Opinion ID: 744660
Heading Depth: 2
Heading Rank: 3

Heading: Overtime Compensation

Text: 20 Stewart argues that the district court applied improper computations in awarding overtime compensation. Stewart claims that the Secretary's computations regarding hours worked by Petty and Hoss were inaccurate because the Secretary concluded that each builder made sixteen pallets per hour, equaling eight dollars per hour (fifty-cent piece-rate), and divided each builder's weekly earnings by eight dollars to determine the hours worked per week. Stewart contends that Petty and Hoss built more than sixteen pallets per hour. Stewart also claims that Petty was paid an hourly rate as a part-time employee until April 19, 1992, rather than mid-March 1992, and the Secretary, failing to take that into account, calculated at piece-rate Petty's hours from mid-March and consequently overestimated Petty's hours. Stewart contends that Petty took breaks and often either missed work or was unproductive while at work because of his alcohol consumption. Stewart claims that he paid Petty well, as evidenced by Petty's testimony that he was paid for his work and that he was happy with that pay and was not seeking overtime compensation. See Tr. 54:21-55:23. 21 The district court's factual findings underlying its computations, including its conclusion that Stewart had knowledge that Petty worked overtime, are not clearly erroneous. The district court properly based its award of back wages to Petty on credible testimony and documentary evidence due to Stewart's violation of the FLSA in failing to keep records of ST & P's employees' hours. Furthermore, Stewart challenges the calculations set forth by the Secretary at trial, rather than the district court's determinations. The district court considered the evidence adduced at trial, including the DOL's report and various witnesses' testimony, to determine the number of hours each employee worked each week during certain periods. Slip op. at 19-24. After multiplying the estimated weekly total by the number of weeks in the particular period, the district court divided the employees' total earnings during that period by the total number of hours worked during that period to arrive at an hourly wage, which was then used to compute the overtime compensation owed to each employee. Id. 22 [W]hen an employer has failed to keep proper records, courts should not hesitate to award damages based on the 'just and reasonable inference' from the evidence presented. Martin v. Tony & Susan Alamo Found., 952 F.2d 1050, 1052 (8th Cir.) (citing Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687, 66 S.Ct. 1187, 1192, 90 L.Ed. 1515 (1946)), cert. denied, 505 U.S. 1204, 112 S.Ct. 2992, 120 L.Ed.2d 869 (1992). For employees paid weekly, absent explicit proof of a mutual agreement for a rate of pay capable of delineation in hourly terms, the court must infer that the 'regular rate' is substantially that calculated by dividing the total weekly compensation by the number of hours scheduled in the workweek. Mumbower v. Callicott, 526 F.2d 1183, 1187 (8th Cir.1975) (in absence of statutorily required time records, court relied upon employee recollections to compute back wages for employee who had her own key to the premises and served as her own supervisor), citing Overnight Motor Transp. Co. v. Missel, 316 U.S. 572, 580 n. 16, 62 S.Ct. 1216, 1221 n. 16, 86 L.Ed. 1682 (1942) (Wage divided by hours equals regular rate.). The district court's approach, finding differing weekly hours for employees during peak and non-peak periods, was meticulous and based upon the just and reasonable inference[s] from the evidence presented. See Martin v. Tony & Susan Alamo Found., 952 F.2d at 1052. Because Stewart failed to maintain employment records required under § 11(c) of the FLSA, 29 U.S.C. § 211(c), he will not be permitted to benefit from his failure to do so. See Mumbower v. Callicott, 526 F.2d at 1186. Consequently, Stewart cannot be heard to complain that the damages lack the exactness and precision of measurement that would be possible had [he] kept records in accordance with the [FLSA]. See Anderson v. Mt. Clemens Pottery Co., 328 U.S. at 688, 66 S.Ct. at 1192. Moreover, Stewart failed to show that the district court's determination that Petty missed work for alcohol-related reasons once every three months was clearly erroneous. 23 Stewart also argues that the district court erred in awarding Petty overtime compensation for unauthorized overtime work. Stewart maintains that to recover for Petty's unauthorized work, the Secretary must show that such work was necessary and that the time spent at ST & P was for work. Brief for Appellant at 18. 24 We hold that the district court did not err in concluding that overtime need not be specifically authorized by the employer for the employee to be entitled to premium pay. The key inquiry is not whether overtime work was authorized, but whether Stewart was aware that Petty was performing such work. 25 The term work is not defined in the FLSA, but it is settled that duties performed by an employee before and after scheduled hours, even if not requested, must be compensated if the employer knows or has reason to believe the employee is continuing to work and the duties are an integral and indispensable part of the employee's principal work activity.... The employer who wishes no such work to be done has a duty to see it is not performed. He [or she] cannot accept the benefits without including the extra hours in the employee's weekly total for purposes of overtime compensation. If the employer has the power and desire to prevent such work, he [or she] must make every effort to do so. 26 Mumbower v. Callicott, 526 F.2d at 1188 (citations omitted). Even if Stewart had prohibited Petty's overtime work, which, presumably, he did not do because he paid Petty for such work, Stewart could not avoid liability under the FLSA because he had actual and constructive knowledge that Petty worked overtime. See Reich v. Department of Conservation & Natural Resources, 28 F.3d 1076, 1082 (11th Cir.1994) (a court need only inquire whether, under the circumstances, the employer either had knowledge of overtime hours being worked or had the opportunity through reasonable diligence to acquire knowledge). Despite the fact that Stewart did not order Petty to work overtime, [s]uch extra work for the employer's benefit and with his tacit approval must be included in determining whether overtime compensation is statutorily required. Mumbower v. Callicott, 526 F.2d at 1188. Moreover, the fact that Petty did not seek overtime pay is irrelevant because Petty cannot waive his entitlement to FLSA benefits. See id. (the employer's obligation to pay premium overtime compensation is statutory and cannot be waived). A contrary holding would be detrimental to the [FLSA's] legislative policy of spreading work to more employees by requiring employers to pay each individual a premium for excessive hours. Id., citing Overnight Motor Transp. Co. v. Missel, 316 U.S. at 577-78, 62 S.Ct. at 1219-20.