Summary of May 25, 2006, Conference Call

July 21, 2006

Samuel A. Vitaro
ARBITRATOR / MEDIATOR / FACT - FINDER

June 8, 2006
Ilir M. Tsungu
Deputy Chief Human Capital Officer
Bureau of Immigration and Customs Enforcement
Department of Homeland Security
Washington, D. C. 20536

Leyni Rosario
Employee and Labor Relations Specialist
Bureau of Immigration and Customs Enforcement
Department of Homeland Security
Washington, D. C. 20536

Joe Goldberg, Assistant General Counsel - Litigation
AFGE(AFL-CIO)
Washington, D. C. 20001

Angelia Wade, Legal Rights Staff Attorney
AFGE(AFL-CIO)Washington, D. C. 20001

Re: AFGE and NINSC / FLSA Grievance / May 25 Conf. Call summary and other matters / Invoice / Letter to claimants

(Sent to Mr. Goldberg, Ms. Wade, Mr. Tsungu and Ms. Rosario by separate e-mails on June 8, 2006)

Dear Joe, Ilir, Leyni and Angelia:

This is a summary of our May 25, 2006 conference call participated in by Ilir, Joe, Leyni, Angelia, Wayne, Jim B., Judy S., and myself. Thank you to the Agency for arranging that call. For clarification, I have also attached the letter that will be sent to non LEO Suffer or Permit recipients, which is the letter drafted by Ilir, with the “calculation of overtime payments” paragraph deleted because it related to calculation of suffer or permit overtime for law enforcement recipients (and which the Union disputes). Further, I have enclosed my invoice for services between April 5 and June 8, 2006.

May, 2006 Conference Call.

The following matters were discussed:

1) Supplemental Decision – I informed the parties that I would issue a supplemental decision shortly, so as not to delay calculations. (That decision was issued on June 7, 2006).

2) Case # 343 – The Union has recently delivered numerous documents to the Agency and the Arbitrator as required by the January 3 Opinion. It appears that the Agency needs to reply. (See June 7 decision).

3) Status of Payment for Randy Callahan – Payment apparently has still not received. Leyni will get back to Joe on the status. (There was recent communication among the parties and Mr. Callahan this week but apparently payment not yet made to Union or Randy).

4) Attorney Fees – This matter is mostly resolved but date of payment still up in the air but thought to be within 30 days. Ilir will get back to Joe on status. Joe indicated that he won’t wait much longer without going to the Arbitrator. Arbitrator advised him to wait at least 30 days from the date of the Agency’s commitment.

5) Status of Computations for Suffer or Permit Overtime – Leyni provided an update. Laguna and Dallas, which had split up the cases, have completed nearly all, except for 11 or so (and presumably also not completed those for which Laguna posed questions for this Arbitrator, which were addressed in the June 7, 2006 Decision). Thus, it looks like they will meet the arbitrator ordered deadline.

The Formula issue

There is still the issue of whether it is appropriate to use a formula in computing suffer or permit overtime for law enforcement types that would likely result in a lower hourly rate and less compensation than we had anticipated and which had been discussed in our last conference call. The Agency indicated that it had met with and confirmed OPM’s view that this formula is required. I asked, as suggested during our last conference, whether it made sense to get OPM involved in a conference call with us. The Agency indicated that OPM was willing to do that but both the Agency and the Union suggested that OPM would simply tell us what we already knew (i.e., their position that the formula was necessary) and that such a call might not be so helpful. The Agency also indicated that OPM would be willing to provide us with a formal written decision, if requested, on this issue but the parties agreed that this would likely involve some delay. In view of that likely delay, that route does not make sense to this arbitrator but if both parties agree otherwise, I will reconsider. In any event, the parties have briefed this matter. Indeed, Ilir informed us that he would be replying to the Agency’s last submission (which has since been received). The Union objected to that reply opportunity. I will consider the Agency’s submission but if the Union wants to reply to that submission, it may do so within 5 days of this e-mail.

A couple of other observations on this computation dispute. As I have informed the parties, I want to first see how this plays out in the actual computations, which I would expect to receive on or near our next conference call, scheduled for June 14, 2006. I have also not yet received Wayne’s examples, using actual cases, of how the formula would apply. Please let me know when I (and the Union) can expect that. Also, this matter only concerns LEO recipients and I expect payments to be made to the others soon after our next conference call. Ilir, by that time, you should have obtained the needed funding approval from the constituent branches. In that regard, because there was some confusion during this call, I have attached a copy of the letter that will go out to recipients – except for those few who will get paper checks – before the payment is deposited in the claimants’ bank accounts.

The Agency was also going to provide Ms. Scipio with the names of those who will be receiving paper checks, which will be sent out by Ag NFC.

The cap issue

Previous to this call, the Agency had surfaced the possibility that some payments might be subject to a statutory cap (which might include adding in the straight overtime received). I raised this matter during the call, expressing skepticism as to the fairness of using a cap and expressing the view that the Agency would in effect profit from their failure to follow the FLSA. The Union claimed, citing to a footnote in correspondence, that the cap does not apply to FLSA payments. Ilir advised that he is awaiting information on this matter from Agency attorneys. There was a brief discussion of the Agency’s ability to seek a waiver, even if the cap applied, but Ilir stated that he wasn’t willing to do that. Ilir, please advise as to the Agency’s position on this. This may require briefing and, if necessary, I want to make a decision on this as soon as possible and in a way that does not further delay payments.

