Working time claims/lawsuits take many forms and often arise out of seemingly unlikely circumstances.  In a recent case, the Third Circuit ruled that temporary workers brought in to take over the jobs of locked out workers cannot receive pay under the FLSA for their time spent travelling to and crossing the picket line.  The case is entitled Smith et al. v. Allegheny Technologies Inc. et al. and issued from the Third Circuit Court of Appeals.

On Strike

The panel held that riding across the picket line in vans provided by an industrial strike staffing company was not their principal activity nor was it integral to their principal activity.  Those are the factors that determine if a particular tangential (or preliminary) activity is compensable.  The Court held that the travel time was not a principal activity just because the employer mandated particular travel procedures.  The workers were driven to the facility, across the picket line, from their hotel, which was almost an hour away.

The Court noted that “for example, a temporary workforce’s commute would be a principal activity if members of that workforce were simply hired to cross the picket line in the morning, enter its factory, and then re-cross the picket line at night.  Similarly, a complaint could allege facts that demonstrated the employee’s crossing the picket line was as important as the work the employee subsequently performed. But no such facts were alleged here.”

The Court also stated that this picket line crossing was not “integral or indispensable” to the job of making steel.  The Court stated that “taking a Strom van to work was at least two steps removed from their steel production duties.”

The Takeaway

This is the correct decision.  This was, in essence, home-to-work commuting which is never compensable under the FLSA.  Yes, there was an interesting variation on the theme but the Court found that the principle remained inviolate.  Still, employers must always be wary of the pre-work activities their employees engage in as a collective action could be lurking around the corner.

Or just down the road…

Many employers these days have timekeeping systems that deduct time (e.g. thirty minutes) for lunch on a daily basis.  There is an inherent danger in doing this, as employees may claim that they worked through lunch and therefore should be paid.  This is evidenced in yet another settlement in such an action, a settlement that totals $1.5 million.  The case is entitled Magpayo v. Advocate Health and Hospitals Corp. and was filed in federal court in the Northern District of Illinois.

Lunch BreakThe collective action involved hundreds of emergency room nurses.  This class submitted papers to a federal Judge asking approval of the settlement, which will include 262 ER Nurses.  The motion noted that the employer would have continued to litigate and there were risks, for the plaintiffs, in maintaining the suit.

The motion stated that “the traditional means for handling wage claims like those at issue here — individual litigation — would unduly tax the court system, require a massive expenditure of public and private resources and, given the relatively small value of the claims of the individual class members, would be impracticable.  The proposed settlement, therefore, is the best vehicle for class members to receive the relief to which they are entitled in a prompt and efficient manner.”

As stated above, the theory of the case was worked lunch breaks were going unpaid because of the automatic deductions.  The lead plaintiff also claimed the Hospital did not pay for overtime when more than forty hours were worked and that she had to work after she clocked out.  The class had been certified under Rule 23 of the Federal Rules of Civil Procedure and as a collective action under the Fair Labor Standards Act.

The plaintiffs wanted to settle because there was a risk the class could be decertified and greater expense would be incurred.  The motion noted that by asserting that “additional litigation would only serve to increase the expenses incurred without reducing the risks facing class members.”  The layers will receive $600,000 in fees.

The Takeaway

Automatic lunch deduction systems are legal but there must be a reporting mechanism, a fail-safe mechanism, for when employees do work through lunch (or claim they do).  The employee is trained to fill out a form, submit it to the supervisor for approval, and payment.  Then, the employer is protected and the employee properly paid for a true missed lunch break.

Sounds simple, yet these suits keep happening?

I have defended many off-the-clock working time cases and I submit that they are very dangerous for employers. This is because they are particularly amenable to class certification because it is likely that there is a common policy applicable to the members of the class. This premise is highlighted by a recent settlement for a class of security guards employed by a security and facility services at JFK International Airport. The settlement is $2.52 million deal. The case is entitled Douglas v. Allied Universal Security Services et al., and was filed in federal court in the Eastern District of New York.

The plaintiff, Kirk Douglas, requested court approval of the settlement through a motion that labeled the settlement fair and reasonable. The motion stated that “in short, while plaintiff continues to believe in his case, and class counsel has and will continue to capably represent their client’s interests in litigation and mediation, they recognize that Allied has presented significant, and potentially dispositive arguments, that pose a significant risk to their chances for class-wide recovery, and this favors preliminary approval.”

The theory of the case was that the employees were compelled to drive to their bases before they clocked out for the day and they were required to do paperwork after their shifts. There was also an allegation that the employees worked through lunch time. The employees in the class (which totaled about six hundred people) were airport security agents, operations assistants and employees dubbed Tour Supervisors, who were claimed to really not be exempt employees.

The settlement came to be after a mediation. The plaintiffs asserted that while they believed in the rightness of their claims, the Company “has mounted considerable defenses to liability and damages.” In that regard, the Company resisted the contention that the employees were actually performing “work” in these off-the-clock situations. The motion asserted that the proffered settlement was “a good value” given the risks inherent in the litigation. The motion stated that “in class counsel’s estimation, the settlement represents a meaningful percentage of the recovery that the class members would have achieved had they prevailed on all their claims, survived an appeal, and sought to enforce and collect upon a judgment.”

The Takeaway

The activities alleged to be working time in this case are troubling because they are the kind that a good-faith, well intentioned employer might not perceive to even be “work.” That is the problem. Employers have to be aware that any activity that they either compel their employees to perform or which are integral to their jobs may be working time and therefore, compensable.

At least be aware of the possibility…