15 F.4th 1321
11th Cir.2021Background
- Hector Hernandez worked for Plastipak (2011–2016) as a salaried, non‑exempt technician paid a fixed biweekly salary ($1,964.99) while his weekly hours fluctuated.
- Plastipak used the fluctuating workweek (FWW) method to calculate overtime, and sometimes applied a more generous formula (dividing salary by 40 rather than actual hours).
- Plastipak also paid a night shift premium (flat $30/week, prorated to $0.75/hour) and holiday pay (credited 8 hours or an extra 8 hours when worked).
- Hernandez sued claiming those additional payments meant his straight‑time pay was not a “fixed salary,” so FWW was inapplicable and he was owed time‑and‑a‑half; the district court granted summary judgment for Hernandez.
- The Eleventh Circuit reversed, holding that bonuses/shift differentials and holiday pay on top of a fixed salary do not, by themselves, preclude use of the fluctuating workweek method, and remanded for the district court to consider remaining prerequisites (e.g., clear mutual understanding, correct application).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether additional pay (shift premium, holiday pay, bonuses) added to a fixed salary prevents use of the FWW method | Hernandez: Additional pay makes weekly pay variable, so salary is not "fixed" and FWW is inapplicable | Plastipak: Such payments are "extra compensation" distinct from the fixed straight‑time salary; FWW remains available | Court: Payments on top of a fixed salary do not bar FWW so long as the employee receives a fixed salary covering all hours and receives at least the required overtime premium (or more) for overtime hours |
| Whether Missel and DOL guidance permit counting bonuses while applying FWW | Hernandez: Relies on interpretations adverse to allowing bonuses (argued DOL guidance conflicted) | Plastipak: Missel and DOL bulletins/opinion letters support treating bonuses as separate from fixed salary and compatible with FWW | Court: Missel and the DOL’s historical guidance support that bonuses/extra pay can be compatible with FWW; regulation 29 C.F.R. § 778.114(a) is consistent with that view |
| Whether a legal distinction between performance‑based bonuses and time‑based premiums matters | Hernandez: Time‑tied bonuses (shift premiums) should bar FWW even if performance bonuses might be allowed | Plastipak: Regulation makes no such distinction; both are "additional compensation" distinct from fixed salary | Court: Rejected the distinction; § 778.114(a) does not differentiate between bonus types—both may coexist with FWW if salary requirement met |
| Whether summary judgment for Hernandez was appropriate and next steps | Hernandez: Sought summary judgment for unpaid overtime | Plastipak: Appealed, arguing legal error on fixed‑salary requirement | Court: Reversed summary judgment and remanded for district court to address remaining FWW prerequisites (e.g., clear mutual understanding, correct computation) |
Key Cases Cited
- Overnight Motor Transp. Co. v. Missel, 316 U.S. 572 (1942) (Supreme Court endorsing fluctuating workweek approach for fixed weekly wage with variable hours)
- Lamonica v. Safe Hurricane Shutters, Inc., 711 F.3d 1299 (11th Cir. 2013) (discusses computation of regular rate under FWW)
- Condo v. Sysco Corp., 1 F.3d 599 (7th Cir. 1993) (explains salary compensates straight time so only a 50% premium is due under FWW)
- Lalli v. Gen. Nutrition Ctrs., Inc., 814 F.3d 1 (1st Cir. 2016) (holds commissions/bonuses can be added to fixed salary without foreclosing § 778.114 treatment)
- Dacar v. Saybolt, L.P., 914 F.3d 917 (5th Cir. 2018) (addresses treatment of time‑based vs performance bonuses under FWW)
- Encino Motorcars, LLC v. Navarro, 138 S. Ct. 1134 (2018) (supreme court instruction to give statutory text a fair reading when construing FLSA provisions)