961 F.3d 598
2d Cir.2020Background
- Plaintiffs are Bed Bath & Beyond (BBB) Department Managers paid under the fluctuating workweek (FWW) method until March 2015; BBB later switched to a non-FWW hourly overtime scheme.
- At hiring/promotions DMs received written acknowledgements explaining a base weekly salary (guaranteed) plus additional pay for hours over 40; payroll records span ~1,500 weeks.
- Payroll records show that in almost every week DMs either worked ≥40 hours or, with credited paid time off (PTO), were credited ≥40 hours; plaintiffs identify six weeks where pay was less than the weekly salary and hours+credited PTO <40.
- BBB corrected two payroll errors before suit, corrected a third later; three other disputed weeks were explained as (a) termination midweek, (b) a negotiated unpaid vacation arrangement, and (c) an FMLA-related pay adjustment.
- BBB permitted DMs who worked holidays or scheduled days off to take paid days off later (time-shifting PTO rather than extra pay).
- The district court granted summary judgment for BBB; the Second Circuit affirmed, holding plaintiffs failed to raise a genuine factual dispute on FWW prerequisites and related claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Were DMs paid a truly fixed, guaranteed weekly wage (prerequisite for FWW)? | Six weeks where pay < weekly salary and hours+credited PTO <40 show no true weekly guarantee. | Payroll corrections, consistent written notices, and benign explanations (termination, negotiated unpaid vacation, FMLA) show weekly guarantees across the record. | Plaintiffs failed to show a genuine dispute of material fact; weekly-guarantee requirement met for summary judgment purposes. |
| Does FWW require employees' hours to fluctuate both above and below 40 hours? | FWW should apply only where hours sometimes fall below and sometimes exceed 40 so short weeks offset long weeks. | No such requirement in §207, Missel, Belo, or 29 C.F.R. §778.114; core prerequisite is a fixed weekly wage and mutual understanding. | Rejected plaintiff's argument; FWW does not require weeks to fluctuate above and below 40. |
| Is BBB’s policy allowing employees who work holidays to take PTO later inconsistent with FWW (i.e., an hours‑based bonus)? | Shifting PTO after holiday work effectively increases straight‑time compensation and conflicts with FWW. | Policy simply time‑shifts paid time off and does not increase straight‑time pay or create hours‑based bonuses. | Policy consistent with FWW because it does not provide additional straight‑time compensation for hours worked; it is permissible. |
Key Cases Cited
- Overnight Motor Transp. Co. v. Missel, 316 U.S. 572 (1942) (articulated the fluctuating workweek computation: weekly salary ÷ hours worked = weekly regular rate; overtime premium = ½ that rate per OT hour)
- Walling v. A. H. Belo Corp., 316 U.S. 624 (1942) (emphasized the importance of a guaranteed weekly wage and upheld fluctuating overtime rate where a weekly guarantee existed)
- Bay Ridge Operating Co. v. Aaron, 334 U.S. 446 (1948) (construed Belo narrowly and tied its rule to the presence of guaranteed weekly wages)
- Walling v. Helmerich & Payne, Inc., 323 U.S. 37 (1944) (post‑Belo decisions limiting Belo’s flexibility where weekly guarantees were absent)
- Heder v. City of Two Rivers, 295 F.3d 777 (7th Cir. 2002) (discussed FWW applicability where schedules did not dip below scheduled hours, but relied on alternative grounds)