Indian Health Service settles employee overtime case for $80M

As many as 20,000 employees who worked for the Indian Health Service from 2006 to 2015 will receive compensation of up to $33,000 after the agency settled a lawsuit over alleged violations of the Fair Labor Standards Act.

Three employee unions—the Laborers’ International Union of North America, the National Federation of Federal Employees and the American Federation of Government Employees Local 3601—filed a lawsuit against IHS claiming employees were forced to work overtime, but not compensated.

Snider & Associates, the law firm representing the three unions and their employees, said a mediator helped the Indian Health Service and the unions come to an $80 million settlement.

“We have yet to find one federal agency that is fully in compliance and properly compensating all bargaining unit employees,” said managing attorney and firm member Michael Snider in a release.

Under the FLSA, agencies are supposed to compensate employees, but the unions claim employees were improperly classified as exempt or not properly paid for travel time or “off the clock” work, also known as suffer or permit overtime.

IHS said the claims “largely arise from IHS employees who have covered shifts at health care facilities that would not otherwise have been covered or stayed beyond their scheduled work time to serve additional patients.”

Robert McSwain, acting director of the Indian Health Service, wrote to tribal leaders announcing the settlement on May 22. Most of the employees impacted by the settlement are Native Americans.

McSwain said settling the claims is the appropriate step.

“IHS is also working to address the management of overtime work performed by IHS employees,” McSwain said in the letter.

IHS said they are reallocating $20 million from fiscal 2015 funds that were supposed to be used for new staffing at the Kayenta Health Center in Arizona, $9 million will be charged to the fiscal year the overtime was earned and the remaining $51 million will come from prior year third-party health insurance collections that would have been available to pay these overtime costs when they were incurred.

The law firm has brought dozens of cases against the government for FLSA violations. Snider & Associates said it also has won settlements from the State Department (almost $40 million), the Environmental Protection Agency ($35 million), the General Services Administration ($30 million) and the Department of Housing and Urban Development ($24 million).

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