California Supreme Court Rejects Federal “De Minimis” Doctrine

By Swerdlow Florence Sanchez Swerdlow & Wimmer

August 2, 2018

In another victory for employees, the California Supreme Court held last week that small amounts of time that an employee works before clocking in or after clocking out for the day are compensable, and an employer’s failure to pay for such time is not excusable under the federal “de minimis” doctrine.

The issue arose in Troester v. Starbucks – a class-action lawsuit filed against the coffee chain by a shift supervisor on behalf of all nonmanagerial employees in California who performed store-closing tasks. Troester alleged that, from 2009 to 2010, Starbucks required him to clock out before initiating the store’s closing tasks, which took an additional four to ten minutes of time each day. After clocking out, Troester would transmit information to Starbucks’ corporate headquarters, activate the alarm, exit the store, lock the front door, walk coworkers to their cars in compliance with company policy, and occasionally reopen the store to allow employees to retrieve items they left behind or to bring in patio furniture mistakenly left outside. Troester submitted evidence that, over this 17-month period, this unpaid time totaled 12 hours and 50 minutes, or $102.67 in alleged unpaid wages.

Starbucks argued, before a federal district court, that the de minimis doctrine of the federal Fair Labor Standards Act (FLSA) should bar Troester’s claim under California law. Under the FLSA, insubstantial or insignificant periods of time beyond the scheduled working hours, which as a practical administrative matter cannot be precisely recorded for payroll purposes, may be disregarded. The federal district court agreed with Starbucks. However, the plaintiffs appealed, and the Ninth Circuit Court of Appeal asked the California Supreme Court to address whether the FLSA doctrine applies to wage claims brought under California law.

The California Supreme Court held that the FLSA’s de minimis doctrine had not been incorporated into the California Labor Code or Wage Orders, which require employees to be paid for “all work.” The Court did not foreclose the possibility of a non-FLSA de minimis rule applying to California wage-and-hour law, but held that it did not excuse Starbucks’ failure to pay its employees under the facts of that case. The Court noted that modern timekeeping technology enables employers to account for even small amounts of time that used to be difficult track.

In light of Troester, employers should not require employees to perform any uncompensated tasks after they clock out or before they clock in for work, even if such time appears to be small or insignificant.