Monday, August 19, 2013

Divided Sixth Circuit Counts Paid Volunteer Firefighters as Employees for Purpose of FMLA Coverage

Last week, the Sixth Circuit reversed summary judgment for a city employer on an FMLA claim on the grounds that the employer had the requisite 50 employees if paid volunteer firefighters were counted as employees of the employer. Mendel v. City of Gilbralter, No. 12-1231 (6th Cir. 8-15-13). In that case, the plaintiff claimed that his termination violated the FMLA. The employer defended on the grounds that it was not subject to the FMLA, having only 41 employees instead of the requisite 50. However, the plaintiff pointed out that the defendant city would have more than 50 employees if volunteer firefighters were considered. The firefighters were responsible for their own training, were never required to respond to any fire or other emergency, were not provided with any employee benefits and were treated as independent contractors. Nonetheless, they were paid $15/hour when they did respond, which was comparable to the wage paid regular firefighters in surrounding communities and their own fire chief. The Court's majority found that the firefighters fit within the FLSA's definition of employees and not within the definition of "volunteer" because they were paid a substantial amount. Accordingly, the defendant city was subject to the FMLA. The dissenting judge concluded that the choice was not limited to employee or volunteer and that the firefighters could qualify as independent contractors, which would place the defendant city below the FMLA's 50-employee threshold.

According to the Court's opinion, the FMLA borrows its definition of "employee" from the Fair Labor Standards Act. The FLSA defines "employee" as "to suffer or permit to work." 29 U.S.C. § 203(g). This broad definition encompasses individuals who might not qualify as an employee under common law principles. Nonetheless, courts typically apply the "economic realities test" in determining whether an individual is an employee under the FLSA. In this case, the Court's majority concluded that the firefighters were employees because they were suffered or permitted to work and were paid a substantial wage for their efforts.

The majority also considered the FLSA amendment for volunteers, which provides at 29 U.S.C. §203(e) in relevant part that:
The term "employee" does not include any individual who volunteers to perform services for a public agency which is a State, a political subdivision of a State, or an interstate governmental agency, if—
(i) the individual receives no compensation or is paid expenses, reasonable benefits, or a nominal fee to perform the services for which the individual volunteered; and
(ii) such services are not the same type of services which the individual is employed to perform for such public agency.
The Court's majority concluded that the $15/hour paid to volunteer firefightes was more than a nominal fee because it was comparable to the wages paid to regularly employed firefighters. "Essentially, the Gibraltar firefighters are paid a regular wage for whatever time they choose to spend responding to calls. These substantial hourly wages simply do not qualify as nominal fees." 
 

Notably, the Supreme Court has held that those who "work in contemplation of compensation" are "employees" within the meaning of the FLSA, even though they may view themselves as "volunteers." Tony & Susan Alamo Found., 471 U.S. at 300–02, 306. Despite the fact that the Gibraltar firefighters are referred to as "volunteers," the inescapable fact nevertheless remains that they "work in contemplation of compensation." Thus, the Gibraltar firefighters are "employees" and not "volunteers" within the meaning of the FLSA.
The dissenting judge found the majority's analysis to be too narrow:
Volunteer status precludes employee status under the Leave Act; but that someone is not a volunteer does not necessarily mean they are an employee. Some types of workers fall into neither category, such as independent contractors, prisoners, and residential assistants in college dorms.
The dissent also found the $15/hour to be nominal in light of all of the unpaid training the firefighters must complete each year to maintain their certification. When those unpaid hours are considered, the average wage drops to less than $9/hour. 
 
Moreover, the city did not control their work, as required to fit within the FLSA definition:
The first firefighter to respond to a fire typically controls the scene; the City does not send anyone to supervise them. And the City does not require a firefighter to respond to any fires in the first place. Indeed a firefighter could go for years without responding to a single fire—and the City would not discipline him. . . . Persons that need a Family and Medical Leave Act are presumably persons who need leave not to show up for work. That description does not apply to the City of Gibraltar's firefighters.
NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.