Smartphone App Is a Good Reminder to Ensure FLSA Record Keeping in Order By James M. Coleman
104 DLR I-1
WAGE & HOUR
The Labor Department's new smartphone application that employees can use to
track their hours worked, breaks, and overtime—and eventually their tip income,
commissions, bonuses, and paid time off—should serve as a warning for
employers to thoroughly review all recordkeeping obligations under the Fair Labor
Standards Act, management attorney James M. Coleman warns in this BNA
Insights article.
Until it becomes more clear how differences between the employer's set of
timekeeping records and the employee's app-based records will be handled by
courts and by DOL's Wage and Hour Division, Coleman, with Constangy Brooks &
Smith in Fairfax, Va., advises employers to take the time to make sure their wage
and hour recordkeeping is in order.
DOL's Smartphone App Is a Good Reminder to Ensure FLSA Recordkeeping in Order
By James M. Coleman
James M. Coleman is a managing partner with the national labor and employment law firm of
Constangy, Brooks & Smith LLP, the co-chair of the firm's Wage & Hour Practice Group, and heads the firm's office in Fairfax, Va. Mr. Coleman can be reached at jcoleman@constangy.com.
The next time you see your employees entering data on an iPhone, be thankful if they're only texting
their friends.
Instead, your employees may be creating their own records of the hours that they will claim they
worked. On May 9, 2011, DOL's Wage and Hour Division (WHD) announced its first “smartphone
application” (89 DLR A-2, 5/9/11). Although the current version works only with the iPhone and the
iPod Touch, DOL promises updated versions that will work on Blackberry and Android-based
smartphones, as well as updated functionality that will allow for the tracking of more extensive data,
including tip income, commissions, bonuses, deductions from pay, holiday pay, shift differentials, and
paid time off.
For now, the free app provides users with an electronic timesheet, which DOL says will help employees
to independently track the hours they work. Once the employee's hourly wage is entered, the app
automatically calculates the gross wages that are due based on the data entered. It can also track
breaks and overtime. The app is currently available in both English and Spanish.
The DOL is touting its app as a significant technological advance because “instead of relying on their
employers' records, workers now can keep their own records. This information could prove invaluable
during a WHD investigation when an employer has failed to maintain accurate employment records.”
DOL is not saying whether it will consider the employer's records to be inaccurate merely because the
employee's own records may differ.
Although it has received a lot of attention, many believe that the timekeeping app is more of a
gimmick and an effort at public relations, than anything else. Employees have always been free to
create their own records of hours worked, whether using pencil and paper, a calendar, an oldfashioned
Palm Pilot, or stone tablets, for that matter. In the end, the app does not allow an employee
to do anything that she couldn't have done before, albeit by less technologically advanced means.
Also, one wonders how many workers who might use an app like this can afford to own an iPhone or
iPod Touch, or the associated monthly data charges.
That said, the app has certain advantages, including the automatic calculation of gross pay, and the
ability to e-mail the data–perhaps to the employee's lawyer or the WHD. And it certainly provides
employers with an incentive to make sure that their wage and hour recordkeeping is in order.
Recordkeeping Obligations Under FLSA
The federal statute that is implicated by the app is the Fair Labor Standards Act , as amended, 29
U.S.C. § 201, et seq. (FLSA). The FLSA requires employers to maintain accurate records of hours
worked by nonexempt employees, and failure to maintain records is a violation of the FLSA in itself,
even if the employer complies with its minimum wage and overtime obligations.
But frequently, the failure to maintain adequate records is also used against the employer to prove
that it committed substantive violations of the FLSA's minimum wage or overtime requirements.
Where the plaintiffs are “exempt” employees who contend that they should be treated as nonexempt,
the employer will usually have no records of hours worked because exempt employees are excluded
from that portion of the FLSA's recordkeeping requirements that mandate records of hours worked.
Courts use a burden-shifting analysis in order to establish the hours worked for which minimum wage
or overtime compensation is due. The plaintiffs have the initial burden of proof to establish that they
performed work for which they were not properly compensated under the FLSA. When the employer
has maintained no records of hours worked—perhaps because it had been treating the plaintiffs as
exempt, or because the records that do exist are inaccurate or unreliable—the plaintiffs can easily
satisfy their initial burden of proof. All they have to do is produce sufficient evidence to show the
amount and extent of that uncompensated work as a matter of just and reasonable inference. Once
this inference is established to the satisfaction of the court, the burden is then placed on the employer
to come forward with evidence of the precise amount of work performed or with evidence that negates
the reasonableness of the inference established by the plaintiffs.
FLSA Cases Based on App
It will be interesting to see what the courts will do with employee time records that were maintained
via the new app. Presumably, “app records” will be given the same weight as any other employee
record of hours worked. However, it will take some time before “FLSApp cases” make their way
through the court system.
We expect to see more quickly how WHD will respond to FLSA complaints that are supported by
records created via the new app. Employers may be hearing soon from WHD investigators with
questions about why the employer's time records differ from employee records created via the new
app. Presumably, some variation between the competing sets of records is to be expected, but if the
differences are significant, it will be interesting to see which set of records DOL will be more likely to
accept as an accurate reflection of hours worked. Stay tuned…
Contact us at http://www.bna.com/contact/index.html or call 1-800-372-1033
It will be interesting to see what the courts will do with employee time records that were maintained via the new app.
ISSN 1522-5968
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