Mastagni Holstedt Welcomes Senior Criminal Defense Attorney David Demurjian to our Southern California Office

David Demurjian joins Mastagni Holstedt, APC as a member of the Labor and Employment Department. He is based in the Rancho Cucamonga office, representing public sector employees in administrative and disciplinary investigations, hearings, critical incident investigations, and criminal defense.

Over the past 30 years, David Demurjian has been a prosecutor in New York, Massachusetts and California, where he has handled a wide array of felony cases (crimes against police officers). For most of his career, he has been a use of force expert for various law enforcement and military agencies (state and federal) throughout the country. His area of expertise is in use of force by law enforcement and military personnel. He has taught on defensive tactics and use of force throughout the world.

Mr. Demurjian is a graduate of New York University (1984) with a double major in economics and in classics. He received his Juris Doctor at Fordham University School of Law (1987). He is admitted to practice in California, New York and Massachusetts State Bars and also the 1st, 2nd, and 9th Federal Circuits.

Mr. Demurjian is also a certified force instructor for a large law enforcement agency and serves as a sworn officer with that agency. His assignments have been patrol, gang enforcement and academy staff for the last fifteen years. These assignments have provided him with a unique insight into the split second decisions made in the life and death encounters of law enforcement. Mr. Demurjian is also a captain assigned to the Judge Advocate General's Office.

For the past 40 years, he has trained in judo, Aiki-jujutsu and Kyokushinkai karate. He holds a black belt rank in all of these disciplines.

Please join the firm in welcoming David Demurjian, Esq. as our Senior Criminal Defense Attorney.

Ninth Circuit Holds that Certain Per Diem Payments Must Be Included in Employees’ “Regular Rate”

In a recent decision, the Ninth Circuit Court of Appeals held that a weekly per diem paid to clinicians employed by a healthcare staffing agency needed to be included in the regular rate used to calculate clinicians’ overtime pay. (Clarke v. AMN Services, LLC (9th Cir., Feb. 8, 2021, No. 19-55784) 2021 WL 419473.) The court held that because the per diem functioned as compensation for work performed rather than as reimbursement for work-related expenses, it was improperly excluded from the calculation of clinicians’ “regular rate of pay” for overtime purposes under the Fair Labor Standards Act (FLSA).

The case involved AMN Services, a healthcare staffing company that places hourly workers on short-term assignments throughout the country. AMN paid traveling clinicians a per diem intended to reimburse them for costs such as meals, incidentals, and housing while working away from home. The clinicians were not required to provide proof of these costs, but rather received the per diem whenever their work assignment was further than 50 miles from their residence. Clinicians were required to work three 12-hour shifts per week. If a clinician worked less, their per diem was reduced. However, they could “bank” excess hours from previous weeks, which would then off-set any missed shifts. Local clinicians also received per diem payments, but for those employees, the per diems were included as part of their wages for overtime purposes. The district court granted summary judgment for AMN, and the Ninth Circuit reversed.   

In coming to this conclusion, the Ninth Circuit stated that the relevant test, the “function” test, requires a case-specific inquiry based on the particular formula used to determine the amount of the per diem benefits. Other relevant, but not dispositive, factors include whether (i) the payments increase or decrease based on the time worked, (ii) payments occur irrespective of incurring any actual costs, (iii) the employer requires any attestation that costs were incurred, and (iv) payments are tethered to days or periods spent away from home or instead occur without regard to whether the employee is away from home.

In applying these factors in the present case, the Ninth Circuit noted that the employer made pro rata deductions in the per diem payments that were unconnected to whether the employee remained away from home incurring expenses for its benefit (such as for clinicians who were too ill to work), which indicated that the deductions were connected to the amount paid for hours worked while away from home. Further, the Ninth Circuit found it relevant that the clinicians were permitted to offset missed or incomplete shifts with hours they “banked” on days or weeks in which they worked more than the minimum required hours. The court noted that there was no plausible connection between working extra hours one week and incurring greater expenses the next. Finally, the Ninth Circuit held that the strongest indicator that the payments were in fact compensation for hours worked was that the company paid local clinicians and traveling clinicians the same per diem payments and considered the local clinician’s per diem payments as wages. In sum, the court found that the per diem was not tied to the actual expenses each employee incurred and therefore could be construed as “supplemental compensation” which should be included in the employee’s “regular rate of pay.”

