FLSA Provides No Remedy for Employees Who Claim that Their Regular Wages Should Have Been Higher

A federal district court has ruled that technicians for a satellite television company cannot pursue their claim that they should have received additional “straight-time” compensation because there is no provision in the Fair Labor Standards Act (FLSA) that provides for the recovery of “straight-time” pay [Espenscheid v. DirectSat USA, LLC, DC WI, Dkt. No. 09-cv-625-bbc, 4/11/11].

Claims for uncompensated nonovertime hours are commonly known as “straight-time” or “gap-time” claims, because those hours are not overtime.

The facts. Several satellite technicians had testified that they were not allowed to record their time for performing various tasks between the first installation or service call and the final installation or service call, including: (a) loading tools and equipment into their work vehicles and unloading equipment into their homes; (b) receiving job assignments, planning routes and completing paperwork; (c) calling customers to provide estimated arrival times; (d) restocking equipment; (e) cleaning and maintaining work vehicles; and (f) attending weekly safety and training meetings. The technicians did not dispute that their total compensation for all pay periods divided by their hours worked in that period did not fall below the minimum wage rate.

The law. 29 USC 206 of the FLSA requires employees to be paid at no less than the minimum wage rate. 29 USC 207 of the FLSA generally requires most employees to be paid overtime if they work more than 40 hours in a week.

Some courts have interpreted 29 CFR 778.315 (“Payment for all hours worked in overtime workweek is required”) and 29 CFR 778.317 (“Agreements not to pay for certain nonovertime hours”) of the FLSA regulations as meaning that an employer has not complied with the maximum hours requirement of the FLSA if the employer does not pay its employee for all straight time.

The district court agreed that the rationale of the other courts made some sense, because, as 29 CFR 778.317 points out, even if an employer pays premium pay to an employee who works more than 40 hours in a week, the employer's failure to pay that employee for some nonovertime hours has “the effect of diminishing the employee's total overtime compensation.” However, the district court pointed out that an employer's failure to pay for nonovertime hours does not diminish an employee's overtime compensation. Rather, it diminishes the employee's overall compensation.

The ruling. The district court ruled against the technicians pursuing their claim under the FLSA because there is no language in the FLSA that creates a cause of action for diminished overall compensation. The FLSA only addresses the minimum wage and overtime. The court also said that the statutory text of the FLSA does not expressly prohibit employers from requiring employees to work some hours below the overtime threshold for “free,” provided that the employees' average wage rate exceeds their minimum wage rate.