Wage and Hour Case Notes

• Publication year: 2023
• Author: Nicole R. Roysdon

WAGE AND HOUR CASE NOTES

AUTHOR*

Nicole R. Roysdon

EMPLOYER NOT ENTITLED TO SUMMARY JUDGMENT FOR TRACKING EMPLOYEE'S EXACT TIME WORKED UNDER QUARTER-HOUR ROUNDING POLICY, BUT DID NOT PAY FOR ALL TIME WORKED

Camp v. Home Depot U.S.A., Inc., 84 Cal. App. 5th 638 (2022)

Delmer Camp filed a class action against Home Depot alleging that, despite capturing the exact time worked by employees through an electronic timekeeping system, Home Depot rounded employee time to the nearest quarter hour, and, thus, failed to pay employees for all time worked. Although Camp was underpaid by nearly eight hours over four and a half years, the trial court granted Home Depot's motion for summary judgment, finding Home Depot's rounding policy satisfied the standard articulated in See's Candy Shops, Inc. v. Superior Court, 210 Cal. App. 4th 889 (2021) since it was "neutral on its face" and "used in such a manner that it will not result, over a period of time, in failure to compensate employees properly for all the time they have actually worked."

On appeal, although the Sixth District Court of Appeal recognized other Courts of Appeal have found time rounding lawful under California law based on See's Candy, it relied on the California Supreme Court's guidance in Troester v. Starbucks Corp., 5 Cal. 5th 829 (2018) and Donohue v. AMN Services, LLC, 11 Cal. 5th 58 (2021). The Court concluded that "Home Depot, in relying on its quarter-hour rounding policy, did not meet its burden to show that there was no triable issue of material fact regarding plaintiff Camp's claims for unpaid wages, where Home Depot could and did track the exact time in minutes that an employee worked each shift and those records showed that Camp was not paid for all the time he worked."

Specifically, the Court found the Troester court's interpretation of the Cal. Lab. Code and the wage orders compelling. First, the Troester court stated that the Cal. Lab. Code and wage orders intend for employees to be compensated for all time worked. Here, that was evidence that Camp was not compensated for all time worked.

Second, the Troester court recognized the importance that the Cal. Lab. Code and wage orders place on the "small things." In particular, the California Supreme Court noted that small amounts of worktime, usually those measured in minutes, add up over time. Thus, when such work regularly occurs, it is compensable. Here, Camp lost almost eight hours of work due to time rounding.

Third, the Troester court counseled against relying on federal regulations regarding the compensability of time worked when there is no evidence of an intent to adopt such standards in the Cal. Lab. Code and wage orders. Although the federal regulation authorizes rounding so long as it averages out over time among employees as a whole, the Court of Appeal found the "federal regulation has no analog in the Labor Code or in the applicable wage order." Further, there is no language in the Cal. Lab. Code or wage orders authorizing time rounding when it results in the underpayment of an individual employee when the employer can and does capture actual time worked. Here, even though Home Depot employees in the aggregate were overcompensated over time, the rounding policy caused Camp to be undercompensated, which was not permitted under the language of the Cal. Lab. Code and applicable wage order.

Finally, the Court of Appeal found persuasive the Donohue court's questioning of the efficiencies of time rounding when "advances in technology have enabled employers to more easily and more precisely capture time worked by employees." Here, it did not appear Home Depot gained any efficiencies by rounding employee time worked. Rather, the court implied it takes more work to capture

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time worked down to the minute and then round it before paying an employee.

Thus, based on the direction of Troester and Donohue, which the Court of Appeal stated it was required to follow, the court held that if an employer "can capture and has captured the exact amount of time an employee worked during a shift, the employer must pay the employee for 'all the time' worked."

The Court noted that its holding is limited to the facts presented, and it did not consider whether time rounding in other contexts complies with California law, or whether an employer that has the actual ability to capture an employee's minutes worked is required to do so. The Court also acknowledged that although neutral time rounding still is lawful under See's Candy, the California Supreme Court has never decided the validity of that standard. Since Troester and Donohue have called rounding into question, especially when an employer captures the exact time worked but due to rounding, does not compensate an employee for all time worked, the court invited the Supreme Court to take up the issue.

CUSTOMER CALL CENTER WORKERS WORKING ON-SITE AND THROUGH EMPLOYER-PROVIDED COMPUTERS ENTITLED TO COMPENSATION FOR TIME SPENT BOOTING UP COMPUTERS

Cadena v. Customer Connexx LLC, 51 F.4th 831 (9th Cir. 2022)

The Ninth Circuit recently held that customer call center workers, who work at a central...