As discussed here, an employer’s maintenance of accurate records of hours worked by employees is not only a substantive requirement of the FLSA, but an essential component to defending against “off the clock” claims. But what happens if an employee brings such a claim and the employer has not maintained records? Is the employer defenseless?
The answer is “Not necessarily,” as highlighted in the recent decision issued by a federal judge following an trial in the District of Maryland. Almendarez v. J.T.T., 2010 U.S. Dist. LEXIS 57371 (D. Md. June 8, 2010). In Almendarez, a jury found that all seven plaintiffs worked overtime, and that Defendants did not maintain appropriate records. However, the jury found that only three of the plaintiffs worked overtime for which they were not properly compensated. The jury found that the employer properly compensated the four remaining plaintiffs for overtime hours worked. These four plaintiffs moved for an order that they were entitled to an overtime award as a matter of law based on the jury’s factual findings, or in the alternative for a new trial.
In denying the plaintiffs’ request, the Judge first explained that in the absence of the records required by the FLSA, evidence regarding hours actually worked and overtime paid were governed by the framework set forth in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 692 (1946). To recover on an unpaid overtime claim under Mt. Clemens, a Plaintiff is “required to show, by a preponderance of the evidence, that he actually worked overtime hours for which he was not compensated at the required rate.” Almendarez, 2010 U.S. Dist LEXIS 57371 at * 11. Because making this determination in the absence of proper records is “heavily dependent on the jury’s assessment of the credibility and veracity of the witnesses”, and since the jury considered the admissible evidence as to overtime hours worked and overtime compensation paid, the court held that the jury’s verdicts were not subject to reversal as a matter of law. The jury was entitled to credit the Defendant’s evidence in the form of “testimony regarding the number of hours required to complete Plaintiffs’ work day and how much they were paid”, along with some “documentary evidence regarding the amounts Plaintiffs were paid in specific periods.” Id. at * 11-12.
While the failure to maintain proper records both constitutes a likely FLSA violation and can hinder the defense of FLSA overtime actions, Defendants faced with FLSA claims for alleged unpaid working time should consider all the evidentiary means available to rebut allegations of alleged unpaid work.