William E. Brock, Secretary of Labor, United States Department of Labor v. Some Seto, Individually and Doing Business as Tony of California

In this appeal we must decide the sufficiency of evidence regarding uncompensated overtime where the employer failed to keep records required by the Fair Labor Standards Act. We conclude that the district court did not fulfill its duty to approximate an award of back wages based on the employees’ testimony. We reverse and remand for a determination of back wages.

FACTS AND PROCEEDINGS BELOW

The Secretary of Labor filed this action on behalf of sixteen employees of Seto, alleging minimum wage, overtime and record keeping violations under the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-219 . The Secretary sought a permanent injunction to restrain Seto from violating the Act and a restitutionary injunction for unpaid overtime compensation (back wages).

At trial, four employees testified that they had worked over 40 hours a week without overtime pay. A Compliance Officer (CO) from the Wage and Hour Division of the Department of Labor testified about her investigation of Seto’s business for compliance with federal wage and hour requirements. However, she was not permitted to testify about her computations of back wages. The court sustained Seto’s objection that the CO’s…