An Employee’s Verbal Testimony May Be Enough to Support an Overtime Claim

A recent decision from the U.S. Court of Appeals for the Fifth Circuit emphasizes the need for employers to ensure that they are maintaining good records of the hours worked by employees, as the lack of such records means that an employee’s own assertions may be enough to create liability under the Fair Labor Standards Act.

Under the Mt. Clement standard established long ago by the U.S. Supreme Court, where an employer has failed to keep record of hours worked, or where the records are “inaccurate or inadequate,” an employee needs to show only “that he has in fact performed work for which he was improperly compensated” and “the amount and extent” of such uncompensated work. Under this standard, the employee need not prove “the precise extent of uncompensated work,” although they must present more than “unsubstantiated assertions.” It is then the employer’s burden to provide evidence to rebut the employee’s claims.

In Flores v. FS Blinds, L.L.C., the Fifth Circuit noted that an employee’s testimony alone is sufficient to sustain an overtime claim under the Mt. Clemens standard, even where the employee offers only an estimated average of the hours worked. But here, the employees were also able to point to work orders and some corroborating testimony from the employer itself. Meanwhile, because the employer did not have records of the time worked, it could not negate the employees’ testimony – at most, it could only challenge the amount of overtime worked.

This case is an important reminder of the critical need for employers to maintain accurate records of hours worked for its non-exempt employees. It may even be wise for them to keep such records for exempt employees and independent contractors (e.g. invoices that reflect the number of hours worked), given the focus on misclassification issues by plaintiffs’ attorneys and the U.S. Department of Labor.