Date: 07-27-2018

Case Style:

Case Number: S234969

Judge: Liu

Court: Supreme Court of California

Plaintiff's Attorney: Shaun Setareh, Thomas Alistair Segal, David Glenn Spivak, Louis Max Benowitz and Stanley D. Saltzman

Defendant's Attorney: Rex S. Heinke

Description: Upon a request by the United States Court of Appeals for the Ninth Circuit
(Cal. Rules of Court, rule 8.548), we agreed to answer the following question:
Does the federal Fair Labor Standards Act’s de minimis doctrine, as stated in
Anderson v. Mt. Clemens Pottery Co. (1946) 328 U.S. 680, 692, and Lindow v.
United States (9th Cir. 1984) 738 F.2d 1057, 1063, apply to claims for unpaid
wages under California Labor Code sections 510, 1194, and 1197?
The de minimis doctrine is an application of the maxim de minimis non
curat lex, which means “[t]he law does not concern itself with trifles.” (Black’s
Law Dict. (10th ed. 2014) p. 524.) Federal courts have applied the doctrine in
some circumstances to excuse the payment of wages for small amounts of
otherwise compensable time upon a showing that the bits of time are
administratively difficult to record.
We approach the question presented in two parts: First, have California’s
wage and hour statutes or regulations adopted the de minimis doctrine found in the
2
federal Fair Labor Standards Act (FLSA)? We conclude they have not. There is
no indication in the text or history of the relevant statutes and Industrial Welfare
Commission (IWC) wage orders of such adoption.
Second, does the de minimis principle, which has operated in California in
various contexts, apply to wage and hour claims? In other words, although
California has not adopted the federal de minimis doctrine, does some version of
the doctrine nonetheless apply to wage and hour claims as a matter of state law?
We hold that the relevant wage order and statutes do not permit application of the
de minimis rule on the facts given to us by the Ninth Circuit, where the employer
required the employee to work “off the clock” several minutes per shift. We do
not decide whether there are circumstances where compensable time is so minute
or irregular that it is unreasonable to expect the time to be recorded.
I.
The factual background, as recounted in the Ninth Circuit’s request for
certification unless otherwise indicated, is as follows: On August 6, 2012,
plaintiff Douglas Troester filed the original complaint in an action in Los Angeles
County Superior Court on behalf of himself and a putative class of all
nonmanagerial California employees of defendant Starbucks Corporation
(Starbucks) who performed store closing tasks from mid-2009 to October 2010.
Troester worked for Starbucks as a shift supervisor. Starbucks removed the action
to federal district court and moved for summary judgment on the ground that
Troester’s uncompensated time was so minimal that Starbucks was not required to
compensate him.
Troester submitted evidence that during the alleged class period,
Starbucks’s computer software required him to clock out on every closing shift
before initiating the software’s “close store procedure” on a separate computer
terminal in the back office. The close store procedure transmitted daily sales,
3
profit and loss, and store inventory data to Starbucks’s corporate headquarters.
After Troester completed this task, he activated the alarm, exited the store, and
locked the front door. Troester also submitted evidence that he walked his
coworkers to their cars in compliance with Starbucks’s policy. In addition,
Troester submitted evidence that he occasionally reopened the store to allow
employees to retrieve items they left behind, waited with employees for their rides
to arrive, or brought in store patio furniture mistakenly left outside.
On March 7, 2014, the district court granted Starbucks’s motion for
summary judgment. The district court’s decision assumed that each activity
identified above was compensable for purposes of its analysis. The undisputed
evidence was that these closing tasks required Troester to work four to 10
additional minutes each day. As the district court stated: “The undisputed facts
show that, on average, Plaintiff activated the alarm approximately one minute after
he clocked out. Moreover, he did so within two minutes on 90 percent of the
shifts and within five minutes on every shift. Once he set the alarm, Plaintiff
needed to exit the store within one minute to avoid triggering the alarm. And
Plaintiff testified that it took 30 seconds to walk out of the store. He then locked
the door, which took 15 seconds to ‘a couple minutes,’ and walked his coworkers
to their cars, which took 35 to 45 seconds. On rare occasions—once every couple
of months—Plaintiff spent a few minutes letting coworkers back inside the store
or bringing in patio furniture that he forgot to retrieve before clocking out.”
