May 1, 2020

Non-exempt employees in California must be compensated for all hours worked.  However, sometimes employees do not clock in and out during every shift (or for meal breaks), either due to lack of oversight or a failure to have proper procedures in place, or because they are misclassified as exempt (since exempt employees generally are not required to keep track of their hours).  This lack of documentation can become an issue if employees later claim they were not paid all wages owing, such as for overtime, or claim they were misclassified as exempt and are thus owed the wages due to a non-exempt employee.

In California, “hours worked” is broadly defined, to include “the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so.”  [IWC Order No. 4-2001, § 2(K).]  Also, an employer must compensate non-exempt employees for work “off-the-clock” (such as work before punching in or after punching out on a time card) if the employer knows or should have known the employees were working those hours.  [Morillion v. Royal Packaging Co. (2000) 22 Cal.4th 575, 585.]  The main issue in determining hours worked is whether an employee was “suffered or permitted” to work by the employer, so it is irrelevant whether it was necessary for the employee to work the long hours worked or whether a different employee could have done the work in less time.  [Chin, et al., Cal. Prac. Guide Emp. Lit. (The Rutter Group 2019) ¶ 11:828.]

Generally, it is the duty of the employer to document the hours worked, and the meal breaks taken, by non-exempt employees.  [See Furry v. East Bay Publishing, LLC (2018) 30 Cal.App.5th 1072, 1079; Lab. Code §§ 226(a), 1174(d); IWC Order No. 4-2001, § 7(A)(3), (5); Chin, et al., Cal. Prac. Guide Emp. Lit. (The Rutter Group 2019) ¶ 11:445.]  Where an employer fails to keep such records, the United States Supreme Court has held that the consequences for such failure should fall on the employer, not the employee, and in such situations, even imprecise evidence offered by the employee as to hours worked can prove sufficient. [Anderson v. Mt. Clemens Pottery Co. (1946) 328 U.S. 680, 687.]

[W]here the employer’s records are inaccurate or inadequate and the employee cannot offer convincing substitutes a . . . difficult problem arises. The solution, however, 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 in conformity with his statutory duty; it would allow the employer to keep the benefits of an employee’s labors without paying due compensation. . . . In such a situation we hold that 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.  The burden then shifts to the employer to come forward with evidence of the precise amount of work performed or with evidence to negative the reasonableness of the inference to be drawn from the employee’s evidence.  If the employer fails to produce such evidence, the court may then award damages to the employee, even though the result be only approximate.

[Hernandez v. Mendoza (1988) 199 Cal.App.3d 721, 727, quoting Anderson v. Mt. Clemens Pottery Co. (1946) 328 U.S. 680, 687-688 (emphasis added).]

To recover in an action for unpaid wages, employees still have the burden of proving they performed the work for which they were not compensated, but there are ways to do that even in the absence of employers’ timekeeping records.  Without timekeeping records, this will obviously be imprecise and require some guesswork, but that is okay. Employees can meet their burden by establishing the hours worked in a regular workday, for instance, and the performance of additional work outside of normal work hours.  [Furry v. East Bay Publishing, LLC (2018) 30 Cal.App.5th 1072, 1080.]

Employees should try to establish their regular working hours and schedule, which can be corroborated by witnesses (such as co-workers) who routinely saw the employees working those hours, as well as phone records, calendars, or emails showing employees were working at specified times.  An employee’s testimony as to hours worked can also constitute sufficient evidence.  [See Furry v. East Bay Publishing, LLC (2018) 30 Cal.App.5th 1072, 1080-1081; Hernandez v. Mendoza (1988) 199 Cal.App.3d 721, 727-728.]

If an employer cannot produce evidence of the precise amount of work performed by the employee or evidence to negate the reasonable inference drawn from the employee’s evidence (which is often the case given the employer’s lack of timekeeping evidence to begin with), then a court should accept the employee’s estimate of the hours and award damages for the unpaid wages accordingly.

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This article is based on the law as of the date posted at the top of the article.  This article does not constitute the provision of legal advice, and does not by itself create an attorney-client relationship with Eskridge Law.