Robert DeLee v. City of Plymouth, Indiana , 773 F.3d 172 ( 2014 )

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 14-1970
ROBERT D. DELEE,
Plaintiff-Appellant,
v.
CITY OF PLYMOUTH, INDIANA,
Defendant-Appellee.
____________________
Appeal from the United States District Court for the
Northern District of Indiana,
No. 3:12-cv-380 — James T. Moody, Judge.
____________________
ARGUED OCTOBER 2, 2014 — DECIDED DECEMBER 9, 2014
____________________
Before FLAUM, MANION, and HAMILTON, Circuit Judges.
FLAUM, Circuit Judge. Pursuant to a long-standing lo-
cal ordinance, the City of Plymouth, Indiana pays its po-
lice officers “longevity pay” after each work anniversary,
calculated by multiplying $225 by the number of years
that the officer has been on the force. Faced with financial
difficulties in 1989, Plymouth enacted a second longevity
pay ordinance pertaining to police, which prorates lon-
gevity pay for officers who take a leave of absence during
2 No. 14-1970
any given year, including for military service. During po-
lice officer Robert DeLee’s twelfth year on the job, he
missed nearly eight months of work while serving in the
United States Air Force Reserves. And so, when he re-
turned, Plymouth paid him one-third of his full longevity
payment for that year. DeLee sued, arguing that longevi-
ty pay is a seniority-based benefit to which the Uni-
formed Services Employment and Reemployment Rights
Act (“USERRA”), 38 U.S.C. §§ 4301–4335, entitles him in
full. Because we conclude that Plymouth’s longevity ben-
efit is more appropriately characterized as a reward for
lengthy service, rather than as compensation for work
performed the preceding year, USERRA guarantees
DeLee a full longevity payment for his twelfth year of
employment. Accordingly, we reverse the district court’s
grant of summary judgment in favor of Plymouth.
I. Background
In addition to salary, the City of Plymouth, Indiana
pays its long-serving police officers and firefighters (to-
gether, “emergency personnel”) what Plymouth calls
“longevity pay” on the anniversaries of their start dates.
Prescribed by city ordinance, longevity pay is “additional
compensation” to be paid to qualified emergency per-
sonnel who have “at least three years of continuous ser-
vice to the City.” See Plymouth, Ind., Ordinance Nos.
2009–1987 (Aug. 10, 2009), 2010–2009 (Aug. 23, 2010). The
portion of the ordinance pertaining to police officers
states:
Longevity pay is calculated to be $225.00.
The amount to be paid to a qualified police
officer is $225.00 multiplied by the number
No. 14-1970 3
of years of continuous service. The maxi-
mum amount paid shall be $4,500.00. Lon-
gevity shall be paid on the pay day follow-
ing the anniversary date of employment for
that individual.
Id.
The record does not indicate when the longevity pay
ordinance for emergency personnel was first enacted, but
the parties suggest that it was long before 1989. That is a
relevant fact, because 1989 is the year in which Plymouth
enacted Ordinance No. 1480, which reads:
WHEREAS, longevity pay has long been
recognized as an incentive for police and
firemen to remain in the service of the City;
and,
WHEREAS, a question has arisen con-
cerning the advisability of paying longevity
to members of the police department or fire
department who have gone to an inactive
status by reason of a leave of absence, or
who have been assigned to duties other
than the normal, customary duties of the
fire department or police department; and,
WHEREAS, in the interest of fiscal re-
sponsibility and fairness, it should be rec-
ognized that a member of the police de-
partment or fire department who is in an
inactive status, but who has reached an an-
niversary date for purposes of longevity
pay, should be paid said longevity, but as
4 No. 14-1970
calculated on the number of months of ac-
tive service to the City in the respective de-
partments.
NOW, THEREFORE, BE IT ORDAINED
*****
Longevity pay shall be prorated for any
qualified policeman or policewoman who
during the year immediately preceding
their anniversary date is on a leave of ab-
sence, or who is otherwise not engaged in
the active performance of the normal and
customary duty of the police department.
Longevity shall be prorated based on the
number of months of actual active duty
during the year immediately preceding the
anniversary date.
