Hill, Farrer & Burrill LLP

Employment Updates

The California Supreme Court Severely Narrows the Application of the De Minimis Doctrine as a Defense to Wage Claims

On July 26, 2018, the California Supreme Court issued its long-awaited decision in Troester v. Starbucks Corporation, No. S234969 (July 26, 2018) holding that the de minimisdoctrine did not apply under either the Fair Labor Standards Act (“FLSA”) de minimis doctrine or general principles of California law where an employee worked approximately 4-10 minutes off-the-clock per shift.  Federal courts have applied the de minimisdoctrine in some circumstances to excuse the payment of wages for small amounts of otherwise compensable time upon a showing that the small amounts of time are administratively difficult to record.

The California Supreme Court departed from the rationale of several federal courts and held that the time the plaintiff spent working off-the-clock performing tasks such as locking the door, activating the alarm, and walking coworkers to their cars for security purposes was not administratively difficult to record and was not de minimis.  The California Supreme Court did not hold with any certainty when the de minimisdoctrine may apply, but suggested that such time must be “fleeting” or “irregular.”

The Court also cautioned against rounding an employee’s time and held that rounding time is only allowable where the rounding policy favors the employee or where the rounding policy is neutral.  In other words, rounding is only permissible where the time recording system rounds the employee’s time up to the nearest tenth of an hour (or whichever increment is used by the employer) at least as often as it rounds the employee’s time down (i.e., rounds up to the nearest tenth of an hour if the employee works more than two minutes, and rounds down to the nearest tenth of an hour if the employee works one or two minutes).

Employers should use time recording systems that capture all time worked by employees to ensure that all time worked is compensated and should eliminate any rounding practices that favor the employer.

Employers doing business in California should contact legal counsel at Hill, Farrer, & Burrill to make sure they are complying with California wage and hour laws in light of the new Troester decision.