(CN) – Oakland, Calif., did not violate federal labor law when it required a police officer who quit before two years to pay back 80 percent of her $8,000 training costs, the 9th Circuit ruled Friday.
The federal appeals panel in San Francisco upheld the district court’s dismissal of Courtney Gordon’s class action for failure to state a claim.
The former police officer’s debt was a “voluntarily accepted loan” from the city, not a kickback under the Fair Labor Standards Act (FLSA), Senior Circuit Judge Procter Hug wrote.
Gordon had argued that Oakland’s longstanding reimbursement agreement, which required her to repay 80 percent of her training costs, or $6,400, when she resigned before her second year of service, violated federal law because it “caused her to receive less than the federal minimum wage during her final workweek.”
The city deducted part of the debt from Gordon’s final paycheck. She later paid the remainder out-of-pocket and moved to file an amended complaint.
The federal judge dismissed Gordon’s motion, ruling that because her final paycheck exceeded the minimum wage, the city’s demand for reimbursement was legal.
Gordon fared no better in the 9th Circuit.
“The $5,268.03 payment Gordon made to the city is repayment of a voluntarily accepted loan, not a kickback,” Judge Hug wrote.
Oakland could require its police applicants to be fully trained, at no cost to the city, before signing a contract, Hug explained. Instead, the city advances them the cost of training and requires that they pay back a pro-rated portion if they resign before completing five years on the job.
“Gordon, however, chose not to serve the five years necessary to secure complete forgiveness,” Hug wrote. “Despite the debt Gordon owed following her resignation, the city satisfied the FLSA’s requirements by paying Gordon at least minimum wage for her final week of work. The city was therefore free to seek repayment of Gordon’s training debt as an ordinary creditor.”