Opinion ID: 470074
Heading Depth: 2
Heading Rank: 1

Heading: Refusal to Award Back Wages

Text: 10 An employee seeking to recover unpaid minimum wages or overtime under the FLSA has the burden of proving that he performed work for which he was not properly compensated. Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687, 66 S.Ct. 1187, 1192, 90 L.Ed. 1515 (1946). In view of the remedial purpose of the FLSA and the employer's statutory obligation to keep proper records of wages, hours and other conditions and practices of employment, this burden is not to be an impossible hurdle for the employee. Id. 11 [W]here the employer's records are inaccurate or inadequate and the employee cannot offer convincing substitutes, ... the solution ... is not to penalize the employee by denying him any recovery on the ground that he is unable to prove the precise extent of uncompensated work. Such a result would place a premium on an employer's failure to keep proper records ...; it would allow the employer to keep the benefits of an employee's labors without paying due compensation as contemplated by the [FLSA]. 12 Id. 13 Here, it is undisputed that overtime hours and wages were not recorded by Seto as required by the FLSA. In such a situation, an employee has carried out his burden if he proves that he has in fact performed work for which he was improperly compensated and if he produces sufficient evidence to show the amount and extent of that work as a matter of a just and reasonable inference. Id. (emphasis added). 14 The burden then shifts to the employer to show the precise number of hours worked or to present evidence sufficient to negate the reasonableness of the inference to be drawn from the employee's evidence. Id. at 688, 66 S.Ct. at 1192. If the employer fails to make such a showing, the court may then award damages to the employee, even though the result be only approximate. Id. (emphasis added). 15 We find that the district court erred as a matter of law in concluding that the Secretary's proof of uncompensated overtime was too speculative. Mt. Clemens Pottery leaves no doubt that an award of back wages will not be barred for imprecision where it arises from the employer's failure to keep records as required by the FLSA. 16 The employer 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].... Nor is [an award] to be condemned by the rule that precludes the recovery of uncertain and speculative damages. 17 Id. at 688, 66 S.Ct. at 1192 (emphasis added). 18 Seto argues that the Secretary failed to show the amount of overtime as a just and reasonable inference. In the alternative, he argues that his witnesses' testimony negated the reasonableness of the inference to be drawn from the Secretary's evidence. 19 These arguments are unavailing here. The district court found that Seto failed to pay overtime and minimum wages and failed to maintain records as required by the FLSA. These violations were the basis for the injunctive relief granted below. Seto does not challenge these findings or the injunction. 20 Once the employee has proved that he has performed work and has not been paid in accordance with the [FLSA], the fact of damage is certain. Mt. Clemens Pottery, 328 U.S. at 688, 66 S.Ct. at 1193. The only uncertainty is the amount of damage. In such a case 'it would be a perversion of fundamental principles of justice to deny all relief to the injured person, and thereby relieve the wrongdoer from making any amend for his acts.'  Id. (quoting Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 563, 51 S.Ct. 248, 250, 75 L.Ed. 544 (1931) ). 21 The district court's determination that the damages were too speculative ignored the legal standard established in Mt. Clemens Pottery: Unless the employer can provide accurate estimates [of hours worked], it is the duty of the trier of facts to draw whatever reasonable inferences can be drawn from the employees' evidence .... Id. 328 U.S. at 693, 66 S.Ct. at 1195. The district court failed to fulfill its duty in ascertaining back wages. 22 The Secretary's claim for back wages is remanded to permit the district court to approximate an award based on reasonable inferences from the employees' testimony. See Houser v. Matson, 447 F.2d 860, 863 (9th Cir.1971) (remand where ample evidence in record from which amount of back wages can be reasonably inferred); Wirtz v. Dix Box Co., 322 F.2d 499, 501 (9th Cir.1963) (remand for new trial where proffered testimony permitted determination of award of back wages with reasonable accuracy). 23