| CA Supreme Court Continues to Define the Scope of Hours Worked |
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| The California Supreme Court often issues decisions that have broadened and strengthened the rules around “hours worked” and compensable time for nonexempt employees, including Troester v. Starbucks, which rejected the federal de minimis rule excluding some small amounts of time from compensation, and Frlekin v. Apple, which required compensation as hours worked for end of shift security checks of employee belongings. In a recent decision, the California Supreme Court recently held that where an employer exercises sufficient control over an employee’s actions, that time under the employer’s control will be compensable (Huerta v. CSI Electrical Contractors, No. S275431 (March 25, 2024)). A contractor doing work at the California Flats Solar Project (the project). The location is on a significant expanse of land with a designated road for entry and travel to the employee parking lots. At the entry was a guard shack on the land’s perimeter with a security gate several miles down the road from the shack. From the security gate, it’s another 10 to 15 minutes down the road to the employee parking lots. Employee Huerta was hired by a subcontractor to assist on the project. He was subject to security checks at the security gate. Due to the mandatory searches at the security gate, long lines would often form while security inspected work badges and sometimes visually inspected inside vehicles and truck beds. The exit procedure at the end of the shift was similar, causing delays between five and 30 minutes to exit through the security gate. Employees were not paid for the time spent waiting at the security gate, undergoing the security check, or traveling from the gate to the parking lot at the day’s start or from the parking lot to the gate at day’s end. Eventually, Huerta filed a wage and hour class action lawsuit for wages for time spent waiting at the security gate, time spent driving from the security gate to the parking lot (and vice versa), and time during meal periods during which he was required to be on the premises. Because Huerta’s claims centered around California’s definition of “hours worked” in the applicable wage order, the Ninth Circuit sent three questions to the California Supreme Court: 1. “Is time spent on an employer’s premises in a personal vehicle and waiting to scan an identification badge, have security guards peer into the vehicle, and then exit a security gate compensable as ‘hours worked’ within the meaning of the wage order? 2. “Is time spent on the employer’s premises in a personal vehicle, driving between the security gate and the employee parking lots, while subject to certain rules from the employer, compensable as ‘hours worked’ or as ‘employer-mandated travel’ within the meaning of the wage order?” 3. “Is time spent on the employer’s premises, when workers are prohibited from leaving but not required to engage in employer-mandated activities, compensable as ‘hours worked’ within the meaning of the wage order, when that time was designated as an unpaid ‘meal period’?” The court began its review by highlighting the two independent factors that make up the “hours worked” definition in California’s wage orders, which is the time an employee: –Spends subject to the control of the employer; or –Is suffered or permitted to work. For time to be compensable as “hours worked,” only one factor must be met. The court found control was exercised at the security gate for exit screenings. As part of the mandatory exit screening, employees were: 1. Confined to the worksite in his vehicle while waiting for their turn; and 2. Required to perform specific tasks, such as waiting in his vehicle in line, rolling down his window to present their badge and remaining at the gate for enough time to allow security to visually inspect various parts of their vehicles. Commute Compensation The second question about whether the drive time from the security gate to the parking lot is compensable relies upon travel time rules. Ordinarily, an employee’s commute to their worksite is not compensable, even if the employee is required to be present at the worksite at a specific time. However, once an employee has reported to the first location where the employee’s presence is required by the employer, any other travel within that workday is compensable. Huerta argued that because their employer told him and other employees that the security gate was “the first location where an employee’s presence was required,” any travel beyond the security gate is compensable. The employer argued that the statement about the security gate was only meant to inform an employee that this was the only way to commute to the parking lot — which was the actual first place an employee’s presence is required. The court held that the phrase “the first location where the employee’s presence is required by the employer” must be a location that is required for an employment-related reason other than the practical necessity of reaching the worksite. Common examples of this are situations where an employee must pick up tools, vehicles, work orders or other job-related items before traveling on to a worksite. The court declined to take a specific position on whether Huerta’s travel from the security gate to the parking lot was compensable but did conclude that in order for travel time to be compensable, there must be evidence that the employer required the employee’s presence at the initial location, and that the employee’s presence was required “for an employment-related reason other than accessing the worksite.” Red Flag Tips In light of Huerta, here are a few takeaways for employers: -The California Supreme Court continues to focus on ensuring employees are paid for all hours worked, no matter how incidental to the employee’s actual job duties. -A primary factor in determining compensation is whether the time is subject to sufficient control by the employer, so employers should ensure they’re compensating employees for all time the employee is responding to direction or otherwise being controlled by the employer’s policies and practices. -Travel time compensation depends upon when an employee first reports to a site for an employment-related reason other than the practical necessity of reaching the worksite. -This is particularly important for workers with multiple worksites, as all travel time after reaching the first worksite in a day is compensable. Employment-related reasons will generally apply to a job duty, such as collecting tools or job orders at one location before proceeding to another. In this case, travel after the security gate is compensable. |
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