Wage & Hour Counsel : Wage & Hour Lawyer & Attorney : Littler Mendelson Law Firm : Employment Law, Labor Relations

By Matthew Hank

In Carmody v. Kansas City Board of Police Commissioners, the Eighth Circuit Court of Appeals addressed the standard of proof in a wage and hour case when an employer fails to maintain accurate timekeeping records. The court held that, even under the “relaxed standard” established by the U.S. Supreme Court in Anderson v. Mt. Clemens Pottery Co., plaintiffs in a wage and hour case must still provide evidence of actual damages.

Carmody involved a group of police officers who sued the Kansas City Board of Police Commissioners, claiming they were given flextime instead of overtime wages as required by the Fair Labor Standards Act (FLSA). Neither the officers nor the city tracked the accrued flextime. In response to discovery requests, the officers failed to provide information about the number of uncompensated hours they claimed to have worked or the amount of money they alleged was owed. Only after the close of discovery, and after the defendants moved for summary judgment, did the officers come forth with evidence of damages: the officers’ affidavits containing precise estimations, week by week, of unpaid hours worked.

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By Laura Hayward

In See’s Candy Shops, Inc. v. Superior Court, the California Court of Appeal for the Fourth Appellate District explicitly held that in California employers are entitled to use a timekeeping policy that rounds employee punch in/out times to the nearest one-tenth of an hour (a “nearest-tenth rounding policy”) if the rounding policy is “fair and neutral on its face” and “is used in such a manner that it will not result, over a period of time, in failure to compensate the employees properly for all the time they have actually worked.” The court adopted the standard used by both the United States Department of Labor and the California Division of Labor Standards Enforcement, bringing “sweet” news to employers who use rounding policies.

The very existence of these policies had been called into question by the trial court in this case when it granted summary adjudication to the plaintiffs on several of See’s key affirmative defenses in a certified wage and hour class action challenging See’s timekeeping policy. Two of these defenses encompassed See’s claims that: (1) its nearest-tenth rounding policy was consistent with state and federal laws permitting employers to use rounding to compute and pay wages and overtime; and (2) that its rounding policy did not deny the plaintiff or class members full and accurate compensation. In response to the trial court decision, See’s filed a writ of mandate petition challenging the court’s decision on these two defenses, which was summarily denied by the appellate court. 

Undeterred, See’s filed a petition for review with the California Supreme Court, which granted the petition and ordered the appellate court to vacate its prior order and issue an order to show cause in the matter. After extensive further briefing of the issues by both parties, and the filing of several briefs by amici curiae, See’s got its just desserts when the appellate court ordered the trial court to vacate its decision and enter a new order denying summary adjudication to the plaintiffs as to See’s affirmative defenses. Of course, while the ruling leaves open the issue of whether See’s will ultimately prevail in proving its rounding policy is fair and neutral, it does spare rounding policies from what could have been a death knell.

To learn more about the decision, please see Littler's ASAP, Sweet News on Rounding for California Employers: See's Candy Shops, Inc. v. Superior Court, by Laura Hayward.

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By Mary Walsh

In a matter of significance for California employers, in See’s Candy Shops, Inc. v. Superior Court of San Diego, the California Supreme Court recently ordered the California Court of Appeal, Fourth Appellate District, to review a trial court decision holding that rounding employee time entries violated California law.

Last year, in an unprecedented ruling, the San Diego Superior Court held that See’s Candy Shops, Inc. (“See’s") violated California law by rounding employee time entries to the nearest six minutes. The court granted the plaintiff’s motion for summary adjudication on two of See’s rounding affirmative defenses, finding them at odds with sections of the California Labor Code dealing with the timing of wage payments.

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By Josh Kirkpatrick

On May 9, 2011, the U.S. Department of Labor announced the launch of its first smartphone application, an electronic timesheet employees can use to track their hours of work, including breaks. According to a DOL press release, the information tracked through this application “could prove invaluable during a Wage and Hour Division investigation when an employer has failed to maintain accurate employment records.” The app, currently available in English and Spanish and only for iPhone, iPad and iPod Touch devices, allows users to input their hourly rate of pay and calculates the amount of wages due to the worker. Additionally, through the app, users can add comments related to their work hours; view a summary of work hours in a daily, weekly and monthly format; and email the summary of work hours and gross pay as an attachment. A glossary, limited information regarding wage and hour laws, and contact information for the DOL are accessible through the app. The agency stated it will pursue the development of updates that allow employees to track their tips, commissions, bonuses, deductions, holiday pay, pay for weekends, shift differentials and pay for regular days of rest, among other pay information.
 

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There is good news for New Jersey employers who utilize rounding. The New Jersey Department of Labor and Workforce Development has reconsidered its prior rejection of federal "rounding" rules. After a public comment period, the Department formally adopted a new rule which adopts, verbatim, the federal regulation regarding the use of time clocks and rounding practices. Under the new rule, rounding is lawful under New Jersey law so long as it "averages out ... over a period of time." This development means that New Jersey employers no longer need to assess the impact of rounding on a week-to-week basis. While this is a welcome development, employers who utilize rounding should remain vigilant to ensure that rounding is not "one sided" and that it does, in fact, average out over time.

This entry was written by Robert W. Pritchard.
 

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In the case of Kasten v. Saint Gobain Performance Plastics Corp., the Seventh Circuit Court of Appeals recently considered the question of whether verbal complaints may constitute protected activity under the FLSA. In this case, the plaintiff alleged that he verbally complained to his supervisors and the company’s human resources department about the legality of the location of the company’s time clocks. The plaintiff alleged that he told two supervisors and a human resources employee that the placement of the clocks was illegal because it prevented employees from being paid for time spent donning and doffing required protective gear.

The Seventh Circuit first affirmed the district court’s conclusion that internal, intra-company complaints may be protected activity for purposes of the anti-retaliation provision of the FLSA. The Court then turned to the question of whether verbal, intra-company complaints may be protected activity.

The Seventh Circuit held that because the FLSA prevents employees from being retaliated against for filing complaints, the statute could not be interpreted as intending to protect unwritten complaints. The court viewed the “natural understanding” of the phrase “file any complaint” to connote the use of a writing. Therefore, to constitute protected activity under the FLSA, the “complaint” must involve the submission of a writing to an employer, court, or administrative body. Notably, other courts have reached a different conclusion.

This blog entry was authored by Theresa Waugh.
 

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