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California Supreme Court Examines Compensable Time Based On Security Checks
Mar 27, 2024

California Supreme Court Examines Compensable Time Based On Security Checks

Topics: Court Decisions, Personnel Policies and Procedures, Wage & Hour Issues

On Monday, the California Supreme Court issued its opinion in Huerta v. CSI Electrical Contractors Inc., answering three questions about the scope of the term “hours worked” in Wage Order No. 16. While Wage Order No.16 governs the construction, drilling, logging, and mining industries, the interpretation of the term “hours worked” will likely be defined similarly for Wage Orders governing other industries. The California Supreme Court’s opinion comes from the certification of a request from the Ninth Circuit to provide guidance on three questions in a wage and hour class action based on California state law.  

In Huerta, according to the plaintiff, in the morning, the employees entered a Security Gate where guards scanned each worker’s badge (and sometimes peered inside vehicles and truck beds), then spent up to 10 to 15 minutes driving from the Security Gate to the parking lot where the employees parked for work. The employees also had to wait in line at the Security Gate at the end of the day for a security check of vehicles. The security check could include a visual inspection of the vehicle and truck bed to look for stolen tools or endangered species that were present at the location. While driving from the Security Gate to the employee parking lot, employees had to follow certain rules designed to protect the endangered species on site, including using only permitted access roads, following slow speed limits, and not honking horns or playing music that could be heard outside of their vehicles.  

Based on these facts, the California Supreme Court decided the following certified questions:

Question 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 . . . Wage Order No. 16?”  

Answer to Question 1:  When an employee is required to spend time on the employer’s premises awaiting and undergoing an employer-mandated exit security procedure that includes the employer’s visual inspection of the employee’s personal vehicle, the time is compensable as “hours worked.” The Court found that because the employee was subject to the control of the employer and had to perform “specific and supervised tasks” (presenting a badge and undergoing the security check) when checking out at the Security Gate at the end the workday, that is “time worked” for which the employee must be compensated. The Court recognized that the facts of this case presented more than the time it would take for an employee to scan a security badge to enter or exit a parking lot and the wait time for the exit procedure was more than just “ordinary traffic congestion at the end of the workday” because of the visual inspection procedure. The Court in its analysis focused on the exit procedure, but the same analysis would apply to entry procedures that require employees to undergo security checks.  In addition, as noted, the Court implied the mere scanning of a badge to facilitate opening of a security gate would not be compensable time.  While the Court noted the length of time for the security procedure in this particular case, it also reiterated that California’s wage and hour statutes do not incorporate a de minimis doctrine.

Question 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 . . . Wage Order No. 16?”

Answer to Question 2:  The time traveling between the Security Gate and the employee parking lots is compensable as “employer mandated travel” under Wage Order No. 16, section 5(A) if the Security Gate is the first location where the employee’s presence is required for an employment-related reason other than the practical necessity of accessing the worksite.  The Court provided a few examples of when an employee’s presence at an initial location is required, such as to pick up work supplies, receive work orders or other directives, or perform work before travelling to a second jobsite.  

The time traveling from the Security Gate to the parking lot is not compensable as “hours worked” because an employer’s imposition of ordinary workplace rules on employees during their drive to the worksite in a personal vehicle does not create the requisite level of employer control.  This distinction is important because the term “employer mandated travel” is unique to Wage Order No. 16 and does not require that the employee be subject to the employer’s control to be compensable. Rather, the travel need only have occurred at the direction of the employer after the employee’s arrival at the “first location” where the employer required the employee’s presence. The Court specified that the Security Gate could be the “first location” the employer required the employee’s presence if it was “required for an employment-related reason other than the practical necessity of reaching the worksite.” However, the Court did not determine whether the Security Gate was the “first location” because the evidence submitted conflicted and was an issue for the trier of fact to determine.

Question 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 . . . Wage Order No. 16, or under California Labor Code Section 1194, when that time was designated as an unpaid ‘meal period’ under a qualifying collective bargaining agreement?”  

Answer to Question 3:  When an employee is covered by a collective bargaining agreement that complies with Labor Code section 512, subdivision (e) and Wage Order No. 16, section 10(E), and that agreement provides for an “unpaid meal period,” that time is nonetheless compensable under the wage order as “hours worked” if the employer prohibits the employee from leaving the employer’s premises or a designated area during the meal period and if this prohibition prevents the employee from engaging in otherwise feasible personal activities. An employee may bring an action under Labor Code section 1194 to enforce the wage order and recover unpaid wages for that time.

Based on the Huerta decision, California employers whose employees undergo security checks or other requirements to enter and exit the workplace should carefully examine whether the time spent may be deemed compensable time for which the employee should be paid. Employers with similar workplaces or security requirements may want to consider paying a lower hourly wage for what the decision calls “employer mandated travel” and any similar periods of non-productive time. Employees who are not permitted to leave the premises for meal breaks should be compensated for the time spent during an on-premises meal break, and well-tailored on-duty meal period agreements should be put in place when the facts warrant.  Please reach out to the author or other CDF attorneys for additional guidance on these issues as well as practical considerations on compliance, given certain difficulties to measure, record, or monitor time spent when entering or exiting the workplace if it falls within the purview of compensable time. 

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For over 25 years, CDF has distinguished itself as one of the top employment, labor and immigration firms in California, representing employers in single-plaintiff and class action lawsuits and advising employers on related legal compliance and risk avoidance. We cover the state, with five locations from Sacramento to San Diego.

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Sacramento Office Managing Partner and Chair of CDF’s Traditional Labor Law Practice Group. Mark has been practicing labor and employment law in California for thirty years. His practice has a special emphasis on the representation of California employers in union-management relations and handling federal and state court litigation and administrative matters triggered by all types of employment-related disputes. He is also adept at providing creative and practical legal advice to help minimize the risks inherent in employing workers in California. He recently named “Sacramento Lawyer of the Year” in Employment Law-Management for 2021 by Best Lawyers®.
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