Force Account Labor and Equipment Costs
Appeal Brief
| Disaster | 4488 |
| Applicant | Henry J Austin Medical Center |
| Appeal Type | Second |
| PA ID# | 021-UFPMT-00 |
| PW ID# | GMP 700357/ PW 2309 |
| Date Signed | 2024-09-13T16:00:00 |
Summary Paragraph
The coronavirus (COVID-19) pandemic resulted in a major disaster declaration for the state of New Jersey with an incident period from January 20, 2020, to May 11, 2023. The Henry J. Austin Health Center (Applicant), a Private Nonprofit organization, requested $18,854.22 in Public Assistance funding for force account labor (FAL) premium pay it provided to staff who administered COVID-19 vaccinations. The Applicant paid premium pay equal to 50 percent of the employee’s regular hourly rate for any overtime hours worked. This pay was in addition to the employee’s hourly overtime rate that the Applicant also paid. In a Determination Memorandum, FEMA found that the Premium Pay Policy was not implemented prior to the disaster. The Applicant appealed the determination. The Applicant stated its Personnel Policy, approved prior to the disaster, allowed the CEO to authorize compensatory time. The Region 2 Regional Administrator found the premium pay was ineligible because the predisaster Personnel Policy did not include premium pay, the Premium Pay Policy was implemented after the disaster and the premium pay was based on discretionary criteria. The Applicant appealed FEMA’s determination for the denied premium pay in the amount of $18,854.22 and provided two additional policies.
Authorities
- Stafford Act § 403(a)(3).
- 44 C.F.R. § 206.225(a)(1).
- PAPPG, at 23.
- Child and Family Services of Erie County, at 3, FEMA-4480-DR-NY, at 3. City of Beaufort, FEMA-4286-DC-SC at 4. Brevard County, FEMA-4337-DR-NY, at 3. Horry Elec. Co-op Inc., FEMA-4464-DR-SC, at 2. Florida Christian Homes Senior Housing, Inc., FEMA-4486-DR-FL, at 4
Headnotes
- FEMA is authorized to provide assistance for emergency protective measures to save lives and protect public health and safety. FEMA determines the eligibility of overtime, premium pay, and compensatory time costs based on the applicant’s predisaster written labor policy, provided the policy: (1) does not include a contingency clause that payment is subject to Federal funding, (2) is applied uniformly regardless of a Presidential declaration, and (3) has set non-discretionary criteria for when the applicant activates various pay types.
- The Applicant has not provided a predisaster written policy that authorized the premium pay it disbursed to employees or that set non-discretionary criteria for when various pay types were activated.
Conclusion
The Applicant did not demonstrate that the claimed FAL premium pay costs were provided under a predisaster labor policy that meets FEMA policy requirements. Therefore, this appeal is denied.
Appeal Letter
SENT VIA EMAIL
Lieutenant Colonel Christopher M. DeMaise
Governor’s Authorized Representative
Division of State Police
Recovery Bureau
1034 River Road
West Trenton, NJ 08628
Charles L. Davis II
Chief Executive Officer
Henry J Austin Health Center
31 North Warren Street
Trenton, New Jersey 08618
Re: Second Appeal – Henry J Austin Medical Center, PA ID: 021-UFPMT-00, FEMA-4488-DR-NJ, Grants Manager Project (GMP) 700357/ Project Worksheet (PW) 2309, Force Account Labor and Equipment Costs
Dear Christopher M. DeMaise and Charles L. Davis II:
This is in response to the New Jersey Office of Emergency Management’s (Recipient) letter dated June 5, 2024, which transmitted the referenced second appeal on behalf of the Henry J Austin Medical Center (Applicant). The Applicant is appealing the U.S. Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of funding in the amount of $18,854.22 for premium pay.
As explained in the enclosed analysis, I have determined the Applicant did not demonstrate that the claimed FAL premium pay costs were provided under a predisaster labor policy that meets FEMA policy requirements. Therefore, this appeal is denied. Therefore, this appeal is denied.
This determination is the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.
Sincerely,
/S/
Robert Pesapane
Division Director
Public Assistance Division
Enclosure
cc: David S. Warrington
Regional Administrator
FEMA Region 2
Appeal Analysis
Background
The coronavirus (COVID-19) pandemic resulted in a major disaster declaration for the state of New Jersey on March 25, 2020, with an incident period from January 20, 2020, to May 11, 2023.
The Henry J. Austin Health Center (Applicant), a Private Nonprofit organization, requested $18,854.22 in Public Assistance funding for force account labor (FAL) premium pay it provided to staff who administered COVID-19 vaccinations.[1] The Applicant paid premium pay equal to 50 percent of the employee’s regular hourly rate for any overtime hours worked. This pay was in addition to the employee’s hourly overtime rate that the Applicant also paid. The Applicant provided two pay policies in support of its premium pay request.
