The DFW Hospital Council is posting blogs submitted by our Associate Members. The following was provided by Hall Render. For guidelines, please contact Chris Wilson at chrisw@dfwhc.org.

The Fair Labor Standards Act (“FLSA”) is a federal law that establishes, among other things, when time spent by an employee is compensable. Because the Texas Payday Law defers to the FLSA on the question of compensable time, Texas employers need to comply with the federal Department of Labor’s (“DOL”) guidance with respect to enforcement standards.

Two common practices in health care have come under intense DOL scrutiny in the past few years: work off-the-clock and auto-deducted meal breaks. It is easy to understand how both of these practices run afoul of the law. Pre-shift huddles, for example, are an important way of transitioning responsibilities and care concerns between care providers from shift to shift.

Additionally, hospital and other health care staff often put patient care first and take breaks only when they can, if they can. Notwithstanding the patient-centered focus of the above, the DOL and courts have enforced the regulations strictly, resulting in millions of dollars of expense to health care providers across the country. Of particular interest, a California court recently gave preliminary approval to a $6.255 million settlement in a lawsuit against a California-based medical group.

There, the plaintiff nurses claimed they did not receive pay for time spent opening and closing software applications that were necessary to performing their jobs. Specifically, their complaint alleged the computer startup process took four to ten minutes daily; however, they were not on-the-clock until the programs were actually running. In addition, they alleged that the shutdown process took four or five minutes daily, but they were not allowed to begin the process earlier than three minutes before the end of each shift (resulting in one to two minutes of additional unpaid time per nurse per shift).

The plaintiffs also claimed that although the employer automatically deducted thirty minutes daily for unpaid meal breaks, the nurses were not “completely relieved” from their duties during those breaks. Accordingly, the nurses claimed that they were entitled to not only overtime pay under the FLSA, but also wages and penalties under the state labor code.

According to forensic accountants engaged by the plaintiffs, the medical group’s potential exposure for damages and penalties ranged between $18 and $20 million. A $6.255 million settlement has preliminary approval.

PRACTICAL TAKEAWAYS
Generally, an employee’s time must be paid if it is suffered or permitted by the employer for the benefit of the employer, specifically:

• No meal breaks are required for adult employees. But, if a meal break is given, it must last 30 minutes or longer, and the employee must be fully relieved of duties—that is, the employee must perform no work and the break must be uninterrupted. Otherwise, it is likely a paid break.

• An employee’s day starts with any activity that is “integral and indispensable” to the employee’s principal activities and that likely includes logging in and huddles.

To protect your organization from a lawsuit and/or DOL audit:

• Train your employees and managers, and keep documentation of the training. Train employees on the proper use of the time-clock, the proper process for adding missed punches, what to do if lunch is interrupted or missed and the sequence of shift start (coffee, punch in, prep and huddle – in that order). Train your managers on state and federal wage and hour laws so they know how to schedule compliant employee shifts and how to react to an employee’s request for time correction.

• Audit your payroll practices, going back two years, on a regular basis, under the confidentiality of attorney-client privilege. Your considerations should include:

o If you use automatic meal period deductions, look closely at any exception reports for missed breaks. If an entire department has no missed breaks for any employee during the review period, that means each employee received his or her break every day. Is that realistic? If the answer is no, you should look closer.

o Update your policies. When the DOL visits, detailed policies are good evidence that you had a proper process, such as a meal break policy that explains automatic meal deductions and notifies employees of their obligation to report interruptions and missed lunches. However, if your policy is not in compliance, or if employees are not familiar with the terms of the policy, it can hurt more than it can help.

o By auditing regularly, you can identify issues and resolve them early. If you have a concern, contact counsel for an opinion letter. Good faith reliance on the opinion of counsel may save you from liquidated damages.

This article is educational in nature and is not intended as legal advice. Always consult your legal counsel with specific legal matters. If you have any questions or would like additional information about this topic, please contact:

• Robin Sheridan at rsheridan@hallrender.com;
• Heather Mogden at hmogden@hallrender.com;
• or your regular Hall Render attorney.

Robin Sheridan and Heather Mogden are attorneys with Hall, Render, Killian, Heath & Lyman, P.C., the largest health care focused law firm in the country. Please visit the Hall Render Blog at for more information on topics related to health care law.