UNAUTHORIZED WORK TIME: THE COMPENSABILITY OF HOURS WORKED BEFORE AND AFTER THE EMPLOYEE’S SHIFT.

Robin Foret
December 5, 2007 — 5,812 views  
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As any employer knows, employees sometimes make their own decision to commence work before their shift begins, or after their shift ends, despite the fact that the employer has not approved additional hours, and in some instances, in violation of a company policy restricting the practice.  Courts have increasingly been asked to address these issues and to determine when such practices result in compensable time for which the employee must be paid under the Fair Labor Standards Act (“FLSA”). 
                                        
Fast v. Applebee’s International, Inc.

Recently, the court in Fast v. Applebee’s International, Inc., 502 F. Supp.2d 996 (W.D. Mo. 2007), was asked to decide whether the FLSA required compensation for time spent at the work site before an employee officially began his or her workday.  In that case, the employee, Gerald A. Fast (“Fast”), worked as a bartender at an Applebee’s restaurant.  Like all employees who worked for Applebees, Fast was required to arrive at work 15 minutes early, a concept known as “Appletime,” and represented time for which employees were not compensated.  Upon arriving at work, the computerized system allowed employees to clock in early with manager approval, or to “clock in as scheduled.”  The “clock in as scheduled” option automatically delayed the clock-in time until the start of the employee’s shift.  Although the computer instructed employees who “clocked in as scheduled” not to begin work prior to their shift, the computer nevertheless allowed such employees to enter customer orders and complete transactions before they were officially on the clock.  Alternatively, employees who did not clock in to the Applebee’s computer system could not enter orders or perform other transactions. 

Fast argued that Applebee’s violated FLSA by not compensating him for work performed prior to his shift in two respects.  First, Fast stated that in general, prior to clocking in he performed tasks such as straightening up chairs and picking up trash on the way to the bar area.  Second, Fast claimed that he sometimes chose the “clock in as scheduled” option and began taking customer orders and performing work-related functions before his shift.  Applebee’s defended the allegations by arguing that the time Fast spent on those activities was de-minimis, and thus, not paid time under the FLSA. 

With respect to the first category, i.e., work performed on the way to the bar area prior to the time Fast punched the time clock, the court agreed with Applesbee’s and concluded the work was de-minimis and not compensable.  The employee’s own testimony that he spent only a couple of minutes straightening up and picking up trash on the way to the bar area supported this result.  The second category, however, the time period after Fast “clocked in as scheduled” but before his shift began, was not de-minimis and was compensable.  Even if the amount of time worked during the “clocked in as scheduled” period was small, the fact that the computer allowed the employees to begin work necessitated an inference that the employer expected that employees would work prior to their actual shift time.  Moreover, the time worked could be easily tracked through the computer system, and paid accordingly.  

Basic Principles

            The basic principles applied by the court in Fast are contained in the FLSA, and the FLSA regulations, but are often overlooked by employers.  The basic premise is that “work not requested but suffered or permitted is work time,”  and includes periods in which an employee “voluntarily continues to work at the end of a shift.” 29 C.F.R. §785.11.  As the court in Fast explained, an employer cannot sit back and accept the benefits of an individual’s labor without expecting to pay wages.  To the contrary, it is the responsibility of management to exercise control and make sure that its workforce does not perform work not authorized or desired by the employer. 29 C.F.R. §785.13.  These rules apply even if an employee engages in labor for the benefit of the employer while away from the office. 29 C.F.R. §785.12.

            Although the Fast case involved labor performed before the start of the employee’s workday, these principals apply with equal force to employees who unilaterally choose to work overtime that has not been authorized, or which is done in violation of company policy.  Unless the time at issue can be properly classified as de-minimis, the FLSA mandates that all time actually worked by an employee must be compensated in the form of wages.  To be sure, the employer is charged with the responsibility of keeping track of all hours worked, whether through a time-clock system, time sheets or other record keeping system, and with establishing procedures to address unauthorized hours worked.  Company procedures should address problems in this regard through a performance review process.  Employees who violate policies against unauthorized work time can be disciplined, and even terminated, for their refusal to follow company procedures; however, they must be paid wages for the time worked.

Tips for Compliance

1.         Do not refuse to pay employees for unauthorized hours worked.  This applies to regular hours, as well as to overtime hours.

2.         Do have a written policy stating that employees who work unauthorized hours without management approval may be disciplined.

3.         Do not encourage employees to perform unauthorized work; for example, permitting employees to routinely eat at their desks during lunch time to perform functions that are not time sensitive.  This practice commonly results in overtime payment obligations for the employer when hours exceed 40 in a given workweek. 

4.         Do encourage supervisors and managers to keep track of unauthorized hours worked to properly and timely address concerns through the performance process. 

5.         Do have a system in place to accurately track all employee hours worked.

The general information contained in this article is not designed to address specific situations, and does not include rules and regulations particular to various states .  If you have questions concerning this topic, you should consult with legal counsel to obtain advice on fact specific matters.

Robin Foret heads the Labor and Employment practice at Curran Tomko Tarski, LLP.  Ms. Foret is Board Certified in Labor & Employment Law by the Texas Board of Legal Specialization

Robin Foret

The Foret Law Firm

Robin Foret practices in the areas of employment law, commercial litigation and specialty insurance defense claims. She handles a variety of employment matters such as theft of trade secrets, breach of employment agreements, non-competition agreements, wage and hour issues under the Fair Labor Standards Act (FLSA), discrimination and harassment issues under Title VII of the Civil Rights Act of 1964 (Title VII) and the Texas Commission on Human Rights Act (TCHRA), the Americans with Disabilities Act (ADA), Family Medical Leave Act (FMLA) issues, and the Sarbanes-Oxley Act (SOX). Robin has handled a wide variety of employment law matters for employers, as well as for executive-level employees, before agencies, and state and federal courts.