Automatic Deduction of Meal Periods Is Acceptable but Risky

Every employer knows that the Fair Labor Standards Act requires that nonexempt employees be paid the federal minimum wage for all time worked and that they receive overtime pay for all hours worked in excess of 40 hours per week.  Employers are also keenly aware of the need to maintain time records that document the employee’s hours.  If employees are not paid for all time worked, significant monetary liability can result.

Some employers have adopted policies requiring their employees to take 30 minute breaks.  In accordance with this break policy, employers may choose to automatically deduct a 30 minute break from the employee’s daily hours.  But what happens if the employee disregards the employer’s break policy and opts to work through lunch? This situation was recently addressed in Quickley v. University of Maryland Medical System Corporation, et al. where a hospital found out that giving employees a little extra freedom to control their workday cost may potentially come at a high cost to the employer.

In Quickley, the hospital employees clocked in at the beginning of a shift and clocked out at the end of their shift.  The employees did not clock out for lunch, but the hospital maintained a policy of automatically deducting 30 minutes per day to account for lunch.  If the employee worked through lunch, it was up to the employee to notify the hospital so that the 30 minute break would not be deducted from their hours.

The plaintiff in Quickley sued the hospital over the automatic 30 minute deduction, claiming that she was “suffered or permitted to work” during her lunch and that the hospital must pay her for it regardless of its break policy.  In its defense, the hospital argued that the automatic deduction of time did not violate the FLSA and that the employees had the responsibility of informing it that they were working through their meal break period.

The court agreed with the hospital that the automatic deduction of time was not a per se violation of the FLSA, but noted that this was not the real issue.  An automatic deduction of time is permissible, but it is incumbent on the employer to ensure that the employees are not, in fact, working during that time.  When the employer shifts the burden to the employee to report time worked during meal breaks, the employer must make that responsibility clear to the employee and must make every effort to facilitate the employee’s reporting opportunities.

In Quickley, the court noted that based upon the pleadings it appeared that the employer did not provide an easy mechanism for the employee to inform the employer of the need to credit portions of the meal period back to the employee.  While this is not the end of the case for the employer, and the employer may still be able to prove that it did, in fact, provide the employee with reasonable ways of reporting work during meal periods, the employer now faces the prospect of prolonged litigation in order to prove that it did not violate the FLSA.