Over the 17-month period of his employment, Troester’s unpaid time
totaled approximately 12 hours and 50 minutes. At the then-applicable minimum
wage of $8 per hour, this unpaid time added up to $102.67, exclusive of any
penalties or other remedies. The district court further assumed that the additional
time would be administratively difficult to capture. Finally, while acknowledging
that Troester’s store closing activities were regularly occurring, the district court
4
found that regularity not significant to its conclusion that the uncompensated time
was de minimis. The district court concluded that the de minimis doctrine applied
and granted summary judgment against Troester on his claim for unpaid wages as
well as his derivative claims for failure to provide accurate written wage
statements, failure to pay all final wages in a timely manner, and unfair
competition.
On appeal, the Ninth Circuit recognized that although the de minimis
doctrine has long been a part of the FLSA, this court has never addressed whether
the doctrine applies to wage claims brought under California law. The court
further recognized that in some instances California law has been interpreted to be
more protective of employee wage claims than federal law. Against this
background, the Ninth Circuit certified the question presented to this court.
II.
In Anderson v. Mt. Clemens Pottery Co. (1946) 328 U.S. 680 (Anderson),
the high court considered whether certain types of employee activity constituted
compensable work time. The worksite was a pottery plant covering eight acres,
and the principal question was whether the employees should be compensated for
the time spent walking to and from their workstations and engaging in certain
preliminary and postliminary activities. The court held that generally such time is
compensable: “Since the statutory workweek includes all time during which an
employee is necessarily required to be on the employer’s premises, on duty or at a
prescribed workplace, the time spent in these activities must be accorded
appropriate compensation.” (Id. at pp. 690–691.) The court further held that once
an employee proves damages from an employer’s failure to pay for compensable
work, the fact that the precise amount of the damages is difficult to prove because
of the employer’s inadequate recordkeeping cannot be counted against the
employee: “[T]he employee has proved that he has performed work and has not
5
been paid in accordance with the statute. The damage is therefore certain. The
uncertainty lies only in the amount of damages arising from the statutory violation
by the employer. In such a case ‘it would be a perversion of fundamental
principles of justice to deny all relief to the injured person, and thereby relieve the
wrongdoer from making any amend for his acts.’ ” (Id. at p. 688.)
But Anderson qualified these holdings with a caveat: “We do not, of
course, preclude the application of a de minimis rule where the minimum walking
time is such as to be negligible. The workweek contemplated by § 7(a) [of the
FLSA] must be computed in light of the realities of the industrial world. When the
matter in issue concerns only a few seconds or minutes of work beyond the
scheduled working hours, such trifles may be disregarded. Split-second
absurdities are not justified by the actualities of working conditions or by the
policy of the Fair Labor Standards Act. It is only when an employee is required to
give up a substantial measure of his time and effort that compensable working
time is involved. The de minimis rule can doubtless be applied to much of the
walking time involved in this case, but the precise scope of that application can be
determined only after the trier of facts makes more definite findings as to the
amount of walking time in issue.” (Anderson, supra, 328 U.S. at p. 692.) The
court remanded for application of the de minimis doctrine to determine whether
the employee time spent on preliminary activities was “insubstantial and
insignificant” and “need not be included in the statutory workweek.” (Id. at
p. 693.)
In 1961, the de minimis doctrine was codified as a federal regulation with a
proviso that the doctrine was to be applied sparingly and not arbitrarily: “In
recording working time under the FLSA, insubstantial or insignificant periods of
time beyond the scheduled working hours, which cannot as a practical
administrative matter be precisely recorded for payroll purposes, may be
6
disregarded. The courts have held that such trifles are de minimis. (Anderson v.