The Applicant’s policy VII-712 Personnel: Hours of Employment/Overtime and Compensatory Time, (Personnel Policy) first issued in 1997, provided the Chief Executive Officer (CEO) with the responsibility to “review and evaluate the policies and procedures related to work hours.”[2] The Personnel Policy stated non-exempt employees who worked in excess of 40 hours a week were eligible for overtime and also stated employees were not automatically eligible for compensatory time unless required by a union agreement or authorized by the CEO. Additionally, the Personnel Policy stated that “[n]o employee shall be automatically eligible for compensatory time, unless determined by bargaining unit agreement or by circumstances authorized by the Chief Executive Officer.”[3]
The Applicant’s policy titled VII-734 Appreciation Pay and Premium Pay (Premium Pay Policy) implemented on June 22, 2021, stated “invocation of this policy [wa]s vested with the Board of Directors” and authorized the CEO to determine the eligibility of premium pay using criteria in the policy.[4] The Premium Pay Policy outlined that employees who performed eligible work beyond their normal hours in positions with an increased exposure would be paid premium pay. The Premium Pay Policy stated the Senior Administration would determine a flat hourly rate equal to an additional percentage increase of the employee’s base hourly rate that it would provide as premium pay.[5]
In a Determination Memorandum issued on November 2, 2023, FEMA denied the requested FAL premium pay costs, stating the Applicant did not demonstrate the premium pay was based on a predisaster written labor policy. FEMA found that the Premium Pay Policy was not implemented prior to the disaster.
First Appeal
In a letter dated December 28, 2023, the Applicant appealed the determination. The Applicant stated its Personnel Policy, implemented prior to the disaster, allowed the CEO to authorize compensatory time. In a letter dated January 3, 2024, the New Jersey Office of Emergency Management (Recipient) forwarded the appeal to FEMA with its support.
The FEMA Region 2 Regional Administrator denied the requested FAL premium pay costs in a letter dated April 3, 2024. FEMA found the FAL premium pay was ineligible because the predisaster Personnel Policy did not include premium pay, the Premium Pay Policy was implemented after the disaster, and the premium pay was based on discretionary criteria.
Second Appeal
In a letter dated May 31, 2024, the Applicant appealed FEMA’s denial of the requested premium pay, in the amount of $18,854.22, reiterating its previously raised arguments. The Applicant provides two additional policies and argues that the premium pay is eligible because the policies were implemented prior to the COVID-19 pandemic and later updated in the Premium Pay Policy. The Pandemic Plan, approved in May 2014 and updated in March 2020, outlines the Applicant’s overall planning in the event of a pandemic.[6] The Human Resources During Pandemics SOP, effective on April 1, 2011, reviewed and revised on March 15, 2020, outlines the Applicant’s plan to address potential staffing shortages.[7] In a letter dated June 5, 2024, the Recipient forwarded the second appeal to FEMA with its support.
Discussion
FEMA is authorized to provide assistance for emergency protective measures to save lives and protect public health and safety.[8] FEMA determines the eligibility of overtime, premium pay, and compensatory time costs based on the applicant’s predisaster written labor policy, provided the policy: (1) does not include a contingency clause that payment is subject to Federal funding; (2) is applied uniformly regardless of a Presidential declaration; and (3) has set non-discretionary criteria for when the applicant activates various pay types.[9]
Here, the Applicant is requesting reimbursement for premium pay that is equal to 50 percent of each employee’s base hourly pay rate, which it paid in addition to each employee’s overtime hourly pay rate. However, the Applicant has not provided a predisaster written labor policy that authorized the payment of the premium pay that the Applicant disbursed to employees. The predisaster Human Resources During Pandemics SOP and Pandemic Plan provided with the Applicant’s second appeal, while first approved prior to the COVID-19 pandemic declaration, do not discuss premium pay, authorize any specific amount of premium pay, or authorize the premium pay amount the Applicant paid. Although the predisaster Personnel Policy addresses compensatory time, it does not discuss premium pay. This is significant to the issue on appeal because compensatory time is different from premium pay.[10]In contrast to the Personnel Policy, premium pay was discussed in the Premium Pay Policy. However, the Applicant implemented the Premium Pay Policy in June 2021, after the start of the declared incident period.[11]
Furthermore, the Applicant has provided policies that are based on discretionary rather than non-discretionary criteria. Prior second appeal decisions have found criteria were non-discretionary when automatically triggered based on certain specific circumstances occurring,[12] In this case, however, the predisaster Personnel Policy stated that no employee would be automatically eligible for compensatory time, unless determined by a bargaining unit agreement or by circumstances authorized by the CEO. The Applicant has neither produced an applicable bargaining unit agreement that sets forth non-discretionary criteria, nor shown how providing discretion to the Applicant’s CEO on when to activate a specific pay type constitutes non-discretionary criteria.[13] Similarly, the post-disaster Premium Pay Policy provides the Applicant’s Senior Administration with discretion to determine the additional percentage of premium pay it would pay in addition to the employee’s normal overtime rate.[14]Therefore, based on the above, the Applicant has not provided a predisaster written policy that authorized the premium pay it disbursed to employees or that set non-discretionary criteria for when various pay types were activated. Consequently, the requested FAL premium pay is not eligible for PA funding.
