Seyfarth Synopsis: A federal district court held that “boot-up” and “shut-down” time in a call-center environment is de minimis and therefore not compensable.
It has been hornbook law since the early days of the FLSA that disregarding small increments of otherwise compensable time does not give rise to back overtime liability under the de minimis doctrine. Indeed, the Supreme Court held as far back as 1946 in its Anderson v. Mt. Clemens Pottery Co. decision that “[w]hen the matter in issue concerns only a few seconds or minutes of work beyond the scheduled working hours, such trifles may be disregarded” and that “[i]t is only when an employee is required to give up a substantial measure of his time and effort that compensable working time is involved.”
But wage-hour practitioners also are well aware of the recent challenges in arguing for application of the de minimis doctrine. Citing Justice Scalia’s passage in Sandifer v. U.S. Steel Corp. (2014) that the “de minimis doctrine does not fit comfortably within the statute at issue here, which, it can fairly be said, is all about trifles,” some courts have curtailed the de minimis doctrine considerably, reasoning that small increments of time nevertheless can be compensable when they are performed regularly, involve larger amounts of time when aggregated, and/or can be tracked by technological tools with little administrative burden. This especially has been the case under California wage-hour law.
The curtailing of the de minimis doctrine has been one cause of a rash of wage-hour lawsuits filed in call center environments. The typical claim is that employees need to turn on (or at least wake up) their computers, then log in to the employer’s system, and then log into a timekeeping application to clock in, but that they are not paid for the activities before they actually clock in.
Such a claim for the time spent on computers before clocking in was filed against a call-center operator in the District of Nevada in 2018. The case worked its way up to the Ninth Circuit, which held that because the booting up of a computer and logging in to an employer’s system is integral and indispensable to the principal activities of employees who use their computers to do their jobs, such time can be compensable. In so holding, the Ninth Circuit declined to take up the employer’s argument that, even if the time is integral and indispensable, it nevertheless is de miminis and cited and quoted Justice Scalia’s qualms over the de minimis doctrine.
This decision in Cadena v. Customer Connexx LLC, which followed a similar decision by the Tenth Circuit in 2021 in Peterson v. Nelnet Diversified Solutions, LLC, caused some to lament the demise of the de minimis doctrine and conclude that it no longer provided a defense to off-the-clock claims.
But the Cadena decision by the district court on remand last week demonstrates that, like the Dread Pirate Roberts (Westley) after enduring the Pit of Despair, the de minmis doctrine is only “mostly dead.” And as Miracle Max has explained, “there’s a big difference between all dead and mostly dead. Mostly dead is slightly alive.”
District Judge Andrew P. Gordon may very well be a Princess Bride fan. In that decision, he granted summary judgment to the employer holding that the undisputed materials facts showed that the vast majority of the time employees spent booting up and shutting down their computers was not compensable under the de minimis doctrine. The court also found that in rare events where the time spent took longer than normal – and thus was compensable – the employees’ time was adjusted appropriately at their request.
Noting that “[s]plit-second absurdities” are not justified by the policy of the FLSA in finding that the vast majority of the time at issue in the case was non-compensable, Miracle Max, er, Judge Gordon relied on the fact that most of the employees testified it took mere seconds or a couple of minutes to turn their computer on or off. As he observed, it isconsistent with common sense that pushing or clicking a button or opening a computer program typically takes little time and “the aggregate amount of compensable time to turn a computer on and off each day even over the course of many months” is “negligible.”
Although the plaintiffs suggested that the employer should have used the employees’ badge swipes in and out of the building to capture their hours worked (employees were permitted to access the building up to 30 minutes before their scheduled shift), Judge Gordon shut down this argument, explaining that the time an employee badges into the building does not necessarily reflect the time the employee started working. Employees might be doing other non-work things pre-shift such as visiting the break room or socializing prior to actually logging on to their computers and commencing work. There also was evidence that some employees swiped in and out of the building multiple times before or after the same shift, sometimes for unexplained lengthy periods of time. In addition, the employer would have to investigate each instance where the badge swipes and timekeeping program varied by more than a minute or so to verify whether the time was spent on compensable activities. Judge Gordon found that cross-referencing numerous badge swipes per day with the login times on the timekeeping system and investigating discrepancies was precisely the type of burdensome task the Ninth Circuit previously concluded an employer need not undertake.
Lastly, Judge Gordon noted that in unique situations when the time spent booting up or shutting down was not de minimis employees could and did request adjustments to their time. Employees thus already had been compensated for such anomalies, so that claim was given the boot In doing, so, the Cadena decision placed stock in the employer’s explicit timekeeping policies. It prohibited off-the-clock work and demonstrated that it communicated the policy to its employees. Employees were directed to log into the timekeeping system on the computer as their first task and to close out all other programs before logging out of the timekeeping system at the end of their shifts. The employer also had a means for employees to adjust their time to report off-the-clock work by filling out a “punch” form for supervisors to correct their time. The Cadena plaintiffs testified they were aware of this procedure and many of them testified that they used it to report off-the-clock work when they could not log in quickly. Punch and payroll forms largely corroborated that the time was adjusted appropriately.
This decision serves as an important reminder to companies whose employees clock-in and out of work on their computers. As the Cardena court acknowledged, the de minimus doctrine is not a hard and fast rule that judges will apply in a reliably uniform manner. And defending a call center wage-hour claim, in many respects, still may be like having a paper cut with lemon juice poured on it. Answering the real question – whether an employee is required to give up a substantial measure of her time and effort to boot up or shut down such that the time should be considered compensable – is an ambiguous task, and one on which courts may not agree. Employers should examine their timekeeping policies to ensure that the policies explicitly provide that employees must be compensated for all hours worked and provide a mechanism to request that time is added in the event of a slow computer boot up – such as in the event of a software update, a bug, or some other obstacle – that takes the employee more than a mere few seconds or minutes. They also should institute training to ensure employees are aware of the policy and that supervisors document timekeeping adjustments and do not otherwise fail to enforce such policies. Further, employers also would be well served by assessing the applications and programs an employee must open before they can clock in on their computer to ensure they know how long the process takes in real time.
If they take these steps, and to paraphrase Miracle Max, they will put themselves in the best position possible to storm the castle of wage-hour litigation.