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Employer’s failure to maintain accurate time records permits estimated, aggregate jury award under FLSA
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A Fair Labor Standards Act (FLSA) case sent back from the Supreme Court for a determination of the proper allocation of damages has resulted in a district court upholding a $5.8 million jury award.
In 2011, a jury awarded $5.8 million to a class of plaintiffs alleging violations of the Fair Labor Standards Act (FLSA) against Tyson Foods, headquartered in Springdale, Ark. Approximately 3,300 Iowa pork processing plant workers alleged that they were not paid overtime for time spent donning and doffing protective gear. Tyson Foods opposed the plaintiffs' request to bifurcate the case into two trials: one for liability and one for damages. During trial, the district court instructed the jury not to award damages to uninjured class members.
[SHRM members-only toolkit: Calculating Overtime Pay in the United States]
After multiple appeals, the U.S. Supreme Court, noting that the record did not describe the intended disbursal methodology, sent the case back to the district court to determine the proper allocation of damages among the class members that "will be successful in identifying uninjured class members."
On remand, the district court denied Tyson Foods' request for a new trial and concluded that the aggregate jury award did not include uninjured individuals. The court determined that Tyson Foods failed to keep records of donning and doffing time, "leading to the necessity of using averages developed by [the plaintiffs' expert] to prove the FLSA violation."
The district court noted that "the combination of a nonbifurcated trial and the accompanying use of an aggregate jury award based on dollars rather than minutes has lessened the precision with which the court is able to distribute damages." According to the district court, however, "Tyson invited both problems by opposing bifurcation of the original trial and by its failure to keep complete records."
Consequently, the district court accepted the plaintiffs' expert methodology for allocating the award. That methodology limits damages to weeks in which each worker who was harmed worked more than 40 hours without counting any extra minutes that another plaintiffs' expert had estimated to be the average time spent donning and doffing protective gear. Furthermore, under the methodology proposed, class members who had less than $50 in total damages would not receive payouts, reducing the chance that workers who were not actually underpaid would receive windfalls.
Applying this methodology resulted in 2,722 class members being owed $2.9 million in unpaid time. Because the FLSA permits liquidated (or doubled) damages for an employer's willful violation, the $5.8 million award, according to the court, "reasonably resolves any uncertainties in favor of upholding the jury's verdict."
Bouaphakeo v. Tyson Foods Inc., N.D. Iowa, No. 5:07-cv-04009 (Oct. 6, 2016).
Professional Pointer: Employers have a statutory duty to keep proper records of nonexempt employees' wages and hours. Without precise employer records, it may be difficult to defend against an FLSA lawsuit. Maintaining policies that require accurate time submissions by employees, training employees and supervisors on how to track time, and providing employees with a mechanism to complain about and cure alleged underpayment can help protect employers from FLSA liability.
Scott R. Eldridge is an attorney with Miller, Canfield, Paddock and Stone in Lansing, Mich.
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