3rd Circuit Rules Employers Must Pay for Short BreaksOn November 7, 2017 by Schnader in Labor and Employment
A recent case in the Third Circuit Court of Appeals serves as an important reminder that employers must pay workers for short breaks. The opinion by Judge McKee in Secretary United States Department of Labor v. American Future Systems, Inc. d/b/a Progressive Business Publications was issued October 13, 2017 and can be found here.
Progressive Business Publications pays its sales representatives an hourly wage. It previously had a policy giving employees two fifteen-minute paid breaks per day. In 2009, it eliminated the paid breaks, instead allowing employees to log off their computers at any time, calling it “flexible time.” However, if the employees were logged off for more than 90 seconds, they were not paid for the break. The unpaid breaks included time to use the bathroom, get coffee, or to take a moment in between sales calls to prepare for the next call. As a result, the employees were being paid just over five hours per day.
The Department of Labor brought suit against Progressive alleging it violated the Fair Labor Standards Act (FLSA) by failing to pay the federal minimum wage to employees subject to this policy. The District Court granted the Department’s motion for partial summary judgment on the minimum wage claim and Progressive appealed.
In the opinion, Judge McKee had this to say about Progressive’s “flexible time” policy: “The policy that Progressive refers to as ‘flexible time’ forces employees to choose between such basic necessities as going to the bathroom or getting paid unless the employee can sprint from computer to bathroom, relieve him or herself while there, and then sprint back to his or her computer in less than ninety seconds.” In a footnote, Judge McKee wonders if this feat is even possible, absent the employee having access to a Portkey (in the Harry Potter series, an object used to transport wizards from one spot to another).
Judge McKee then found that Progressive’s “flexible time” policy is in fact a break policy to which the FLSA applies, and that Progressive violated the FLSA by failing to pay its employees for rest breaks of twenty minutes or less.
Under the federal law, breaks that are under 20 minutes must be paid – with very narrow exceptions. Therefore, employers who permit employees to take breaks lasting under 20 minutes should be aware that such breaks most likely need to be paid. This may include, for example, splitting break time that ordinarily is unpaid – such as splitting an unpaid 30-minute lunch break into two 15 minute breaks because the business requires the break be interrupted. To ensure compliance with the law, Employers should have policies directing employees and managers on paid and unpaid break time, and that unpaid breaks of over 20 minutes must be taken in their entirety. Employers also should monitor break time practices to ensure policy compliance.