Mt. Clemens Pottery Co., 328 U.S. 680 (1946).) This rule applies only where
there are uncertain and indefinite periods of time involved of a few seconds or
minutes duration, and where the failure to count such time is due to considerations
justified by industrial realities. An employer may not arbitrarily fail to count as
hours worked any part, however small, of the employee’s fixed or regular working
time or practically ascertainable period of time he is regularly required to spend on
duties assigned to him. See Glenn L. Martin Nebraska Co. v. Culkin, 197 F. 2d
981, 987 (C.A. 8, 1952), cert. denied, 344 U.S. 866 (1952), rehearing denied, 344
U.S. 888 (1952), holding that working time amounting to $1 of additional
compensation a week is ‘not a trivial matter to a workingman,’ and was not de
minimis; Addison v. Huron Stevedoring Corp., 204 F. 2d 88, 95 (C.A. 2, 1953),
cert. denied 346 U.S. 877, holding that ‘To disregard workweeks for which less
than a dollar is due will produce capricious and unfair results.’ Hawkins v. E. I. du
Pont de Nemours & Co., 12 W.H. Cases 448, 27 Labor Cases, para. 69,094 (E.D.
Va. 1955), holding that 10 minutes a day is not de minimis.” (29 C.F.R. § 785.47
(2018).)
Subsequently, the Ninth Circuit in Lindow v. U.S. (9th Cir. 1984) 738 F.2d
1057 (Lindow) explained that “in determining whether otherwise compensable
time is de minimis [under the FLSA], we will consider (1) the practical
administrative difficulty of recording the additional time; (2) the aggregate amount
of compensable time; and (3) the regularity of the additional work.” (Id. at
p. 1063.) This test has been widely used by federal courts. (See, e.g, Kellar v.
Summit Seating Inc. (7th Cir. 2011) 664 F.3d 169, 176; Carlsen v. United States.
(Fed.Cir. 2008) 521 F.3d 1371, 1380–1381; De Asencio v. Tyson Foods, Inc. (3d
Cir. 2007) 500 F.3d 361, 374–375; Brock v. City of Cincinnati (6th Cir. 2001) 236
7
F.3d 793, 804–805; Kosakow v. New Rochelle Radiology Assocs., P.C. (2d Cir.
2001) 274 F.3d 706, 719; Metzler v. IBP, Inc. (10th Cir. 1997) 127 F.3d 959, 965.)
Lindow noted that “[m]ost courts have found daily periods of
approximately 10 minutes de minimis even though otherwise compensable.”
(Lindow, supra, 738 F.2d at p. 1062 [collecting cases].) But Lindow recognized
that “[n]o rigid rule can be applied with mathematical certainty.” (Ibid.) Lindow
also observed that courts should consider “the size of the aggregate claim. Courts
have granted relief for claims that might have been minimal on a daily basis but,
when aggregated, amounted to a substantial claim. [Citations.] We would
promote capricious and unfair results, for example, by compensating one worker
$50 for one week’s work while denying the same relief to another worker who has
earned $1 a week for 50 weeks.” (Id. at p. 1063.)
In order to determine whether the federal de minimis doctrine applies in
California wage litigation, we first examine the governing statutes and regulations.
In California, “wage and hour claims are today governed by two complementary
and occasionally overlapping sources of authority: the provisions of the Labor
Code, enacted by the Legislature, and a series of 18 wage orders, adopted by the
IWC.” (Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1026
(Brinker).) “The IWC’s wage orders are to be accorded the same dignity as
statutes. They are ‘presumptively valid’ legislative regulations of the employment
relationship [citation], regulations that must be given ‘independent effect’ separate
and apart from any statutory enactments.” (Id. at p. 1027.) Wage orders take
precedence over the common law to the extent they conflict. (See Martinez v.
Combs (2010) 49 Cal.4th 35, 64–65.)
“When construing the Labor Code and wage orders, we adopt the
construction that best gives effect to the purpose of the Legislature and the IWC.
[Citations.] Time and again, we have characterized that purpose as the protection
8
of employees — particularly given the extent of legislative concern about working
conditions, wages, and hours when the Legislature enacted key portions of the
Labor Code. [Citations.] In furtherance of that purpose, we liberally construe the
Labor Code and wage orders to favor the protection of employees. [Citations.]”