Plymouth, Ind., Ordinance No. 1480 (Nov. 13, 1989).
Robert DeLee is a patrolman in Plymouth, Indiana,
who has been with the Plymouth police since April 19,
1999. On his eleventh anniversary, DeLee received lon-
gevity pay in the amount of $2,475 ($225 times 11 years).
In his twelfth year on the job, DeLee was called to active
service by the United States Air Force, in which he has
served as a member of the Reserves since July 7, 1997 and
currently holds the rank of Technical Sergeant. DeLee
was mobilized for active duty on September 1, 2010 and
returned to his job as a Plymouth patrolman on May 11,
2011. Upon his return, Plymouth paid him his longevity
pay for that year, prorated pursuant to Ordinance No.
1480 for the time that he had spent serving in the Air
No. 14-1970 5
Force. Had DeLee been actively employed as a patrolman
for the entire year, he would have earned a longevity
payment of $2,700 ($225 times 12 years). Instead, because
DeLee had worked approximately four months of his in-
dividual fiscal year, Plymouth issued him one-third of a
full longevity payment—or $900.
Believing that Plymouth violated federal law by
withholding $1,800 of his longevity pay, DeLee filed a
USERRA complaint with the Veterans’ Employment Ser-
vice of the Department of Labor. DOL investigated and,
after an unsuccessful attempt to resolve the issue with
Plymouth, referred the matter to the Department of Jus-
tice, which agreed to represent DeLee in litigation.
DeLee then sued Plymouth in the Northern District of
Indiana for alleged violations of USERRA. DeLee’s com-
plaint accuses Plymouth of violating 38 U.S.C. § 4316(a)
by denying him full longevity pay, which he alleges is a
seniority-based benefit to which USERRA entitles him.
Without taking discovery, the parties filed cross-motions
for summary judgment on the § 4316(a) claim. 1 The dis-
trict court granted Plymouth’s motion for summary
judgment and denied DeLee’s motion for partial sum-
mary judgment. DeLee appealed, and so we review the
district court’s ruling on the parties’ cross-motions for
summary judgment de novo. Gross v. PPG Indus., Inc., 636
1 DeLee also sought statutory damages for a willful USERRA viola-
tion pursuant to 38 U.S.C. § 4323(d)(1)(C). A plaintiff is entitled to a
jury trial on a liquidated damages claim under USERRA, Middleton v.
City of Chicago, 578 F.3d 655, 659 (7th Cir. 2009), and DeLee did not
move for summary judgment on that claim. Plymouth, however,
moved for summary judgment on both counts.
6 No. 14-1970
F.3d 884, 888 (7th Cir. 2011); Storie v. Randy’s Auto Sales,
LLC, 589 F.3d 873, 876 (7th Cir. 2009).
II. Discussion
USERRA, the most recent statute in a long line of fed-
eral veterans’ rights laws enacted since the Selective
Training and Service Act of 1940, was passed in 1994 to
strengthen existing employment rights of veterans of our
armed forces. 2 Gross, 636 F.3d at 888. The statute seeks (1)
to encourage military service by minimizing the disad-
vantages to civilian careers, (2) to minimize the disrup-
tion in the lives of servicemembers by providing prompt
reemployment, and (3) to prohibit servicemember dis-
crimination. 38 U.S.C. § 4301(a). USERRA accomplishes
these goals by prohibiting an employer from discriminat-
ing against a servicemember because of his service
(§ 4311), requiring prompt reemployment of a returning
servicemember (§§ 4312, 4313(a)), establishing a protec-
tive period during which an employer may not discharge
a reemployed servicemember without cause (§ 4316(c)),
and—relevant to this case—affording returning service-
members all of the seniority and seniority-based benefits
that they would have attained had they remained con-
tinuously employed (§ 4316(a)).
More precisely, § 4316(a) specifies:
2 “Congress emphasized when enacting USERRA that to the extent it
is consistent with USERRA, the ‘large body of case law that had de-
veloped’ under the predecessor statutes to USERRA ‘remained in
full force and effect.’” Gross, 636 F.3d at 888 (quoting 20 C.F.R.
