PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

JULIA FLOOD; DRAKE FOX; ROBERT

HOWLETT; KATHERINE JOHNSON;

KAREN KEROACK; ANTHONY MARTIN;

JAMES MCLEAN;JOHN MCMILLIAN;

DAVID MILLER; LORA MILLER;

MICHAEL NAVE; POWELL PHILLIPS;

BOBBY PIERCE; JACK POPLIN; DAVID

PRITCHARD; ROBERT PUGH; JOHN

SCIALES; BRIAN SIMONSON; PAMELA

STEWART; RONALD WAHAB; STANLEY

No. 97-1099

G. WARDRIP, JR.; SHEILA

YOUNGBLOOD,

Plaintiffs-Appellants,

and

RUSSELL ASHLEY,

Plaintiff,

v.

NEW HANOVER COUNTY,

Defendant-Appellee.

Appeal from the United States District Court

for the Eastern District of North Carolina, at Wilmington.

James C. Fox, Chief District Judge.

(CA-96-123-7-F-3)

Argued: July 15, 1997

Decided: September 22, 1997

Before MURNAGHAN, Circuit Judge, and BUTZNER and

PHILLIPS, Senior Circuit Judges.

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Affirmed by published opinion. Judge Murnaghan wrote the opinion,

in which Senior Judge Butzner and Senior Judge Phillips joined.

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COUNSEL

ARGUED: Gary Keith Shipman, SHIPMAN & ASSOCIATES,

L.L.P., Wilmington, North Carolina, for Appellants. Andrew William

Olsen, Assistant County Attorney, OFFICE OF THE COUNTY

ATTORNEY, Wilmington, North Carolina, for Appellee.

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OPINION

MURNAGHAN, Circuit Judge:

Plaintiffs-Appellants, a group of present or former full-time emergency medical service ("EMS") personnel (collectively, the "Plaintiffs"), filed suit against their employer, Defendant-Appellee New

Hanover County, North Carolina (the "County") for violations of the

Fair Labor Standards Act ("FLSA"), 29 U.S.C.A.§§ 210-19 (West

1965, 1985 & Supp. 1997). The district court dismissed the Plaintiffs'

claims pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief may be granted. For the reasons

stated below, we affirm the district court's judgment.

I.

The Plaintiffs all work a nine-day regularly recurring cycle of

24.15 hours on-duty, 24 hours off-duty, 24.15 hours on-duty, 24 hours

off-duty, 24.15 hours on-duty, followed by 96 consecutive hours offduty. Although their work schedule never changes, they work a different number of total hours each week depending upon the number of

scheduled work days that fall within the week. Thus, their workweek

ranges between 48.3 hours, 56.3 hours, 64.45 hours, and 72.45 hours,

and their amount of overtime consequently ranges between 8.3 hours,

16.3 hours, 24.45 hours, and 32.45 hours. The County also requires

the Plaintiffs to attend regularly scheduled shift meetings and continuing education seminars to maintain their EMS certifications. The

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County compensates the Plaintiffs for the time that they spend at the

meetings and seminars, and it adds the hours attributable to the meetings and seminars to the Plaintiffs' regularly scheduled hours for that

week.

At all relevant times, the County has compensated the Plaintiffs

pursuant to a "fluctuating workweek" payment method. That method

allows employers to compensate employees at a one-half time rate for

overtime hours, rather than the standard one and one-half time rate,

if the employment meets certain requirements. See 29 C.F.R.

§ 778.114 (1996). The County gave each of its employees a memorandum that clearly explained the fluctuating workweek payment

method and that provided examples of how the County would calculate employees' salaries pursuant to that method. The County required

each employee to sign the memorandum under a printed statement

that reads, "The Fluctuating Work Week 29 C.F.R.§ 778.114 of the

Fair Labor Standards Act has been explained to me and I have had

the opportunity to have any questions answered."

On August 5, 1996, the Plaintiffs filed suit against the County.

They claimed that the County's compensation plan did not meet the

requirements of the fluctuating workweek payment method. They

sought declaratory relief, injunctive relief, backpay for unpaid overtime compensation, liquidated damages, and attorney's fees. The

County subsequently filed a motion to dismiss the Plaintiffs' suit pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state

a claim upon which relief may be granted. The district court granted

the County's motion to dismiss on the ground that the County's compensation plan satisfied all of the requirements of the fluctuating

workweek payment method.

II.

We review the district court's decision to grant the motion to dismiss de novo. See Brooks v. City of Winston-Salem, North Carolina,

85 F.3d 178, 181 (4th Cir. 1996). We must accept the factual allegations in the Plaintiffs' complaint and must construe those facts in the

light most favorable to the Plaintiffs. See Estate Constr. Co. v. Miller

& Smith Holding Co., 14 F.3d 213, 217-18 (4th Cir. 1994). We may

affirm the district court's dismissal only if it appears beyond doubt

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that the Plaintiffs can prove no set of facts in support of their claim

that would entitle them to relief. See Rogers v. Jefferson-Pilot Life

Ins. Co., 883 F.2d 324, 325 (4th Cir. 1989).

