Employee’s Memory Not Enough to Save His Overtime Claim

November 15, 2016

This case from the 7th Circuit demonstrates what burdens employers bear when one of their employees files a lawsuit under the Fair Labor Standards Act (FLSA). It serves as a reminder of the importance of accurate timekeeping, not only because the FLSA requires employers to maintain timekeeping records but also because timekeeping records can help employers defeat employees’ claims for unpaid wages and overtime. 

Facts and Procedural Background 

James Melton worked in the Tippecanoe County (Indiana) surveyor’s office from July 6, 2009, through his termination on September 1, 2010. Regular work hours in the surveyor’s office were from 8:00 a.m. to 4:30 p.m. with a one-hour floating lunch break, resulting in a 37.5-hour workweek.

On May 13, 2010, Melton sent his supervisor an e-mail and asked if he could take a class during work hours and make up four hours a week by only taking half-hour lunches and coming in a half-hour early on Tuesdays, Thursdays, and Fridays. His supervisor responded by e-mail, telling him he could take the class, but because of concerns about supervision and being able to keep track of time, he could not make up the missed time. The supervisor instructed him that he would have to treat the time as unpaid or as vacation time. Melton acknowledged his supervisor’s answer and responded by e-mail, stating that it was fine with him.

Melton’s class began the week of August 23, 2010. He worked through lunch on one day that week and came in early three days. He was paid for the additional time he worked, but he was terminated for failing to follow his supervisor’s order that he could not work extra time.

Melton filed a wage lawsuit alleging a violation of the overtime provisions of the FLSA and a violation of Indiana wage law. He claimed that he was not paid for all the hours he certified he worked. He alleged that his timecards did not accurately reflect the hours he worked because when he put his actual time worked on his timecard, the office secretary reduced his hours to 37.5, telling him that he could not be paid for more than 37.5 hours in a workweek. Specifically, he claimed that he was not compensated for (1) time worked before 8:00 a.m., even though his supervisor told him to come to work early every day, and (2) time worked through all or part of his floating lunch each day. In support of his claim, he provided a spreadsheet that he created from memory. The spreadsheet purported to show the dates and times he worked for the entire 14 months that he was employed with Tippecanoe County.

The county asked the court to dismiss Melton’s lawsuit. In response, Melton did not point to any evidence regarding unpaid lunch hours or to his spreadsheet. Instead, he relied on his deposition testimony about how he submitted time sheets to the secretary but that the time sheets were returned to him “corrected” to 37.5 hours. The county responded that Melton had only designated evidence related to about 20 minutes of unpaid time per day before work and no evidence of working through lunch. The county argued Melton only had evidence upon which a reasonable juror could find, at the most, an additional one hour and forty minutes of time worked in a week. The county submitted that Melton could not establish an FLSA violation because that additional time would only account for a workweek of 39.2 hours, not the greater than 40 hours in a workweek necessary to establish an overtime violation.

The district court agreed, and it granted the county’s motion to dismiss. The district court did not decide Melton’s state-law wage and hour claim. Melton appealed the dismissal of his FLSA claim to the 7th Circuit.

The Court’s Analysis 

The 7th Circuit started by explaining that when an employee files an FLSA lawsuit, he has the burden of proving that he performed work for which he was not properly compensated. An employee who alleges that his employer kept inaccurate records has carried his burden if he proves that he has in fact performed work for which he was improperly compensated and produces evidence to show the amount and extent of that work as a matter of just and reasonable inference. If the employee meets his burden, the burden shifts to the employer to come forward with evidence of the precise amount of work performed or with evidence to negate the reasonableness of the inference to be drawn from the employee’s evidence.

Melton called into question the accuracy of the county’s records by alleging that the secretary told him he could not be paid for more than 37.5 hours per week and testifying in his deposition that she would always “correct” his timecards to 37.5 hours if he claimed more. It was therefore his burden to produce sufficient evidence to show the amount and extent of that work as a matter of just and reasonable inference. This is where he failed.

Melton did not point to any evidence to support his lunch-hour claim in his response to the county’s motion for summary judgment. He did not even attempt to rely on his own spreadsheet as evidence of his unpaid lunch hours or respond to the county’s argument that his spreadsheet was demonstrably unreliable. The court would not allow him to rely solely on an unsupported claim, just because he said so, when the claim was refuted by evidence proffered by the county. The court found the county had convincingly refuted any reasonable inference to be drawn from the spreadsheet.

Melton testified at his deposition that the source of information for the spreadsheet was his own memory. The court found permissible an employee’s reliance on his own recollection but explained that relying on recollection does not mean an employee may survive dismissal when his recollection is flatly refuted by other evidence in the record or his story is so internally inconsistent or implausible that no reasonable person would believe it. At the very least, an employee relying on his own recollection to prove a violation of the FLSA must have a reasonably reliable story.

In Melton’s case, there were several weeks in his spreadsheet where he was seeking compensation for what he alleged were uncompensated hours but where county payroll records showed he was already compensated. His spreadsheet also indicated, and he claimed, that he was never paid for more than 37.5 hours, but again, that claim was contradicted by the county’s payroll records, which showed several occasions where he was compensated for hours worked beyond 37.5.

Melton also alleged that he would work through all or part of his lunch. There was not a single day on his spreadsheet where he accounted for taking any portion of a lunch break but instead sought compensation for every single day’s lunch. The court concluded that his spreadsheet testimony about lunches should be rejected because no reasonable person would believe it. He had not produced sufficient evidence to show the amount and extent of the hours he worked through lunch as a matter of just and reasonable inference. Therefore, the county was entitled to dismissal of claims arising from allegedly unpaid lunchtime hours worked.

Melton did, however, provide sufficient evidence upon which a reasonable juror could conclude that he worked hours before 8:00 a.m. for which he was not compensated. Melton’s spreadsheet alleged 45 minutes per week worked before 8:00 a.m., which only brought his total workweek hours to 38.25. In his deposition, he testified that he came in about twenty minutes early every day—1 hour and 40 minutes of additional time. The court found that even ignoring the inconsistency in his testimony and using Melton’s more generous estimate, he did not produce sufficient evidence to show that there was a dispute of material fact. Neither 45 minutes nor 1 hour and 40 minutes per week added to his 37.5 regular hours was sufficient to show that he worked in excess of 40 hours per week—the threshold requirement for FLSA’s overtime provisions to apply.

The appellate court affirmed the trial court’s dismissal of Melton’s case. Melton v. Tippecanoe County, Case No. 14-3599 (7th Cir., September 22, 2016).

Bottom Line 

This case presents a common scenario—a disgruntled employee who files a wage claim after his termination. There are a few lessons to take away from this case.

First, this case serves as a reminder that when an employee works extra hours that were not authorized or approved, as Melton did during his first week of class, an employer is obligated to pay the employee for the hours he worked but can take disciplinary action based on the employee’s failure to follow directives. Employers should include in their handbooks and workplace policies that employees are prohibited from working extra hours or overtime without preapproval and may be subject to discipline if they perform work without approval or authorization.

Second, this case serves as a reminder of the importance of maintaining accurate timekeeping records of hours worked each day and each workweek. Timekeeping records are an employer’s first line of defense when faced with an employee who “remembers” things differently and makes claims that he worked extra, uncompensated hours and overtime hours.

Third, keep in mind that in addition to claims for minimum wage and overtime that employees can pursue under the FLSA or state minimum wage and overtime law, Wisconsin’s wage payment law also allows employees to pursue claims for unpaid wages based on the agreed-upon wage rate between the employer and the employee.

Leslie Sammon
Leslie Sammon