The ruling marks a significant win for hourly workers and confirms that courts must consider the function and purpose of the excluded payments rather than defer to the employer’s label or categorization.  Although the Ninth Circuit has not yet addressed holiday-in-lieu exclusions, several district courts have applied similar reasoning, most recently in a case our office filed for Richmond fire fighters. (see, Padilla v. City of Richmond (N.D. Cal., Dec. 23, 2020, No. 20-CV-04597-PJH) 2020 WL 7643235.)  Further, although the case was decided under the FLSA, the Ninth Circuit stated its understanding that the same general analysis applied under the California Labor Code.

Fourth Circuit Denies Chesapeake Battalion Chiefs the FLSA Protections of the First Responders Regulation

             On December 4, 2020, the United States Court of Appeals for the Fourth Circuit held that Battalion Chiefs (BCs) for the Chesapeake Fire Department were exempt from overtime requirements under the Fair Labor Standards Act (FLSA) because their “primary duties” were to manage the department rather than to act as front-line first responders. (Emmons v. City of Chesapeake (4th Cir., Dec. 4, 2020, No. 19-1755) 2020 WL 7086608.)

            In 2018, a group of seven BCs filed a lawsuit in federal court challenging their classification as overtime exempt employees. The district court granted summary judgement in favor of the Department, concluding as a matter of law that the BCs were executive employees, and thus were exempt from FLSA overtime requirements. The BCs appealed the decision to the Fourth Circuit, and the three-judge panel affirmed the lower court’s decision.

            The FLSA, in relevant part, requires that employers pay their employees overtime whenever they work more than 40 hours a week. However, it exempts workers employed in an “executive, administrative, or professional capacity.” The Department of Labor has promulgated a series of regulations further defining these statutes. The First Responders Regulation (codified in 29 CFR § 541.3(b)) exempts certain workers from the FLSA’s exemptions including police officers and firefighters, provided that their “primary duties” are not managerial. In determining an employee’s primary duty, courts consider the following factors: 1) the relative importance of the exempt duties as compared to other duties, 2) the amount of time performing the exempt work, 3) the employee’s relative freedom from direct supervision, and 4) the relationship between the employee’s salary and the wages paid to other employees for the kind of non-exempt work performed.

            In considering these factors, the court determined that BCs were exempt managerial employees. The court noted that BCs primarily perform high-level managerial and supervisory duties including making staffing decisions, monitoring and guiding company officers, and making decisions regarding discipline. The court also stated that BCs were not “front-line firefighters,” and even in the rare instances where they responded to an emergency, their job was to “strategize and to command.” The court also noted that BCs were relatively free from supervision. BCs worked 24-hour shifts while their supervisors did not, meaning BCs were unsupervised for most of their time at work. In regards to the fourth factor, the court noted that BCs were paid relatively the same as the next lowest person in the chain on command. However, they found that this fourth factor was not sufficient to overcome the other three.  

            Throughout the Emmons opinion, the court contrasted the BCs job duties with those of fire captains in the previous Fourth Circuit case of Morrison v. County of Fairfax (4th Cir. 2016) 826 F.3d 758. In Morrison, the court came to the opposite conclusion, finding that the fire captains were not exempt workers. The court specifically noted that in Morrison, the fire captains spent their majority of the time in the station and on emergency calls acting as first responders, and had little executive or managerial duties. As discussed above, the same was not true of the BCs in this case.

            The Emmons opinion is concerning for employees in the fire service and their unions because it narrows the protections afforded by the First Responders Regulation.  Thankfully for California Fire Fighters, this Fourth Circuit decision is not binding on the Ninth Circuit Court of Appeals.  However, until the First Responders Regulation or the exemptions are clarified expect California agencies to argue that Ninth Circuit courts should adopt the Emmons reasoning.    

DOL Opinion Letter Addresses Travel To and From the Office When Teleworking

             Due to the COVID-19 pandemic, many businesses have extended teleworking opportunities for employees. Even as businesses begin to reopen, many of these teleworking capabilities are likely to remain in place. Recently, the U.S. Department of Labor (DOL) released an opinion letter that addresses travel time for an employee who chooses to telework for part of the day and work from the office for part of the day. The DOL concluded that under the scenarios raised in the letter, the travel time was not compensable.

