As shoppers and retailers get ready to celebrate “Black Friday” -- the kickoff to what we hope will be a busy holiday shopping season -- it’s a good time for retail employers to review their policies on timekeeping and to ensure that non-exempt employees know how to record their working time. Where is it not prohibited by state laws concerning meal and other breaks, employees may sometimes end up missing all or part of an unpaid meal break due to the demands of a busy sales floor. Employers need make sure employees are properly compensated for time spent working during what would have been an unpaid break, and to protect against allegations to the contrary under the federal Fair Labor Standards Act or similar state wage laws. It will go a long way in avoiding, and if necessary, defending against such claims if your company timekeeping policies are carefully drafted, circulated, and followed.
The Sixth Circuit Court of Appeals recently issued a ruling that provides some guidance on this issue. In White v. Baptist Memorial Healthcare Corp, et al (No. 11-5717) (6th Cir., Nov. 6, 2012) the plaintiff, a nurse, claimed that she was not compensated for work done during her unpaid meal break time at the defendant hospital. The Sixth Circuit upheld the lower court’s dismissal of plaintiff’s claims because the employer’s handbook included an “exception log” mechanism that allowed employees to report when they missed all or part of a meal break, and that Plaintiff knew about, but failed to take advantage of, that mechanism.
Relying upon prior decisions from other federal appeals courts, the White Court found: “Under the FLSA if an employer establishes a reasonable process for an employee to report uncompensated work time, the employer is not liable for non-payment if the employee fails to follow the established process.” Employers should be guided by this finding, and ensure that they have policies in place that clearly inform non-exempt employees how to record or report all time worked, including instances of missed or interrupted meal breaks.
Having the appropriate policies in place is, of course, just the first step. It is also imperative for those policies to be sufficiently communicated and enforced. For example, in ruling for the employer in White, the Sixth Circuit found it significant that: (a) Plaintiff admittedly knew about the “exception log” policy in the handbook (and had, in fact, used it successfully on occasion to obtain pay for time worked during her meal break period); and (b) there was no evidence that the defendant employer discouraged its employees from reporting time worked during meal breaks or that the employer was otherwise notified that their employees were failing to report time worked during meal breaks.
Retail employers should therefore ensure not only that their non-exempt employees know about the time recording policies, but also that their supervisory managers (whether non-exempt or exempt) who work “on the ground” at the retail locations know about, and enforce, the policies. Even if a company has the right policies in place, it could all be for naught if there is evidence that managers routinely look the other way as employees are required to work through all or part of their unpaid meal break without compensation.