TimeSheet.jpgThe U.S. Court of Appeals for the Sixth Circuit in Ohio recently issued a decision rejecting a nurse’s claim for compensation for missed meal breaks under the Fair Labor Standards Act (“FLSA”).  Not only is the holding in White v. Baptist Memorial Health Care Corp a victory for employers, but it underscores the importance of having reasonable policies and procedures in place for reporting all time worked including overtime.

Margaret White was an emergency room nurse for Baptist Memorial Health Care Corp.  During her employment, White was given unpaid meal breaks that were automatically deducted from her pay check.  However, White’s meal breaks were not regularly scheduled due to the nature of working in an emergency room.  Instead, meal breaks occurred as work demands allowed.

The hospital’s employee handbook provided that if an employee’s meal break was missed or interrupted because of work, the employee would be compensated for the time worked during the meal break.  Employees were also instructed to record time spent working during a meal break in an “exception log” regardless of whether the meal break was partially or entirely interrupted.  White signed a document acknowledging her understanding of this policy.  White was also familiar with the hospital’s procedures to report and correct payroll errors.  She admitted that, when she utilized these procedures, errors were handled immediately.

White initially recorded her missed or interrupted meal breaks on the exception log pursuant to the policy and was compensated for her time.  However, White also stated there were occasions she was not paid for missing a meal break.  She also said that from time to time she told her supervisors and the human resources department that she was not getting a meal break.  However, she never said that she was not compensated for missing her meal breaks.  Eventually, White stopped reporting her missed meal breaks on the exception log and did not use the procedures to correct payroll errors.  She also did not keep records of when she missed meal breaks and was not compensated for them.

White filed a class action against Baptist alleging violations of the FLSA for failing to compensate her for working through her meal breaks.  The U.S. District Court in Memphis, Tennessee granted summary judgment in favor of the hospital and decertified the class action on the grounds that the hospital’s policy for compensating employees for missed breaks was proper under the FLSA.  White appealed the decision to the Court of Appeals where it was affirmed.

In reaching its decision, the appellate court stated that a system which automatically deducts meal times from an employee’s work hours is lawful under the FLSA.  Further, if an employer establishes a reasonable process for an employee to report uncompensated work time, the employer is not liable for non-payment under the FLSA if the employee fails to follow the established procedures.  The Court further stated that when the employee fails to follow reasonable time reporting procedures, the employee prevents the employer from “knowing its obligation to compensate the employee and thwarts the employer’s ability to comply with the FLSA.”

With these legal principles in mind, the court found that the hospital had established policies and a system in place to pay employees for time worked during meal breaks.  The evidence also showed that White was paid for her missed meal breaks when she utilized the system, and not paid when she failed to use the system.  There was also no evidence that the hospital prevented her from using the system.  Although White occasionally told her supervisors that she was not getting a break, she never told them that she was not being compensated for missing a meal break.  Based upon these facts, the court concluded that there was no way the hospital knew or should have known that White was not being paid for her missed meal breaks.  Therefore, White’s claim was denied.

The lesson the White decision teaches employers is that they should establish, reasonable procedures for employees to report all time worked including work during meal breaks or outside of their regularly scheduled work hours.  In addition, employers should regularly publish and remind employees of these policies and procedures.  Finally, employers should discipline employees who violate the established policies and procedures.  If you need help with creating these procedures or would like to have your existing procedures reviewed by one of our attorneys, please contact our Fresno, Los Angeles, San Diego or San Francisco office.