6) More Specific Letters to Claimants Who Are Contesting the Straight Overtime Calculations – There are several issues that are involved, here. We need to identify those claimants who are disputing their straight overtime, determine whether they raised a specific disagreement and, if so, provide them with a specific response. During our April 21 conference call, we were unclear as to the number of and who was awaiting a specific reply (which we have been putting off, mostly because of the disruption caused by Katrina). Accordingly, I directed the Agency to provide a list of these disputants, along with relevant information concerning them. In May 2006, the Agency provided its spreadsheet (maintained by Alethea and Lynwood) but I was unable to tease out the needed information from that list. Anyway, I need a clearer sense of who these disputants are, what they have claimed and how and when they got a response. It’s my recollection from the call that the Agency was going to pull out that information from the list but I have not received anything. Ilir, when can we expect such a list and information?

During a discussion of this matter, Ms. Scipio indicated that she had recently sent out specific responses to disputants, which (I believe) came as a surprise to all on the call. It was not clear what these letters said. Thus, Ms. Scipio was going to electronically transmit each of these letters – she estimated that there were 73 of them –to Ilir, who, in turn, was going to provide them to the Union and the Arbitrator. Ilir, have you gotten them yet? If so, please get them to us. If not, please check with Ms. Scipio as to the delay.

On a related matter, this week, the Union provided information which appeared to show that Ms. Scipio was telephonically contacting disputants to apparently explain any disagreement as to straight time computation, during which she may have even discussed possible overpayment. (It appears that the person she contacted, Baxter McNeal, was identified during our conference call as a person who may not have gotten a response, so that it’s likely that Ms. Scipio may have been acting to address what she thought was a concern of ours). Any discussion by NFC of an overpayment is inflammatory and I do not want NFC to be raising such matters, without the Agency first consulting with me. Thus, I instructed the Agency to advise NFC not to further communicate with straight time disputants unless the communication is approved by me, which the Agency has done.

7) Deceased Claimants - Ms. Scipio indicated that there were a number of deceased employees (112?), and that checks had been returned for some and that beneficiary information was unknown as to others. Ms. Scipio was going to assemble a list of those for whom addresses or other information was needed and provide that list to Ilir, who would then pass it on to the Union or myself. The Union indicated a willingness to help get addresses. Ilir, have you gotten the list yet?

8) In Person Hearing – The Union has requested a hearing in San Francisco. I agree that a hearing is necessary, at which we will seek to bring many outstanding matters to resolution but the hearing, unless both of you agree, will be in Washington, DC. I am available July 20, 21, and 28. Please talk with each other and let me know which date is mutually agreeable.

9) Next Conference Call – The next call is scheduled for June 14 at 1:00 PM (Eastern). It is the Union’s turn to arrange that call.

Please let me know if the above does not comport with your recollection or notes.

Sincerely,

Sam Vitaro

(Letter to non-LEO Suffer or Permit recipients)

 

Date
Claimant’s name
Address
City, State

Re: FLSA Suffer or Permit Arbitration Award and Payment

Dear Claimant:

You will soon receive payment either by mail (if you no longer work at DHS) or by Electronic Funds Transfer (if you are currently employed at DHS) for certain “suffer or permit” FLSA overtime awarded to you by an Arbitrator’s Decision dated January 6, 2006. Thus, the purpose of this letter is to briefly explain the background which led to that decision, the nature of “suffer or permit” overtime, an explanation of the enclosures to this letter, the amount that you will be receiving, an explanation of liquidated damages, an explanation of certain tax aspects of the award, and to provide you with a point of contact for seeking answers to questions you may have.

Background

On June 2, 1994, the American Federation of Government Employees (AFGE) National Immigration and Naturalization Service Council (NINSC or Union) filed a grievance on behalf of current and former employees within the bargaining unit with the U.S. Immigration and Naturalization Service (INS or Agency). Upon examination of all allegations and issues within the grievance, the Agency determined FLSA provisions covered certain positions held by the grievants. On May 23, 1998, the FLSA status of the positions held by the above-mentioned grievants were changed to FLSA non-exempt.

Overtime and “Suffer or Permitted” Overtime

FLSA overtime may be earned in two different ways, straight overtime and “suffer or permit” overtime. Straight overtime is overtime a federal employee reports to the Agency within his or her Time and Attendance reports. On the other hand, “suffer or permit” overtime is unrecorded and consists of work performed for the benefit of the Agency, and about which the Agency knows or has reason to believe that the work is being performed. See Arbitrator’s Decision dated January 6, 2006, page 43. To the extent that you were eligible, you should have already received a straight FLSA overtime payment in the summer of 2005.

