In May a federal jury returned a more than $22 million verdict – the largest recorded award under the Fair Labor Standards Act – against East Penn Manufacturing Co., Inc., one of the world’s largest battery manufacturers.
“This case serves as yet another cautionary tale to employers to ensure compliance with federal (as well as state and local) overtime laws,” say attorneys Benjamin Hinks and Danielle Jurema Lederman of the Bowditch & Dewey law firm.
Specifically, employers must track all hours that employees work and pay an overtime premium at the rate of time and one half for all hours worked over 40 in a given workweek, they warn.
The U.S. Department of Labor sued on behalf of more than 7,500 East Penn employees who were seeking unpaid overtime wages.
The DOL filed the lawsuit in 2018 based on claims that East Penn did not pay its employees for time spent changing in and out of protective gear and showering, protective measures needed to mitigate exposure to workplace hazards, such as lead.
The DOL argued that time spent performing these tasks must be counted as hours worked because the time was “necessary and indispensable” to the employees’ work.
East Penn’s failure to appropriately account for this additional work time, the DOL asserted, resulted in employees working more than 40 hours per week without being compensated for the overtime.
The court granted summary judgment in 2021 in favor of DOL but reserved the issue of damages for a jury to determine at trial.
The jury concluded that East Penn was required to pay the affected workers for this donning and doffing time as well as showering time, resulting in the landmark damages award. In addition to the more than $22 million awarded by the jury, the DOL is seeking liquidated (double) damages – an additional penalty available under the FLSA.
