Are employers required to pay for travel time if employees drive company-vehicles to and from work? What if they perform work-related tasks before leaving or after arriving home? Does it make a difference if they are prohibited from using the vehicles for personal errands? Although the Fair Labor Standard Act’s general travel principle is simple – most travel to and from work is not compensable – travel time questions still plague employers. Fortunately, the Fifth Circuit just made the forecast a little clearer for employers.
On June 15, 2011, in Chambers v. Sears Roebuck and Co., No. 10-20360 (5th Cir. June 15, 2011), the Fifth Circuit adopted a Southern District of Texas opinion granting summary judgment for the employer. Chambers is especially important for employers that provide company cars for travel. Nevertheless, aspects of the case have applications to all employers and provide helpful reminders regarding the importance of well-drafted policies and procedures.
The Fifth Circuit Confirms that Travel Time is Generally Not Compensable
The plaintiffs in Chambers were a class of Sears Roebuck and Co. (“Sears”) in-home service technicians. In 2001, Sears implemented a Home Dispatch Program (“HDP”) that allowed technicians to keep company service vans at their homes overnight and travel directly to the jobsite. Sears did not pay technicians for up to 35 minutes of travel to their first job. It similarly did not pay for up to 35 minutes of travel from their last job to their homes. In both cases, travel over 35 minutes was paid. Despite the general rule that employers are not required to pay for travel to and from work, plaintiffs argued that, under the HDP, the travel time was compensable work hours.
The court began its analysis by reviewing the Employment Commute Flexibility Act (“ECFA”), which amended the FLSA and Portal-to-Portal Act to clarify an employer’s responsibilities regarding travel time. ECFA states that an employer may provide a company vehicle to an employee for travel and still take advantage of the general principle that home to work and work to home travel is not compensable if two conditions are met: 1) the travel must be in the normal commuting area for the employer’s business; and 2) there must be an agreement between the employer and employee that the time is not compensable. In Chambers, the existence of an agreement between the employer and employee was undisputed. Plaintiffs, however, argued that the HDP failed to meet ECFA’s first criteria because “normal commuting area” refers to distance and the HDP incorrectly used a time limit. The plaintiffs also argued that because they were prohibited from using the company vans for personal business, ECFA was inapplicable. The court rejected both arguments.
Having failed to remove their travel time from ECFA’s protection, plaintiffs attempted to argue that duties they performed before leaving home and after arriving home were compensable and, thus, triggered the start to and end of the paid work day under the “continuous work day” rule. By way of example, the technicians:
- logged onto their computers to receive daily assignments;
- transported a computer to their trucks where they plugged the computer into a docking station;
- called the first customer of the day (there was some dispute about whether these calls occurred);
- entered the time they left and returned home;
- downloaded service information at day's end;
- printed out final reports; and
- placed UPS packages in their trucks.
The court found that none of these activities were integral and indispensable to the technicians’ principal activities and, therefore, were not compensable and did not trigger the continuous work day. Additionally, the court found that these duties were de minimus and, therefore, payment was not required under that theory. As a final blow, the court held that, to the extent the time technicians spent on morning and evening activities was more than de minimus, Sears would not have any reason to know that the technicians were performing duties either before or after travel because they were specifically informed not to do so. Without knowledge, Sears was not responsible for compensating the technicians for the time worked.
Leaving no stone unturned, plaintiffs further insisted that, because they were unable to use the company vans for personal reasons, they were “engaged to wait” during their commute times and the time was compensable “wait time” or “on-call time.” Again, the court rejected these arguments, finding that “wait time” is only compensable if it is part of an employee’s principal activities, not if it is a preliminary or postliminary activity, and that there was no evidence to support a claim that the technicians were “on call.”
The most striking and useful portion of Chambers is the factual description of the well-drafted HDP. For example, Sears developed an automatic download system where the technician would simply log in and receive the first address automatically and immediately - such that the time technicians spent on this task was minimal. To protect itself in the event that the log in process was not as simple as contemplated, Sears instructed the technicians, if there were technical issues, to complete payroll correction sheets to account for any time spent troubleshooting the computer.
Moreover, during the travel from home to the first service call, Sears’s policies clearly prohibited technicians from communicating with managers, calling customers or performing other work. Sears also locked technicians out of the service call computers until they arrived at the first call and, by doing so, were able to ensure compliance with its policies. The policies regarding post-service call duties were also specific. Sears required that all paperwork, part orders, customer payments and cleaning be accomplished before the work to home travel or on days when the technician was in the office – in other words, while the technician was “on the clock.”
A final policy illustrates the level of detail that allowed Sears to successfully defeat all claims in the suit. Sears shipped parts to the technicians’ homes to use during their service calls, but specifically instructed the technicians to simply accept the delivery and put the unopened box in the van at a convenient time to be opened during their work days. This instruction was even printed on the boxes themselves.
The court’s opinion in Chambers could have easily been different without these clear and carefully considered policies. This diligence is an example to all employers, not simply those revising or creating travel time policies. If the employer’s policies comply with the FLSA and state law, they not only provide instruction to employees, but also represent a key piece of evidence in constructing a strong defense against employee claims.