ANTHONY SANDERS, ET AL V. COUNTY OF VENTURA, No. 22-55663 (9th Cir. 2023)
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Plaintiff employees who opted out of their union and employer-sponsored health plans received a monetary credit, part of which was deducted as a fee that was then used to fund the plans from which plaintiffs had opted out. Plaintiffs argue that this opt-out fee should be treated as part of their “regular rate” of pay for calculating overtime compensation under the Fair Labor Standards Act (FLSA).
The Ninth Circuit affirmed the district court’s grant of summary judgment. The panel held that the opt-out fees were not part of the employees’ “regular rate” of pay, but rather were exempted as “contributions irrevocably made by an employer to a trustee or third person pursuant to a bona fide plan for providing” health insurance under 29 U.S.C. Section 207(e)(4).
Court Description: Labor Law The panel affirmed the district court’s grant of summary judgment to the defendant in an action brought under the Fair Labor Standards Act by employees who opted out of their union- and employer-sponsored health plans.
The employees received a monetary credit, part of which was deducted as a fee that was then used to fund the plans from which they had opted out. The employees argued that this opt-out fee should be treated as part of their “regular rate” of pay for calculating overtime compensation under the Act.
The panel held that the opt-out fees were not part of the employees’ “regular rate” of pay, but rather were exempted as “contributions irrevocably made by an employer to a trustee or third person pursuant to a bona fide plan for providing” health insurance under 29 U.S.C. § 207(e)(4).
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