JIM MAlTOX Attorney General

Supreme Cowl BulldInS P. 0. BOX 12545 Austin. TX. 75711. 2545 512/4752501 Telex 9101874.1367 Telecopier 5121475.0255

714 Jackson, Suite 700 Dallas. TX. 75202.4505 214/742-8944

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1001 Texas, Suits 700 Houston, TX. 77002~3111 713/2235885

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200 Main Plaza, Suite 400 San Antonio. TX. 782052797 51212254191

An Equal OpportunityI Affirmative Action Employer 

# The Attorney General of Texas
thy 19, 1986

Mr. VernonM. Arrell Comieeioner OpinionNo. JM-491
Texas RehabilitationCommission 118East RiversideDrive Austin,Texas 

### 78704 Re: Whether a state agencymay require Its employees to take compensatory time in lieu of overtimepay DearMr. Arrell:
You ask whl?thera conflict exists between the provisions of section 2f(l) of articleV of the currentGeneral Appropriations Act, Acts 1985. 69th 'Leg.,ch. 980, at 7759, and the Fair Labor Standards Act of 1938, 29 U.S.C. 5201 et seq. (hereinafter FLSA). You wish to knov whether a stste agency may allow or require an employee to take compensatory tine off for overtime instead of paying overtime compensation. Section 2f(l)provides, inpart: f. OVI!F:TIME.(1)Employees Subject to FLSA. An employm who is subject to the overtimeprovisions of the Fair Labor StandardsAct of 1938, 29U.S.C. Sets. :201 et seq.. (FLSA) is entitled to compen~ia~tion

for overtime as provided by this subdiv:.sion.
An employeewho Is required to work hours in excess of 40 hours in a workweek is entitled to cmpenwtion for the excesshours eitherby: (A) the agency allowing (or requiring) the employw to take compensatory time off during the same p,~yperiod, at the rate of 1% hours off for eachhour of overtime; or (B) at the discretion of the employing agency, in cases In which granting compensatory time off is imp::actical.

the employeereceivingpay for the overtim: at the rate equal to 1% times the employw's regularrate ofpay. (Emphasisadded).

p. 2239Ur. VernonM. Arnell - Page 2 (JM-491)

The PLSA was amended ,cecentlyto specify that a public employer may provide an employeewith time off, at a rate of 1% hours of time off for each hour of overtime, **in** lieu of overtime pay under certain circumstances. See Fair :,aborStandardsAmendments of 1985, Pub. L. 99-150, §Z(a)(l)T Z,tat. (1985). These amendmer.tstook effect April 15. 19K 'Id .-A The985 amendments also affected the applicability of section 2f(l)(A) with regard to the time period duringwhich time off musk: be taken. Attorney General Opinion m-475 (1986). Opinion JM-475 atldressed how the 1985 amendments to the FLSA affected sectlons 2f(l) and 2f(4) of the current appropriations act. Section 2f(4) is a "contic,gency provision,"contingentupon amendments to the FLSA. Section 2f'(4)allows overtime time off to be taken during the 12-month peric'dafter the week in vhich the overrime accrued. Opinion m-475 concluded that state agencies may allov or require an employee to tak#e time off, at a rate of 1% hours for each hour of overtime, during xhe 12-monthperiod following the end of the workweek for overtime incurred on or after April 15, 1986. Accordingly, your question with regard to policy and practice after April 15 is answered inQll.nion m-475.
You are also concexaed with potential liability for overtime policy and practice In effect prior to April 15. A state agency's practice of allowing or requiringan employeeto take time off in lieu of overtimepay, pursuant to section 2f(l),prior to April 15 does not conflict wirh the FLSA. As it was applicable prior to April 15, section 2f(l) authorized a state agency to allow or require its employees "to take compensatory time off during the same pay period, at a rate of 1% hours ofjifor each hour of overtime." As indicated, Opinion JM-475 determine3 that, because of the legislative intent expressed in section 2f(4) and because of the 1985 amendments to the FLSA. compensatory time off for overtime incurred after April 15 need notbe limited to the samla pay period. The "same pay perioi."requirement was initially included by the Texas Legislature only kn an effort to comply with the RSA as required by the United St.atesSupreme Court In Garcia v. San Antonio Netrogolltan Transit Authority, 105, S. Ct. 1005. U.S. (1985). See Opinion m-475. Court interpretationsofthe versicnE the FLSAX effect when Garcia was decided indicated that the act allowed compensatory time off in lieu ofpayment only if time off was granted during the same pay period. See Dunlop v. New Jersey, 522 F.2d 504. 511 (3d Cir. 1975). vacated3 remanded on other grounds for consideration of Natj.onalLeague of Cities sub nom New Jersey v. Uaery, 427 U.S. 909 (19:;21); Attorney General Opinion H-382 (1974). Accordingly, thepracrice of allowing or requiring an employee to take compensatory time off for overtime worked in lieu of paying overtime compensationunder certain circumstances is not inconsistentwith the FLSA either as it existetl prior to April 15 or as amended. See also

p. 2240Mr. Veruon l4.Arnell - Paglr3 (JM-491)

Pub. L. 99-150. 12(c) (llmltationof liabilityof states andpolitical subdivisions for actionsprior toApril 15. 1986).
SUMMARY
A state agency's practice of alloving or requiring an emp'loyeeto take compensatory time off for overtime in lieu of paying overtime compensation under certain circumstances is nor inconsistentwith the FLSA as it existed prior to April 15 or as am,ended.

Very trulyyour 

# J-h

.

JIM HATTOX AttorneyGeneral ofTexas
JACKRIGBTOWER FirstAssistantAttorney General
MARY KELLER ExecutiveAssistantAttorney General
ROBERT GRAY SpecialAssistantAttorney,General
RICR GILPIN Chairman,Opinion Consnittt:e Preparedby JenniferRiggs; AssistantAttorney Genera1

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