            Under a principle of the Fair Labor Standards Act (FLSA) known as the “continuous workday rule”, all time between the first and last principal activity of the day is generally considered compensable work time. Under this doctrine, otherwise non-compensable travel that occurs after the beginning of the employee’s first principal activity, and before the end of the employee’s last principal activity, is covered under the FLSA. Meaning, travel from worksite to worksite is generally compensable while time spent commuting to and from work is generally not. However, the distinction between commute and worksite-to-worksite travel becomes more complicated when considering employees who spend some of their time teleworking.

            In the December 31, 2020 opinion letter, the DOL addresses a number of scenarios in which an employee works from home for part of the day and works in the office for the remainder of the day, with time spent performing certain personal tasks in between. (FLSA2020-19.) For example, in the first scenario, an employee works in the office until 1 pm, leaves to go to her child’s parent teacher conference, and works from home for the remainder of the day. In the next scenario, the employee works from home in the morning, attends a doctor’s appointment, and then works from the office the rest of the day.

            The DOL concluded that the travel time was not compensable because the employee was either off-duty while traveling or engaged in normal commuting. They reasoned that the travel time was not compensable under the continuous workday doctrine because the employee was not required to travel from worksite to worksite as a part of her job. Rather, she was “traveling of her own volition for her own purposes during off-duty time.” When an employee is completely relieved of any duties such that she can use her time effectively for her own purposes, that time is not compensable. Because the employee arranged her workday to be divided into a block worked at home and a block worked at the office, separated by a block reserved for her own purposes, the reserved time was not compensable even if the employee used some of that time to drive to the office.

            In coming to this conclusion, the DOL relied on a number of court decisions analyzing situations in which employees chose to perform various tasks at home before or after their commute. These decisions relied on the principle that even if the employee chose to do some preparatory or administrative work at home, they were able to schedule their time and could technically wait until they were on-duty to perform these tasks. The DOL quoted the court in Garcia v. Crossmark stating, “It simply cannot be the case that an employee is empowered unilaterally to convert her commute into compensable time merely by deciding to perform her daily routine in a particular manner.” (157 F.Supp.3d (D.N.M. 2015) 1046, 1049-50.)

            Notably, the opinion letter only addresses situations in which the employee chooses or requests to work from home before or after performing a personal errand on uncompensated time. Thus, the analysis will be different for employees who are ordered by their employer to come into the office in the middle of a telework day or ordered to work from home after coming into the office.

 

 

Supreme Court: Federal Officials Subject to Individual Liablility for Violating Right to Free Exercise of Religion

             On December 10, 2020, in a unanimous opinion, the Supreme Court ruled that Muslim men put on the no-fly list in retaliation for their refusal to act as informants for the FBI could sue FBI agents for monetary damages under the Religious Freedom Restoration Act (RFRA).  The RFRA permits litigants to obtain monetary damages against federal officials in their individual capacity for violating the First Amendment right to free exercise of religion. 

            The case, Tanzin v. Tanvir (U.S., Dec. 10, 2020, No. 19-71) 2020 WL 7250100, centered around three Muslim men who claimed that FBI agents placed them on the no-fly list because they refused to act as informants against their religious communities. The individuals were seeking both an injunction and monetary damages for lost income and wasted airline tickets. The defendants claimed that monetary damages were not permitted by RFRA.

            Writing for the Court, Justice Clarence Thomas noted that the plain language of RFRA permits individuals to sue government officials in their individual capacities. Moreover, the Court found that monetary damages were a form of “appropriate relief” permitted by the statute. The Court noted that money damages have long been authorized in American law, dating back to the beginning of the republic. Specifically, the Court pointed to the Civil Rights Act of 1983, which permits monetary recovery against government officials who violate individuals’ civil rights. RFRA, enacted in 1993, is in that tradition and uses the same terminology. The Court concluded by acknowledging that although there may be valid policy reasons to shield government officials from liability, Congress is the one who must create such policies.  

            Although the recent ruling opens government officials to liability, officials are still entitled to assert a defense of qualified immunity when sued in their individual capacities for monetary damages under RFRA. Qualified immunity shields government officials for being held personally liable for money damages for constitutional violations so long as the officials did not violate a “clearly established” right. The Tanzin Court acknowledged, that the FBI agents were still entitled to raise the defense of qualified immunity. (Id. at p. *5, fn. 2.)