some instances the knowledge is of a fairly advanced type, but is not in a field of science or learning; and

3.) The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction which restricts the exemption to professions where specialized academic training is a standard prerequisite for entrance into the profession. The best prima facie evidence that an employee meets this requirement is possession of the appropriate academic degree.  However, the word “customarily” means that the exemption is appropriate for employees in such professions who have substantially the same knowledge level and perform substantially the same work as the degreed employees, but who attained the advanced knowledge through a combination of work experience and intellectual instruction.  For example, the learned professional exemption is appropriate in unusual cases where a lawyer has not gone to law school, or a chemist does not possess a degree in chemistry.  However, the learned professional exemption is not applicable to occupations that customarily may be performed with only the general knowledge acquired by an academic degree in any field, with knowledge acquired through an apprenticeship, or with training in the performance of routine mental, manual, mechanical, or physical processes.  The learned professional exemption also does not apply to occupations in which most employees have acquired their skill by experience rather than by advanced specialized intellectual instruction.  The position of Engineering Technician is an example of such an occupation where the employee collects, observes, tests and records factual scientific data within the oversight of professional engineers, and performs work using knowledge acquired through on-the-job and classroom training rather than by acquiring the knowledge through prolonged academic study.

The claimant’s work does not meet the professional exemption criteria.  His primary duties do not require applying knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction as described by the criteria.  He manages and ensures completion of complex installation and integration tasks for C4ISR systems.  His work requires knowledge, skills, and abilities related to, for example, project management, communication skills to advise internal and external stakeholders, data analysis, and management of project costs, schedules, and risks associated with performance of C4ISR alterations and installations.  Our fact-finding also disclosed his work requires specialized training to serve as an OSIC, but the claimant’s position neither requires theoretical knowledge of the electronics specialty nor knowledge of this and other disciplines, and new developments in the field (e.g., electronics engineering), as required by the professional exemption criteria.

The claimant’s work does not meet the learned professional exemption criteria.  Unlike the first element, his work is not predominantly intellectual in character requiring the consistent exercise of discretion and judgment to apply knowledge in a field of science or learning.  Unlike the second element, he does not apply advanced knowledge of the traditional professional fields of science or learning listed in that element.  Moreover, OPM’s Handbook of Occupational Groups and Families does not identify the 856 Electronics Technician Series as a professional series.  Unlike the third element, as previously discussed, his work does not require knowledge customarily acquired by a prolonged course of specialized intellectual instruction.  His work is not restricted to professions where specialized academic training is a pre-requisite for entrance into the occupation.  Rather, the knowledge and skills required to perform his work are acquired through a combination of specialized technical course work (as a military member of the U.S. Navy, the claimant completed basic enlisted submarine school and Electronics Technician “A” school with subjects such as basic electricity, electronics, and electronic communication systems), on-the-job training, and experience.

Based on the preceding analysis, the claimant’s work does not meet the professional or learned professional exemption criteria.

Decision

The claimant’s work does not meet the executive, administrative, or professional or learned professional exemption criteria.  Therefore, his position is properly designated as FLSA nonexempt (i.e., covered by the overtime pay provisions of the FLSA).  The claimant is entitled to compensation at the FLSA overtime rate for all overtime hours worked during the claim period.  Since the claim was received by OPM on March 27, 2019, the claimant can receive back pay for two years prior to that date (i.e., March 27, 2017), and for any overtime worked to the present.

As stated in 5 CFR 550.806, the claimant is also owed interest on the back pay.  The agency must follow the compliance requirements on page ii of this decision.

The claimant submitted numerous overtime requests covering portions of the claim period.  The agency must reconstruct his pay records for the period of the claim and pay the back pay for the difference between the FLSA overtime rate and any title 5 overtime paid, and any interest on the back pay as required under 5 CFR 550.805 and 550.806.  If the claimant believes the agency incorrectly computes the amount, he may file a new FLSA claim with this office.

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