§ 1002.2).
No. 14-1970 7
A person who is reemployed under this
chapter is entitled to the seniority and other
rights and benefits determined by seniority
that the person had on the date of the
commencement of service in the uniformed
services plus the additional seniority and
rights and benefits that such person would
have attained if the person had remained
continuously employed.
38 U.S.C. § 4316(a).
USERRA defines “benefits” and “rights and benefits”
to mean:
any advantage, profit, privilege, gain, sta-
tus, account, or interest (including wages or
salary for work performed) that accrues by
reason of an employment contract or
agreement or an employer policy, plan, or
practice and includes rights and benefits
under a pension plan, a health plan, an em-
ployee stock ownership plan, insurance
coverage and awards, bonuses, severance
pay, supplemental unemployment benefits,
vacations, and the opportunity to select
work hours or location of employment.
38 U.S.C. § 4303(2). USERRA defines “seniority” as “lon-
gevity in employment together with any benefits of em-
ployment which accrue with, or are determined by, lon-
gevity employment.” 38 U.S.C. § 4303(12).
In other words, USERRA requires employers to ad-
here to the “escalator” principle, placing a returning ser-
8 No. 14-1970
vicemember at the “precise point he would have occu-
pied had he kept his position continuously” while away
from the job for his military service. Fishgold v. Sullivan
Drydock Corp., 328 U.S. 275, 284–85 (1946) (interpreting
the Selective Training and Service Act of 1940’s seniority
provision); Rogers v. City of San Antonio, 392 F.3d 758, 763
(5th Cir. 2004) (quoting Fishgold in the USERRA context).
Of importance here, USERRA “supersedes any State law
(including local law or ordinance), contract, agreement,
policy, plan, practice, or other matter that reduces, limits,
or eliminates in any manner any right or benefit provid-
ed by” USERRA. 38 U.S.C. § 4302(b).
At summary judgment, the district court focused on
the language of Plymouth’s proration ordinance—
mindful of the guidance promulgated by the Supreme
Court in Accardi v. Pennsylvania R.R. Co., 383 U.S. 225
(1966), and Foster v. Dravo Corp., 420 U.S. 92 (1975)—in
arriving at its conclusion that Plymouth’s longevity pay
for police officers is not a benefit determined by seniority.
Accardi involved returning servicemembers’ claims to
severance payments, which the Supreme Court deter-
mined to be a seniority-based benefit to which the ser-
vicemembers were entitled. 383 U.S. at 232. Following
honorable discharges from the armed forces, Accardi and
his co-plaintiffs returned to their jobs at the Pennsylvania
Railroad and were restored to their former positions with
the same amount of seniority that they had when they
left, plus credit for the three years they had spent in the
armed forces. Id. at 227. Fifteen years later, however, the
men were laid off and, pursuant to their union agree-
ment, awarded severance pay based on “the length of
compensated service” with the railroad. Id. at 227–28. The
No. 14-1970 9
railroad excluded the three years that the men had spent
in the armed forces. The men sued, alleging violations of
the Selective Training and Service Act of 1940, which re-
quired employers to reinstate honorably discharged em-
ployees to “their former position” or “a position of like
seniority, status, and pay,” without a loss of seniority. Id.
at 229.
The statute’s purpose, the Supreme Court said, was
“to preserve for the returning veterans the rights and
benefits which would have automatically accrued to
them had they remained in private employment rather
than responding to the call of their country.” Id. at 229–
230. Although the severance payments were based pri-
marily on the employees’ length of service with the rail-
road, the railroad argued that severance was “not based
on seniority, but on the actual total service rendered by
the employee.” Id. at 230. The Supreme Court rejected
that argument for two reasons. First, the Court noted, the
railroad’s rules afforded severance credit for an entire
year to an employee who had worked just seven days,
undercutting the railroad’s argument that the severance
payments were compensation for services rendered. Id.
