Supreme Court Serves Starbucks A Cup Of "Express-No"! The Time Was Compensable, Even If "De Minimis"
Posted July 30, 2018

On July 26, 2018, the California Supreme Court served up a hard-to-swallow cup of “Express-No” -- not just for Starbucks, but for all California employers who were hoping the Court would deny pay to employees for the extra minutes spent at work between clocking out and actually leaving the workplace. Instead, in Troester v. Starbucks Corporation, the Court concluded an “employer that requires its employees to work minutes off the clock on a regular basis or as a regular feature of the job may not evade the obligation to compensate the employee for that time by invoking the de minimis doctrine.”

Troester was a former Starbucks shift supervisor. He alleged that the Starbucks computer software required him to clock out on every closing shift before initiating the Starbucks software's "close store procedure." After Troester completed the closing tasks, he activated the alarm, exited the store, and locked the front door. This closing process took him between four to ten minutes per shift. Troester’s unpaid minutes over 17 months of employment totaled only $102.67 in wages.

Troester wanted to be paid for that time, but Starbucks told him that it was de minimis, meaning too small or difficult to measure and, therefore, non-compensable. Unfortunately, the California Supreme Court disagreed with Starbucks. To reach its decision, the Court answered two questions in the negative:

1. “[H]ave California's wage and hour statutes or regulations adopted the de minimis doctrine found in the federal Fair Labor Standards Act (FLSA)?” No, they have not.
2. “Does the de minimis principle, which has operated in California in various contexts, apply to wage and hour claims?” No, especially not in this case where the employee had to work “off the clock.”

Where does this leave California employers? You may pay more for your next espresso at Starbucks! You also should be aware of a few key takeaways from the majority opinion (which constitutes binding precedent) and the concurring opinions (which are not binding precedent, but are instructive):

• Find a way to capture all time worked by employees until they actually leave the premises. Employers must figure out a way to capture even small amounts of time during which employees are technically performing services for the employer, even though they have already clocked out. Here, for example, Starbucks restructured the order of the closing work so that employees would not have to perform additional tasks after clocking out.
• Pay your employees for all hours worked. California law is concerned with “small things,” which includes all minutes worked. The Labor Code and Wage orders do not allow employers to require employees to work “off the clock” in any amount, no matter how small.
• The de minimis doctrine for wage and hour issues may not be totally dead in California. Justice Kruger’s concurring opinion provides hope for employers by providing the following examples where the de minimis doctrine might be applicable:
  • Software glitches on timekeeping systems that delay workers’ log-ins for one to three minutes.
  • The time it takes to read and acknowledge a work schedule delivered via text message or email during off hours.
  • At the end of a shift, while a retail employee is waiting for transportation, briefly responding to a customer’s questions even though the employee is off duty.

  LightGabler is an employment defense firm working with employers and management to ensure compliance with California employment law and proactively prevent litigation. If you have any questions regarding “hours worked,” “off-the-clock” claims, the “de minimis“ doctrine, or any other employment law matter, please call LightGabler at 805-248-7208.

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