In a favorable ruling for management, the Fifth Circuit affirmed the principle that an employer need not follow their employees’ understanding of their own workweek. Rather, the employer may define the workweek in a way that is most employer-friendly for determining overtime obligations.
In Johnson v. Heckmann Water Resources (CVR), Inc., the plaintiffs worked 7 consecutive 12 hour shifts in every two week pay period, which ran from Thursday – Wednesday. The plaintiffs filed a lawsuit alleging that their employer violated the overtime requirements of the Fair Labor Standards Act by not calculating overtime compensation using a Thursday – Wednesday workweek. Under the plaintiff’s preferred approach, they would be entitled to over 40 hours of overtime each pay period. However, the employer calculated overtime on a Monday – Sunday basis, resulting in less than 10 hours of overtime for the plaintiffs each pay period.
The district court granted summary judgment for the employer, and the Fifth Circuit affirmed. In so holding, the court noted that regulations interpreting the FLSA only require that a “workweek” be “a fixed, regularly recurring period of 168 hours—seven consecutive 24-hour periods.” While the regulations require that the workweek remain fixed once established, they expressly state that the workweek “need not coincide with the calendar week but may begin on any date and at any hour of the day.” In rejecting the employees’ claims of overtime violations, the Fifth Circuit also relied upon a 2009 DOL Opinion Letter and a similar decision from the Eighth Circuit, both of which supported an employer’s right to choose a workweek under the FLSA.
This decision should serve as a reminder to employers to review their workweek policies to ensure that the workweek is not only clearly defined, but also defined in a way that is most economical to the company. Kelley Drye’s Labor and Employment Group can help you determine whether your pay policies comply with applicable wage and hour law and assist with proper documentation in the event that your practices are challenged.