Secretary United States Department of Labor v. American Future Systems Inc., No. 16-2685 (3d Cir. 2017)Annotate this Case
Progressive publishes and sells business publications, using sales representatives who are paid an hourly wage plus bonuses based on the number of sales per hour while they are logged onto their workstation computers. Progressive previously gave employees two 15-minute paid breaks per day. In 2009, Progressive eliminated paid breaks but allowed employees to log off of their computers at any time, for any duration. Progressive does not pay them for time they are logged off of their computers, including bathroom breaks and time used to prepare for the next call. Sales representatives estimate the total number of hours that they expect to work during the upcoming pay period. They are subject to discipline for failing to work that number of hours. Progressive sends representatives home for the day if their sales are not high enough and sets fixed schedules for representatives when that is deemed necessary. The Department of Labor alleged that this policy violated the Fair Labor Standards Act “by failing to compensate . . . sales representative employees for break[s] of twenty minutes or less . . . .” The district court agreed that that 29 C.F.R. 785.18 created a bright-line rule. The Third Circuit affirmed that the Act requires employers to compensate employees for all rest breaks of 20 minutes or less.