III.

As a general rule, the FLSA provides that an employer may not

employ an employee for a workweek longer than forty hours unless

it pays its employee one and one-half times the employee's "regular

rate" for all hours in excess of forty. See 29 U.S.C.A. § 207(a)(1);

Monahan v. County of Chesterfield, Virginia, 95 F.3d 1263, 1267 (4th

Cir. 1996). The employee's "regular rate" is the hourly rate that the

employer pays the employee for the normal, nonovertime forty-hour

workweek. See Walling v. Youngerman-Reynolds Hardwood Co., 325

U.S. 419, 424 (1945). If the employer employs an employee on a

weekly salary basis, it determines the employee's regular hourly rate

of pay by dividing the weekly salary by the number of hours that it

intends the weekly salary to compensate. See 29 C.F.R. § 778.113

(1996).1

However, the Department of Labor's (the "DOL") implementing

regulations provide an alternative way for employers to calculate the

regular rate of pay for certain salaried employees. Section 778.114 of

the implementing regulations provides that a salaried employee whose

hours fluctuate from week to week can reach a mutual understanding

with the employer that he or she will receive a fixed amount of compensation per week, regardless of the number of hours that the

employee works in that week, and that he or she additionally will

receive a rate of fifty percent of the regular hourly pay for any hours

over forty worked in that week. See 29 C.F.R. § 778.114(a). The

employee must clearly understand that the fixed weekly amount com-

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1 Thus, the regulations provide that if an employer pays its employee

$182.70 per week with the understanding that the salary compensates the

employee for a regular workweek of thirty-five hours, the employee's

regular rate of pay is $182.70 divided by thirty-five hours, or $5.22 per

hour. When the employee works overtime, the employer must pay the

employee $5.22 for each of the first forty hours and $7.83 (one and onehalf times $5.22) for each additional hour thereafter. See 29 C.F.R.

§ 778.113.

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pensates for all of the hours worked in that week, rather than a set

number of hours as in the case of a regular salaried employee heretofore described, and that he or she will receive that amount every week

regardless of whether he or she actually works a long or a short workweek. Id. The employer calculates the regular hourly pay by dividing

the employee's fixed weekly pay by the total number of hours that the

employee worked during the week. Id.2 The fixed amount must be

sufficient to provide compensation at a regular rate not less than the

minimum hourly rate, and the overtime premium cannot be less than

one-half of the regular rate. Id. Since the employer has already paid

the employee a regular rate of pay for all of the hours that the

employee worked, including the overtime hours, it only has to pay an

additional one-half time pay premium for the overtime hours. Id.;

Monahan, 95 F.3d at 1280-81.

Thus, under the "mathematical payment structure provided under

[the fluctuating workweek] method of overtime compensation, the

more the employee works and the more overtime the employee logs,

the less he or she is paid for each additional hour of overtime."

Monahan, 95 F.3d at 1280. However, section 778.114 does not represent an "exception" to FLSA. It merely provides an alternative means

by which an employer can determine its employees' regular and overtime rate of pay. See Bailey v. County of Georgetown, 94 F.3d 152,

154-55 n.5 (4th Cir. 1996).

Here, the County pays the Plaintiffs pursuant to the fluctuating

workweek payment method. The starting salary for EMS personnel is

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2 Thus, the regulations provide that if an employer pays its employee

$250.00 per week with the understanding that the salary compensates the

employee for all hours that the employee works each week, and the

employee works forty-four hours in one particular week, the employee's

regular rate of pay is $250.00 divided by forty-four hours, or $5.68 per

hour. The employer must pay the employee $261.36[$250.00 fixed salary plus $11.36 (one-half times $5.68 for each of the four hours of overtime)] for that forty-four hour week. When the employee works fifty

hours in one particular week, the employee's regular rate of pay is

$250.00 divided by fifty hours, or $5.00 per hour. The employer must

pay the employee $275 [$250.00 fixed salary plus $25.00 (one-half times

$5.00 for each of the ten hours of overtime)] for that week. See 29 C.F.R.

§ 778.114(b).

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$18,574. The employee therefore receives a fixed, weekly salary of

$357.20 ($18,574 divided by fifty-two weeks) regardless of the number of hours that the employee works in any particular week. Pursuant

to section 778.114, the County then adds fifty percent of the employee's regular rate of pay for each hour over forty that the employee

works. The County determines the employee's regular hourly rate by

dividing the fixed, weekly amount by the total number of hours that

the employee works in a particular week. The County undisputedly

calculates the Plaintiffs' salaries correctly pursuant to the section

778.114 method. The Plaintiffs argue, however, that the County must

pay them the standard overtime rate of one and one-half times their

regular rate because it does not meet the requirements of section

778.114.

