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Be wary of unpaid rest breaks for nonexempt employees

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Watercooler discussions. Coffee breaks. Calls to check on the kids. Text messaging.

These activities in the workplace are routinely seen throughout the workday.

What is your company philosophy on these personal breaks?

Is your company one that sees this as commonplace, good for employee relations and necessary time for your employees to regroup and refocus?

Or is your company one that views this as disruptive and an ever-growing problem that affects your bottom line?

Whatever your philosophy on these personal breaks, it is not uncommon for these activities to trigger internal conversations about how to control the number, frequency and timing of breaks taken in order to maximize the time spent by employees performing their job duties.

This discussion often leads to the implementation of policies and procedures designed to encourage and improve the productivity of employees but not negatively affect morale.

This is a delicate balance for employers. In striking this balance, it is paramount that any policy implemented on breaks must comply with applicable federal and state laws.

This is illustrated in a recent decision by the United States District Court for the Eastern District of Pennsylvania relating to an employer's policy dealing with rest breaks.

In that case, the employer, American Future Systems Inc., doing business as Progressive Business Publications, had a policy in place that allowed sales representatives in its call centers to take rest breaks at any time for any reason.

However, the policy stated that “personal break time is not paid because it is a disadvantage for the representative to do so.”

As a result of this policy, employees were not compensated for time spent engaging in such activities as visiting the bathroom, grabbing a cup of coffee or taking a break between calls.

This policy ultimately was challenged by the U.S. Department of Labor, which claimed the employer, and its principal owner, unlawfully required its nonexempt employees to work and not be paid for any rest breaks of 20 minutes or less taken during the work day.

The employer argued that the policy dealt with off-duty time, where the employees are completely relieved from duty and can use the time effectively for their own purpose.

The court ultimately agreed with the DOL and found that, in implementing this policy, both the employer and its principal owner violated the Fair Labor Standards Act and were liable for unpaid wages, including overtime compensation and liquidated damages.

The decision by the court was founded upon its review and interpretation of the DOL regulations. While federal regulations do not mandate that an employer provide rest breaks to employees, there are certain scenarios where breaks taken by an employee must be compensated.

Specifically, the DOL regulations state: “Rest periods of short duration, running from five minutes to about 20 minutes, are common in industry. They promote the efficiency of the employee and are customarily paid for as working time. They must be counted as hours worked.”

The court adopted this regulation as the bright-line rule for employers who have employees in Pennsylvania covered by FLSA and have a policy relating to the compensability of workday breaks of 20 minutes or less.

Put simply, short rest breaks of 20 minutes or less are compensable and count toward the 40-hour workweek.

As is typically the case, there are limited exceptions to this bright-line rule.

First, if the employer has a policy that authorizes a rest break for a specific length of time and the employee takes an extended rest break beyond the time allotted, the employer does not have to compensate the employee for the unauthorized portion of that break.

Second, while an employer is obligated to provide a reasonable break time to an employee to express breast milk for her nursing child for one year after the child's birth, the employer is not obligated to compensate the employee for the time spent for that purpose.

Like the federal law, Pennsylvania state law does not require a private sector employer to give breaks to employees who are 18 and older. However, the Pennsylvania Department of Labor & Industry confirms that, if an employer allows a break, then the employee must be compensated if the break lasts less than 20 minutes.

The groundwork for employers has been set as to how compensation for rest breaks should be handled with regard to nonexempt employees.

Now is the time to review your policies on workday breaks in order to confirm they are clear and specific about time and frequency and, further, that the time will be compensable and count toward the regular workday.

Loren L. Speziale is a business and employment attorney with Gross McGinley LLP in Allentown, counseling public and private corporations and small businesses on employment policies, contracts and actions. She can be reached at 610-820-5450 or lspeziale@grossmcginley.com.

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