Off-the-Clock Work Must be Paid

Photo by Han Chau on Unsplash

Last week, the California Supreme Court, in a case called Troester v. Starbucks Corporation, confirmed that California wage and hour law “does care for small things.” In this case, it cares about small increments of time spent on work off-the-clock by hourly employees. Small increments in this case is about 4 to 10 minutes after clocking out.

De Minimis Doctrine

This is a departure from federal law’s more employer-friendly version of the de minimis doctrine. The de minimis doctrine is an established defense under the Fair Labor Standards Act (FLSA), which allows employers to disregard time as de minimis (and therefore not have to pay employees for that time) if the employer could prove: (1) it would be difficult and impractical for the employer to record the additional time; (2) the total amount of compensable time is minimal; and (3) the additional work is irregular. For example, pre-shift or post-shift meetings.

Starbucks Hourly Employee Worked 4 to 10 Minutes Off-the-Clock Each Shift

In the Troester v. Starbucks case, Douglas Troester worked for Starbucks as an hourly shift supervisor. As part of his duties, he was required to clock out before performing his store closing tasks and therefore wasn’t paid for the time he spent performing those tasks. Troester submitted evidence that Starbucks’s computer software required him to clock out on every closing shift before initiating the software’s “close store procedure” on a separate computer terminal in the back office. The close store procedure transmitted daily sales, profit and loss, and store inventory data to Starbucks’s corporate headquarters. After he finished that task, he had to activate the alarm, exit the store, and lock the front door. He also submitted evidence that he walked his coworkers to their cars in compliance with Starbucks’s policy.

On average, he worked 4 to 10 minutes off the clock, which totaled 12 hours and 50 minutes during his 17 month employment. At the then-prevailing minimum wage of $8 per hour (which gives you an idea of how long this case has been going on), he was not paid for $102.67 of work hours (not including penalties and other remedies). He filed a class action law suit under the California Labor Code for failure to pay minimum and overtime wages, failure to provide accurate written wage statements, and failure to timely pay all final wages.

If the Employee’s Working, S/He Must be Paid

The California Supreme Court noted that “An employer that requires its employees to work minutes off the clock on a regular basis or as a regular feature of the job may not evade the obligation to compensate the employee for that time by invoking the de minimis doctrine. As the facts here demonstrate, a few extra minutes of work each day can add up.” The Court further noted that $102.67 “is enough to pay a utility bill, buy a week of groceries, or cover a month of bus fares. What Starbucks calls ‘de minimis’ is not de minimis at all to many ordinary people who work for hourly wages.”

Below are the main issues that lead the court to reach this conclusion:

• IWC wage order No. 5-2001 (Wage Order No. 5) concerning the “public housekeeping industry” includes establishments such as Starbucks that provide food and beverages defines hours worked as “the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so . . . .” (Read more about Wage Orders and suffer or permit to work standard.)
• The off-the-clock work done was part of the employee’s duties and was done regularly.
• Technology has made it easier to capture time, therefore it is not impractical or unreasonable to expect the time to be recorded.

In summary, all time that an hourly employee spends doing something as part of their duties or which is for the employer’s benefit must be paid.

PRACTICAL TIP:

For Employers

The Court provided some alternatives that employers could implement:
• Structuring work so that employees would not have to work before or after clocking out.
• Using technology to have time tracking tools to more accurately record employee’s time.
• Estimating the time it takes employees to perform work and to compensate employees for that time.

Additionally, employers should also:
1. Review pre-shift, post-shift, and similar practices to ensure there is no regularly occurring off-the-clock work that should be captured as working time.
2. Adjust written policies as necessary.
3. Educate and train managers and investigate all claims of “pre-shift” or “post-shift” work.

For Employees

Employees who regularly work off-the-clock should bring this matter to your supervisor or human resources’ attention so that the violation may be remedied.

Schedule a call if you have questions about off-the-clock work or California employment laws.

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In: Employment Law, Uncategorized

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