Third Circuit: No FLSA "Overtime Gap Time" Claims

 In DOL v. Comprehensive Healthcare Management Services LLC, the Third Circuit held that "overtime gap time" claims under the FLSA are not actionable. Imagine this scenario:

Category	Hours	Rate	Compensation
Straight time paid	38	$20	$760
Overtime paid	3	$30	$90
Straight time unpaid	2	$20	$40
Total paid			$850
Total contractually owed			$890

Under the FLSA, the employee should receive $890. 40 hours straight time at the regular rate of $20/hour (40 * $20 = $800) plus 3 hours at 1.5x their regular rate (3 * $30 = $90). In our hypothetical, the employee was not paid for two of their non-overtime hours and effectively short-changed by $40. 

Can the employee (or in this case, DOL), bring a claim for those unpaid hours? Nope. Why? At the risk of oversimplifying, the Third Circuit effectively held that the FLSA does *two* things: employees must get paid 1.5x their regular rate for overtime, and must be paid at least minimum wage. In our hypothetical, the employer did both. So, no FLSA claim. 

Now, super-important caveat! Other laws exist - so, for example, in Pennsylvania this employee would presumably have a claim for the unpaid wages under the Pennsylvania Wage Payment and Collection Law (WPCL). However, the Third Circuit's decision still matters for a variety of reasons:

• Jurisdiction: WPCL claims will ordinarily be in state court and not federal (unless there is diversity jurisdiction or some other federal claim);
• Liquidated Damages: The FLSA allows for *double* damages as liquidated damages, whereas the WPCL only allows for the greater of 25% or $500 in liquidated damages; and
• Agency Enforcement: The U.S. DOL would not have enforcement authority (though the PA DLI would). 

One final note: This creates a circuit split (the Fourth Circuit allows such claims), so this may be an issue that SCOTUS takes up.