April 5, 2016
The U.S. Supreme Court recently made it easier for employees to prove class action claims under the Fair Labor Standards Act (FLSA). Using statistical “representative evidence,” over 3,000 employees of Tyson Foods asserted FLSA claims alleging unpaid overtime for “donning and doffing” their protective gear. A jury awarded the employees $2.9 million. The Supreme Court, in Tyson Foods, Inc. v. Bouaphakeo, affirmed the award and the use of statistical evidence to support class-wide claims even though it could result in some employees getting paid for overtime they did not work.
The FLSA requires that covered employees who work more than 40 hours a week receive compensation for overtime worked. Compensable work does not include time spent walking to and from an employee’s work station or other “preliminary or postliminary activities.” However, employers must pay employees for activities that are “integral and indispensable” to their regular work, even if they do not occur at the employee’s workstation. It also requires employers to “make, keep, and preserve…records of the persons employed by him and of the wages, hours, and other conditions and practices of employment.”
Generally, to prove a violation of the FLSA, an employee must show that he or she actually worked more than 40 hours in a week. In Tyson Foods, however, the Supreme Court approved the employees’ use of statistical evidence of a representative sample to satisfy this requirement. The employees worked in the kill, cut, and retrim departments of a Tyson’s pork processing plant in Iowa. Their work required them to wear protective gear which the employees claimed was integral and indispensable to their hazardous work. Tyson did not record the time each employee spent donning and doffing their gear. So, to prove their case, the employees relied upon statistical representative evidence. The evidence included employee testimony, video recordings of donning and doffing at the plant, and a study performed by an industrial relations expert, Dr. Kenneth Mericle. Mericle conducted 744 videotaped observations and analyzed how long various donning and doffing activities took. He then averaged the time taken in the observations to produce an estimate for each department. Using this data, the employees’ other expert, Dr. Liesl Fox, was able to estimate the amount of time of uncompensated work each employee performed.
The Court found that a representative or statistical sample is a means to establish liability. Its permissibility turns on the degree to which the evidence is reliable in proving or disproving the elements of the relevant cause of action. The Court stopped short of establishing a general rule governing the admissibility of statistical evidence. However, it stated that in many cases, a representative sample is “the only practicable means to collect and present relevant data” establishing a defendant’s liability. That was particularly true in this case since Tyson did not record the time each employee spent donning and doffing protective gear.
By allowing this evidence, the Court allowed the employees to use representative evidence as common proof of an otherwise individualized issue: whether each employee worked over 40 hours without receiving overtime pay. The amount of time each employee spent donning and doffing varied significantly. No two employees performed the same activity in the same amount of time, and Mericle observed “a lot of variation within the activity.” Therefore, the effect of this ruling would result in some uninjured class members receiving payment even though they did not work overtime. Further complicating the matter was the fact that plaintiffs sought $6.6 million, but the jury awarded $2.9 million. Thus, the jury must have disagreed with the experts’ estimations.
INSIGHTS FOR EMPLOYERS
As Justice Thomas aptly noted in his dissent, this decision puts employers in an untenable position. “They must either track any time that might be the subject of an innovative lawsuit, or they must defend class actions against representative evidence that unfairly homogenizes an individual issue.” Either way, the Tyson Foods decision will profoundly affect future FLSA-based class actions.
Please contact a Gjording Fouser lawyer at 208.336.9777 if you would like any additional information about this topic or any other employment issues facing your company.