Third Circuit Says Employees Should Be Paid for Rest Breaks

The Third Circuit Court of Appeals has recently held that under the Fair Labor Standards Act (FLSA), employers must compensate employees for breaks less than 20 minutes, even if they are not performing any work during their break time.

In the case presented to the Court, the employer was a company that produced business publications that were sold by sales representatives over the phone. The representatives were able to take breaks whenever they wanted to, and for any length of time. Their employer did not require them to remain on the premises during their break time. However, whenever these employees were logged off their computer for longer than a minute and a half, they were not paid.

The United States Department of Labor sued the company under a federal regulation that states break periods between five and 20 minutes are customarily paid, and must be counted as hours worked. The trial court concluded that the employer violated the FLSA, and the employer appealed, arguing that a different regulation governed its practices. According to the employer, these breaks were off duty, when employees were completely relieved of duty. The off-duty regulation specifically defines these periods as times when an employee is completely relieved of duty such that they can use the time effectively for their own purposes. The regulation describes this as a fact specific inquiry. The employer argued that since employees were free to leave for as long as they wanted, with no obligation to return to work, even brief breaks did not need to be compensated under the off-duty regulation.

The Third Circuit employed a common canon of construction; where there are two regulations arguably on point, the more specific regulation is controlling. Here, because the off-duty regulation was more generic than the rule governing break policies, it was not controlling. The Court characterized this as a bright line rule, providing that employers must pay employees for any rest breaks lasting 20 minutes or less. At the time of the Third Circuit’s ruling, no other Circuit Court had ruled on this question.

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