By Marylou V. Fabbo, Skoler Abbott

Employers often place the burden of recording hours worked on employees. Employee handbooks may contain provisions that require employees to record and report all their time worked, and employers may require employees to verify their hours by reviewing and signing their time cards. Policies may prohibit off-the-clock work and notify employees that they must report any errors in pay. But is that enough to free you from liability for unpaid wages due to unrecorded time? Maybe; maybe not.

Employees Can't Record Online Training at Home

CVS requires its pharmacy technicians (PTs) to regularly complete mandatory training courses through LEARNet, an online training tool. The LEARNet program doesn't record how long it takes an employee to complete the training or document failed attempts at completing the courses.

To be paid for hours spent on LEARNet training outside the store, a PT must report it to her lead PT. The lead is then responsible for documenting the time and notifying the store manager or shift supervisor to enter the hours into the payroll system.

Two PTs sued CVS, claiming they weren't compensated for all the hours they spent training. The evidence showed that the person who was responsible for making sure mandatory training was completed, the lead PT, never verified whether the PTs were paid for the training. And the store manager, who was responsible for compensation, was aware that at least two employees completed their training outside a regular work shift.

That was enough to hold CVS liable even though it had written policies that prohibited off-the-clock work and required all PTs to record and report all hours worked and review and sign their time cards to verify that they had been paid for all their time worked.

Moreover, the store where the employees worked, Store Number 8, had a budget for labor costs that included an estimated amount of time for PT training. The store consistently used up all of its budgeted hours, so there usually weren't enough hours available to schedule off-shift training, and the store was especially busy, so there wasn't enough time during the normal workday to complete the learning program.

Both employees who claimed unpaid time testified that they had called the issue to management's attention but had been told that the time spent on LEARNet wasn't compensable because it was "continuing education." And the LEARNet program wasn't a reliable way of estimating the amount of time worked because the system could be on even while no one was actively using it.

What Happens If Employment Records Are Incomplete?

Generally, when an employer doesn't have clear records of time worked, courts will "take the employee's word" about the number of hours he worked but wasn't paid for. That's because under Massachusetts law, it's the employer's burden to maintain time records for employees.

The trial court in this case cited a Massachusetts Supreme Judicial Court decision and used that decision to articulate a two-part standard for recovering unpaid wages when the employer's records are inadequate or wrong.

First, an employee must prove that she performed work for which she was improperly (or not) compensated. Second, the employee must produce sufficient evidence to support her claim about the amount of work she performed. If she does both, the employer must rebut the employee's position with "precise data" or "otherwise negate the reasonableness of the inference." Even if the figures aren't precise, a court can award an approximate amount to the employee.

In this case, the court didn't buy one employee's estimates of time worked, but it applied the estimate the other employee had submitted to calculate awardable damages. And both employees were entitled to triple damages under the Massachusetts Wage Act, plus statutory interest and attorneys' fees. All because Store Number 8 failed in its statutory duty to maintain a system that allowed employees to record and be paid for the time they worked. St. Pierre, et al. v. CVS Pharmacy, Inc. (D. Mass., 2017).

Don't Turn a Blind Eye

CVS had the right policies and procedures in place, but that wasn't enough to protect it from liability. Policies that attempt to shift some of the burden of ensuring proper payment of wages to employees only go so far. While it's helpful to have the written policies in place, you cannot simply look the other way when you're aware—or should be aware—that employees are working off the clock.

When an employee submits lengthy responses to a series of e-mails from his manager at night, or when a manager sees an employee taking a lunch "break" while eating/working at his desk, that will likely provide sufficient notice that the employee's hours worked include that time. You may then have to pay him for those hours. If the time was worked in violation of your policy, it's usually OK to take disciplinary measures—as long as they aren't retaliatory. If you have questions about whether your employees' work is compensable, check with experienced labor and employment counsel.

Marylou Fabbo is a partner at the firm of Skoler, Abbott & Presser, P.C., and an editor of Massachusetts Employment Law Letter. She can be reached at 413-737-4753 or mfabbo@skoler-abbott.com.