Conclusion
The Applicant did not demonstrate that the claimed FAL premium pay costs were provided under a predisaster labor policy that meets FEMA policy requirements. Therefore, this appeal is denied.
[1] Except for the requested premium pay at issue on second appeal, FEMA has awarded all requested costs for this project, totaling $102,252.87 in force account labor overtime.
[2] Henry J. Austin Health Center Policy, Topic: VII-712 Personnel: Hours of Employment/Overtime and Compensatory Time, at 1 (last updated September 12, 2018) [hereinafter Personnel Policy].
[3] Id.
[4] Henry J. Austin Health Center Policy, Topic: VII-34 Appreciation Pay and Premium Pay, at 2 (June 22, 2021) [hereinafter Premium Pay Policy].
[5] Id at 2. Specifically, the policy states the rate will be: “an hourly rate of an additional percentage increase of the employee’s base rate for extended hours worked as determined by Senior Administration.” and “will be a flat rate for employees with increased exposure as determined by Senior Administration.”
[6] Henry J Austin Health Center, Pandemic Plan, (issued October 2019, last updated March 24, 2020).
[7] Henry J Austin Health Center, Human Resources During Pandemics SOP (April 1, 2021, last updated March 15, 2020).
[8] Robert T. Stafford Disaster Relief and Emergency Assistance Act § 403(a)(3), Title 42, United States Code (U.S.C.) § 5170b(a)(3) (2018); Title 44 of the Code of Federal Regulations (44 C.F.R.) § 206.225(a)(1) (2019).
[9] Public Assistance Program and Policy Guide, FP 104-009-2, at 23 (Apr. 1, 2018).
[10] The Fair Labor Standards Act defines “compensatory time” as hours during which an employee is not working, which are not counted as hours worked during the applicable workweek or other work period for purposes of overtime compensation, and for which the employee is compensated at the employee's regular rate. See 29 U.S.C. § 207(o)(7)(B) (2019). In contrast, the Applicant’s own Premium Pay Policy defines “premium pay” as an “hourly rate of an additional percentage increase of the employee’s base rate for extended hours worked.” See Premium Pay Policy at 3. Additionally, FEMA policy lists compensatory time as a separate term from premium pay. See PAPPG at 23 (“FEMA determines the eligibility of overtime, premium pay, and compensatory time costs based
on the [a]pplicant’s predisaster written labor policy.”)
[11] See FEMA Second Appeal Analysis, Florida Christian Homes Senior Housing, Inc., FEMA-4486-DR-FL, at 4 (Jan. 2, 2024) (finding the Applicant’s hazard pay policy that was not in effect prior to the start of the incident period was not predisaster).
[12] See FEMA Second Appeal Analysis, City of Beaufort, FEMA-4286-DR-SC, at 4 (July 18, 2019) (finding that the predisaster pay policy’s criteria for activating various pay types was non-discretionary because it was “triggered by the Mayor/Governor declaring a state of emergency and the City suspending normal operations and instead operating under emergency conditions”); FEMA Second Appeal Analysis, Brevard (County), FEMA-4337-DR-FL, at 3 (Dec., 8, 2021) (finding that the predisaster written pay policy was non-discretionary as is was “triggered by the mayor declaring a state of emergency and the Applicant suspending normal operations and instead operating under Declared Emergency Conditions”).
[13] See FEMA Second Appeal Analysis, Horry Elec. Co-op Inc., FEMA-4464-DR-SC, at 2 (March 22, 2022) (finding that the predisaster written labor policies were discretionary in part because they gave the Applicant the authority to vary from supplemental compensation procedures when needed).
[14] See FEMA Second Appeal Analysis, Child and Family Services of Erie County, FEMA-4480-DR-NY, at 3 (Apr. 5, 2023) (finding that the Applicant did not demonstrate that its predisaster written labor policy sets non-discretionary criteria because it “state[d] that the rate of additional pay and applicable time period for premium/hazard pay [wa]s at the discretion of the agency”).