The language of section 778.114 suggests that an employer must

meet the following requirements before it can pay an employee pursuant to the fluctuating workweek method: 1) the employee's hours

must fluctuate from week to week; 2) the employee must receive a

fixed weekly salary that remains the same regardless of the number

of hours that the employee works during the week; 3) the fixed

amount must be sufficient to provide compensation at a regular rate

not less than the legal minimum wage; 4) the employer and the

employee must have a clear, mutual understanding that the employer

will pay the employee the fixed weekly salary regardless of the hours

worked; and 5) the employee must receive a fifty percent overtime

premium in addition to the fixed weekly salary for all hours that the

employee works in excess of forty during that week. See 29 C.F.R.

§ 778.114; Condo v. Sysco Corp., 1 F.3d 599, 601-02 (7th Cir. 1993).

The Plaintiffs argue that the County may not use the fluctuating

workweek method because their hours do not "fluctuate" from week

to week. Although the Plaintiffs admittedly work different hours

every week, i.e., either 48.3, 56.3, 64.45, or 72.45 hours, they contend

that their hours do not fluctuate because they work pursuant to a written, fixed, regular, repeating, and perpetual schedule. They would

define the term "fluctuate" in section 778.114 as a requirement of

utter unpredictability. According to the Plaintiffs, an employee's

hours only fluctuate if the employee works different hours every week

and the employer does not set a fixed, predictable schedule.

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However, the agency charged with administering the FLSA has

rejected the Plaintiffs' argument. The Wage and Hour Division of the

DOL has clearly stated its view that section 778.114 does not require

an unpredictable schedule. In a letter ruling, the DOL determined that

an employer could use the fluctuating workweek method to pay

employees who worked alternating forty-three and fifty-one hour

workweeks pursuant to a fixed schedule. See DOL Administrative

Letter Ruling of May 18, 1966, reprinted in Gilbert J. Ginsburg, et

al., Fair Labor Standards Handbook app. III at 104 (1996). The DOL

noted that although employers generally utilize the fluctuating workweek method when their employees work "a varying or irregular

number of hours in a workweek," the fixed, alternating workweeks in

that case met the requirements of section 778.114. Id. at 105.

Although the DOL's letter ruling does not bind the Court, it does

"constitute `a body of experienced and informed judgment,'" and we

give it substantial weight. Schultz v. W.R. Hartin & Son, Inc., 428

F.2d 186, 191 (4th Cir. 1970) (quoting Skidmore v. Swift & Co., 323

U.S. 134, 140 (1944)).

The United States District Court for the District of South Carolina

has also rejected the Plaintiffs' argument. In Roy v. County of Lexington, South Carolina, 948 F.Supp. 529, 531 (D.S.C. 1996), the plaintiffs, current and former EMS employees, worked a three-day

regularly recurring cycle of 24.5 hours on-duty followed by 47.5

hours off-duty. The court held that the employees' hours "fluctuated"

for the purposes of section 778.114 even though the employees

worked under a regular, perpetual schedule. The court explained:

 The employees . . . argue that § 778.114 is not applicable

because the workweek did not "fluctuate" for purposes of

the regulation. As they note, they worked on a regularly

recurring three-day cycle of twenty-four and one-half hours

on and forty-seven and one-half hours off. Thus, even

though the regular hours they worked in a week were not the

same, their regular hours over a period of weeks were predictable, and they could rely on the cycle to determine when

they would work on any particular date in the future.

However, the fact that the cycle recurs does not mean that

the hours do not fluctuate. It is not necessary for regular

hours to be sporadic for the regulation to be applied; it is

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sufficient that the regular hours vary from one workweek to

another, as they do here. The Court therefore rejects this

argument.

Id. at 531 n.1 (emphasis added).3 

We similarly reject the Plaintiffs' argument. Even though the Plaintiffs work pursuant to a fixed schedule, their hours fluctuate, i.e., they

vary, from workweek to workweek. Therefore, since the Plaintiffs'

hours fluctuate, the County pays them a fixed weekly salary of

$357.20 regardless of the number of hours that they work, and the

County undisputedly satisfies the other requirements of section

778.114, the district court correctly dismissed the Plaintiffs' suit. The

Plaintiffs alleged no claim upon which relief may be granted.

IV.

Accordingly, we affirm the district court's judgment.

AFFIRMED

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3 But see Burgess v. Catawba County, 805 F.Supp. 341, 348 (W.D.N.C.

1992) (noting in dicta that an EMS employee's hours did not fluctuate

for the purposes of section 778.114 when he worked a regular schedule

of twenty-four hours on-duty followed by forty-eight hours off-duty).

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