(Augustus v. ABM Security Services, Inc. (2016) 2 Cal.5th 257, 262 (ABM
Security).)
“Federal regulations provide a level of employee protection that a state may
not derogate. Nevertheless, California is free to offer greater protection. We have
stated that, ‘[a]bsent convincing evidence of the IWC’s intent to adopt the federal
standard for determining whether time . . . is compensable under state law, we
decline to import any federal standard, which expressly eliminates substantial
protections to employees, by implication.’ [Citation.] More recently, we have
‘cautioned against “confounding federal and state labor law” [citation] and
explained “that where the language or intent of state and federal labor laws
substantially differ, reliance on federal regulations or interpretations to construe
state regulations is misplaced.” ’ ” (Mendiola v. CPS Security Solutions, Inc.
(2015) 60 Cal.4th 833, 843 (Mendiola).) On a number of occasions, we have
recognized the divergence between IWC wage orders and federal law, generally
finding state law more protective than federal law. (See ibid. [departing from
federal law in requiring compensation for sleep and other personal activities for
on-call employees residing on employer’s premises for extended period]; Martinez
v. Combs, supra, 49 Cal.4th at pp. 67–68 [noting the divergence between state and
federal definitions of “employ”]; Morillion v. Royal Packing Co. (2000) 22
Cal.4th 575, 588–592 (Morillion) [state law has not adopted a rule comparable to
federal Portal-to-Portal Act excluding certain transportation time under employer’s
control]; Ramirez v. Yosemite Water Co. (1999) 20 Cal.4th 785, 795–799
9
[recognizing that the IWC’s definition of “outside salesperson” exempt from
overtime rules differs from federal definition].)
In order to determine whether California has adopted the federal de minimis
rules, we first observe that IWC wage order No. 5-2001 (Wage Order No. 5)
concerning the “public housekeeping industry” includes establishments such as
Starbucks that provide food and beverages. (See Wage Order No. 5, subd. 2(P).)
Subdivision 2(K) defines hours worked as “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 . . . .” As case law
has clarified, the time during which “ ‘the employee is suffered or permitted to
work’ ” encompasses the time during which the employer knew or should have
known that the employee was working on its behalf. (Morillion, supra, 22 Cal.4th
at p. 585.) Subdivision 4(A) of Wage Order No. 5 sets the minimum wage and
specifies that wages must at least be paid to an employee “for all hours worked.”
Under subdivision (3)(A), employees covered by the wage order are entitled to
receive one and one-half times their regular rate of pay “for all hours worked” in
excess of eight hours in a workday or 40 hours in any workweek.
The Labor Code also contemplates that employees will be paid for all work
performed. (All statutory references are to the Labor Code unless otherwise
indicated.) Section 510, subdivision (a) provides: “Eight hours of labor
constitutes a day’s work. Any work in excess of eight hours in one workday and
any work in excess of 40 hours in any one workweek and the first eight hours
worked on the seventh day of work in any one workweek shall be compensated at
the rate of no less than one and one-half times the regular rate of pay for an
employee. Any work in excess of 12 hours in one day shall be compensated at the
rate of no less than twice the regular rate of pay for an employee. In addition, any
work in excess of eight hours on any seventh day of a workweek shall be
10
compensated at the rate of no less than twice the regular rate of pay of an
employee.” The section recognizes certain exceptions in various statutorily
authorized alternative workweeks, but no others.
The federal rule permitting employers under some circumstances to require
employees to work as much as 10 minutes a day without compensation is less
protective than a rule that an employee must be paid for “all hours worked” (Wage
Order No. 5, subds. 3(A), 4(A)) or “[a]ny work” beyond eight hours a day (Lab.
Code, § 510, subd. (a)). And there is no “ ‘convincing evidence of the IWC’s
intent to adopt the federal standard.’ ” (Mendiola, supra, 60 Cal.4th at p. 843.)