“Suffer or permit” claims were gathered by the Union in the fall of 2001 and submitted to the Agency in early 2002. Only those persons who made a specific “suffer or permit” claim were eligible to receive suffer or permit compensation from the Agency in this case. These suffer or permit claims were presented to the Arbitrator in a series of hearings between December 2003 and May 2004.

Eligibility for Payment

As stated above, this letter concerns the Arbitrator’s decision and corresponding calculations relating to the FLSA suffer or permit overtime claims. The Arbitrator presiding over this case issued that comprehensive decision on the suffer or permit overtime claims on January 6, 2006. A copy of this decision may be accessed at the following website provided by the Union: http://www.afge.org/index.cfm?fuse=document&documentID=1052

In his decision, the Arbitrator, consistent with prevailing law, determined that a claimant should have met the following requirements at any time between June 2, 1991, and May 23, 1998, in order to be eligible for “suffer or permit” overtime.

1. The claimant must have been in a position that was classified as FLSA exempt between June 2, 1991 and May 23, 1998 and subsequently determined to be FLSA non-exempt.

2. The position described in paragraph 1 above must have been covered by the NINSC bargaining unit (e.g., not a Border Patrol bargaining unit).

3. In that position, the employee must have worked in the United States or its territories between June 2, 1991 and May 23, 1998. (The FLSA does not cover work outside of the United States.)

4. The claimant must have filled out an on-line “suffer or permit” claim form on the AFGE website which was active in the late fall/winter 2003-04.

5. The claimant’s case must have been presented by the Union to the Arbitrator during the INS FLSA suffer or permit hearings that took place between December 2003 and May 2004.

Because you met all five of the above requirements for at least part of the period claimed by you, and because your specific claim for “suffer or permit” hours were determined by the Arbitrator in his January 6, 2006 decision that you were entitled to “suffer or permit” compensation, at least, in part, payment for back pay plus liquidated damages is being made to you.

Calculation and Payment Amounts

Your payment is consistent with the findings made by the Arbitrator as to your particular claim. Stated another way, you should receive only the amount determined by the arbitrator, no more and no less. This means that you may not receive compensation for your entire claim if the Arbitrator found that you were not entitled to the whole of your claim.

Enclosed with this letter are documents to assist you in understanding the way in which that amount of FLSA “suffer or permit” overtime payment was calculated. These documents include an Earnings Statement and an FLSA “suffer or permit” calculation worksheet. The worksheet shows the total amount of suffer or permit back pay earned, the time periods involved, liquidated damages (an amount equal to the back pay earned) and the total amount paid to you.

Liquidated Damages

The FLSA does not provide for the payment of both liquidated damages and interest. Therefore, the Arbitrator determined that only liquidated damages are appropriate in this case. Liquidated damages are equal to the back pay amount; hence, you will be paid double the amount of backpay you are owed as a result of this decision. Additionally, please note liquidated damages, as explained below, are considered interest income for tax purposes.

Tax Information

Appropriate Federal and State taxes have been withheld on the back pay earnings portion of your payment. Additionally, employees who are or were under the Federal Employee Retirement System (FERS) are subject to the appropriate Old Age, Survivors and Disability Insurance withholdings on their back pay. Also withheld on the back pay earnings is the Medicare premium and payment into the Civil Service Retirement System or FERS.

The liquidated damages that have been paid along with the FLSA “suffer or permit” back pay payments are considered taxable interest income to the payees. No taxes have been withheld on the liquidated damages portion of your payment. For the calendar year ending in 2006, you will be provided with a Form 1099 INT (Internal Revenue Service Interest form) or W-2 (income earnings statement) as appropriate, to remind you to report your suffer or permit overtime and liquidated damages with your 2006 Federal, State, and local income tax returns.

For further tax information, please consult your tax advisor.

Inquiries

In any process as large and complex as this one, it is almost inevitable for some class members to have questions about the amount of the retroactive FLSA suffer or permit overtime payment received. For that reason, we have provided you with the payroll history of your calculations. This information should be sufficient to address any of your concerns.

However, if you still have questions about the amount of suffer or permit overtime received (i.e., that it is somehow less than the arbitrator awarded you), please include a brief description of your concern along with any supporting documentation within 30 days of receipt of your payment. Make sure you include your name, social security number, address, and telephone number, addressing your materials to:

INS FLSA Grievance
Office of Human Resources
U.S. Customs and Border Protection
1300 Pennsylvania Avenue NW
Mail Stop 2.3-C
Washington, D.C. 20229

The Agency, in coordination with the Union, will review your inquiries and respond with an explanation that addresses your concerns. You may use Agency mail to forward inquiries or documents to the CBP address listed above. A copy (not the original which must be sent to the Agency at the address listed above) of the materials should be sent to the Union by both e-mail and surface mail to the addresses listed below:

AFGE-GCO
INS-FLSA-S&P
80 F Street NW
Washington, DC 20001
Awade@afge.org

Resolving this grievance has been difficult and, at times, contentious. It required the services of an Arbitrator, as well as many hundreds of hours of work time by Union and Agency staff. The Union and Agency have sought to assure that claimants are being provided with proper compensation under the FLSA for the time worked. Thank you for your patience.

Sincerely,

(Att: Worksheets)

 

INS FLSA

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