On October 13, 2017, the Third Circuit Court of Appeals (which covers Pennsylvania) decided Department of Labor v. American Future Sys., Inc., No. 16-2685 (3d Cir. 2017), clarifying whether breaks of 20 minutes or less must be compensated under the Fair Labor Standards Act (“FLSA”).
In this case, the employer had a “flex-time” policy whereby sales associates could log off their computers for any amount of time at any time. If they were logged off for less than 90 seconds, the time was paid. Any time logged off that was greater than 90 seconds was not compensated. The company believed that this flexible schedule allowed employees to work at their own pace, and take breaks when they needed them.
The Department of Labor (“DOL”) sued, noting that, pursuant to FLSA regulations, breaks up to 20 minutes are compensable. The employer argued that the FLSA does not specifically state that breaks must be compensated. The court agreed with the DOL, however, noting that the DOL consistently has applied its regulation, at 29 C.F.R. § 785.18, which provides that: “Rest periods of short duration, running from 5 minutes to about 20 minutes, are common in industry. They promote the efficiency of the employee and are customarily paid for as working time. They must be counted as hours worked. Compensable time of rest periods may not be offset against other working time such as compensable waiting time or on-call time.”
The court held that the DOL’s interpretation of the FLSA, as set forth in the regulation, was entitled to deference, and that it set forth a bright-line rule as to when breaks need to be compensated. The fact that the employer called this time “flex-time” rather than break time did not matter to the analysis. The court said the result of the flex-time policy was directly contrary to the FLSA, which is “a humanitarian and remedial legislation.”
The court did note that the employer could forego breaks altogether. However, if short breaks are given, they must be paid.
What Does This Mean For You? If you give short breaks of 20 minutes or less, they must be paid under the FLSA. Longer breaks do not need to be paid, as long as employees are completely relieved of duties during this break time. If you have an alternative pay or flex-time program, you should examine it closely to make sure it fits within the requirement that breaks of 20 minutes or less must be paid.
**This update is provided for informational purposes only and
should not be construed as legal advice or as creating an
attorney-client relationship where one does not already exist**