Next, the Court said, “the real nature” of severance pay-
ments are compensation for loss of a job, not payment for
services rendered. Id. For those reasons, the Supreme
Court concluded that severance payments are “a means
of compensating employees for the loss of rights and
benefits accumulated over a long period of service”—not,
as the railroad had argued, a form of deferred compensa-
tion for work done in the past. Foster, 420 U.S. at 98 (de-
scribing the holding in Accardi). Accordingly, the sever-
10 No. 14-1970
ance payments were a seniority-based benefit guaranteed
by federal statute, the Court held. Id.; 383 U.S. at 232.
By contrast, Foster involved the accrual of vacation
benefits, which the Supreme Court deemed a form of
short-term compensation for work performed, and thus
not a benefit based on an employee’s seniority to which a
servicemember was entitled pursuant to the Military Se-
lective Service Act. 420 U.S. at 100. Foster’s union’s col-
lective bargaining agreement required employees to
work twenty-five weeks in a calendar year to accrue the
company’s full amount of allotted vacation time. Id. at 94.
Foster worked seven weeks in 1967, took military leave,
and then returned for thirteen weeks in 1968. Id. When
his employer denied him vacation days for both years, he
sued, arguing that vacation days are a seniority-based
benefit. The Supreme Court disagreed, highlighting the
difference between the vacation benefits at issue and the
severance payments addressed in Accardi. Both included
a work requirement, but unlike the work requirement in
Accardi (which “appear[ed] plainly designed to measure
time on the payroll rather than hours on the job”), the
work requirement to accrue vacation benefits “consti-
tute[d] a bona fide effort to compensate for work actually
performed.” Id. at 99. Critical to the Court’s conclusion
that “vacation benefits were [not] intended to accrue au-
tomatically as a function of continued association with
the company” was the fact that employees accrued extra
vacation time as they worked overtime hours, and that if
an employee was laid off before hitting the 25-week
mark, he was compensated for vacation days on a pro
rata basis. Id. at 100-01. Thus, the Court held, the vacation
benefits at issue were more appropriately characterized
No. 14-1970 11
as “a form of shortterm compensation for work per-
formed.” Id. at 100.
The district court considered the circumstances and
reasoning of these two cases and concluded that Plym-
outh’s longevity pay for police officers is more akin to a
vacation benefit than to a severance payment because of
the operation of Ordinance No. 1480, which, as dis-
cussed, serves to prorate the benefit according to the
months that an employee was on a leave of absence. The
district court concluded that the longevity rate (i.e., the
number of years of employment by which $225 is multi-
plied) “is plainly a seniority benefit,” but that the longev-
ity amount “is clearly intended to be compensation for
work actually performed in the preceding year.” DeLee v.
City of Plymouth, Ind., 2014 WL 1316870, at *4 (N.D. Ind.
Mar. 31, 2014). Therefore, in the district court’s view,
DeLee was not deprived of the seniority benefit—the
$225 was multiplied by 12, even though his total longevi-
ty payment then was prorated—and Plymouth did not
run afoul of USERRA. Id.
There is logic to the district court’s reasoning: by pro-
rating longevity pay, the benefit appears to be more
closely tied to the number of months an employee has
worked in the short term than to the number of years that
he has been employed by the City. And the result seems
equitable because it provides DeLee some seniority bene-
fit (in the form of the rate calculation) for his missed time,
without requiring the City to provide him a full longevi-
ty payment for a year in which he took a leave of ab-
sence. But a pair of more recent Supreme Court cases—
Alabama Power Co. v. Davis, 431 U.S. 581 (1977), and Coffy
12 No. 14-1970
v. Republic Steel Corp., 447 U.S. 191 (1980)—compel a con-
clusion contrary to the one reached by the district court.
In Alabama Power, a reemployed servicemember sued
his employer pursuant to the Military Selective Service
Act, after he was denied employer pension credit for the
time he had spent on military leave. 431 U.S. at 582.
Again the Supreme Court stressed the importance of
identifying the “real nature” of the payments, noting
that, in Accardi, the Court had rejected an employer’s at-
tempt to “disguise” severance payments by “use of a
‘compensated service’ formula to calculate the amount of
payments.” Id. at 588. And the Court reiterated Foster’s
conclusion that vacation benefits were “a form of pay for
work done” largely on account of the “common concep-
tion of a vacation as a reward for and respite from a
lengthy period of labor.” Id. at 589.
The Court stressed that there are “two axes of analy-
sis” for determining whether a benefit is a right of senior-
ity secured by a veteran: (1) whether the benefit would
have accrued, with reasonable certainty, if the veteran
had been continuously employed during his military
service, and (2) whether the benefit is a “perquisite of
seniority.” Id. Prong one was easily satisfied, the Court
held. Id. at 591. In analyzing prong two—and this is par-
ticularly instructive in DeLee’s case—the Court empha-
sized that Foster “turned on the nature of vacation bene-
fits, not on the particular formula by which those benefits
were calculated”—“[e]ven the most traditional kinds of
seniority privileges could be as easily tied to a work re-
quirement as to the more usual criterion of time as an
No. 14-1970 13
employee,” the Court said. Id. at 592. Against that back-
drop, the Court noted:
It is obvious that pension payments have
some resemblance to compensation for
work performed. Funding a pension pro-
gram is a current cost of employing poten-
tial pension recipients, as are wages . . . .
The same observations, however, can be
made about any benefit and therefore are of
little assistance in determining whether a
particular benefit recompenses labor or re-
wards longevity with an employer.
Id. at 592–93. Taking into account all of the different as-
pects of pension plans, the Court concluded that the
“‘true nature’ of the pension payment is a reward for
length of service.” Id. at 593. To the Court, the “most sig-
nificant factor pointing to this conclusion [was] the
lengthy period required for pension rights to vest in the
employee.” Id. at 593. But the Court also was swayed by
the “function of pension plans in the employment sys-
tem”—“[by] rewarding lengthy service, a plan may re-
duce employee turnover and training costs and help an
employer secure the benefits of a stable work force.” Id.
at 594. These same objectives are accomplished by Plym-
outh’s longevity payments, as even the preamble of Or-
dinance No. 1480 acknowledges. 3
3 Plymouth devotes a sizable portion of its brief to an analysis of
Jackson v. Beech Aircraft Corp., 517 F.2d 1322 (10th Cir. 1975), which
Plymouth believes to be the only circuit court decision addressing
longevity pay under USERRA or a predecessor statute. Although the
court found the “longevity pay” at issue in that case not to be senior-
14 No. 14-1970
The ordinance’s preamble—which speaks to the ordi-
nance’s purpose and therefore aids us in assessing the
fundamental nature of Plymouth’s longevity benefit—
tells us several things. First, by noting that “longevity
pay has long been recognized as an incentive for police
and firemen to remain in the service of the City,” the or-
dinance acknowledges the benefit’s history as a reward
for lengthy service. (Indeed, Plymouth concedes that
longevity pay, in the absence of proration, is a seniority-
based benefit.) Second, by flagging the advent of “ques-
tions . . . concerning the advisability of paying longevity”
to those on inactive status, the ordinance highlights the
potential unsustainability of that policy. Finally, by an-
nouncing that it was informed by considerations of “fis-
cal responsibility and fairness,” the ordinance self-
identifies as a compromise that remains true to Plym-
outh’s long-standing tradition of paying firefighters and
police a longevity payment, while accounting for the fi-
nancial realities of the day. The plain language of the
ity-based, Jackson is of little utility. Plymouth overlooks that the Su-
preme Court specifically granted certiorari in Alabama Power because
of a conflict among the circuits, and that Alabama Power’s holding
(that pension benefits are seniority-based) overruled the holding in
Jackson (that they are not). That result renders questionable the con-
tinuing force of Jackson’s ruling concerning longevity pay. Moreover,
the “longevity pay” in Jackson was fundamentally different from the
one at issue here. In Jackson, longevity pay took the form of “an hour-
ly premium of 5 cents per hour” after five years and “10 cents per
hour” after ten years on the job. Id. at 1323. The benefit in Jackson,
therefore, was more akin to a raise, than to the “longevity pay” that
Plymouth provides.
