Chicago police officers who alleged they were not compensated for off-duty work performed on their BlackBerrys were not entitled to recovery for such unscheduled overtime work, ruled the Seventh Circuit. Finding that the city did not know about the overtime work, and that the officers were not prevented or discouraged from submitting slips by an unwritten policy of the Organized Crime Bureau, the appeals court found no persuasive reason to upset the judgment of the district court. Accordingly, the lower court judgment for the Bureau was affirmed (Allen v. City of Chicago, August 3, 2017, Hamilton, D.).
Mobile electronic devices. Members of the Chicago Police Department’s Bureau of Organized Crime brought an FLSA collective action alleging that the bureau did not compensate them for work they performed off-duty on their mobile electronic devices (BlackBerrys). A bench trial was conducted in the matter and the district court held in favor of the employer, finding that it did not prevent the officers from requesting payment for such nonscheduled overtime work, and did not know that they were not being paid for it.
Employer without knowledge of overtime work. The Seventh Circuit began its discussion by explaining the standards that apply when an employer asserts that it did not know of the overtime work for which employees claim they were not paid. For law enforcement employees, like the plaintiffs, the threshold for requiring overtime is 171 hours per 28-day period. Employers must pay for all work they know about, even if they did not ask for the work, or want the work to be done, and even if they had a rule against doing the work. However, the court noted that an employer is not required to pay for work it did not know about, and had no reason to know about.
One way an employer can exercise diligence is by establishing a reasonable process for an employee to report uncompensated work time. But an employer’s formal policy or process for reporting overtime will not protect the employer if it prevents or discourages accurate reporting in practice.
Although members of the Bureau had scheduled shifts, the nature of their work sometimes required them to work outside their shifts during off-duty time. The police department issued the officers mobile electronic devices (BlackBerrys), which they sometimes used in their off-duty work. This suit is over whether they were appropriately compensated for off-duty work on their BlackBerrys.
Overtime reporting process. The police department has a process that officers use to obtain overtime compensation: they submit “time due slips” to their supervisors. The slip does not ask how the work was done, and officers do not typically include that information. Supervisors approve the time, and the slips are sent to payroll and processed. The employees regularly used that system. However, during the period relevant to this suit, many employees did not submit slips for off-duty work done on mobile electronic devices.
The central question at trial was whether the employees were prevented or discouraged from submitting slips by an unwritten policy of the Bureau. The employees convinced the district court that they worked overtime on their BlackBerrys. But they also had to show that the Bureau actually or constructively knew that they were not reporting that work.
Parallel case. The Seventh Circuit found that this case paralleled the Sixth Circuit’s ruling in White v. Baptist Memorial Health Care Corp. Like the nurse in White, the officers worked time they were not scheduled to work, sometimes with their supervisors’ knowledge. They had a way to report that time, but they did not use it, through no fault of the employer. In the district court’s view, reasonable diligence did not require the employer to investigate further. The appeals court saw no clear error in that view of the facts, and saw no legal error in reaching the same conclusion as the Sixth Circuit in White.
Constructive knowledge. The officers also claimed that the district court misapplied the concept of constructive knowledge. They asserted that constructive knowledge should be found whenever the employer could have known about uncompensated work through examining all its records. In this case, the Bureau could have discovered the employees’ uncompensated work by comparing the time slips to call and email records the BlackBerrys generated, to have had constructive knowledge of the unpaid work.
However, the appeals court pointed out that the reasonable diligence standard asks what the employer should have known, not what “it could have known.” In rejecting the employee’s contention, it noted that White held that “if an employer establishes a reasonable process for an employee to report uncompensated work time it is not liable for non-payment if the employee fails to follow the established process.” On the other hand, the appeals court rejected the employer’s broad interpretation of White, which equated reasonable diligence with a reasonable reporting process. Thus, it concluded that the district court applied the standard correctly.
Factual errors. Finally, the appeals court turned to employees’ argument that the district court got the facts of the case wrong—that it clearly erred by holding that the Bureau did not actually or constructively know they were underreporting their overtime. It rejected the employee’s arguments. The district court agreed that the Bureau knew about at least some off-duty work. But it also found that the Bureau did not know that such work was not being reported and paid. Moreover, the employees knew the reporting procedures and used them without regular reminders. The district court also found that cross-referencing slips with phone records was a burdensome task and “impracticable.” Having correctly proceeded to trial, the district court was not obliged to resolve all conflicts in the evidence in favor of the employees. The judgment of the district court was affirmed.
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