Supreme Court Will Determine Whether Time Spent Going Through Security Checks Is Compensable Under the FLSA
Paula Lopez, October 16, 2014.
Last week, in the case Integrity Staffing Solutions v. Busk, the U.S. Supreme Court heard argument on whether warehouse workers are entitled to overtime pay for time spent waiting to pass through employer mandated security checks after they had already clocked out for the day. The plaintiffs were former warehouse workers in Nevada employed by Integrity Staffing Solutions, Inc. a company that provides warehouse space and staffing to Amazon.com and similar clients. The plaintiffs worked in two warehouses in Nevada as hourly employees filling orders placed by customers of Amazon.com. Company policy required that all warehouse workers pass through security checks prior to exiting the building. The security checks took place after the employees had clocked out for the day, and required employees to remove their jackets, belts, and shoes, empty their pockets and pass through metal detectors. The plaintiffs alleged that the security checks lasted up to 25 minutes.
Under the Fair Labor Standards Act (FLSA), employees are guaranteed compensation for all work or employment they engage in that is covered by the act. However, the statute never defines what constitutes “work” for which an employee is entitled to be paid. Following its enactment, a string of court decisions broadly defined “work”. In the 1944 case Tennessee Coal, Iron & R. Co. v. Muscoda, the Supreme Court held that the time spent traveling from the portal of a mine to the working area underground was compensable under the FLSA. Then in the 1946 Supreme Court decision Anderson v. Mt. Clemens Pottery Co., the Court held that the entire time that the employee is required to be on the employer’s premises is compensable. This included time spent walking from the time clock to their work stations.
The decisions in Tennessee Coal and Mt. Clemens led to such an avalanche of cases being filed under the FLSA for overtime claims that Congress amended the FLSA by passing the Portal-to-Portal Act of 1947. The Portal-to-Portal Act narrowed the FLSA’s coverage by creating categories of activities that do not constitute compensable work: (i.) walking, riding or traveling to the place where the employee is to perform the principal activity of his or her job, and (ii.) activities that are preliminary and postliminary to the employee’s job. Under the Portal-to-Portal Act, activities generally done before or after an employee’s principal activities are completed would not be compensable under the FLSA. As a result, the Supreme Court established a general test for determining whether certain preliminary or postliminary activities are of a nature that should be compensable. Under this test, an activity that is “integral” and “indispensable” to a principal activity is compensable under the FLSA even if it is performed prior to or subsequent to the employee’s regular shift.
The case of Integrity Staffing came before the Supreme Court following a decision from the Court of Appeals for the Ninth Circuit, reversing the dismissal of the plaintiffs’ claims for overtime pay for time spent waiting to undergo security checks. The district court had granted Integrity’s motion to dismiss the plaintiffs’ claims for failure to state a claim because it held that the time spent passing through security screenings fell into the category of a “postliminary” activity that is non-compensable under the Portal-to-Portal Act. However, the Ninth Circuit held that the security screenings were for the employer’s benefit because they were intended to prevent theft. Therefore, even if they were “postliminary” activities, they were “integral” and “indispensable” to the employees’ principal work activities. The federal government supports Integrity’s position that security checks are simply part of the egress process and the time is not compensable.
During oral argument, Integrity and the federal government argued that the security screenings at issue are akin to punching out at the end of the day and constitute “postliminary” activities excluded from the FLSA by the Portal-to-Portal Act. Plaintiffs’ counsel argued that the security screening is an additional task required by the employer and benefited only the employer by preventing theft, making it a principal activity for which employees should be paid. To establish that the security checks at issue are not merely part of the ingress and egress process covered by the Portal-to-Portal Act, Plaintiffs’ counsel pointed out that the security screenings occurred after the employees had punched out for the day.
The Justices, in an effort to expound on what is “integral and indispensable” to an employee’s principal work activity, presented each side with hypotheticals that pressed counsel for both parties and the government to concede instances of postliminary and preliminary activities that would and would not be compensable. Some of the hypotheticals included whether law clerks required to come in early to cut grapefruit and make a judge’s breakfast should be compensated for that time, or whether casino workers, bank tellers or employees working cash registers should be compensated for the additional time spent in reporting to management at the end of their shifts as part of an enhanced close out process intended to prevent theft. Plaintiffs’ counsel took the position that each of the activities is compensable. (Counsel for the government conceded that law clerks should be compensated for the time spent cutting grapefruit). Meanwhile, Integrity’s counsel took the position that the additional time spent by casino workers, bank tellers, and register workers was a closer case for compensable time than that of the warehouse workers going through security screenings. What also appeared to catch some of the Justices’ attention is the amount of time involved in passing through the security checks and whether Integrity could have taken steps to significantly reduce the duration by staggering shifts or hiring additional security checkers.
Integrity affords the Court another opportunity to provide clarity over which activities are an “integral” and “indispensable” part of an employee’s principal work activities, compensable under the FLSA even if they are performed before the shift starts or after it ends. In January 2014, the Court addressed the issue of what constitutes “changing clothes” in Sandifer v. United States Steel Corp., and held that the extra time spent at the work place to put on and take off protective gear was not compensable because the FLSA excludes from the compensable workday time spent changing clothes. The Court held that the items at issue fell within the definition of “clothes” excluded under the FLSA. Important to the Court’s holding was that the time involved in donning the protective gear was de minimis. In deciding Integrity, irrespective of how the Court rules, the decision will provide desperately needed clarity as to what activities constitute compensable “work” under the FLSA. A decision is expected within the next few months.