No. 14-1970 15
preamble, therefore, strongly suggests that by enacting
its proration policy, Plymouth sought to cut the cost of
paying an expensive benefit, without disturbing its un-
derlying purpose. The Supreme Court’s decision in Coffy
underscores the importance of the ordinance’s origins in
our diagnosis of its true nature.
In Coffy, the Court deemed supplemental unemploy-
ment benefits (“SUBs”) to be a seniority-based benefit,
the denial of which violated the plaintiff’s rights under
the Vietnam Era Veterans’ Readjustment Assistance Act
of 1974. 447 U.S. at 193. As in Alabama Power, the Court
found the reasonable certainty prong of the two-axes test
to be easily satisfied (SUBs are a benefit that would have
accumulated had Coffy not taken a leave of absence to
perform military service), and so the Court focused on
ascertaining the “real nature” of the benefit. Id. at 199–
200. In doing so, the Court traced the history of SUBs,
which evolved from the demand by organized labor for a
guaranteed annual wage. Id. at 200. As the Court ex-
plained, once it became evident to unions in certain in-
dustries that their fight for a guaranteed minimum wage
was a losing battle, they switched their focus to supple-
menting existing unemployment compensation pro-
grams. Id. “From the beginning, then, the purpose of SUB
plans was to provide employment security regardless of
the hours worked rather than to afford additional com-
pensation for work actually performed. From the em-
ployer’s standpoint, SUBs, like pension benefits, help to
assure a stable work force through periods of short-term
layoffs.” Id. Moreover, the “essential function of SUB
plans is to provide economic security for regular em-
ployees in the event they are laid off. Protection against
16 No. 14-1970
layoff is, of course, one of the traditional attributes of sen-
iority.” Id.
In its appellate brief, Plymouth explains the historical
context in which it enacted its proration policy, explain-
ing that its adoption was precipitated by the Supreme
Court’s ruling in Garcia v. San Antonio Metropolitan Trans-
it Authority, 469 U.S. 528 (1985). By Plymouth’s character-
ization, Garcia “affirmed the constitutionality of Con-
gress’ extension of the [Fair Labor Standards Act] to local
governments” and “struck a major financial blow to mu-
nicipalities.” The resultant financial stress prompted
Plymouth—“in the interest of fiscal responsibility and
fairness”—to adopt the longevity pay proration policy
set forth in Ordinance No. 1480. This is insightful, be-
cause it demonstrates that Plymouth began prorating
longevity pay—tying it for the first time to a work re-
quirement—to save money, not because it no longer
sought to reward longevity and incentivize continued
employment for its firefighters and policemen.
Besides the historical context in which SUBs came
about, three elements of the SUB plan influenced the Cof-
fy Court’s decision, all of which cut convincingly in
DeLee’s favor with regard to characterizing longevity
pay as a seniority-based benefit. First, the Supreme Court
rejected the district court’s conclusion that SUB payments
were so closely related to hours worked as to demon-
strate that the plan was a “bona fide effort to compensate
for work actually performed,” since that conclusion “is at
odds with the literal terms of the plan, which provide
that SUB credits are earned for all weeks in which an
employee has any hours.” 447 U.S. at 201 (emphasis in
No. 14-1970 17
original). Like Coffy’s employer, Plymouth claims that
the contested benefit is compensation for work per-
formed, but the literal terms of the benefit do not support
that conclusion. Recall that DeLee’s anniversary date is
April 19 and that DeLee deployed from September 1,
2010 until May 11, 2011. DeLee therefore missed 7
months and 19 days of his twelfth year on the job and
another 23 days in his thirteenth year. Yet Ordinance No.
1480 calls for proration “based on the number of months
of actual active duty,” and so when Plymouth calculated
his prorated benefit, it discounted his longevity pay by
8/12. The rough estimation used by Plymouth suggests
the same thing that Ordinance No. 1480’s preamble im-
plies—that Plymouth prorates the longevity payments as
a cost-savings mechanism pursuant to a fiscal compro-
mise, not because the longevity pay is payment for days
in which work was actually performed.