Nothing in the language of the wage orders or Labor Code shows an intent to
incorporate the federal de minimis rule articulated in Anderson, Lindow, or the
federal regulation. Although Anderson has been the law for 70 years and has been
incorporated into the Code of Federal Regulations for over 50 years, neither the
Labor Code statutes nor any wage order has been amended to recognize a de
minimis exception. Starbucks cites no statutory or regulatory history, and we have
found none, that indicates an intent by the IWC or the Legislature to impliedly
adopt such a rule.
Only one published Court of Appeal decision has applied the de minimis
rule in an employee compensation case, specifically using the Lindow factors.
(Gomez v. Lincare, Inc. (2009) 173 Cal.App.4th 508, 527–528.) But it did so
without considering whether the rule should apply to California wage claims, and
the court determined in any event that the rule did not apply in the case before it,
which involved several hours per week of uncompensated time. (Ibid.)
We recognize that the de minimis doctrine appears in the Enforcement
Policies and Interpretations Manual published by the Division of Labor Standards
Enforcement (DLSE Manual). Sections 47.2.1 and 47.2.1.1 of the manual adopt
virtually verbatim the federal regulation on this issue. (DLSE Manual (2002
11
update) p. 47–1; see 29 C.F.R. § 785.47 (2018).) But unlike wage orders, the
DLSE Manual is not binding on this court. (Mendiola, supra, 60 Cal.4th at
p. 848.) Although statements in the policy manual may be considered for their
persuasive value, the DLSE Manual contains rules that have not been subject to
the Administrative Procedures Act and do not represent an exercise of quasilegislative
authority by an administrative agency. (See Alvarado v. Dart
Container Corp. of California (2018) 4 Cal.5th 542, 555–561; DLSE Manual at
pp. 1-1 to 1-2.)
The DLSE has also issued opinion letters adopting the Lindow test for the
de minimis rule. (See Dept. of Industrial Relations, DLSE Opn. Letter
No. 1988.05.16 (1988).) Such advisory opinions are also not binding, although
they may be a source of informed judgment to which courts and litigants may
resort for guidance. (See Yamaha Corp. of America v. State Bd. of Equalization
(1998) 19 Cal.4th 1, 14.) Here, the DLSE’s adoption of the federal de minimus
rule appears to be based on the general proposition that federal case law
construing the FLSA “may sometimes provide guidance to state courts in
interpreting the IWC Orders.” (DLSE Opn. Letter No. 1988.05.16. at p. 1.) But
we will not presume the IWC intended to incorporate a less protective federal rule
without evidence of such intent, and we see no sign of such intent here.
III.
Our conclusion that California statutes and wage orders have not adopted
the federal de minimis doctrine does not fully resolve the issue before us.
According to Starbucks, the de minimis rule is also a principle of California law
that is independently applicable to wage and hour cases as a matter of state law.
Starbucks cites Wisconsin Dept. of Revenue v. William Wrigley, Jr., Co. (1992)
505 U.S. 214, which examined a federal statute granting immunity from state
taxation to companies when their only business contact with the state is the
12
solicitation of orders. At issue was whether de minimis business contacts other
than solicitation of orders would forfeit this immunity under the statute. The high
court concluded that the de minimis principle applied, rejecting Wisconsin’s
argument that “the plain language of the statute bars this recognition of a de
minimis exception, because the immunity is limited to situations where ‘the only
business activities within [the] State’ are those described, 15 U.S.C. § 381
(emphasis added). This ignores the fact that the venerable maxim de minimis non
curat lex (‘the law cares not for trifles’) is part of the established background of
legal principles against which all enactments are adopted, and which all
enactments (absent contrary indication) are deemed to accept.” (Id. at p. 231.)
Starbucks argues that even if the relevant Labor Code statutes and wage order
have not explicitly adopted the federal de minimis rule, the de minimis principle is
part of the “established background of legal principles” against which the statutes
and wage order have been enacted.
Troester contends that the fact that the IWC has not adopted an explicit de
minimis regulation after it had been incorporated into federal law is a sign that the
IWC intended to preclude its application in wage cases. Troester further contends
that unlike the California Labor Code, the text of the FLSA does not contain a
blanket requirement to pay employees for all hours worked, except in a regulation
that postdated and implicitly incorporated Anderson’s de minimis rule. (29 C.F.R.
