Wage and Hour Laws: Compensable Time Under the Fair Labor Standards Act
On May 24, 1937, when President Franklin Roosevelt sent a bill to Congress relating to Wage and Hour Laws for what later would become the Fair Labor Standards Act (“FLSA”),[1] he did so with the message that America should be able to give “all our able-bodied working men and women a fair day’s pay for a fair day’s work.”[2]
The U.S. Supreme Court has been particularly concerned with Wage and Hour Laws in recent years in determining exactly when employees are on and off the clock. Establishing rules for when employees are on and off the clock directly affects the wages that employees are owed—“a fair day’s pay for a fair day’s work.”
For example, in 2014 the Court decided Sandifer v. United States Steel Corp., No. 12-417, a Wage and Hour Laws case where the question was whether time that steelworkers spend donning and doffing protective gear is compensable under the FLSA, 29 U.S.C. § 203(o). Section 203(o) provides that a union and an employer may agree to exclude the time workers spend “changing clothes” from the minimum wage and overtime protections of the FLSA.
In a unanimous opinion authored by Justice Scalia, the Court held that “clothes” within the meaning of § 203(o) “denotes items that are both designed and used to cover the body and are commonly regarded as articles of dress.”[3] Protective gear such as flame-retardant hoods, flame-retardant jackets, and flame-retardant pants are “clothes” within the meaning of § 203(o).[4] The Court further held that “changing clothes” includes putting new clothes over old ones, and not simply taking off one outfit to put on another.[5] Accordingly, the time that employees spend donning and doffing protective gear falls within the exception of § 203(o) and is not compensable under the FLSA if a union and an employer have agreed to exclude it.[6]
On March 3, 2014, the Supreme Court granted certiorari in another Wage and Hour Laws case concerning compensable time under the FLSA: Integrity Staffing Solutions, Inc. v. Busk, No. 13-433. The question presented is whether time spent in security screenings should be compensated under the FLSA, as amended by the Portal-to-Portal Act.[7]
The Portal-to-Portal Act does not require compensation for activities that are “preliminary” or “postliminary” to the “principal activity or activities” that an employee “is employed to perform.”[8] However, preliminary and postliminary activities are compensable if they are “integral and indispensable” to the employee’s principal activities.[9] To be “integral and indispensable,” an activity must be: (1) necessary to the principal work performed; and (2) done for the benefit of the employer.[10]
Respondents in Integrity Staffing Solutions are warehouse workers who seek back pay, overtime, and double damages under the FLSA for time spent in security screenings after the end of their work shifts. Before they left work, employees waited up to 25 minutes to be searched and were required to remove their wallets, keys, and belts, and pass through metal detectors.[11] Relying on an unbroken line of authority from other jurisdictions, the district court dismissed Respondents’ claims because security screenings are typical “preliminary” or “postliminary” activities that are non-compensable under the FLSA pursuant to the Portal-to-Portal Act.[12]
The Ninth Circuit reversed, holding that time spent in security screenings was compensable under the FLSA because it was “necessary to [Respondents’] primary work as warehouse employees.”[13] That holding squarely conflicts with decisions from the Second and Eleventh Circuits concerning Wage and Hour Laws issues, holding that time spent in security screenings is not subject to the FLSA because it is not “integral and indispensable” to employees’ principal job activities.[14]
The Ninth Circuit distinguished the Second and Eleventh Circuit cases by noting that, unlike in Gorman and Bonilla, in which everyone who entered the workplace had to pass through a security clearance, only select employees were required to undergo security screenings.[15] Additionally, the security screenings were required to prevent employee theft, a concern that stemmed from the nature of the Respondents’ work and their access to merchandise in the warehouse.[16] Thus, the screenings were done for the benefit of the employer, unlike in Bonilla, where security screenings mandated by the FAA did not benefit the employer.[17]