In White v. Baptist Memorial Health Care Corp., the key litigated issue was whether an employer could recover wages for work performed during unpaid meal breaks when she failed to follow her employer's procedures for reporting uncompensated work time.

Margaret White was employed as a nurse with Baptist Memorial Health Care Corp. Baptist's employee handbook stated that employees working shifts of six or more hours would receive an unpaid meal break that would be automatically deducted from their pay checks. However, employees were instructed to record all time worked during meal breaks in an "exception log" if the meal break was missed or interrupted for a work-related reason. In that event, the employee would be compensated for the time worked during the meal break.

White initially logged time worked during her meal breaks in the "exception log," but she eventually stopped reporting her missed meal breaks. Although she informed her supervisors and Baptist's human resources department from time to time that she was missing meal breaks, she never informed them that she was not paid for the missed breaks. White also did not use Baptist's procedure to report and correct payroll errors to address the errors relating to her interrupted, but unpaid meal breaks.

White filed suit against Baptist and moved for conditional class certification, alleging that Baptist violated the FLSA by failing to pay her for time worked during her meal breaks and that Baptist's policy for compensating employees for missed meal breaks violated the FLSA. After granting in part White's motion for class certification, the district court granted Baptist's motions for summary judgment and class decertification. White appealed.

On November 6, 2012, the US Court of Appeals for the Sixth Circuit issued an opinion affirming the judgment of the district court. In its 2-1 ruling, the Sixth Circuit held that when an employer establishes a reasonable process for an employee to report uncompensated work time, the employer is generally not liable for failing to pay an employee who does not follow the process.

The court began by noting that, under the FLSA, a system that automatically deducts for meal breaks is lawful. The court further noted that an employer generally is only liable for uncompensated work time that it knew or should have known about, rather than work time that it merely could have known about. If an employer establishes a system for employees to record time worked during meal breaks, and the employee fails to follow the employer's established procedures, the employer is liable for unpaid wages only if either:

The Sixth Circuit found no evidence that Baptist discouraged employees from reporting time worked during meal breaks or that they were otherwise notified that their employees were failing to report time worked during meal breaks. Although White alleged that she told her supervisors that she was not receiving meal breaks, this was insufficient to show that Baptist knew that she was not paid for that work time.

The court also affirmed the district court's grant of Baptist's motion for class decertification, holding that without a viable FLSA claim, White could not represent others whom she alleged are similarly situated.

In dissent, Judge Moore explained that an employer must pay an employee for any time the employer knows or should have known the employee worked, even if the employee failed to report the work. Judge Moore's dissent noted that summary judgment was not proper in this case because White presented evidence that Baptist knew or should have known about White's missed or interrupted meal breaks that were unpaid.

The Sixth Circuit's decision sets a high bar for employees seeking to recover unpaid compensation for working time that is not logged according to an employer's reasonable timekeeping procedures. Although the court acknowledged that an employee's failure to record time is not an absolute bar to recovery under the FLSA, the court's stringent application of its test appears to leave little room for employees attempting to show that an employer had actual or constructive knowledge of uncompensated work if the employee failed to follow the employer's established procedures for reporting work time. For employers, the decision reinforces the importance of maintaining a: