01 Feb Are You “On the Hook” for “Off the Clock” Calls?
Have you ever called one of your hourly-paid (also called “non-exempt”) employees after hours, to get a quick answer to an important work-related question?
If you have, did you pay the employee for his or her time?
If not, then Employer Beware! This is the next frontier for class actions involving employee wage and hour litigation.
Labor Law and Advancing Technology
It used to be that only executives, partners and doctors had a company-issued pager or cell phone, but today virtually everyone in an organization is accessible from the office at all hours. Many people work as they commute to and from the office, conducting telephone calls with customers and employees from their cars. With all of this technology keeping employees connected to the office around the clock, employers need to consider labor law implications for their non-exempt employees. Must hourly-paid employees be compensated for work done “off the clock,” or even for commuting to and from work?
The answer is “it depends”; as with many facets of the developing law, there are numerous grey areas. In general, the right to compensation depends on the type of work the employee is doing, and how much work the employee does while “off the clock.”
Keeping off the Radar Screen of Class Action Lawyers
Courts have held that, as a general rule, “preliminary” and “post-liminary” activities are not separately compensable. These types of activities include such things as commuting to and from work, changing clothes and generally preparing to begin work or end work. As for commuting, there is a federal law that specifically addresses employee compensation — the Employee Commuting Flexibility Act. In a recent decision, the California Court of Appeal clarified that under this federal law, commuting does not qualify as compensable work — even in a company car that is issued for purposes of commuting to and from job sites. However, if the “off the clock” work that is done in preparation for (or at the end of) the workday is an “integral part” of the employee’s principal work activities, then the work usually will be compensable as time worked. If not, then no pay is required.
So, what kinds of “off the clock” work are considered “integral” to an employee’s job? An activity is considered an “integral and indispensable” part of the employee’s job if it is performed as part of the regular work of the employee in the ordinary course of business, and is done by the employee primarily for the benefit of the employer. For example, one court has held that, when an employee is required to email to his boss all of the day’s jobs and service visits after the end of the workday, the work is considered “integral,” and the employee must be compensated. But the same court held that tasks such as mapping out a route to a client site are not considered “integral” to a job, and thus, are not compensable. Other courts have held that time spent “on call” is compensable if the employee has effectively been “engaged to wait” and is restricted during on-call hours from doing personal activities. Based on these precedents, it would stand to reason that if an employee is engaged in work-related discussions or telephone calls during his commute to the office, that time will be compensable.
However, under the Fair Labor Standards Act, an employer need only pay overtime for an employee’s “off the clock” work if the amount of time spent on the activities is more than de minimis. Although there is no set amount of time that is considered de minimis, there are three factors that the courts consider:
1) the practical administrative difficulty of recording the “off the clock” time;
2) the aggregate amount of compensable time; and
3) the regularity of the additional work.
Although the courts have not adopted a precise amount of time that qualifies as more than de minimis and thus compensable, the courts have noted that a “split second absurdity” does not qualify. This means, for example, that if an employer emails the hourly employee after hours, asking, “Where did you put my customer file?” and the employee takes two minutes to read the email and respond, “On the left side of your desk,” then this type of “off the clock” work would be considered de minimis, and not compensable. In fact, the courts have noted that even if a single, one time task takes as long as ten minutes, this may still be considered de minimis and not compensable.
If, however, the employee must spend 10 to 15 minutes after hours each day to complete a required task, this is considered more than de minimis, and the employee must be paid for the work. The California Court of Appeal recently noted that 15 minutes per day amounts to over an hour per week — a significant amount of time and money to many employees.
Today’s advanced technologies can help a business run more efficiently and allow employees to be more productive. However, employers should remember that the old labor laws still apply to new technologies. Except for “split second absurdities,” hourly employees must be compensated for “off the clock” time spent on tasks that are integral to the employee’s job function.