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July 12, 1993

YOURMAN, et al., Plaintiffs,
DINKINS, et al., Defendants.

The opinion of the court was delivered by: LORETTA A. PRESKA

 Loretta A. Preska, U.S.D.J.

 Plaintiffs are employees of the City of New York (the "City"), the New York City Health and Hospitals Corporation (the "HHC"), and the Board of Education of the City School District of the City of New York (the "BOE") who have been designated as "managerial" employees by their respective employers. They bring this action pursuant to the Fair Labor Standards Act ("FLSA"), 29 U.S.C. §§ 201-19 (1988), seeking unpaid overtime compensation at time and one-half their regular rate of pay for all hours worked in excess of forty hours each week. See 29 U.S.C. § 216(b). *fn1"

 Additionally, plaintiffs whose regular work week is thirty-five hours seek overtime compensation at their regular rate of pay for all hours worked between thirty-five and forty hours each week pursuant to Administrative Code of the City of New York § 12-108. *fn2"

 Before the Court are the parties' cross-motions for summary judgment. The Court finds, as each of the parties maintains, that no genuine issue as to any material fact concerning liability exists; the Court's task is therefore to apply the law to the facts before it. See Martin v. Malcolm Pirnie, Inc., 949 F.2d 611, 614 (2d Cir. 1991), cert. denied, 121 L. Ed. 2d 222, 113 S. Ct. 298 (1992). As to the FLSA claim, the Court finds that plaintiffs are not exempt from the overtime compensation provisions of FLSA and therefore grants plaintiffs' motion and denies defendants' motion as to FLSA liability. As to the state claim, the Court finds that plaintiffs do not meet the requirements of § 12-108 and therefore grants defendants' motion and denies plaintiffs' motion as to that claim. Only the issue of damages under FLSA remains to be settled in this action.

 I. Defendants' Time and Leave Regulations

 Central to this action are the written time and leave regulations applicable to plaintiffs issued by the City ("City Regs."), the HHC ("HHC Regs."), and the BOE ("BOE Regs."). These regulations specify a minimum work week of thirty-five hours, and the City and the BOE regulations expressly require employees to work any additional hours and days necessary to carry out their responsibilities. City Regs. § 3.0; HHC Regs. § 1.0(B)(1); BOE Regs. § 4(a). *fn3" The regulations do, however, provide some flexibility for employees to vary, with supervisor approval, the hours worked on a given day in order to compensate for unusually long hours worked in a certain period, two weeks for the City and the BOE and one week for the HHC. City Regs. § 3.0; HHC Regs. § 1.0(C)-(D); BOE Regs. § 4(b).

 Pursuant to the regulations, employees must maintain time records reflecting their hours worked. City Regs. § 11.1; HHC Regs. § 1.0(A); BOE Regs. § 5; see Defs.' Resp. to Pltfs.' First Reg. for Admis. of Facts ("Defs.' Admis.") No. 10. The impetus for the institution of this action is plaintiffs' failure to receive any credit for time worked beyond the regular work week. See City Regs. § 6.0; BOE Regs. § 10(a).

 As will be made clear below, critical to the determination of whether plaintiffs should receive overtime compensation under FLSA is an analysis of the circumstances under which deductions may be made by defendants from plaintiffs' compensation. Leave allowances provided by defendants to plaintiffs are important in this regard.

 Plaintiffs accrue between twenty and twenty-seven days of paid annual leave allowance each year which can be used for vacation, personal business, or religious holiday leave. City Regs. § 4; HHC Regs. § 2.1; BOE Regs. § 8. Plaintiffs also accrue twelve days of paid sick leave allowance each year. City Regs. § 5; HHC Regs. § 2.2; BOE Regs. § 9. Use of annual leave allowance and sick leave allowance requires the approval of a supervisor and is measured by the hour for the City and the BOE and by the half-hour for the HHC. City Regs. §§ 4.4, 5.3; HHC Regs. §§ 1.0(B)(3), 2.1(E), 2.2(C); BOE Regs. §§ 8, 9. *fn4"

