(a) General. (1) As a condition for use of compensatory time in lieu of
overtime payment in cash, section 7(o)(2)(A) of the Act requires an
agreement or understanding reached prior to the performance of work.
This can be accomplished pursuant to a collective bargaining agreement,
a memorandum of understanding or any other agreement between the public
agency and representatives of the employees. If the employees do not
have a representative, compensatory time may be used in lieu of cash
overtime compensation only if such an agreement or understanding has
been arrived at between the public agency and the individual employee
before the performance of work. No agreement or understanding is
required with respect to employees hired prior to April 15, 1986, who do
not have a representative, if the employer had a regular practice in
effect on April 15, 1986, of granting compensatory time off in lieu of
overtime pay.
(2) Agreements or understandings may provide that compensatory time off
in lieu of overtime payment in cash may be restricted to certain hours
of work only. In addition, agreements or understandings may provide for
any combination of compensatory time off and overtime payment in cash
(e.g., one hour compensatory time credit plus one-half the employee's
regular hourly rate of pay in cash for each hour of overtime worked) so
long as the premium pay principle of at least ``time and one-half'' is
maintained. The agreement or understanding may include other provisions
governing the preservation, use, or cashing out of compensatory time so
long as these provisions are consistent with section 7(o) of the Act. To
the extent that any provision of an agreement or understanding is in
violation of section 7(o) of the Act, the provision is superseded by the
requirements of section 7(o).
(b) Agreement or understanding between the public agency and a
representative of the employees.
(1) Where employees have a representative, the agreement or
understanding concerning the use of compensatory time must be between
the representative and the public agency either through a collective
bargaining agreement or through a memorandum of understanding or other
type of oral or written agreement. In the absence of a collective
bargaining agreement applicable to the employees, the representative
need not be a formal or recognized bargaining agent as long as the
representative is designated by the employees. Any agreement must be
consistent with the provisions of section 7(o) of the Act.
(2) Section 2(b) of the 1985 Amendments provides that a collective
bargaining agreement in effect on April 15, 1986, which permits
compensatory time off in lieu of overtime compensation, will remain in
effect until the expiration date of the collective bargaining agreement
unless otherwise modified. However, the terms and conditions of such
agreement under which compensatory time off is provided after April 14,
1986, must not violate the requirements of section 7(o) of the Act and
these regulations.
(c) Agreement or understanding between the public agency and individual
employees. (1) Where employees of a public agency do not have a
recognized or otherwise designated representative, the agreement or
understanding concerning compensatory time off must be between the
public agency and the individual employee and must be reached prior to
the performance of work. This agreement or understanding with individual
employees need not be in writing, but a record of its existence must be
kept. (See Sec. 553.50.) An employer need not adopt the same agreement
or understanding with different employees and need not provide
compensatory time to all employees. The agreement or understanding to
provide compensatory time off in lieu of cash overtime compensation may
take the form of an express condition of employment, provided (i) the
employee knowingly and voluntarily agrees to it as a condition of
employment and (ii) the employee is informed that the compensatory time
received may be preserved, used or cashed out consistent with the
provisions of section 7(o) of the Act. An agreement or understanding may
be evidenced by a notice to the employee that compensatory time off will
be given in lieu of overtime pay. In such a case, an agreement or
understandingwould be presumed to exist for purposes of section 7(o)
with respect to any employee who fails to express to the employer an
unwillingness to accept compensatory time off in lieu of overtime pay.
However, the employee's decision to accept compensatory time off in lieu
of cash overtime payments must be made freely and without coercion or
pressure.
(2) Section 2(a) of the 1985 Amendments provides that in the case of
employees who have no representative and were employed prior to April
15, 1986, a public agency that has had a regular practice of awarding
compensatory time off in lieu of overtime pay is deemed to have reached
an agreement or understanding with these employees as of April 15, 1986.
A public agency need not secure an agreement or understanding with each
employee employed prior to that date. If, however, such a regular
practice does not conform to the provisions of section 7(o) of the Act,
it must be modified to do so with regard to practices after April 14,
1986. With respect to employees hired after April 14, 1986, the public
employer who elects to use compensatory time must follow the guidelines
on agreements discussed in paragraph (c)(1) of this section.
[52 FR 2032, Jan.
16, 1987; 52 FR 2648, Jan. 23, 1987]
