is as your owners know this is a wage our class action the fundamental issue here is whether the defendant geico properly accounted for and will bonuses when calculating the regular rate of pay for purposes of paying overtime to its employees and so there's two bonuses that issue here a cash bonus and a bonus that is a contribution to an employee trust account and so this is a technical case  but one that we think is quite straightforward when you begin to adjust a little bit i'd like to start if i could with the cash bonus and i want to return to a theme here which is the theme that reapportion back over the hours worked to get a new regular rate of pay an increased regular rate of pay which then becomes the proper regular rate of pay for purposes of calculating the one dollar and a half times of overtime that is the call the traditional method the percentage method is an alternative to the traditional method well we understand both masses the issue is harder you went on to either of them so we win because the two methods are supposed  identical results and they don't the the fundamental premise behind the percentage method is that by calculating over time by calculating the bonus as a percentage of straight and overtime hours worked if you do it the math works out so that the overtime payment is exactly as it would be had the bonus been reapportioned under the traditional method that is this mathematical this is the theme the mathematical quincey has to be mathematically december st you don't get paid tell no one gets paid until for two months that's the stop here understood well there's no under the stuff heard the two months the longevity period as it may be called care that two month period there's absolutely no no double counting because employees under guy goes program do not get paid any overtime adjustment at all over those two months they say that the percentage method is based on the calendar year it does not extend out to those two stub years those two long jebediah start to stub months those two longevity months that's where the employees are being shortchanged your honor what i what i'm having trouble understanding on your argument maybe and help me is if you look at the fact why doesn't the method that geico uses satisfy that regulation it would if geico didn't force employees to remain employed over the two month period following the end of the counter year because that method works only if and this is the mathematical couldn't say you only have a mathematical quibble and see if you calculate the percentage based on the actual earnings period not based on some arbitrary earnings period but the actual earnings peered geico sets the earning period as the calendar year ok i could say there's no bonus rate correct ok so geico says but if you want a bonus then you have to remain in our employee for this period subsequent to the percentage bonus period right right and that's what dicho does aunt but we're going to pay you for assuming you remain we're going to pay  that past calendar year the full percentage of the bonus you're owed for the past on the year but we're not going to pay you your he saying it's an illegal condition is at this is what i'm having trouble understanding so so the remember that the until february following that st calendar year geico would have to concede that the bonus period under those facts would be january of year one to february payout of year two why is that the bonus period we can look at twenty nine c a four thousand seven hundred and seventy eight point two one one c and i'll read from that provision bonuses which are announced to induce employees to remain with the firm  regarded as part of the regular rate of pay bonuses contingent upon the employees continuing employment until the time the payment is to be made and the like are in this category they must be included in the regular rate of pay t to eleven makes clear that that's the period as you called it must be part of the regular rate of pay so if you doing the calculation under the traditional method you would have to extend the period the in question through to the february payout so what geico doesn't stead is they say well no we can do this as a percentage but they don't do it as a percentage of the fourteen month period they do it as a percentage of the twelve month period and the employee shorted the overtime over the subsequent two months  remaining time i will thank you good morning may it please the court i'm aaron buckley i represent the apple e in this case government employees insurance company so what we're talking about here in terms of the  of january and february following the following following the plan year is simply a condition upon receipt of the bonus in two opinion letters the nov and five opinion letter the department of labor a pint that a percentage bonus in fact can be a long jetty bonus and then again in two thousand and five the department issued an opinion letter specifically approving the type of bonus here where you have a certain plan year and then the bonus is actually paid in the following year and there's a reason why these conditional or long jetty bonuses are allowed and that is simple the conditions do not change the math the plan year which is the calendar year is that is the period over which the bone for which the bonus is paid and it is under spewed here that when the appellant ms russell received her bonus in february of two thousand and thirteen for the two thousand and twelve plan year she received precisely ten percent of her total earnings in a cash bonus and another ten percent of her tone total earnings in a trust contribution so the condition does not change the math and and  the math is clear the under the percentage bonus like this the recipients are receiving all their overtime pay as a mat matter of arithmetic fact this same principle applies both to the cash bonus and to the trust contribution because they are both calculated in precisely the same way as a percentage of total earnings which includes all the employees regular pay overtime pay shift differential pay and any commissions or bonuses other than the profit sharing bonus itself so is there is there any condition at which point it would dissipate the bonus in other words you're entitled to your bonus for the year but you must remain for nine additional months would that be permitted well i don't see why it wouldn't be permitted your honor under both the guidance of the department of labor and the th circuit brought case which is cited in the breeze the principle is the same because the period for which the bonus is paid is it the math works out the same as it would be if you  were doing the regular rate method so you know the condition itself doesn't matter now we can question whether that would be a wise thing making people wait you know nine months you know to the extent company or you're not really entitle to your have the you know the effect that you're trying to create which is to encourage employers to to stay on someone might be more willing to stay on for a month or two than they might be for nine months so that might be unwise if an employer were requiring its employees to wait nine months but it would not be unlawful because again the math would work out and there doesn't seem to be any i think legitimate argue an argument in this case that the math does not in fact work out  when a percentage of bonuses paid as either a cash bonus or in this case both a cash bonus and a trust contribution there's an additional reason of course why the trust contribution is valid and that is that not a percentage bonus so there are two dollars independent reasons why the trust contributions are excludable so i think that covers it your honor but i'm willing to i like to return to respond to a point that counsel just made which is the hypothetical you presented that where the employee has to stay an extra nine months counsel said that that might not have the effect that you're trying to create which is to get the employee to stay on and that is precisely why the earnings period needs to include this long jeopardy portion because the employer gets something out of the employee by requiring them to stay that extra period and gikas case we haven't had an opportunity to discover yet we're on a motion to dismiss but we believe that those st couple months in the calendar year that die call requires the employee to stay in order to get the bonus those couple of months are very important to die kill because there's a lot of activity in insurance industry around the multiplier is when they calculate the bombs and if that were their motivation if that's what they needed there's a simple way to do it that wouldn't require us to be here today which is pay the bonus in february but don't require the employee to remain we provided a hypothetical in our papers of the bellhop in alaska who works one month gets a bonus paid on january one hundred percent bonus on january's earnings but must stay employed the rest of the year in order to receive that bonus no doubt the employer is getting valuable consideration and incentivizing the employee to work hard throughout the rest of that year and the whole fundamental purpose of the regular rate laws is to ensure that when you're asking employees to work hard on your behalf to stay extra stay longer than you might otherwise stay that that extra work that you derive from that employee needs to be compensated the overtime rate needs to be adjusted and so that the hypothetical i think rings true exposes the fundamental problem with their argument if your honour's would like i could address the argument on the trust payment that