When Is Mandatory Counseling Paid Time Under The FLSA?

Gwendolyn Gibbs and Lanita Drew worked for the New York Police Department. Each was identified by the NYPD as having a problem with alcohol use, although each employee disputed this characterization as false. NYPD required both employees to attend mandatory alcohol treatment and counseling sessions, or else face disciplinary action including, potentially, termination.

NYPD’s counseling fell into three categories: Inpatient counseling at a residential alcohol treatment facility, outpatient counseling during regular work hours provided by the City, and outpatient counseling provided by third parties after regular work hours. Gibbs attended all three types of counseling, while Drew attended only the latter two. Ultimately, Gibbs’ employment with the NYPD was terminated when she refused to continue counseling. Drew completed the required counseling program and remained employed with the NYPD.

Both employees sued the City, contending that the time spent in alcohol counseling should be paid time under the Fair Labor Standards Act (FLSA). A federal court rejected the claim, concluding that the sessions were not “work” as defined by the FLSA.

The Court held that to be “work,” an activity must be both “controlled or required by the employer and pursued necessarily and primarily for the benefit of the employer and his business. There is no dispute that the counseling sessions were required by the NYPD. The dispositive issue is whether the counseling sessions were pursued necessarily and primarily for the benefit of the employer. Here, several factors ultimately lead to the conclusion that the counseling sessions were not predominantly for the benefit of the NYPD.

“First, there is no evidence in the record to suggest that the counseling sessions benefited the NYPD in any relevant way. Of course, that is not to suggest that the NYPD does not benefit from having sober employees. Nor is it to suggest that the NYPD does not benefit in some manner from rehabilitating employees whose employment, rightly or wrongly, might otherwise be prematurely terminated, potentially necessitating an investment in hiring and training a new employee. But these are not the kinds of benefits that courts have recognized as decisive in this context. Something more is required.

“In the only case of which the Court is aware where an employee’s continued employment was held to amount to a benefit to the employer, the Court stressed the fact that the counseling sessions helped ensure that the employee stayed on the job in a position that was short-staffed. Put differently, it was the fact that the employer was short-staffed, combined with other factors on that record, that led the Court to conclude the employer was the primary beneficiary. Lacking any evidence pointing to a similar or otherwise notable benefit to the employer, the two other courts that have considered this question have thus reached the opposite conclusion.

“Because the record here contains no suggestion that the employees’ continued employment was particularly valuable to the NYPD – there is no suggestion, for example, that their positions were short-staffed – there is an insufficient basis to conclude that the NYPD benefited in a relevant manner from the counseling sessions.

“Second, and conversely, there is evidence in the record that supports the conclusion that the employees benefited from the counseling sessions. Where an employee’s job performance has been affected by alcohol use such that an employer has cause to discipline or terminate the employee, it seems indisputable that the counseling sessions benefit the employee because they provide an alternative to discipline or termination: Instead of potentially losing her job, the employee is offered a second chance contingent on completion of the counseling. But even where such cause may not or does not exist, employees may still be the beneficiaries of counseling sessions.

“Third, the record reflects that the NYPD did not assume primary responsibility for the cost of the counseling. Although this factor on its own is not decisive, it reinforces the conclusion that the employees, not the City, were the predominant beneficiaries of the counseling.”

Gibbs v. City of New York, 2015 WL 321850 (S.D. N.Y. 2015).