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Highway 31 Fire

Appeal Brief Appeal Letter

Appeal Brief

Disaster2816-DR-SC
ApplicantSouth Carolina Forestry Commission
Appeal TypeSecond
PA ID#000-UV1CH-00
PW ID#1
Date Signed2013-03-28T00:00:00

Citation:  FEMA-2816-DR-SC, South Carolina Forestry Commission,
Highway 31 Fire

Cross-
Reference:
  Overtime

Summary:  During the period April 22 to May 20, 2009, the South Carolina Forestry Commission (Applicant) fought a wildfire that started as a small woods fire that became the worst wildfire in South Carolina history.

FEMA prepared PW-1 for $600,444 but reduced the total by $114,512 in force account labor when an eligibility review revealed that the Applicant included costs for overtime hours for exempt employees. Section VII(F)(5) of Recovery Policy RP9525.7, Labor Costs-Emergency Work identifies overtime cost for exempt employees as generally ineligible. The Applicant filed a first appeal on June 20, 2011, arguing that exempt employees who are on a mandatory furlough temporarily lose their exempt status and may be paid for overtime hours worked. On July 13, 2012, FEMA Region IV denied the first appeal.

In a second appeal, the applicant pointed out that at the time of the event, the Commission had implemented a mandatory furlough as a cost-saving measure, which, under the Fair Labor Standards Act, disqualifies exempt employees from being paid a straight salary.

Issues:  1. Do exempt employees of a public agency lose their exempt status during a budget-required furlough?
               2.  Do those formerly-exempt employees qualify for payment of overtime hours worked during the furlough period?

Findings: 1. Yes
                  2. Yes

Rationale: 29 CFR §541.710(b),  Fair Labor Standards Act, as amended [29 U.S.C.A]

 

Appeal Letter

March 28, 2013

Major General Robert E. Livingston, Jr.
Adjutant General
South Carolina Emergency Management Division
2779 Fish Hatchery Road
West Columbia, South Carolina 29172

Re: Second Appeal–South Carolina Forestry Commission, PA ID 000-UV1CH-00, Highway 31 Wildfire, FEMA-2816-FM-SC, Project Worksheet (PW) 1

Dear General Livingston:

This is in response to a September 20, 2012, letter from your office, which transmitted the referenced second appeal on behalf of the South Carolina Forestry Commission (Applicant).  The Applicant is appealing the U.S. Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $114,512 of funds for overtime hours paid to exempt personnel who engaged in fighting the Highway 31 Wildfire.

Background

On April 22, 2009, the Applicant’s dispatch center received a 911 call regarding a two-acre fire in Horry County.  In a matter of hours what started as a small woods fire grew into a large, severe wildfire.  At 10:30PM April 22, the Forestry Commission’s Incident Management Team (IMT) arrived on-scene and took over management of the incident.  One hundred and thirty Commission employees supported the Incident Commander and the Command and General Staff.  FEMA prepared PW 1 for $600,444 for the cost of fighting the fire, but reduced the total by $114,512 in force account overtime labor when an eligibility review revealed that the Applicant included costs for overtime hours for exempt employees.

First Appeal

At the time of the fire, the Forestry Commission had imposed a budget-required mandatory furlough as a cost-saving measure.  In a letter dated June 20, 2011, the Applicant appealed FEMA’s reduction of $114,512 in overtime labor claiming that, according to the Fair Labor Standards Act (FLSA), salaried employees lose their exempt status during the period of a mandated furlough, and are eligible during that period to be paid overtime.  On July 13, 2012, FEMA denied the Applicant’s first appeal on the grounds that the Applicant’s written policies did not allow for compensating exempt employees for overtime or compensatory time. 

Second Appeal

The Applicant submitted a second appeal on September 13, 2012, and requested that FEMA reconsider its denial based Section 213 of the FLSA and its implementing regulation at Title 29 Code of Federal Regulations § 541.710(b), Employees of public agencies, which provide that a salaried employee becomes disqualified from being exempt in the workweek that a furlough occurs.  The South Carolina Emergency Management Division supported the Applicant’s appeal and forwarded it to FEMA with a letter dated September 20, 2012.

Discussion

FEMA Recovery Policy RP9525.7 Labor Costs-Emergency Work, does not allow exempt workers from earning overtime doing emergency work.  However, U.S Department of Labor guidelines allow an exemption when public employers require employees to take furloughs as a cost-saving measure.  According to information provided by the U.S. Department of Labor, 29 CFR § 541.710(b) and the FLSA disqualifies an employee from being exempt in the workweek that a furlough occurs.  During the furlough period salaried employees lose their “exempt status” and are paid straight time and overtime for all hours worked.  Therefore, the Applicant’s normally exempt employees were subject to the FLSA and the cost of overtime labor during the period of the furlough is eligible for FEMA reimbursement.

Conclusion

I have reviewed the information submitted with the appeal and have determined that the Applicant’s appeal should be granted in full.  By this letter, I am requesting that the Regional Administrator take the appropriate action to implement my decision. 

Please inform the Applicant of my decision. This determination is the final decision on this matter pursuant to 44 CFR §206.206 Appeals.

Sincerely,

/s/

Deborah Ingram
Assistant Administrator
Recovery Directorate


cc:   Major P. May
       Regional Administrator
       FEMA Region IV