Court Opinion

ID: 3001792
Source: CourtListenerOpinion
Date Created: 2015-09-24 20:20:51.860462+00
Date Added: 2024-06-11T11:45:46.865176
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 06-3529
VIVIAN BROWN,
                                                 Plaintiff-Appellant,
                                  v.

FAMILY DOLLAR STORES OF INDIANA, LP,
                                                Defendant-Appellee.
                          ____________
             Appeal from the United States District Court
      for the Southern District of Indiana, Indianapolis Division
               No. 04 C 2015—Larry J. McKinney, Judge.
                          ____________
     ARGUED NOVEMBER 9, 2007—DECIDED JULY 15, 2008
                          ____________

 Before CUDAHY, RIPPLE, and ROVNER, Circuit Judges.
  ROVNER, Circuit Judge. Plaintiff-Appellant Vivian Brown
brought an action against her former employer, Family
Dollar Stores of Indiana, LP (“Family Dollar”), alleging
that Family Dollar failed to pay in a timely manner over-
time wages due her in violation of the Fair Labor Stand-
ards Act, (“FLSA”), 29 U.S.C. 201 et seq., the Indiana
Wage Payment Statute, Ind. Code § 22-2-5-1 et seq., and
the Indiana Wage Claim Statute, Ind. Code § 22-9-1 et seq.
The district court granted Family Dollar’s motion for
summary judgment on the FLSA claim and the state
2                                               No. 06-3529

claim for an unpaid incentive bonus, and dismissed the
remaining state claims without prejudice. Brown now
appeals that decision, and we reverse.
  Family Dollar owns and operates a chain of retail
stores. Brown was hired as a cashier/stock person in
August 2003. She subsequently was promoted to assistant
manager, with a corresponding increase in hourly pay. On
approximately November 24, 2003, Family Dollar termi-
nated the manager at the store in which Brown worked.
As assistant manager, Brown then took on some of the
responsibilities of the store manager, but remained an
employee paid on an hourly basis and eligible for over-
time pay. There were two other employees who worked
at the store in addition to Brown, but they filled the
positions of clerk and stock persons. The store remained
without a store manager until January 8, 2004, when
Family Dollar promoted Brown to store manager. Pursuant
to Brown’s request, she was transferred to a different
Family Dollar store in April 2004, and in May 2004,
she was terminated by the company.
   Brown alleged that she was not properly compensated
for overtime during the time she worked at Family
Dollar. The FLSA provides that employees who work
more than forty hours in a week must be paid for the
excess hours at one and one-half times the regular rate
of pay. 29 U.S.C. § 207(a)(1). An employee bears the burden
of proving that she performed overtime work for which
she was not properly compensated. Anderson v. Mt.
Clemens Pottery Co., 328 U.S. 680, 686-87 (1946), super-
seded by statute on other grounds as stated in IBP, Inc. v.
Alvarez, 546 U.S. 21, 41 (2005). The district court held that
“ ‘while this burden is not an insurmountable one, an
employee who brings suit for unpaid overtime compensa-
No. 06-3529                                               3

tion bears the burden to prove, with definite and certain
evidence, the she performed work for which she was not
properly compensated.’ ” Dist. Ct. op. at 5-6, citing Ander-
son, 328 U.S. at 686-87; Reeves v. IT & T Corp., 616 F.2d
1342, 1351 (5th Cir. 1980), implicitly overruled on other
grounds as recognized in Heidtman v. County of El Paso, 171
F.3d 1038, 1042 n.4 (5th Cir. 1999). Brown was unable
to identify with specificity the hours or even days for
which she worked overtime that was not properly paid.
Accordingly, the district court concluded that Brown’s
general allegations were insufficient to meet that burden
and granted summary judgment in favor of Family Dollar.
  Anderson, however, does not set forth a new “definite and
certain evidence” standard but merely recognized the
established requirement that damages be proven. Anderson
recognized that once a plaintiff establishes a violation of
the FLSA, the plaintiff must establish damages, and that
the task is not a difficult one where the employer has
kept time records in compliance with the requirements
of the FLSA. In that circumstance, the accurate time
records will establish the amount of damages, and the
general rule that precludes recovery of uncertain and
speculative damages is appropriate. Anderson, 328 U.S. at
688. That is a recognition of the need to quantify damages,
not a new, more burdensome standard. Anderson also
articulated, however, a different standard that was to
apply where the employer’s records did not provide that
accurate record of time worked.
  Anderson recognized that where an employer failed to
keep the proper and accurate records required by the
FLSA, the employer rather than the employee should
bear the consequences of that failure. To place the burden
on the employee of proving damages with specificity
4                                               No. 06-3529

