Margaret White v. Baptist Memorial Health Care Co.
19 Wage & Hour Cas.2d (BNA) 1441, 2012 U.S. App. LEXIS 22752, 699 F.3d 869 (2012)
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Rule of Law:
Under the Fair Labor Standards Act (FLSA), an employer is not liable for nonpayment for work performed during a meal break if it establishes a reasonable process for an employee to report such uncompensated work and the employee fails to follow that process.
Facts:
- Margaret White was a nurse for Baptist Memorial Health Care Corp. (Baptist) from August 2005 to August 2007.
- Baptist had a policy of automatically deducting a 30-minute unpaid meal break from the paychecks of employees working shifts of six or more hours.
- The policy required employees who missed or had their meal break interrupted for work-related reasons to record that time in an 'exception log' to be compensated.
- White signed a document acknowledging she understood this policy.
- On some occasions, White used the exception log to report missed meal breaks and was compensated for her time.
- White occasionally informed her supervisors that she was not getting her meal breaks, but she never told them that she was not being compensated for the missed breaks.
- Eventually, White stopped reporting her missed meal breaks in the exception log, despite knowing the procedure.
- White also knew of a separate procedure to correct payroll errors, which she had used successfully before, but did not use it for the uncompensated meal breaks.
Procedural Posture:
- Margaret White filed a lawsuit and moved for conditional class certification against Baptist Memorial Health Care Corp. in federal district court.
- The district court granted in part White's motion for conditional class certification.
- Following discovery, Baptist moved for summary judgment and for class decertification.
- The district court granted Baptist's motions for summary judgment and decertification, ruling in favor of the employer.
- White, as the appellant, appealed the district court's rulings to the U.S. Court of Appeals for the Sixth Circuit.
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Issue:
Does an employer violate the Fair Labor Standards Act (FLSA) by not compensating an employee for work performed during an automatically-deducted meal break if the employer provides a reasonable process for reporting such work and the employee fails to use it?
Opinions:
Majority - Siler, J.
No. An employer does not violate the FLSA for non-payment of work when it has established a reasonable reporting process for uncompensated time that the employee fails to utilize. The central question under the FLSA is whether the employer knew or had reason to believe the employee was working without compensation. Baptist established a reasonable process—the exception log—for employees to report work performed during meal breaks. White knew of this process and was compensated when she used it. By failing to follow the reasonable time-reporting procedures, White prevented Baptist from knowing its obligation to compensate her and thwarted Baptist's ability to comply with the FLSA. An employer cannot be held liable for an obligation it had no reason to believe existed, particularly when the employee consciously fails to use the provided reporting mechanism.
Dissenting - Moore, J.
Yes. Summary judgment was improper because a genuine issue of material fact exists as to whether the employer had actual or constructive knowledge of the uncompensated work, regardless of the employee's failure to report it. The ultimate duty to maintain accurate records and ensure proper payment under the FLSA rests with the employer, not the employee. The mere existence of a reporting policy does not absolve the employer of this duty. White presented evidence that she complained to supervisors about missing breaks and even testified that she sometimes used the log and was not compensated. A reasonable jury could find from this evidence that Baptist had actual or constructive knowledge she was working without pay, which would constitute an FLSA violation.
Analysis:
This decision solidifies the principle that an employee bears some responsibility for ensuring proper compensation under the FLSA when a reasonable reporting system is in place. It establishes that an employee's failure to use a known, functional reporting mechanism can defeat a claim for uncompensated time by negating the 'constructive knowledge' element. This provides employers with a significant defense against FLSA claims, incentivizing them to create and maintain clear, accessible procedures for reporting work time. For future plaintiffs, it highlights the critical importance of exhausting employer-provided remedies before resorting to litigation.
