What you need to know (for now) about smartphone use and overtime pay

I first wrote about the possibility of employees seeking unpaid overtime for time spent away from work checking emails on mobile devices all the way back in 2007, and have kept writing about it since (for example, here and here). Now, more than 8 years later, we finally have the first judicial decision on whether non-exempt employees are owed overtime or other compensation for this off-the-clock time. The result is a mixed bag for employers.

In Allen v. City of Chicago (N.D. Ill. 12/10/15) [pdf], the court held that in the Chicago Police Department did not violate the FLSA by failing to pay police officers for off-duty time working on their employer-issued BlackBerrys. Yet, the case is not a clear win for employers across the board.

The court applied a two-pronged test to determine whether the police officers were entitled to overtime for off-duty emailing.

1. Did they perform compensable “work” for which they were not paid?
2. Did the employer have actual or constructive knowledge that the employees performed work without compensation?

On the first question, the court determined that some, but not all, of the off-duty activities the employees performed on their Blackberrys constituted compensable work under the FLSA. The court drew a line between those tasks necessary to the employees’ jobs (compensable) and those incidental and non-essential (not compensable).

The Department-issued BlackBerrys give the plaintiffs the ability to perform certain necessary work while on and off duty. Some activities plaintiffs performed on their BlackBerrys had to be done immediately, even if they were off duty. These activities include reaching out to CIs, gathering information on investigations that were heating up, and contacting and reallocating teams of officers in response to a shooting. Such off-duty activities were at times pursued necessarily and primarily as part of plaintiffs' jobs in BOC, and constituted compensable work under the FLSA.

However, the evidence failed to show that all of the off-duty activities plaintiffs performed on their BlackBerrys were a necessary part of their jobs. For example, the mere act of plaintiffs “monitoring” their BlackBerrys does not constitute an activity pursued necessarily and primarily for the benefit of the City under the FLSA, so long as the plaintiffs could still spend their off-duty time “primarily for [their] own benefit without persistent interruptions.”

On the second question, the court determined that, despite the compensable nature of the employees’ off-duty time, the employer nevertheless prevailed because it lacked any actual or constructive knowledge of the work being performed.

Plaintiffs fell far short of showing a uniform culture or well-grounded understanding that off-duty BlackBerry work would not be compensated in BOC. Plaintiffs have not proven that supervisors within BOC had specific knowledge of off-duty BlackBerry work being performed without compensation (i.e., without a corresponding time due slip being turned in). And, in light of the evidence that BOC members (including plaintiffs) turned in slips for off-duty BlackBerry work and were compensated, plaintiffs have not shown that there was a common understanding (or an unwritten policy) that such work would not be compensated.

What does all this mean? It means that in the opinion of this one court, some off-the-clock time spent checking email is compensable work, if (1) it’s essential, and not merely incidental, to the employees’ jobs, and, (2) regardless of whether the time is compensable, the employer still must know, or have reason to know, of the time worked. (For more on an employer’s constructive knowledge to support a wage-and-hour claim, click here.)

Allen, however, is merely the first chapter written on this issue. The next chapter will likely come from the Department of Labor, which is taking a long look at this issue and is expected to opine in 2016.

For now, what steps can employers take the minimize the risk of this breed of overtime claim?

1. If possible, limit smartphone issuance or BYOD connections to exempt employees.
2. For non-exempt employees, consider implementing an email curfew or other policy that prohibits or limits the use of email off-duty.
3. Prohibit your exempt employees from communicating with non-exempt employees while they are off-the-clock.
4. Implement a reasonable process for employees to report uncompensated off-the-clock work (and follow it).
5. Monitor employees’ access of and use of your email and other electronic systems to ensure compliance with your policies on off-duty emailing.
6. If you know, or have reason to know, that your employees are breaching your rules on off-duty email, counsel or discipline the violation, terminate repeat offenders, and, regardless, pay for the time worked.