The city of Lexington will pay firefighters $17.7 million for back overtime and pension.
The payment stems from a 2005 lawsuit filed by Lexington firefighters alleging that the city owed them money for overtime worked.
The details of the settlement are being worked out and must be approved, city and firefighter union officials said. The Urban County Council gave preliminary approval to making the money for the settlement available at the council’s Tuesday work session.
City officials have previously said any surplus or additional money from the fiscal year that ended June 30 would be used to pay for the settlement. That means there will be no surplus money to spend this year. In addition, the city has set aside millions of dollars in previous years in expectation that the firefighters’ lawsuit would eventually be settled. The city has more than $30 million in its rainy day fund, which is separate from surplus funds.
Chris Bartley, president of the Professional Firefighters Local 526, said the $17.7 million transfer of city money is the first step in the settlement process.
“It’s close,” Bartley said. “They are still finalizing the agreement.”
The total includes overtime, pension payments and interest, Bartley said.
Susan Straub, a spokeswoman for the city, said the final settlement must be approved by the council and the courts. That’s in addition to the council’s approval of the transfer of the money.
“We anticipate that the settlement may be completed in the next few months contingent upon approvals by the circuit court and the Urban County Council,” Straub said.
The case has languished in the courts for 12 years. Some of those delays were due to changes in state law on overtime calculations for firefighters.
A Fayette Circuit Court judge ruled that Lexington did not have to pay back overtime. The ruling was affirmed by the Kentucky Court of Appeals. The firefighters’ union appealed the decision to the Kentucky Supreme Court.
But before the case was heard by the state high court, another ruling in a separate case changed how cities paid overtime to firefighters.
The state Supreme Court ruled in 2011 that municipal governments are subject to Kentucky’s wage and hour laws and are not immune to lawsuits brought by the Kentucky Labor Cabinet to recoup the money.