would defeat the purpose of the FLSA where the em-
ployer’s own actions in keeping inadequate or inaccurate
records had made the best evidence of such damages
unavailable. The Court accordingly held that “[i]n 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 just and reasonable inference.” Id. at
687-88. The burden then would shift to the employer to
produce evidence of the precise amount of work performed
or to negate the reasonableness of the inference to be
drawn from the employee’s evidence. Id. If the employer
fails to meet that burden, a court may award damages
even though they are approximations. Id. at 688.
  The district court in this case recognized the just and
reasonable inference test set forth in Anderson, but deemed
it inapplicable because it concluded that “Brown does
not allege that Family Dollar’s records are not in accord
with FLSA requirements.” The record, however, demon-
strates that Brown presented evidence that the records
were not in compliance with the FLSA and could not be
trusted. First, Brown introduced evidence that the rec-
ords were accurate when submitted by employees, but
were subsequently altered by management prior to issu-
ance of the paychecks. Specifically, Brown testified in her
deposition that managers, district managers, and assistant
district managers could manipulate the records of times
worked in the computer system. She testified that as a
manager, she personally observed employees pay-
checks that were not reflective of the times in the printouts
and e-mails that she had sent to payroll. She further
declared that when she reported that a person’s check
No. 06-3529                                               5

was short, she was given the response that they were not
going to get paid. Finally, Brown also testified that she
had the same experience when LaTasha Holder was the
store manager, with Brown’s own paycheck not reflecting
the hours on the printout. That evidence alone is sufficient
to raise a genuine issue of fact regarding the accuracy of
the records kept by Family Dollar, but Brown provided
additional evidence that the time records were inade-
quate or inaccurate.
  Brown provided evidence that the hours in the em-
ployer’s time records could not have been accurate be-
cause they did not conform with the hours that she
would have had to have been at the store given the store’s
hours of operations. The district court acknowledged that
the manager of the Family Dollar store at which Brown
worked was terminated on approximately November 24,
2003, and that Brown continued to serve as assistant
manager but also took on the managerial duties. Brown
testified that she was the only person with the key to
open and close the store. The only other persons at the
store were two associates who were clerks and stock
persons, and only assistant managers or managers had
the responsibility of opening and closing stores. She fur-
ther testified that if she did not come in, the store would
not be open for business, and that on one occasion when
she injured her finger, she had to return from the emer-
gency room to reopen the store or it would not have
been open for business. Brown testified that it took approx-
imately 1-1 ½ hours to open the store, and an additional
1-2 hours to close it. Closing a store involved myriad
duties, that could include redoing a display wall, putting
up new SKU (stock keeping unit) numbers, and rearrang-
ing shelves or end caps. During the holiday period from
6                                              No. 06-3529

Thanksgiving to Christmas, the store had extended hours
and closing would take longer. The hours in the em-
ployer’s records, however, were not reflective of those
hours. For instance, in numerous instances, the recorded
time would have allowed significantly less than the 1-2
hours that closing the store requires. The store closed
at 8:00 p.m. every day but Sunday, when it closed at 6:00
p.m. The following clock-out times were inconsistent
with the 1-2 hours of work required to close the store:
Closing time of 6:00 p.m.—clock-out time:
10-19-03 6:30

Closing time of 8:00 p.m., clock-out time:
10-20-03   8:18
11-7-03    8:34
11-15-03   8:30
11-20-03   8:27
11-25-03   8:29
12-27-03   8:06
01-08-04   8:21

More tellingly, the clock-out times for the dates during the
holiday hours between Thanksgiving and Christmas had
Brown clocking out at times before the store would have
even closed:

Closing time of 9:00—clock-out time:
11-28-03 8:18
11-29-03 8:11
12-6-03 8:37
12-13-03 8:10
No. 06-3529                                              7

Closing time 7:00—clock-out time:
11-30-03 6:21

Closing time 10:00—clock-out time:
12-17-03 8:11

The failure of the employer’s time records to conform
with the hours that Brown would have had to have been
in the store further casts doubt on the accuracy and ade-
quacy of the employer’s records under the FLSA, and
therefore the Anderson just and reasonable inference
standard is appropriate.
  The Anderson test addresses whether there is a reason-
able basis to calculate damages, and assumes that a vio-
lation of the FLSA had been shown. The damages issue is
the one before the court at this time, but we should note
that the evidence cited above regarding the holiday
hours, Brown’s responsibilities, and the failure to pay
her for those hours raises a genuine issue of fact as to
whether she was not properly paid overtime in violation
of the FLSA. Therefore, the remaining question is wheth-
er that Anderson standard is met.
  The holiday hours, as well as her testimony regarding
the time it took to open and close the store, provide a
basis for arriving at a just and reasonable inference as to
the uncompensated hours. As noted above, there is evi-
dence in the record that she was the only person able to
open and close the store, and that she spent at least 1-2
hours before and after those store hours preparing the
store for business. Comparison of the hours for which
she was paid with the hours of operation for the store,
8                                              No. 06-3529

