Supreme Court Holds Amazon's Staffing Company Does Not Have to Pay for Time Spent on Post-Shift Security Screenings
On December 9, 2014, the U.S. Supreme Court unanimously held that Amazon contract workers employed by Integrity Staffing Solutions, Inc., were not entitled to pay for the up to 25 minutes that they spent in security screening lines after their shifts. Integrity Staffing Solutions, Inc. v. Busk, 574 U.S. ___ (2014).
In this case, Integrity Staffing Solutions was sued under the Fair Labor Standards Act of 1938 (FLSA), 29 U.S.C. §201 et seq., by two of its employees who worked at Amazon warehouses on a contract basis wrapping packages for shipment. The workers alleged that at the end of each shift, Amazon required them and all warehouse workers to spend approximately 25 minutes every day in lines to pass through anti-theft metal detectors without paying them for that time. Some of them complained that the time spent in security lines was so long because Amazon did not employ enough security personnel.
Justice Thomas, writing for the unanimous Court, determined that the real inquiry under the Portal-to-Portal Act of 1947 (which amended the FLSA) was whether a pre or post-shift activity is "integral and indispensable to the principal activities that an employee is employed to perform." In other words, merely because an employer requires a pre- or post-shift activity, does not mean it is "integral and indispensable" to the performing employee's principal duties.
Applying an economic analysis, the Supreme Court noted that if every menial task required by an employer to be completed pre or post-shift was automatically "integral and indispensable," this would greatly increase the cost of the employer to employ people in these positions. In this case, the Court held that Amazon "could have eliminated the screenings altogether without impairing the employees' ability to complete their work", which was to package products. Because the security screenings were held to be neither "integral", nor "indispensable" to the warehouse workers' "principal activities", the employees were not entitled to be paid for the time spent lining up for security screenings.
It will be interesting to see how Integrity Staffing's analysis will be utilized in other cases. For example, in Allen v. City of Chicago, No. 10-C-3183, a class of non-exempt Chicago police officers alleged in federal court in Illinois that they were required to work on electronic devices issued by the department answering calls, emails and texts outside of normal working hours without receiving any compensation, allegedly in violation of the FLSA. The plaintiffs allegations in Allen that “without these PDAs and the work routinely performed while off-duty, the Chicago Police Department would be far less successful in accomplishing its law enforcement mandate and goals.” Under the Supreme Court's new analysis in Integrity Staffing Solutions, Inc., it is possible that Allen's off-the-clock use of departmentally-used electronic devices (a now outmoded PDA) could be deemed "integral and indispensable" to his "principal activities" as a police sergeant, which would turn his late night and early morning use of the PDA into compensable time.
Similarly, in Kuebel v. Black & Decker Inc., 643 F.3d 352 (2d Cir. 2011), which was remanded by the Second Circuit and is now awaiting trial, the court may also put the Supreme Court's new analysis to the test. Kuebel was a non-exempt Black & Decker retail specialist who alleged that he performed “administrative” duties from his home in the morning and evenings before and after his shifts, including syncing his PDA to the company server, and checking email and voicemail, which often caused him to work more than 40 hours per week. Kuebel did not record any overtime hours on his timesheets because he claimed his managers instructed him not to. It remains to be seen whether the courts will find that merely because Kuebel was required to sync his PDA and check email and voice mail will mean that they were "integral and indispensable" to the "principal activities" of a Black & Decker retail specialist, so that he will be entitled to be paid for his time spent performing those administrative tasks.
While the true impact of the decision in Integrity Staffing Solutions, Inc. v. Busk remains unclear, the analysis will be applied to many other types of pre and post-shift activities, aside from security screening, such as putting on and removing uniforms or protective gear and time spent booting up computers in call centers.
It is important to note what the Integrity Staffing Solutions decision will not do. It applies only to non-exempt (hourly) workers and employees, not to exempt employees who are not entitled to overtime pay and are paid a salary for all hours worked. Pre and post-shift commuting, walking to work stations or on-call waiting to work when these non-exempt employees are free to handle personal matters will not be compensable, as the Portal-to-Portal Act expressly excludes these incidental activities from being considered compensable time. However, time spent showering and decontaminating after working in a battery plant and time spent sharpening knives in a meat packing plant are compensable
Although the Integrity Staffing decision appears to limit the pre- and post-shift activities that will be compensable, employers, employees, unions and courts alike will probably continue to struggle when determining exactly which pre and post-shift activities are compensable and which are not. The Supreme Court's decision is indisputably a victory for other employers who utilize security screening (such as Apple, CVS and others), but it remains to be seen how many other employers in different industries will be able to use it.
For more information, please contact Naureen Amjad (firstname.lastname@example.org) of Pedersen & Houpt's Employment Practice Group.
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