Business owners should examine their time-keeping practices in the wake of the Troester v. Starbucks decision. Now, if an employee is required to “regularly work” for any minutes off the clock, then an employer must pay them for that time.
Facts: Troester (Plaintiff) worked as a supervisor at Starbucks for seventeen (17) months. As part of his “closing” duties he was required to clock-out prior to completing the following: the “close store” protocols on the Company computer, setting the alarm, locking up the store, and walking employees to their cars (a Company policy). On occasion, he had to let employees back into the store to get forgotten items. On other occasions, he had to take a few minutes to put away furniture that was accidentally left on the patio. The court determined that Plaintiff was essentially working an additional four (4) to ten (10) minutes off-the-clock, each closing shift. This amounted to twelve hours and fifty minutes of uncompensated time during his employment with the company. At the $8.00 per hour minimum wage rate, Starbucks owed Troester $102.67.
Holding: According to the federal Fair Labor Standards Act (FSLA), an employer is not required to pay an employee for de minimis time, which is defined as “insubstantial or insignificant periods of time beyond the scheduled working hours which cannot as a practical administrative matter be precisely recorded for payroll purposes.” The California Supreme Court considered whether this FSLA provision has been adopted by the California Labor Code, and also considered whether the de minimis principle that operates in California is applicable to wage and hour claims. The court determined that California has not adopted the federal de minimis standard. The court considered both the Labor Code and Wage Order 5, which concerns the “public housekeeping industry,” and governs wage and hour issues for establishments that provide food and beverages. Ultimately, the court found that there was no intent to incorporate the FSLA de minimis doctrine into California law.
Second, the court considered whether California has its own de minimis doctrine that may apply. Starbucks argued that de minimis non curat lex (the law cares not for trifles) is an “established background of legal principles,” on which the statutes and wage orders were enacted. The court conceded that there is a de minimis principle in the background of California law, but it was not applicable to Troester’s case. The court explained that, for an employee making a living on minimum wage, $102.67 is enough to buy a week’s worth of groceries, or pay a utility bill, and therefore should not be considered de minimis. Starbucks expected Troester to regularly perform tasks off-the-clock, as part of his “closing” duties. Thus, Troester performed these tasks for four (4) to ten (10) minutes, each time he closed the store. The court explained that those extra minutes add up, and employers cannot utilize the de minimis doctrine to “evade the obligation to pay the employee.” The court also stated that improvements in technology and time tracking tools have made it possible to record compensable time where it was previously impractical. Therefore, because it is practical for employers to record this time, the time is not considered “de minimis” and employers cannot require employees to regularly work off the clock. The court declined to determine whether the de minimis principle applies to a wage claim wherein the employee activity is “so brief or irregular” that it would be unreasonable for employers to compensate the employee.
What this means: Any regular task that an employee is expected to perform must be compensated. Employees that clock-out, but have work-related duties (such as locking up or taking out the trash) are still working, and must be paid for that time. Employers should examine how they are calculating their employees’ hours, and ensure that employees are not regularly completing work-related tasks off-the-clock.
If you are concerned that your time-keeping practices may not be compliant, contact the attorneys at Palmer Kazanjian Wohl Hodson LLP.