Equitable Tolling of the Limitations Period of FLSA Actions

“Circumstances rule men: men do not rule circumstances.”

- Herodotus

Last week we blogged about willfulness and the Fair Labor Standards Act (“FLSA”) two to three year statute of limitations. This week we examine when even the running of that period may be tolled.

In most instances, the statute of limitations starts to run as soon as a violation of the FLSA occurs. So, for missing overtime pay the statute of limitations will begin when the overtime pay is missing from the months pay period. However, equitable tolling suspends the statute of limitations from running. This allows plaintiffs to sue for damages that occurred outside of the traditional two or three years window.

The courts award equitable tolling on a case-by-case basis and do so understanding that they should do so rarely. Udvari v. United States, 28 Fed. Cl. 137 (Fed. Cir. 1993). The Supreme Court said that equitable tolling should be awarded when a plaintiff shows that he has pursued his claim diligently and that some extraordinary circumstances have prevented him from acting on it. Pace v. DiGuglielmo, 544 U.S. 408, 418 (2005). Different circuits apply different tests to determine whether or not the facts of each case fit within the holding of Pace. The First and Sixth circuits have a five-factor test that looks at notice, diligence, reasonableness and prejudice. Others like the Third Circuit look to see if the defendant actively misleads the plaintiff, or if the plaintiff pursued his rights in the wrong forum. Failure to post the Department of Labor’s FLSA poster combined with affirmatively misleading the employees, for example, can work an equitable tolling on the claim. These tests are often unique to their jurisdictions, but the themes stay the same; a plaintiff who whole heartedly pursued his rights or was deliberately misled by his employer will be looked favorably on by the court. These factors are viewed on a case by case basis to determine if it is just to award the plaintiff the ability to adjudicate their time-barred claim in court.

For employers, there are defenses to the doctrine of equitable tolling. If the plaintiff unreasonably relied on information, some courts have decided to not toll the statute. For example, the plaintiffs in Aguilar v. Clayton, 452 F. Supp. 896 (E.D. Okla. 1978) understood that they had a claim but relied on a misrepresentation from their employer that they would have to pursue administrative remedies before filing in court. The court found that it was unreasonable to rely on the opposing party’s legal advice when pursuing their own claim. Furthermore, a plaintiff’s personal knowledge of his own rights can be a defense used by the defendant arguing against tolling the statute.

The doctrine of equitable tolling is meant to allow plaintiffs the chance to adjudicate a time barred claim in situations where it would be unjust to let the statute of limitations bar them. There is no one factor that is determinative in every jurisdiction so advice from legal counsel will help to determine the individual rights of each prospective plaintiff.