Federal Circuit Weighs FLSA Timeliness Requirements for Employee Pay During Government Shutdowns
This case law update was written by Victoria E. Grieshammer, an attorney at the law firm of Shaw Bransford & Roth, where since 2021 she has represented federal officials and employees in all aspects of federal personnel employment law. Ms. Grieshammer also advises federal agencies and employers on employment issues, such as proposed disciplinary actions and other employment-related litigation.
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In two cases, Avalos v. United States and Martin v. United States, the United States Court of Appeals for the Federal Circuit ruled that the United States government may pay employees after the conclusion of a government shutdown without penalty.
The plaintiffs in Avalos, who were ‘excepted’ employees required to work during a 2018-2019 government shutdown, received their pay after the conclusion of the shutdown, rather than on their regularly scheduled paydays. The plaintiffs brought suit against the government alleging that it violated the Fair Labor Standards Act (FLSA) by failing to timely pay their wages. The government filed a motion to dismiss, which was denied, and the government filed this interlocutory appeal.
During shutdown periods resulting from a lapse of appropriations, the government is barred from paying wages to excepted employees by the Anti-Deficiency Act (ADA), which states the government may not “authoriz[e] an expenditure or obligations exceeding an amount available in an appropriation or fund.” The Federal Circuit stated, then, that the “central question in this appeal is how the Anti-Deficiency Act’s prohibition on government spending during a partial shutdown coexists with the FLSA’s seemingly contradictory timely payment obligations.”
In answering this question, the court began with the text of the FLSA. The FLSA does not specify when exactly an employer must pay an employee, only that it must pay the employee. Still, courts have interpreted the FLSA to have an implicit timely payment obligation, based on other provisions of the statute, to require employers to pay wages by the employee’s regular payday when possible. Importantly, the Supreme Court has clarified that this requirement depends on the unique events of each case. It has held that the FLSA “does not require the impossible” but requires payment “as soon as convenient or practicable under the circumstances.”
The court next dealt with the contrasting provisions of the ADA, noting that it must strive to “give effect to both” and reconcile the acts. It held that the ADA, which is more specific than the FLSA and expressly forbids government expenditures when appropriations are not available, can coexist with the FLSA’s circumstance-dependent requirement for timely payment of wages. Accordingly, the court reasoned, it is impracticable to ask the government to pay wages during a government shutdown when such payments would violate the ADA and result in civil and criminal liability.
The court subsequently held that “the FLSA’s timely payment obligation considers the circumstances of payment and that, as a matter of law, the government does not violate this obligation when it complies with the Anti-Deficiency Act.” So, the federal government makes timely wage payments during a government shutdown when it pays its employees at the earliest possible date after the lapse in appropriations ends. Since the government here paid the plaintiffs immediately after the shutdown ended, it timely paid its employees.
In Martin, issued on the same day but dealing with a 2013 government shutdown, the Federal Circuit determined that the facts were indistinguishable from Avalos and followed its holding.
Find the full cases here: Martin v. United States, Avalos v. United States
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