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Health Law Alert: Healthcare Facilities Face Threat of FLSA Class Action Lawsuit

September 12, 2017

The healthcare industry is carefully watching a recently filed federal class action lawsuit filed in Texas, in which a hospital system is being sued under the Fair Labor Standards Act (“FLSA”) for allegedly depriving nurses of overtime through automatic time deductions for meal breaks. The FLSA is the federal law that deals with wage and hour issues.

The allegations in Salcedo et al. v. St. Luke’s Health System Corp. et al. could signify that hospitals and healthcare facilities nationwide may face the prospect of similar class action claims. Class actions allow large groups of employees to collectively pursue similar employment-related lawsuits in court. Such actions are popular with the plaintiffs’ bar, and dreaded by employers because of the increased defense costs, as well as the potential catastrophic liability from an adverse jury verdict in a lawsuit involving hundreds or even thousands of plaintiffs. Employment class action lawsuits in one part of the country frequently spawn copycat lawsuits in other jurisdictions, particularly when similar industry practices are at issue.

Under the FLSA, employers are not required to pay employees for bona fide, or genuine meal breaks, ordinarily 30 uninterrupted minutes or more. See 29 C.F.R. 785.19. In Salcedo, the Complaint alleges that in 10 hospitals and healthcare facilities within the St. Luke’s system, nurses are being automatically docked 30 minutes in pay every work shift for meal breaks that do not comply with the FLSA, and seeks alleged unpaid wages. The Complaint states:

Defendant does not provide bona fide meal breaks for its nurses who are responsible for direct patient care. Nurses who work for Defendant are required to remain responsible for patient care throughout their shift. Instead of making nurses clock out for their meal periods and then clock back in at the end of a meal period, Defendant assumes nurses were able to find a 30-minute block of time to enjoy a bona fide meal period. In fact, this does not occur. Nonetheless, Defendant then deducts 30 minutes from nurses’ shifts for a meal period, when in fact, nurses remain on duty during that time.

In light of this apparent signal from the plaintiffs’ bar that hospital meal break policies are a potential target for wage and hour class actions, healthcare providers may want to have their timekeeping practices reviewed for FLSA compliance.