A federal court in Wisconsin recently granted preliminary approval to a $3.5 million settlement between a hospital and nearly 1,400 nurses in one of themany recent cases involving automatic deduction of meal breaks from wages.

In Fosbinder-Bittorf v. SSM Health Care of Wisconsin, Inc., the plaintiff claimed that the hospital’s policy of daily automatic deduction of 30 minute meal periods from hours worked whenever a nurse worked more than 5.5 hours in a workday violated the FLSA because nurses were not relieved from duty for a 30 minute meal break each day. Specifically, the plaintiff alleged that she was not permitted to leave the hospital during meal breaks, was frequently interrupted by doctors and staff, and was forced to carry and respond to a hospital pager.

The hospital moved for summary judgment soon after the action was filed and argued that although the hospital had an automatic meal period deduction policy, any nurse could simply cancel the automatic deduction by pressing a “cancel lunch” button on the time clock or by completing a maintenance sheet correcting the error. In fact, the plaintiff herself had cancelled the automatic meal period deduction 35 times during the class period. Moreover, the hospital’s management guide clearly stated “[i]f an employee works during the meal period (normally a five-minute or longer telephone conversation or any hands on work), the entire lunch period is considered work time” and must be paid. Nevertheless, the court denied the motion for summary judgment, finding factual questions existed as to whether the plaintiff was required to remain at the hospital during her meal period and whether she had been relieved of all duty. In support of its opinion the court concluded, among other things, that the management guide was ambiguous regarding whether employees were completely free during meal breaks and could leave the hospital’s premises. The court also relied on plaintiff’s testimony that the hospital’s charge nurses told her she was not allowed to leave the hospital during her meal periods, and testimony by a hospital witness that he was “not surprised” that nurses found it difficult to take uninterrupted meal periods given the nature of the position.

Shortly after the court denied the hospital’s motion for summary judgment, the parties participated in voluntary mediation and agreed to settle the dispute for a total of $3.5 million, including attorney’s fees and costs. The court granted preliminary approval of the settlement and set a fairness hearing for October 23, 2013.

While a number of courts, including the Sixth Circuit Court of Appeals, have reached a different conclusion than that reached in Fosbinder-Bittorf regarding summary judgment in auto-deduct meal break cases, the decision in this case is nevertheless a reminder of the importance of clearly drafted meal period policies and training for front-line managers to enforce those policies.