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On December 9, 2014, in Integrity Staffing Solutions v. Busk, a unanimous United States Supreme Court ruled that employees are not entitled to be compensated for time spent undergoing security checks before leaving an employer’s facility. The case turned on an interpretation of the federal Fair Labor Standards Act (“the FLSA”), and specifically the Portal-to-Portal Act, which is part of the FLSA and exempts employers from paying employees for activities that are preliminary or postliminary to the employees’ “principal work activity or activities.”
The Casee could have broad implications in many states, as more and more Amazon-type employers spring up. But California law specifically rejects the appli- cation of the portal-to-portal Act to California wage and hour laws – meaning that, had the case been brought under Cali- fornia law, it may well have gone the other way.
The case involved employees of Amazon, the behemoth online retailer. employers at manufacturing and retail sales facilities typically set up security checkpoints before em- ployees can leave the facilities. The employers do not want their employees to steal merchandise and so will search the employees and their bags and jackets before allowing the employees to leave the facility. The employees in this case retrieved and packaged products in a warehouse to send to Amazon customers. In their lawsuit, several former em- ployees claimed that they spent up to 25 minutes per day lining up and going through the security checkpoints. They argued that they were entitled to be paid for this time under federal law.
The case was filed in federal court in Nevada. The federal district court rejected the claims, ruling that, under the FLSA, the time was “postliminary” and uncompensable. But the appellate court concluded that postliminary activities become compensable if they are required and performed for the employer’s benefit. The Supreme Court reversed, holding that the time spent in security screenings was not compensable under the FLSA.
The Court recited prior decisions that recognize that only “principal activity or activities” are compensable, including activities that are an “integral and indispensable part of the principal activities.” An activity is considered “integral and indispensable to the principal activities” if it is an “intrinsic element of those activities and one with which the employee cannot dispense if he is to perform his principal activities.” The Supreme Court concluded that security screenings were not the employees’ principal activity, because (1) they had not been hired to undergo security screenings, and equally (2) could do their actual jobs without security screenings.
California law is significantly more protective of employees than is federal law. It rejects the Portal-to-Portal Act – meaning the entire rationale of the Integral Staffing decision would not apply in a case under California law. And instead of using the “principal activity” test, California law uses the “control test,” generally making time in which employees are subject to the employer’s control compensable.
A good example of how protective this standard can be involved police officers employed by the City of Madera who were represented in the 1984 California Supreme Court case by one of my mentors – and former Carroll Burdick partner – Chris Burdick. (See Madera Police Officers Assn. v. City of Madera.)
The case involved “Code 7” meal breaks for police officers. During those breaks, officers could eat a meal, but they were required to keep their radios on, respond to calls, stay in uniform and be responsive to inquiries from members of the public. In interpreting California law, the California Supreme Court considered different inquiries than did the United States Supreme Court in Integral Staffing. The California court had a two-fold analysis of whether the time was compensable: (1) whether the restrictions on employees are “primarily directed toward the fulfillment of the employer's requirements and policies,” and (2) whether employees are “substantially restricted during Code 7 time, so as to be un- able to attend to private pursuits.” Taking into account the restrictions placed on the police officers by the employer, the Supreme Court concluded that “constraints placed on the activities and conduct of the concerned employees during their mealtime are so restrictive that the employees are at work and are thus entitled to...compensation.”
Turning back to Integral Staffing, the reason the Amazon employees can be required to be subject to a security screening is because they are completely under the control of their employer. Under California law, that may well be enough to ensure compensability.
© Messing Adam Jasmine & Shore LLP
