Tuesday, February 25, 2020

California Supreme Court: Time Spent in Security Screenings is Compensable

  • The Frlekin decision expands the scope of what is considered compensable time under state law.
  • The decision is based on the employer’s control of the employee’s time, not on whether the employee was “suffered or permitted to work.”
  • The court clarified that, in cases involving onsite employer-controlled activities, courts may and should consider additional relevant factors, including, but not limited to:
    • The location of the activity;
    • The degree of the employer's control;
    • Whether the activity primarily benefits the employee or employer; and
    • Whether the activity is enforced through disciplinary measures.

The California Supreme Court issued a decision in Frlekin v. Apple, Inc. (Frlekin) clarifying that, under state law, compensable time or “hours of work” includes the time an employee spends on the employer’s premises waiting for, and undergoing, mandatory exit searches of bags, packages, or personal technology devices (such as iPhones) that are voluntarily brought to work purely for personal convenience.

Many employers have adopted security screenings to curb employee theft, particularly in the retail and mercantile industries. In light of the Frlekin decision, California employers will need to pay close attention to the length and scope of their screening procedures and whether they need to account for the time employees wait to go through the screening process.

Hours Worked

In Frlekin, the plaintiffs sued their employer, Apple Inc. (Apple), for unpaid minimum and overtime wages for the time they spent waiting for and undergoing Apple’s exit searches. Apple required its employees to clock out before submitting to thorough security screenings at the end of their work shift and leaving Apple’s premises. The screenings could be lengthy and required employees to wait for extended periods of time.

Under California’s Wage Order 7 (the controlling law in this case), “hours worked” is defined as “the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so.” (Emphasis added.)

The court in this case concluded that an employer is controlling an employee’s time when it requires the employee to submit to an exit search before exiting the employer’s premises. As a result, the court determined that the time employees spend undergoing exit searches is compensable as “hours worked” under California labor law.

The court also rejected the employer’s argument that compensable time must be tied to an activity that is “required” or “unavoidable,” because this type of language:
  • Does not exist in Wage Order 7; and
  • Is inconsistent with the history and purpose of Wage Order 7.
Issues for Employers

Even though security screening cases are uncommon under federal law, this court decision seems to contradict the U.S. Supreme Court’s decision in Integrity Staffing Solutions, Inc. v. Busk, holding that time spent awaiting bag checks was not compensable time under the Fair Labor Standards Act (FLSA). Employers will want to understand the difference between these two cases and determine whether state or federal law applies, based on their specific circumstances.

Finally, the California Supreme Court also indicated that the Frlekin decision applies retroactively, meaning that employers that adjust their security screening and other off-the-clock practices may also need to go back a few years to determine whether they are liable for unpaid wages to their employees.