would yield a basis for determining the amount and extent
of work as a matter of just and reasonable inference.
Accordingly, the district court erred in requiring Brown
to provide definite and certain evidence of her damages,
and the evidence establishes a genuine issue of fact con-
cerning damages under the proper standard.
  In fact, the evidence presented here is similar to evid-
ence recently considered sufficient by the Eleventh Circuit
in Allen v. Board of Public Educ. for Bibb Cty., 495 F.3d
1306 (11th Cir. 2007). In Allen, a group of persons who
were bus drivers, bus monitors, paraprofessionals, secretar-
ies and custodians sued the county board of public educa-
tion (the “Board”) alleging that they were owed unpaid
overtime compensation under the FLSA. Id. at 1309. In
determining the proper standard to apply, the Allen court
held that deposition testimony called into question the
trustworthiness of the Board’s records, and therefore
that the just and reasonable inference standard was
appropriate. Specifically, the court noted that some em-
ployees testified that they were told not to record their
overtime because the Board would not pay it, that some
who recorded overtime were told to resubmit time
sheets without the overtime, and that some time sheets
were otherwise rejected or altered if overtime was noted.
Id. at 1316. The court concluded that those facts, if true,
indicated that the time records of the Board could not
be trusted, and that the just and reasonable inference
standard was appropriate.
  Those facts are similar to those presented by Brown,
in her allegations that overtime hours that were sub-
mitted on time sheets were not paid, that she was informed
that the overtime would not be compensated, and in the
evidence that the managers had access to the time records
in the computer system and altered them to the em-
No. 06-3529                                               9

ployee’s detriment. As with the evidence in Allen, that
evidence casts doubt on the trustworthiness of the em-
ployer’s time records, and invokes the just and reasonable
inference standard.
  Similarly, the type of evidence deemed sufficient to
raise that inference in Allen is comparable to that in the
present case. In Allen, the court recognized that hours
worked could be proven indirectly, through other “trigger-
ing factors” that would have signaled extended work
hours. For instance, one employee who could not pro-
duce any documentation of her overtime work, could
point to triggering factors such as occasional after-school
ice cream sales and dances that would help her recall dates
in which she worked overtime. Similarly, she noted that on
the dates of PTO (Parent-Teacher Organization) meetings,
she would be at school from the time school ended until
after the meeting around 7:30 or 8:00. The court noted that
she could obtain the date of those meetings, and therefore
provide a basis for inferring the extra hours worked. Id. at
1317. That is similar to the evidence presented by
Brown that she opened and closed the store, that she
worked for 1-2 hours before opening and after store
closing, and that the store was open for extended
holiday hours from Thanksgiving to Christmas. Those
dates are readily ascertainable, and a comparison of time
records with those hours would allow an approximation
as to the hours omitted from the time records and the
unpaid compensation.
  In response to this evidence, Family Dollars argues that
we should not consider her testimony that the store had
extended hours during that holiday season. Although
that would seem to be readily obtainable information,
Family Dollar has not proffered any evidence rebutting
that claim. Instead, Family Dollar seizes upon her state-
10                                            No. 06-3529

ments during a deposition, and argues that her later
interrogatory responses cannot be considered as they
conflict with the deposition testimony. We have recog-
nized that a person cannot manufacture a genuine issue of
fact by submitting an affidavit that contradicts prior
deposition testimony. Velez v. City of Chicago, 442 F.3d
1043, 1049 (7th Cir. 2006). There is, however, no such
outright conflict here.
  Brown was asked in her deposition whether store
hours changed seasonally, and she stated that the store
would close early on Christmas Eve or New Year’s Eve.
The issue was then explored further:
     Q: How about, like, black Friday, the Friday after
        Thanksgiving, would you open early and stay late?

     A: I don’t know anything about that holiday?
     Q: Well, it’s not a holiday. It’s the day after
        Thanksgiving. It’s the busiest shopping time of
        the year. Did the store have different hours of
        business—
     A: Not that I recall.
     Q: —between Thanksgiving and Christmas?
     A: That I recall, we closed early on Christmas Eve or
        Thanksgiving Eve or New Year’s Eve.
That does not present the type of contradictory testi-
mony that would require us to ignore her subsequent
statements via affidavit as to the extended holiday hours.
First, the questioning was somewhat misleading, in that
she was first questioned regarding a specific day, Black
Friday, and as she was answering that, was asked about
hours between Thanksgiving and Christmas. It appears
No. 06-3529                                            11

from her answer that she was focusing on the hours for
the actual holidays, not for the period of time in between
the holidays. See id. (noting that even a contradictory
affidavit may be considered if the deposition question was
phrased in a confusing manner). In any case, she never
stated that there were no holiday hours between
Thanksgiving and Christmas. Family Dollar could of
course argue that her acknowledgment of holiday hours
for Thanksgiving Eve and Christmas Eve implies that
there were no other holiday hours, but that is an implica-
tion, not a contradiction.
  The decision of the district court granting summary
judgment is reversed, and the matter remanded for fur-
ther proceedings consistent with this opinion. The Appel-
lant’s Motion to Strike portions of appellee’s brief is
denied.

                  USCA-02-C-0072—7-15-08