Off the Clock/On-Call Work

California laws require employers to pay employees for all the time they spend working. Under certain circumstances, employers must also pay each employee for the time an employee is required to be on-call, even if the employee ultimately ended up not working during that time.

“Off the clock” cases are those in which employees are not paid for all of the time they spend working. California courts have recognized that where an employer has either “actual” or “constructive” notice that an employee is working, the employer must pay the employee for that time. (See Morillion v. Royal Packing (2000) 22 Cal.4th 575, 585; White v. Starbucks (N.D.Cal.2007) 497 F.Supp.2d 1080, 1083.)

“Actual” means that the employer actually knew that the employee was working. “Constructive” means that the employer should have known that the employee was working. The constructive prong of this test is important: it means that an employer cannot avoid its obligation to pay an employee by intentionally ignoring the fact that that employee is working.

It is important to note that California employers must pay for all off-the-clock work, even when it does not add up to very much money.

In Troester v. Starbucks Corporation (2018) 5 Cal.5th 829, as modified on denial of reh’g (Aug. 29, 2018), the Supreme Court of California addressed the question of whether the de minimis doctrine applies in claims brought under the California Labor Code. Critically, the Court held that it does not.
The de minimis doctrine comes from the phrase, “de minimis non curat lex,” or “the law does not concern itself with trifles.” The doctrine has been used in federal courts to allow employers to avoid paying wages for small amounts of otherwise compensable time based upon a showing that recording that time would be difficult to do.

In Troester, Starbucks sought to use the de minimis doctrine to avoid paying wages for short periods of time employees spent closing the store and transmitting daily sales, profit and loss, and store inventory data to Starbucks’s corporate headquarters. Starbucks also sought to avoid paying for time spent activating the store’s alarm. The plaintiff estimated that he was owed about $100. That may not sound like a lot, but given the number of Starbucks in California, it is clear that Starbucks was saving itself a significant amount of money in unpaid wages through its practices.

The California Supreme Court divided the Troester case into two separate holdings:

First, the Court found that California’s wage and hour laws and regulations had not adopted the federal de minimis doctrine. That is a critical difference between the California Labor Code and the federal Fair Labor Standards Act (FLSA).

Second, the Court held that where an employer requires an employee to work “off the clock,” the de minimis doctrine does not apply to claims brought under California law.

In conclusion, the Court recognized that it might be difficult for an employer to track small amounts of time for the purpose of calculating payroll. However, employers are in a far better position to structure work so that employees are paid for all time spent working. Indeed, it appears that after Starbucks was sued, it figured out how to organize its employees’ work so that they did not have to perform work before they punched in and after they punched out.

Off the clock cases remain viable, even if they are getting more challenging. In Brinker v. Superior Court (2012) 53 Cal.4th 1004, the California Supreme Court described some of the challenges that such cases face. For example, if an employer has an actual policy banning off the clock work, a court will presume that there is no such work taking place. (Id. at 1051-1052.) Employees can rebut this presumption by showing that they did work off the clock. However, this type of individual inquiry makes it hard to certify off the clock cases as class actions. (Id. at 1052.)

It can also be difficult to present sufficient evidence for off the clock cases. (See, e.g., Jong v. Kaiser Foundation Health Plan, Inc. (2014) 226 Cal.App.4th 391, holding that evidence that the employer knew pharmacy managers’ work schedules before reclassification as nonexempt was irrelevant to show employer knew manager worked unrecorded overtime, and evidence offered to show that employer knew manager worked unrecorded overtime was insufficient to create fact issue.)

Still, Troester reaffirms California’s strong commitment to ensuring that workers are paid for every minute that they work.

California law requires employers to pay employees for “reporting time” under the following circumstances:

(1) when employees are required to report for work, (2) do report, but (3) are either not put to work or are provided less than half of their usual daily shift or scheduled shift. (See Industrial Welfare Commission (“IWC”) Wage Orders 1-16, Section 5; Ward v. Tilly’s, Inc. (2019) 31 Cal. App. 5th 1167, 1171.)

Under IWC Wage Orders 1-16, reporting time pay amounts to two to four hours of pay at an employee’s regular rate, as follows:

(A) Each workday an employee is required to report for work and does report, but is not put to work or is furnished less than half said employee’s usual or scheduled day’s work, the employee shall be paid for half the usual or scheduled day’s work, but in no event for less than two (2) hours nor more than four (4) hours, at the employee’s regular rate of pay, which shall not be less than the minimum wage.

(B) If an employee is required to report for work a second time in any one workday and is furnished less than two (2) hours of work on the second reporting, said employee shall be paid for two (2) hours at the employee’s regular rate of pay, which shall not be less than the minimum wage.

In Ward v. Tilly’s, Inc. the California Court of Appeal considered whether employees must physically appear at their worksite in order to be entitled to reporting time pay. (Ward, 31 Cal. App. 5th at 1172.) Defendant Tilly’s, Inc., a retail clothing company, required employees to contact their stores two hours before the start of on-call shifts to determine whether they were needed to work those shifts. (Id. at 1171.) Employees were told to “consider an on-call shift a definite thing until they are actually told they do not need to come in.” (Id.)

The plaintiff, a sales clerk, argued that employees were entitled to reporting time pay even when they did not physically appear at the worksite at the start of scheduled shifts but were on-call and called-in. (Id.) Tilly’s argued that in order to be eligible for reporting time pay, employees must be present at the worksite at the start of their shift. (Id.)

The California Court of Appeal sided with the plaintiff, holding that eligibility for reporting time pay does not hinge on physical presence at the worksite. (Id. at 1185.) Instead, the court found that reporting to work is “best understood as presenting oneself as ordered” reporting time pay also extends to those employees who are on-call. (Id.)and therefore

The Ward Court reasoned that this interpretation of reporting time was consistent with the IWC’s goals in adopting reporting time pay under the wage orders. (Id. at 1183.) In particular, the court found that requiring reporting time pay for on-call shifts was consistent with the policy goals of requiring employers to internalize the costs of overscheduling, compensating employees for the inconvenience and expense of being available for on-call shifts (including hiring caregivers, forgoing other employment and traveling) and making employee pay more predictable. (Id. at 1184-1185.)

In sum, even if you do not physically report to work, you may still be eligible for reporting time pay. Reporting time violations are common in retail, fast food, restaurant, construction and other industries.

The workers’ rights attorneys at Hunter Pyle Law have handled individual, class, and PAGA cases throughout California. If you have questions about your rights in the workplace, please feel free to contact us and utilize our free and confidential intake process. You can reach us at inquire@hunterpylelaw.com or at (510) 444-4400.