Off the Clock Work

The Massachusetts Appeals Court recently issued an important overtime ruling involving off-the-clock work. What happens when an employee works overtime but the employer claims they didn’t know about it. In the case of Vitali v. Reit Management, the Appeals Court weighed this issue and came out on the employee’s side.

In the case, the employee worked in a busy office and was told to take an hour lunch break each day, but because of the busyness of the office, she and her co-workers often worked through lunch. The employer had a way for the employees to use to report that they worked through lunch and to get paid for it, but it was not frequently utilized.

The Court began by noting that the Massachusetts Overtime law is “essentially identical” to the federal Fair Labor Standards Act and is interpreted in harmony with federal law when possible. The court, citing from federal cases, made several useful points about an employer’s duty to pay for all work.

Employer Knowledge of Off-the-Clock Work

The key is whether an employer (1) knew of the off-the-clock work or (2) could have known of it by taking reasonable steps. In either of these scenarios, the employee will have a valid claim.

The court explained the employer’s knowledge requirement:

“The knowledge inquiry requires an assessment of what the employer knew or should have known, and is to be made in view of the employer’s duty . . . to inquire into the conditions prevailing in his business. In other words in reviewing the extent of an employer’s awareness, a court need only inquire whether the circumstances . . . were such that the employer either had knowledge [of overtime hours being worked] or else had the opportunity through reasonable diligence to acquire knowledge.”

What about situations in which overtime is prohibited or prior permission is required?

As the court put it:

“Thus, even where the employer has expressly prohibited overtime work, if it had reason to believe that such work was being done, the employer cannot sit back and accept the benefits without compensating for them.”

However, work done in secret, that an employer could not know about is not compensable. The court pointed out that there would be no liability for pay when “an employer has no knowledge that an employee is engaging in overtime work and that employee fails to notify the employer or deliberately prevents the employer from acquiring knowledge of the overtime work.”

What about when there is a system to re-capture and report missed breaks?

The court responded that such a system was not always enough. “To begin with, [t]he FLSA makes clear that employers, not employees, bear the ultimate responsibility for ensuring that employee time sheets are an accurate record of all hours worked by employees. Moreover, an employer’s duty under the FLSA to maintain accurate records of its employees’ hours is non-delegable.”

This is a key point. Employers often create busy conditions that make taking true breaks difficult. When an employee routinely work through breaks, they often do not want to complain every day for fear of being seen as a troublemaker. The law addresses this situation by keeping the duty to monitor and control the work site where it belongs, with the employer. An employer must do all it can not to obtain free work via an auto-deduct policy. An employer cannot simply tell employees to take a daily hour break when it has reason to know that employees are not always taking their breaks. With time-keeping systems this is easily accomplished, but without one it is often wishful thinking that all employees are taking breaks each day. If this is happening in your workplace, feel free to contact us for a confidential case assessment.