 Various scenarios exist under the regulations in which defendants may make deductions from plaintiffs' compensation. Employees are most clearly susceptible to pay deductions in instances where they have been absent from work yet have exhausted their leave allowances or have not received approval for use of leave allowances. *fn5" Additionally, defendants provide for a lump sum payment of unused accrued leave upon separation from employment. City Regs. § 7; HHC Regs. § 8.0; BOE Regs. § 14. Charges made against a leave allowance during employment may then be construed as deductions in pay to the extent any lump sum payment might be reduced accordingly. *fn6" Furthermore, a deduction in compensation may occur in connection with the calculation of a lump sum payment if an employee is found to have a negative leave balance upon separation from employment; in such a case, the employee might find her final paycheck reduced accordingly.

 A review of defendants' treatment of the following items is particularly useful in evaluating plaintiffs' FLSA claim.

 As evident from the time and leave regulations, plaintiffs must account for each hour (for employees of the City and the BOE) or half-hour (for employees of the HHC) of their workweek. Plaintiffs basically must allot any such unit of time away from work to their annual leave allowance or sick leave allowance, offset it against unusually long hours worked at another time, or take leave without pay. Plaintiffs cannot, for instance, simply slip away from work for an hour in order to take care of personal business. In fact, the City and the HHC regulations expressly provide for charging unexcused tardiness against an employee's annual leave allowance or treating it as leave without pay. City Regs. § 4.6; HHC Regs. § 1.0(E). *fn7"

 B. Disciplinary Penalties

 Plaintiffs are subject to disciplinary penalties, including suspensions without pay of one to four days or deductions from leave balances, for infractions other than those of safety rules of major significance. Defs.' Admis. No. 8. Plaintiffs are subject to penalties for a variety of infractions including, for example, insubordination, abuse of sick leave, refusal to report for drug testing, conduct unbecoming, theft of agency property, and misuse of an agency car.

 C. Court Attendance

 Plaintiffs are authorized to attend court with pay and without using their accrued annual leave allowance if neither they nor anyone related to them has a personal interest in the case; the regulations specifically allow for paid leave in order for employees to attend court pursuant to a subpoena or court order. City Regs. § 8.0(c); HHC Regs. § 2.4(C). Thus, if one of the plaintiffs was absent from work in order to testify at a court proceeding in which she or someone related to her had a personal interest, the plaintiff would have to attempt to use her annual leave allowance, attempt to offset the time against unusually long hours worked at another time, or take leave without pay.

 D. Military Leave

 Plaintiffs may take military leave with pay for twenty-two work days or thirty calendar days each year. N.Y. Mil. Law § 242(5) (McKinney 1990) (incorporated into City Regs. § 8.1, HHC Regs. § 2.4(G), and BOE Regs. § 11). Beyond those periods, however, plaintiffs must seek to use their annual leave allowance, seek to offset the time against unusually long hours worked at another time, or take leave without pay.

 II. Actual Deductions

 Despite plaintiffs' vulnerability under the time and leave regulations to deductions from pay, actual deductions have rarely been made by defendants. In other words, plaintiffs appear for the most part to use their leave allowances or to account otherwise for absences rather than take leave without pay.

 The parties dispute the extent to which deductions from pay have been made by defendants. Defendants contend that only two of the plaintiffs in this action have received such a deduction. The City did not pay John D. Brady for the last eight days of an approximately three-month period in 1991 while he was on active military duty; Brady had exhausted his annual leave allowance. In addition, the HHC penalized Vito LaBella for misconduct concerning the use of a computer system by, inter alia, deducting $ 258.00 from his pay.

 In contrast, plaintiffs contend that approximately ten of them have received deductions in pay. Given the procedural posture of this matter, I will proceed to review plaintiffs' claims acknowledging only the two deductions in pay identified by defendants. As will be shown, the Court's holding does not depend upon the occurrence of any actual deductions in compensation.

 III. The FLSA ...

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