Employment practitioners and HR professionals are aware that the limitations period under the Fair Labor Standards Act is two years, extended to three years in the case of “willful” violations under 29 U.S.C. § 255. Further, an individual’s claim under the FLSA generally is measured from the date of the filing of his or her complaint (in an individual action), or from the date of his filing a “consent to join” in the case of a collective action under 29 U.S.C. § 216(b). See 29 U.S.C. § 256; Gonzalez v. El Acajutla Rest. Inc., 2007 U.S. Dist. LEXIS 19690 (E.D.N.Y. Mar. 20, 2007). Where a plaintiff’s claim falls substantially or completely outside of this limitations period, plaintiffs’ attorneys sometimes argue that the doctrine of equitable tolling should be applied to negate the impact of the statute of limitations, and extend the claim further back in time. This issue recently was addressed at length by Judge Naomi Buchwald of the Southern District New York, with Judge Buchwald rejecting the applicability of tolling following an evidentiary hearing on the issue. Upadhyay v. Sethi, 2012 U.S. Dist. LEXIS 107084 (S.D.N.Y. July 30, 2012).

Upadhyay concerned the claims of a live-in housekeeper and nanny, who provided these household services on a regular basis from 1998 to July 2007. In her complaint, filed in November 2010, she alleged that her performance of massage duties for Defendants brought her outside of the definition of an exempt worker employed “in domestic service in a household . . . who resides in such household." 29 U.S.C. § 213 (b) (21). However, because her complaint was filed more than three years after the cessation of regular services for the Defendants, absent tolling, her overtime claim under the FLSA would be time barred in its entirety. Plaintiff offered several bases for applying the “extraordinary remedy” of equitable tolling under the applicable legal test, which requires “both that the plaintiff exercised diligence in discovering her claims and that the defendants or some ‘extraordinary circumstances’ prevented the plaintiff from bringing suit.”

Determining that these arguments required evidentiary submissions in the form of testimony before the court, Judge Buchwald conducted a hearing at which witnesses testified as to Plaintiff’s diligence and her allegations regarding the “extraordinary circumstances” which prevented her from bringing an earlier, timely claim. Following the hearing, Judge Buchwald issued her opinion, finding that Plaintiff was not diligent, and further that her “Finances” and “Legal Rights” were not hidden from her (and thus no extraordinary circumstances existed). The Judge found Plaintiff’s testimony regarding these issues “riddled with facially incredible statements and discrepancies that have not been satisfactorily explained,” further bolstering a finding that Defendants did not mislead her with respect to her rights.

Tolling can create additional exposure for unwary employers whose negligence or – worse – deceptive conduct can support such a finding. Employers should take care to ensure that required FLSA and state postings prominently are displayed, and take other steps to notify employees of FLSA and state law practices and compliance. Such notice can limit the availability of tolling arguments if and when claims are brought. Of course, longer state statutes of limitations may apply to some claims.