Ahead of the Class

The Supreme Court heard oral argument yesterday in an important Fair Labor Standards Act case that asks whether an employer who requires hourly employees to go through a security screening at the end of their shift – as a way to prevent employee theft – must compensate the employees when the process takes up to 25 minutes each day because of long lines and the requirement of emptying pockets, having bags inspected, and passing through a metal detector.

The case is Integrity Staffing Solutions v. Busk and involves employees of a company that provides warehouse space and staffing to Amazon.com for online order fulfillment. The Court is reviewing a Ninth Circuit decision that the plaintiffs had stated a claim for which additional compensation might be due under the FLSA. Before the Ninth Circuit’s decision, the Second and Eleventh Circuits had decided, in cases involving security screenings at a nuclear power plant and a construction site at an airport, that the time those employees spend going through such screenings was not compensable.

The Court’s decision will likely involve how Congress’ amendment to the FLSA in 1947 – in a statute called the Portal-to-Portal Act – should be interpreted. In that amendment Congress added to the FLSA a provision that said the following activities were not compensable:

activities which are preliminary to or postliminary to [the employee’s] principal activity or activities, which occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time on any particular workday at which he ceases, such principal activity or activities.

29 U.S.C. § 254(a). Since that amendment, the Supreme Court has interpreted it to require overtime compensation if an activity at the beginning or end of the day is “integral and indispensable” to the employee’s principal activities (such as the time a butcher takes to sharpen his knives) but that activities such as waiting in line to punch a time clock or waiting in line to put on protective gear are not compensable.

The United States Solicitor General’s Office is siding with the employer in the Integrity Staffing case and argues that the security screenings are “postliminary” activities that Congress said need not be compensated. The justices peppered the lawyers with hypotheticals – such as whether a lengthy process of closing out a cash register or a judge’s requirement that his law clerks cut his grapefruit in the morning – would be compensable. They also wondered whether it was enough, as the Ninth Circuit had decided, that the activity was required by the employer and was for the employer’s benefit. The employees’ lawyer argued that it was enough, but several of the justices seemed to disagree.

The number of FLSA lawsuits alleging uncompensated work time has skyrocketed in recent years – as employees in many areas (e.g., health care, retail, food service, manufacturing, financial services) allege that employer practices or policies undercompensate them for required activities. How the Supreme Court decides the Integrity Staffing case will likely have a significant effect on whether this trend continues or slows down.