Public Employer May Deny Use of Compensatory Time on Requested Date Even Without Showing Undue Disruption

Nutley Policemen’s Benevolent Ass’n v. Township of Nutley, 419 N.J. Super. 160 (App. Div. 2011).  The federal Fair Labor Standards Act (“FLSA”) , 29 U.S.C. §§201-219, requires a public employer who gives an employee compensatory time off instead of overtime pay to allow the employee “to use such time within a reasonable period after making [a] request if the use of the compensatory time does not unduly disrupt the operations of the public agency.”  The question in this case was “whether an employer who denies permission to use compensatory time on the date requested but permits use within the ‘reasonable period’ defined in its agreement with its employees must also show that a grant would ‘unduly disrupt’ operations.”  In an opinion by Judge Grall, the Appellate Division held that the employer need not make such a showing.  As a result, the court affirmed a grant of summary judgment in favor of the defendant Township.

Judge Grall rightly noted that this was pure question of law, so that the standard of review was de novo.  She also observed that since the FLSA is a federal statute, “decisions of other courts and and interpretations of the federal agency charged with the enforcement and administration of the law are also considered and given due deference.”

Regulations on this subject adopted by the Secretary of Labor were “sufficiently open-ended to leave room for interpretation.”  However, the panel found persuasive two federal Circuit Court decisions.  Those cases held that “the ‘reasonable period’ clause refers to the time within which the employer must ordinarily grant a request to use compensatory time and the ‘unduly disrupt’ clause refers to conditions that relieve the employer of that obligation…. [Thus,] an employee does not have a right to determine when he uses compenatory time off; the only statutory restriction on an employer is that it must grant the use of leave within a reasonable period of an employee’s request.”

The Appellate Division found unpersuasive other federal decisions, on which plaintiff relied, because they did not properly treat the distinct “reasonable period” and ‘unduly disrupt” clauses.  One of those cases cited an informal decision of the Secretary of Labor that appeared to support plaintiff.  But Judge Grall declined to follow that case, noting that the informal decision did not contain any of the relevant facts, was conclusory, and failed to give any effect to the “reasonable period” clause.  Thus, that decision, and the case that relied on it, were not entitled to deference such that the Appellate Division would endorse the conclusion reached there.  The decisions that the panel did find persuasive applied both the “reasonable period” and the “unduly disrupt” clauses, thereby vindicating the principle that every word of a statute is to be given effect in interpreting that statute.