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August 2018

The De Minimis Principle & California Wage Law: No Trifling Matter

In Troester v. Starbucks Corp., the California Supreme Court held that Starbucks could not rely on a de minimis defense to avoid paying employees for time spent complying with Starbucks' store closing procedure, which caused employees to work an average of four to 10 minutes off-the-clock every closing shift. For many, this result comes as no surprise given California’s notoriously employee-friendly laws. What makes this case significant, however, is that it was the first time the Court addressed the application of the de minimis principle to a wage claim under California law.

The de minimis principle has its origins in the legal maxim de minimis non curat lex, which means “the law does not concern itself with trifles.” (Id. at *2.) While the principle has been applied in various circumstances, in the wage and hour context employers often assert it as a defense to excuse the payment of wages for worktime that is deemed trivial, insubstantial, or for worktime that would be too impractical or administratively difficult to capture and pay. After removing the action to federal court, Starbucks moved for summary judgment on the grounds that the few minutes it took for employees to secure the store after clocking out at the end of the day was de minimis, and that the plaintiff’s claim for unpaid wages should therefore be dismissed. The district court agreed and granted Starbucks’ motion. On appeal before the Ninth Circuit, however, the court recognized that while the de minimis principle “has long been a part of the [Fair Labor Standards Act (‘FLSA”)], this court has never addressed whether the doctrine applies to wage claims brought under California law.” Seeing the need for guidance the Ninth Circuit certified the question to the California Supreme Court.  

The Supreme Court framed the issue as follows: Does the FLSA’s de minimis doctrine apply to claims for unpaid wages under the California Labor Code? To answer this question the Court chose to address it in two parts. First, has California adopted the de minimis doctrine found in the FLSA? Second, even if not adopted, does a de minimis principle nevertheless apply to wage and hour claims brought under California law?

The Court answered the first question with a resounding no. The Legislature, the Court held, has provided no indication of an intent to adopt the FLSA’s de minimis doctrine. Federal labor law establishes a threshold level of worker protection that California may meet or exceed. A “federal rule permitting employers under some circumstances to require employees to work as much as 10 minutes a day without compensation is less protective” than California law – which contemplates that employees be paid for all hours worked. (Id. at *15.) Recall that “hours worked” under California law means not only the time spent performing the principal activity of the job, but encompasses all time the employee is subject to the control of the employer. Because nothing in the wage orders, statutes or regulations countenanced a departure from the requirement that employees be paid for all hours worked, the Court found that the Legislature had no intent to adopt the FLSA’s de minimis doctrine.

The Court was more nuanced in its approach to the second question. Despite finding no evidence of intent by California to adopt the FLSA’s de minimis doctrine, the Court did not hold a de minimis defense could never apply to a California wage claim. Instead, recognizing the innumerable factual scenarios in which a de minimis defense could arguably apply, the Court resolved to “decide only whether the de minimis rule is applicable to the facts of this case as described by the Ninth Circuit.” In so doing, the Court found the de minimis principle inapplicable on these facts, where the work in question was embodied in Starbucks' written policies; it occurred with Starbucks' knowledge; it occurred on a regular basis; and it routinely involved up to 10 minutes to complete. Under these circumstances the Court could not deem this amount trifling. The Court also emphasized that class actions in general, and California wage and hour laws in particular, are “indeed concerned with small things.” (Id. at *23.) Moreover, technological advancements in the means by which employers record and capture worktime should eliminate all but the most discreet and irregular occurrences of unrecorded worktime. The Court expressed its hesitation to incorporate “a rule purportedly grounded [at one time] in the ‘the realities of the industrial world’ when those realities have been materially altered in subsequent decades. (Id. at *28.)

In conclusion, employers in California should not rely on a de minimis defense to wage claims involving regularly occurring activities embodied in a policy requiring more than a few minutes to complete. Employers should make every reasonable effort to capture and pay employees for all hours worked, even if it means modifying current company policies and practices, or investing in new technologies capable of recording worktime more accurately.

 

Employment Law

Marshall R. Lurtz



Employment Law

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