Captain Obvious Issues Most Obvious FLSA Decision of 2014 (So Far...)

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Captain Obvious HotelsCom.jpgIf you have been anywhere near a TV or radio over the past few months, you have probably seen or heard the ads for Hotels.com featuring Captain Obvious. If you’re from the Midwest, and Indiana in particular, it has probably crossed your mind whether the Bob and Tom Show’s Mr. Obvious and Captain Obvious are somehow related. Well, maybe that’s just me.

In any event, sometimes I wonder if Captain Obvious would make a good judge. The Fifth Circuit certainly could have used him in an opinion issued last week that you could summarize Captain Obvious-style as: “If the FLSA regulations say the workweek ‘may begin on any day and at any hour of the day’, your employer not only can set any day for the start of your workweek, it can set it to start at any hour, too.” Really. That’s what the Fifth Circuit had to expend eight pages and hours of judicial resources to say last week in what takes my unofficial award for the Most Obvious FLSA Decision of 2014 (So Far…).

The appellants—non-exempt employees paid on an hourly basis—each worked twelve-hour shifts for seven consecutive days beginning every other Thursday. One began working at 6:00 a.m., and the other at 6:00 p.m. The employer paid its employees bi-weekly and used a Monday through Sunday workweek to calculate overtime under the FLSA. Accordingly, their work schedules during a two-week pay period looked like this:

Week

M

Tu

W

Th

F

Sa

Su

Total

1

 

 

 

6

12

12

12

42

2

12

12

12

6

 

 

 

42

and this:

Week

M

Tu

W

Th

F

Sa

Su

Total

1

 

 

 

12

12

12

12

48

2

12

12

12

 

 

 

 

36

So, based on these hours, the employer compensated the first employee for 4 hours of overtime each pay period and the second employee for eight. Incredibly, the two employees asserted in their complaint that their workweek under the FLSA should have begun on Thursday and ended on Wednesday, thereby entitling each to forty-four hours of overtime compensation per paycheck. You don’t have to be a wage and hour attorney to guess correctly that the district court granted summary judgment for the employer.

The FLSA Does Not Require You to Maximize Your Payroll Expenses

The FLSA itself does not define what constitutes a “workweek.”  Helpfully, though, the Department of Labor’s FLSA’s regulations do! 29 C.F.R. § 778.105 states that a workweek “may begin on any day and at any hour of day” and “need not coincide with the calendar week,” so long as it is a “fixed and regularly recurring period of 168 hours—seven consecutive 24-hour periods.”

The employer’s Monday through Sunday workweek complied with that regulatory requirement, and nothing in the plain text of the FLSA required the company to use the proposed Thursday through Wednesday workweek so that employees would receive the maximum amount of overtime for their work schedules. “The mere fact that an established workweek does not maximize an employee’s overtime compensation does not, standing alone, violate the FLSA,” the court wrote, citing a 2009 opinion letter from the Department of Labor and precedent from the Eighth Circuit.

The Fifth Circuit panel’s introduction puts it simply:

Appellants contend that their workweek under the FLSA should reflect their actual, seven consecutive day, Thursday through Wednesday work schedule. Yet, Appellants do not direct the Court to any authority requiring employers to establish a workweek in this manner, nor have we found any such authority.

The bottom line here is that sometimes it doesn’t take a law degree to do this stuff. Under the FLSA, an employer has the unequivocal right to establish a workweek. You don’t have to choose one that maximizes your payroll expenses, like the employees in this case argued. You may set any seven-consecutive-day, 168-hour workweek for employees. Under the regulations, you can even establish different workweeks for different employees or groups of employees. As long as your workweeks are consistent and regular, Captain Obvious is your friend.

Topics:  Corporate Counsel, Employer Liability Issues, Exempt-Employees, FLSA, Fluctuating Workweek, Hospitality Industry, Hotels.com, Non-Exempt Employees, Wage and Hour

Published In: Labor & Employment Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Franczek Radelet P.C. | Attorney Advertising

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