United States District Court, District of Columbia
[Copyrighted Material Omitted]
Brigid F. Cech Samole, Elliot H. Scherker, Greenberg Traurig LLP, Miami, FL, Danielle M. Diaz, Joe Robert Reeder, Greenberg Traurig, L.L.P., Washington, DC, Jonathan C. Chane, Greenberg Traurig, P.A., West Palm Beach, FL, for Plaintiff.
Mercedeh Momeni, U.S. Attorney's Office, Civil Division, Washington, DC, for Defendant.
JOHN D. BATES, District Judge.
Plaintiffs Richard Lubow, Joseph Bopp, David Bennett, Frank Benevento, and James Landis, each a current or retired Diplomatic Security Officer at the U.S. Department of State, brought this suit challenging the Department's decision to collect alleged salary overpayments for plaintiffs' work in Iraq in 2004. Plaintiffs challenge both the Department's determination that their pay exceeded overtime limits and the decision to deny waiver of repayment. The parties have filed motions and cross-motions for summary judgment. For the reasons explained herein, the Court will deny plaintiffs' motion for summary judgment and will grant the Department's cross-motion.
In January 2004, plaintiffs, then all Diplomatic Security Officers at the State Department, began service in Iraq as Regional Security Officers. See Administrative Record [Docket Entry 27] at 340 (July 14, 2010) (" A.R." ).  As Foreign Service Specialists, plaintiffs were eligible for basic pay— compensation for a forty-hour work week— and premium pay— compensation for overtime, compensatory time off, holiday and Sunday premium pay, night pay differential, and law enforcement availability pay. Plaintiffs also received danger pay, post hardship differential, and certain other payments that are not at issue here. See id. The Department classified the war in Iraq as an emergency, and plaintiffs' work qualified as " emergency support service." Id. at 29.
Federal law establishes the aggregate amount of basic and premium pay an employee
may receive. Pursuant to 5 U.S.C. § 5547(a),
[a]n employee may be paid premium pay ... only to the extent that the payment does not cause the aggregate of basic pay and such premium pay for any pay period for such employee to exceed the greater of—
(1) the maximum rate of basic pay payable for GS-15 (including any applicable locality-based comparability payment ... and any applicable special rate of pay ...); or
(2) the rate payable for level V of the Executive Schedule.
This cap applies to each " pay period," i.e., biweekly. Things change somewhat, however, when the employee's premium pay is earned for " work in connection with an emergency." 5 U.S.C. § 5547(b)(1). In that case, the limitation of subsection (a) is replaced by an annual cap. An annual cap allows an employee to collect more total overtime: if the employee works no or little overtime in some pay periods, he has the potential to earn that overtime in later periods. For example, if the employee works no overtime the first six months (first 13 pay periods) of the year, he can earn twice as much overtime in each of the remaining 13 pay periods than he would be able to earn under a biweekly cap. The annual cap set out in 5 U.S.C. § 5547(b)(2) provides,
no employee [paid premium pay for work in connection with an emergency] may be paid premium pay ... if, or to the extent that, the aggregate of the basic pay and premium pay under those provisions for such employee would, in any calendar year, exceed the greater of—
(A) the maximum rate of basic pay payable for GS-15 in effect at the end of such calendar year (including any applicable locality-based comparability payment ... and any applicable special rate of pay ...); or
(B) the rate payable for level V of the Executive Schedule in effect at the end of such calendar year
In 2004, the maximum rate of basic pay payable for GS-15 was $113,674. See A.R. at 84. Including the locality-based comparability payment for the Washington, D.C., area, the maximum rate was $130,305. Id. And the rate payable for Executive Schedule V was $128,200. Id. Accordingly, the annual pay cap for those assigned to Washington, D.C., was $130,305, the higher of the GS-15 locality-adjusted pay and the Executive Schedule V Pay. But no locality-based comparability payment is applicable to overseas employees. Id. at 85; see also 5 C.F.R. § 531.603 (2004). Hence, for those assigned to an overseas post, the maximum, locality-adjusted GS-15 payment for 2004 was $113,674. The Executive Schedule Level V remained at $128,200 regardless of the employee's assignment. The annual pay cap for overseas employees was hence $128,200, the greater of the two.
Plaintiffs began serving in Iraq in 2004. Initially, they were on a temporary duty assignment, and so were formally assigned to Washington, D.C. After the U.S. Embassy in Iraq opened in July 2004, however, plaintiffs received new orders, taking them off temporary duty status and permanently assigning them to that embassy. See A.R. at 340. Their assignment at the start of the year, then, qualified for a $130,305 annual pay cap. Their assignment at the end of the year qualified for a $128,200 pay cap.
The Department provided various cables and notices addressing the payment scheme. In July 2004, the Department distributed a cable informing plaintiffs that " the combination of base pay plus premium
pay ... for those serving in Iraq is capped annually" and that " currently, this translates to $128,200 for those assigned to Iraq; $130,305 for those on [temporary duty assignment] to Iraq from Washington, D.C.," and that " [a]ny amount of premium pay over the cap is forfeited." Id. at 27. In August 2004, the Department's U.S. Mission in Iraq issued an Administrative Notice repeating these points. See id. at 92.
On November 24, 2004, the Department advised each plaintiff:
[W]e have determined that your earnings applicable toward the 2004 annual premium pay cap have already or could shortly put you above the cap for the current pay year. Because you are assigned overseas, the rate of the annual premium pay cap that applies to you is $128,200 (the rate for Level V of the Executive Schedule). Thus, for 2004 the combination of your basic pay and all forms of premium compensation (overtime pay, compensatory time off, holiday premium pay, Sunday premium pay, night pay differential, law enforcement availability pay) cannot exceed $128,200. Title 5 does not allow for rollover of any excess amounts. The Department cannot pay any premium compensation that would cause your combined basic pay plus premium pay to exceed $128,200. If such payments are made erroneously, the Department is obligated to seek collection of such overpayments.
Id. at 316.
Finally, on April 27, 2005, the Department sent each plaintiff a letter notifying him that he had exceeded the premium pay cap for 2004 and that the Department was " obligated to seek the return of the U.S. Government funds that were improperly disbursed." Id. at 29. Using the $128,200 pay cap based on plaintiff's overseas assignment at ...