by Michael P. Maslanka

The U.S. 5th Circuit Court of Appeals (the federal appeals court covering Louisiana, Mississippi, and Texas) recently issued an opinion warning Texas employers of the dangers of allowing employees to work off the clock. Forewarned is forearmed. Read on.

Typical Tale

Business was good—too good. Patriot Erectors was on a roll. Orders were flowing in. Patriot relied heavily on its “production manager” Robert White, though it appeared the company didn’t treat him as an exempt employee. He was working a lot, answering emails after his shift was over to the tune of 250 a day for the last two years of his employment (yes, you read that correctly).

When Patriot opened a new facility, White lived in a company-owned trailer near the facility. He was ultimately terminated, although the court’s opinion doesn’t say why. He sued for unpaid overtime, won at trial, and Patriot appealed.

The appeals court upheld the decision of the lower court, rejecting all three of the company’s arguments.

You’re Out!

Argument No. 1: We never told him not to record his time, so we win! On the facts of the case, this doesn’t matter. Here’s when it does: when the employer issues a policy requiring all employees to accurately report their time worked and prohibits employees from working overtime without prior approval. Strike one!

Argument No. 2: We had a rule that hourly employees clock in and out—he did not, so we win! No! The company knew through its managers that White wasn’t recording all of his time. According to the appeals court, “The mere promulgation of a rule against [off-the-clock work] is not enough. Management has the power to enforce the rule and must make every effort to do so . . . . Upper management knew that White was performing work outside of typical day-shift hours.” The failure to correct the employee’s failure means the employer has ratified/adopted off-the-clock work and is liable to pay White for working those hours. Strike two!

Argument No. 3: White didn’t show that Patriot knew he was working unpaid overtime. This argument is related to the proceeding one. The evidence that Patriot knew is all too familiar in Fair Labor Standards Act (FLSA) cases. This is simply the ethic that “real employees” can take it and don’t ask to be paid for overtime. That’s for weenies. Real employees suck it up. Here, White had a discussion with his manager that not asking for overtime payment was “the Patriot way.” Strike three! You’re out!

‘But He Didn’t Prove His Damages!’

That was the last argument Patriot made. But here’s the deal: The employee not paid overtime bears a very relaxed burden of proof because the FLSA is a remedial statute intended to protect employees. Here’s what the court said was sufficient:

White testified that he sent and received emails and made phone calls while not clocked-in at work and was not compensated for that work. He estimated that he worked at least eight hours each week off-the-clock, which he stated was a “very, very conservative and very, very fair” estimate . . . . Following White’s termination both his email and phone were in Patriot’s custody. [But] Patriot did not produce any evidence to rebut White’s estimate or evidence. And the [trial court correctly] concluded that White’s estimate of [lost overtime] was just and reasonable.

By the way, not providing these documents suggests to a judge and jury that, if they had been provided, the damages would be a lot larger than estimated by White. White v. Patriot Erectors, L.L.C. (5th Cir., 2024).

Bottom Line

Don’t take short cuts. Implement a rule as discussed in this article. Don’t take an ostrich-like attitude of self-delusion—if you are leaving work at 5pm and still see nonexempt employees working away and later not claiming overtime, your company is on the hook for the overtime. Play by the rules. Period.

Michael P. Maslanka is an assistant professor at the UNT-Dallas College of Law. He practiced law from 1981 until he joined the faculty in July 2015. He was Chair of the Labor and Employment section of a large Dallas firm and was the managing partner of the Dallas office of two national law firms prior to July 2015. You can reach him at michael.maslanka@untdallas.edu.