Feds Working During Shutdowns Not Entitled to Bonus Pay, Appeals Court Rules
The decision overturns findings from a lower court.
Federal employees are not entitled to extra financial compensation when they have to work without pay during a government shutdown, a federal appeals court ruled in multiple cases this week.
The U.S. Court of Appeals for the Federal Circuit reversed two decisions from a lower court that had found the “excepted” employees who had worked during shutdowns in 2013 and 2018-2019 were due bonus pay under the Fair Labor Standards Act. In a 2-1 decision, the majority on the panel of judges said the government had fulfilled its obligations by paying the employees as soon as possible after the shutdown ended.
The government's hands were tied by the Antideficiency Act—the law that prevents agencies from distributing funds during a shutdown—the majority ruled. The judges called the ADA and FLSA “seemingly contradictory” and said the two laws had put the government in an impossible situation. Ultimately, they said, the ADA is more specific in its banning of payments during a shutdown while the FLSA allows for some flexibility.
The plaintiffs, made up in the distinct cases by members of the National Treasury Employees Union, the American Federation of Government Employees and others, argued the government was in violation of the FLSA when it missed three separate paychecks for employees working during the record-setting shutdown that began in 2018. The law suggests monetary damages are due when payments are delayed, but the court ruled it provides some wiggle room by requiring compensation “must be timely under the circumstances.”
The majority pointed to a previous Supreme Court case in which it “clarified that the FLSA ‘does not require the impossible’ but requires payment only ‘as soon as convenient or practicable under the circumstances.’”
“If we were to adopt plaintiffs-appellees’ proposed interpretation, we would be forcing the government to choose between a violation of the Anti-Deficiency Act or the FLSA,” the majority said. “This is an absurd result that we should avoid, if possible.”
Due to the timing of paycheck distribution during the 2013 shutdown, plaintiffs in that case were only due $290 plus any overtime they were owed. In the more recent case, employees would have been owed a full four weeks of the federal minimum wage—or $1,160—in addition to any overtime they worked. Federal employees would have to affirmatively opt into the new case to receive any potential award.
Circuit Judge Jimmie Reyna dissented on the decision, arguing the two statutes at play were not inconsistent with each other. Instead, he said, the ADA is meant to punish government workers for making unauthorized expenditures, whereas the FLSA is meant to protect workers. He criticized the majority, suggesting there was no “legal support” for believing federal employees forfeit their FLSA protections during a shutdown.
“Payday is important to the everyday worker,” Reyna said. “Missing a paycheck can have devastating consequences. That is what this case is about. Congress sought a remedy for such consequences by extending the potential for liquidated damages. Here, the employer should not be absolved of adherence to the FLSA, more so where the employer is the government that brought on the shutdown.”
More than 18,000 employees have joined NTEU’s case, while 32,000 had joined AFGE’s as of last year. The cases involve only employees forced to work during the shutdown, which in 2018 was about 500,000 individuals.
The case is precedent-setting, meaning federal employees would not receive any extra compensation for past or future shutdowns. The plaintiffs can still ask for a new hearing before the entire Federal Circuit and appeal to the Supreme Court.