Rounded down or shaved work hours may entitle workers back wages

Lucas Mejia was a stocker for Walgreens, a nationwide pharmacy retail store chain. He and many other employees worked as hourly non-exempt employees in a Walgreens distribution center in California. Mejia filed a class action lawsuit against his employer on behalf of himself and his coworkers, claiming that Walgreens violated several California laws by failing to pay him and other employees for all hours worked.

Walgreens had a practice of rounding down the employees’ hours on their timecards. Employees were also required to pass through security checks before and after their shift but the time they spent doing this were not paid. Employees were also not provided meal periods and were not paid premium wages for the missed meal periods.

Under California law, employees must be paid no less than the minimum wage for all hours worked. When an employee’s time card entries reflect that an employee is on the job a few minutes more than the standard shift time, questions arise as to computation of the work hours. Federal law allows the practice of “rounding” employee’s hours for purposes of calculating the number of hours worked. Following the de minimis doctrine, any insubstantial and insignificant periods of time beyond the scheduled working hours which cannot as a practical administrative matter be precisely recorded for payroll purposes (for example 5 minutes of going through a bag check) may be disregarded. Such time may be rounded out to the nearest 5 minutes of the employee’s start or end time.

However, California law mandates that employees should be paid “for all hours worked.” Hours worked means “the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so.”

Related to the principle of compensating employees for all time worked, is the concern that small amounts of time that may, over the years, add up.  Thus, courts may decide that the de minimis doctrine does not apply if employees regularly spend anywhere from 4 to10 minutes of their time each shift doing unpaid work. Rounding down or shaving minutes off the actual hours worked may therefore violate California law.

In a rounding down practice where several minutes are disregarded and unpaid, the loss to the employee may add up. For example, an employee who clocks in an extra 5 minutes per day, 5 days a week, every week for 4 years has clocked in 5,200 minutes (or 86.67 hours) of unpaid time, which when paid at the California minimum wage of $12 per hour, entitles the employee to back wages in the amount of $1,040. This is not de minimis. As the high court once said, this is enough to pay a utility bill, buy weeks of groceries, or cover bus fares.

Though an extra couple of minutes here and there that are beyond the work hours may be unavoidable and can be disregarded, major discrepancies should be investigated since they raise doubts on the accuracy of the records of actual hours worked.

Rather than proceed to trial, the employees of Walgreens agreed to settle the case. Walgreens will pay the class of employees $4,500,000 in damages.

The Law Offices of C. Joe Sayas, Jr. welcomes inquiries about this topic. All inquiries are confidential and at no-cost. You can contact the office at (818) 291-0088 or visit www.joesayaslaw.com. [For more than 25 years, C. Joe Sayas, Jr., Esq. successfully recovered wages and other monetary damages for thousands of employees and consumers. He was named Top Labor & Employment Attorney in California by the Daily Journal, consistently selected as Super Lawyer by the Los Angeles Magazine, and is a past Presidential Awardee for Outstanding Filipino Overseas.]