Second, the Supreme Court took into consideration
the fact that an employee earned SUB credits for time
that the employee did not actually work, such as while
attending jury duty, out disabled, or performing certain
union duties. Id. at 202. For that reason, the Court reject-
ed the employer’s argument that the 32-hour work-week
minimum revealed the SUB plan’s nature as deferred
compensation for work performed. Id. The Court also
highlighted that Coffy’s SUB plan made no provision for
accrual of additional credits for hours worked over 32
per week or for overtime. “This omission is not sugges-
tive of a desire to compensate work actually performed,”
the Court reasoned. Id. at 202. Similarly, Plymouth issues
full longevity pay, without proration, to employees who
missed significant time from work (for jury duty, vaca-
18 No. 14-1970
tion, sick time, etc.), as long as the employee was not out
on an official leave of absence. Moreover, Plymouth does
not award employees any extra longevity pay for over-
time.
Finally, the Coffy Court took note of the fact that em-
ployees received no benefits if they were laid off or quit
before having worked for the company for two years. Id.
at 205. “Such a threshold requirement is more character-
istic of seniority provisions than of compensation.” Id.
Likewise, for a Plymouth police officer to earn a longevi-
ty payment, he must have been with the City continuous-
ly for three years.
Applying the Alabama Power test to DeLee’s situation,
there is no question that a full longevity payment would
have accrued but for his leave of absence. And, as de-
scribed above, every meaningful aspect of the “perqui-
sites of seniority” considered by the Supreme Court in
Alabama Power and Coffy cuts decisively in DeLee’s favor.
Nevertheless, Plymouth maintains that its longevity ben-
efit is compensation for work done during the prior year,
staking its position on the “simple idea that wages are
earned through work.” But longevity payments are not
wages. And, in any event, that “simple idea” contravenes
USERRA’s guarantee of seniority benefits, which include
seniority-based bonuses. See 38 U.S.C. § 4303(2). 4 In Coffy,
4 Plymouth points to Featsent v. City of Youngstown, 70 F.3d 900 (6th
Cir. 1995), in support of the proposition that longevity pay should
not be considered a reward for lengthy service under USERRA.
Featsent is an FLSA case, in which the plaintiffs, city police officers,
challenged the city’s compliance with the overtime requirements of
the statute. The FLSA requires that employers compensate their em-
No. 14-1970 19
the Supreme Court emphasized that “[e]ven if eligibility
for SUB payments were closely related to hours worked,
that fact would not, by itself, render them compensation
rather than seniority rights.” 447 U.S. at 203. That is be-
cause the nature of the benefit, not the formula by which
it is calculated, is the “crucial factor, ‘for even the most
traditional kinds of seniority privileges could be as easily
tied to a work requirement as to the more usual criterion
of time as an employee.’” Id. at 204 (quoting Alabama
Power, 431 U.S. at 592). Ultimately, the history of SUB
plans, as well as the plan’s specific provisions, compelled
the Coffy Court’s conclusion that the benefit was a reward
for lengthy service. Id. These same considerations dictate
the outcome here, where we conclude that the original
purpose of Plymouth’s longevity pay for police was to
reward them for lengthy service and that that purpose
survived the subsequently-enacted proration ordinance.
Accordingly, the “real nature” of longevity pay foreclos-
es the City’s argument that its prorated payments to po-
ployees who work in excess of forty hours per week at a rate one-
and-a-half times the regular rate at which they are employed. Id. at
903. Among other things, the Featsent plaintiffs argued that the city
failed to incorporate longevity pay into the calculation of its “regular
hourly rate,” which the statute defines to include “all remuneration
for employment paid to, or on behalf of, the employee.” Id. at 904. In
light of the statute’s requirement that the “regular rate” include all
remuneration for employment, the Sixth Circuit held that longevity
pay must be included in the calculation, even though “by definition”
longevity pay is “payment[] given on the basis of length of service” “to
compensate police officers for their service to the city.” Id. 905–06 (empha-
ses added). If anything, therefore, this case undermines, rather than
supports, Plymouth’s argument.
20 No. 14-1970
lice officers are compensation for work actually per-
formed that year.
III. Conclusion
For the foregoing reasons, we REVERSE the judgment
of the district court and REMAND for further proceedings
consistent with this opinion.