Employment Law Alert: California Supreme Court Rejects The Federal De Minimis Work Time Rule

On July 26, 2018, the California Supreme Court issued its long-awaited decision in Troester v. Starbucks Corporation, regarding whether the federal Fair Labor Standards Act’s (“FLSA”) de minimis doctrine applied to claims for unpaid wages under the California Labor Code. The de minimis doctrine is an application of the maxim de minimis non curat lex, which means the “law does not concern itself with trifles.” Federal courts have applied the de minimis doctrine in certain circumstances to excuse the payment of wages for small amounts of otherwise compensable time upon a showing that the bits of time are administratively difficult to record. Those courts have generally found that daily periods of approximately 10 minutes are de minimis even though otherwise compensable.

In a significant divergence from federal law, the California Supreme Court in Troester found that the relevant California wage and hour laws have not adopted the federal de minimis doctrine. While the Court recognized that California has a de minimis rule “that is a general background principle of state law,” the Court found that the relevant wage order and Labor Codes do not permit application of a de minimis rule to the facts of the Troestercase, where the employer regularly required the employee to work “off the clock” several minutes per shift.

In Troester, plaintiff alleged that Starbucks failed to pay him for short periods of time he spent closing the store after he clocked out. These closing activities included activating the security alarm, exiting the store, and locking the store’s front door. Plaintiff also alleged that occasionally he also walked coworkers to their cars in compliance with Starbucks’ policy, reopened the door to allow employees to retrieve items they left behind, waited with employees for their rides to arrive, or brought in store patio furniture mistakenly left outside. The undisputed evidence was that these closing tasks required plaintiff to work between 4 to 10 minutes each day.

Given those specific facts, the Court found that the de minimis doctrine would not be applicable, holding 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.”

The Court noted that “employers are in a better position than employees to devise alternatives that would permit the tracking of small amounts of regularly occurring work time,” and offered some practical alternatives that employers could implement, including:

  • 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 employees’ time; and
  • Reasonably estimating the time it takes employees to perform work (e.g., through surveys, time studies, or a fair rounding policy) to compensate employees for that time.

While the Court held that California law does “not allow employers to require employees to routinely work for minutes off-the-clock without compensation,” the Court specifically declined to “decide whether there are circumstances where compensable time is so minute or irregular that it is unreasonable to expect the time to be recorded.” (Emphasis added). The Court declined to do so “given the wide range of scenarios in which this issue arises.”

In a concurring opinion (which is not considered binding precedent), Justice Kruger offered the following examples of circumstances when a de minimis rule could apply:

  • An employer requires workers to turn on their computers and log in to an application in order to start their shifts. Ordinarily this process takes employees no more than a minute (and often far less, depending on the employee’s typing speed), but on rare and unpredictable occasions a software glitch delays workers’ log-ins for as long as two to three minutes.
  • An employer ordinarily distributes work schedules and schedule changes during working hours at the place of employment. But occasionally employees are notified of schedule changes by e-mail or text message during their off hours and are expected to read and acknowledge the messages.
  • After their shifts have ended, employees in a retail store sometimes remain in the store for several minutes waiting for transportation. On occasion, a customer will ask a waiting employee a question, not realizing the employee is off duty. The employee – with the employer’s knowledge – spends a minute or two helping the customer.
In situations such as these, Justice Kruger wrote in her concurring opinion, “a requirement that the employer accurately account for every second spent on work tasks may well be impractical and unreasonable.”

In short, the California Supreme Court’s decision in Troester demonstrates that California employers are required to track and pay for time worked more strictly than what would be allowed under the federal de minimis rule. California employers should review their timekeeping policies and practices with legal counsel to ensure compliance with California’s heightened standard.

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