The California Supreme Court decision in Troester v. Starbucks is a new case that may change the way you keep track of employee time.
Most employers know they need to keep track (and pay!) non-exempt employees for every hour they work. Non-exempt employees are those who are paid by the hour because they are not a Professional, Executive or Administrative employee. Employers have recordkeeping, minimum wage, overtime pay and other obligations that are based on how many hours each employee works. So it is essential that employees’ time be accurately recorded.
In the Starbucks case, the California Supreme Court ruled that work done off the clock, even a few minutes a day, must be recorded and paid – rejecting the “de minimus” defense for most routine off the clock work situations. The de minimus defense is codified under federal law and permits employers to ignore very small amounts of time worked off the clock, so long as it is: a) uncertain or indefinite periods of time of a few seconds or minutes, and b) cannot, as a practical administrative matter, be recorded.
Troester, a Starbucks manager, was required to clock out before he was able to run the daily sales reports, lock the front door, walk his employees to their cars (a job requirement) and take in any outside furniture that may have been accidently left out. This amounted to between 4 and 10 minutes a shift. Although the time varied, the Court found that because Starbucks knew its managers were required to clock out before completing these tasks it was required to pay for this time.
The Court did not kill the de minimus defense in California entirely. It concluded that de minimus may be applicable when the amount of off the clock work was very small, very difficult to track, and not routine unlike what occurred at Starbucks. The Court will also consider the size of the aggregate amount of off the clock work, what technologies are available to track the work and what the employer has done to try and minimize the off the clock time worked.
This case is a good reminder for employers to:
1. Review The Workplace. Evaluate whether you routinely require non-exempt employees to work off the clock. If so, then:
· make changes to policies/procedures so that work is done while employees are still clocked in, and/or
· investigate and employ technologies that will allow employees to record their time in a more flexible manner, and/or
· pay wages based on reasonable estimates for the off the clock work.
2. Evaluate Time Keeping Practices. Relying on hand-written timesheets are the least accurate and efficient option. An employer could be held responsible for not utilizing the best procedure, in light of the cost or availability to the company.
3. Make It Right. If non-exempt employees have been working off the clock, consider offering to pay a reasonable estimate for that work, in exchange for a full release to avoid legal liability down the road.
If you have a question or want to discuss any employment law issues, please feel free to give us a call.
Samantha Pungprakearti is an Attorney at Carle, Mackie, Power & Ross LLP and part of its Employment Law Group. Phone: (707) 526-4200. Email: firstname.lastname@example.org.