The U.S. Court of Appeals for the Second Circuit recently ruled that an employer must compensate an employee for all work that it is aware that an employee performs, regardless of whether the employee requests overtime compensation. Although whether an employee reports overtime work may be relevant to whether an employer is aware that the employee has worked overtime, it does not diminish the responsibility to pay the employee for work it has permitted.
In Perry v. City of New York, 2nd Cir., No. 21-2095 (Aug. 25, 2023), a group of 2,519 emergency medical technicians and paramedics (“EMTs”) won a multimillion-dollar verdict against the city for unpaid overtime wages. They claimed that the city violated the Fair Labor Standards Act (“FLSA”) by requiring them to work additional time before and after their shifts but only paying them overtime if requested.
The EMTs worked eight-hour shifts. However, before starting their shifts, EMTs must inspect ambulances for personal protective equipment, gear, and medical supplies. A similar process occurs at the end of each shift.
However, the city’s electronic timekeeping and payroll system automatically pays each employee down to the minute based on their reporting for their scheduled shifts. It does not consider the extra work that EMTs must perform before and after their shifts. As a result, even when an EMT scans in early to complete required tasks and scans out late as required by their job duties, the system only pays them for their eight-hour shift. If the EMT wants overtime pay for the time worked before or after their shifts, they must submit a separate request, which 99% of EMTs never do.
On appeal to the Second Circuit, the city argued that they were not required to pay the overtime pay to the EMTs under FLSA because the EMTs had the opportunity to submit requests for overtime pay but failed to do so. As a result, the city claimed it did not know it was failing to pay any EMT overtime as required.
The Second Circuit completely rejected the city’s arguments, stating that FLSA’s liability was not dependent on whether it knew whether the employee was being paid overtime. Instead, if the employer required, knew, or failed to exercise reasonable care to discover that the work was being performed, then the employer was liable for the overtime under FLSA. In this case, since the city had a policy or practice requiring EMTs to perform work before and after their shifts and took insufficient action to remedy the situation, the city willfully violated FLSA.
The appellate court also held that the trial court did not err in failing to instruct the jury that the EMTs were required to show that the overtime work was 100% compensable. Since the employer had a policy and practice of requiring them to work before and after their shifts, it was reasonable to infer that their time was compensable.
Furthermore, employers may not avoid FLSA liability by dividing overtime work into small chunks of time or tasks and labeling it as “de minimis.” Whether work is “de minimis” generally applies to the whole body of work, not to specific parts of the work. As a result, the trial court granted summary judgment to the EMTs on this claim.
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