Auto-deduct policies and meal breaks continue to make FLSA headlines. Last week, the Second Circuit tackled these policies, as well as gap-time claims, head on and came down on the side of the employer.
The case involved a collective action brought by employees of various health-care facilities. The basic allegation was that the plaintiff-employees had not been paid for time worked during meal breaks, before and after shifts, and time spent at training. The plaintiffs brought claims under the federal FLSA and under the New York state wage law. The district court dismissed the complaint several times before the case made it to the 2d Circuit.
The plaintiffs brought two types of claims under the FLSA: (1) overtime; and (2) gap time. Both were dismissed by the trial court. The Second Circuit affirmed the dismissal.
The court concluded that, "in order to state a plausible FLSA overtime claim, a plaintiff must sufficiently allege 40 hours of work in a given workweek as well as some uncompensated time in excess of the 40 hours." Here, the plaintiffs didn't make any factual allegations about how much time they claimed to have worked but not been paid. Similarly, they did not allege whether this missed time (in whatever amount that may be), bumped them into a more-than-40-hour workweek.
As so aptly stated by the court, the plaintiffs' vague allegations "supply nothing but low-octane fuel for speculation, not the plausible claim that is required." Based on the failure to allege any specific facts about the time worked, the dismissal of the claim was affirmed.
We've posted about gap time previously. In this case, the Second Circuit described a gap-time claim as "one in which an employee has not worked 40 hours in a given week but seeks recovery of unpaid time worked, or in which an employee has worked over 40 hours in a given week but seeks recovery for unpaid work under 40 hours."
The court, consistent with the majority of courts to have reached the question, explicitly rejected a gap-time claim brought under the FLSA. As the court explained, there is "no claim under FLSA for hours worked below the 40-hour overtime threshold, unless the average hourly wage falls below the federal minimum wage."
And, in a question of first impression, the court held that the FLSA does not provide for a gap-time claim even when an employee has worked overtime. The court explained:
The agreement to work certain additional hours for nothing was in essence an agreement to accept a reduction in pay. So long as reduced rate still exceeds the minimum wage, an agreement to accept reduced pay is valid.
So long as an employee is being paid the minimum wage or more, the FLSA does not provide recourse for unpaid hours below the 40-hour threshold, even if the employee also works overtime hours the same week. This is an important and timely victory for employers in their continued defense against FLSA lawsuits.
Another Employer's Auto-Deduct Policy Is Upheld (Creeley v. HCR ManorCare, Inc., (N.D. Ohio Jan. 31, 2013)).
6th Cir. Affirms Dismissal of FLSA Gotcha Litigation (White v. Baptist Mem'l Health Care Corp. (6th Cir. Nov. 6, 2012)).
The Legality of Automatically Deducting Meal Breaks (Camilotes v. Resurrection Health Care Corp. (N.D. Ill. Oct. 4, 2012)).
E.D. Pa. Dismisses Nurses' Claims for Missed Meal Breaks, Part I and Part II (Lynn v. Jefferson Health Sys., Inc. (E.D. Pa. Aug. 8, 2012)).
FLSA Victory: Class Certification Denied (Pennington v. Integrity Commun, LLC (E.D. Mo. Oct. 11, 2012))