§ 778.223 (2018).)
We have recognized that the maxim de minimis non curat lex is “of ancient
origin” and may be incorporated by implication into the state’s statutory and
constitutional enactments. (Gerawan Farming, Inc. v. Lyons (2000) 24 Cal.4th
468, 514 [recognizing the incorporation of that principle into the free speech
clause of the California Constitution].) This principle is among the maxims of
jurisprudence codified in the California Civil Code. (Civ. Code, § 3533 [“The law
13
disregards trifles.”].) The rule originated as one of the maxims of equity
formulated by English Courts of Chancery. (See Nemerofsky, What Is a “Trifle”
Anyway? (2001–2002) 37 Gonz. L.Rev. 315, 322–323.) “The function of the ‘de
minimis’ doctrine . . . is to place ‘outside the scope of legal relief the sorts of
intangible injuries, normally small and invariably difficult to measure, that must
be accepted as the price of living in society.’ The maxim signifies ‘that mere
trifles and technicalities must yield to practical common sense and substantial
justice’ so as ‘to prevent expensive and mischievous litigation, which can result in
no real benefit to complainant, but which may occasion delay and injury to other
suitors.’ ” (Id. at pp. 323–324, fns. omitted.) Starbucks argues that in light of the
“ancient roots” of the de minimis rule, we should recognize it as part of our wage
and hour law, just as Anderson recognized the rule as applicable to the FLSA
despite no explicit statutory basis.
We decline to decide whether a de minimis principle may ever apply to
wage and hour claims given the wide range of scenarios in which this issue arises.
In FLSA litigation, the brief employee activity in question has sometimes been
incidental to noncompensable time, such as commute time. (See Chambers v.
Sears Roebuck & Co. (S.D.Tex. 2011) 793 F.Supp.2d 938, 960; Andrews v.
Dubois (D.Mass. 1995) 888 F.Supp. 213, 219; Singh v. City of New York (2d Cir.
2008) 524 F.3d 361.) In other cases, the activity in question was irregular or
rarely occurring. (Musticchi v. City of Little Rock (E.D.Ark. 2010) 734 F.Supp.2d
621, 633.) In still others, the activity in question was paperwork involving a
minute or less of an employee’s time. (Rutti v. Lojack Corp. (9th Cir. 2010) 596
F.3d 1046, 1057–1058.) Beyond the cases, briefs on behalf of Starbucks invoke
various hypothetical scenarios of de minimis activity, such as an employee reading
an e-mail notification of a shift change during off-work hours.
14
Instead of prejudging these factual permutations, we decide only whether
the de minimis rule is applicable to the facts of this case as described by the Ninth
Circuit. As noted, Troester had various duties related to closing the store after he
clocked out, and the parties agree for purposes of resolving the issue before us that
the time spent on these duties is compensable. According to the Ninth Circuit,
“[t]he undisputed evidence was that, on a daily basis, these closing tasks generally
took [Troester] about 4-10 minutes . . . . [The district court] further assumed that
the additional time would be administratively difficult to capture.” (This time is in
addition to the time Troester alleges he spent “once every couple months” letting
coworkers back inside the store or bringing in patio furniture that he forgot to
retrieve before clocking out, time that Starbucks contends was not compensable.)
The de minimis rule, as a background principle, has been invoked in a
variety of statutory contexts, and courts have decided such cases by examining
whether application of the rule would be consistent with the statutory purpose.
(See Goehring v. Chapman University (2004) 121 Cal.App.4th 353, 384
[“Substantial compliance with a statute ‘will suffice if the purpose of the statute is
satisfied . . . but substantial compliance means actual compliance in respect to that
statutory purpose.’ ”].) In the employment context, we have held that there is no
de minimis exception to the assessment of penalties for unreasonable delay in the
payment of workers compensation payments: “The language of section 5814 . . .
does not recognize any such exception and requires assessment of the penalty for
any ‘unreasonable’ delay . . . .” (Gallamore v. Workers’ Comp. Appeals Bd.
(1979) 23 Cal.3d 815, 822.) In Amaral v. Cintas Corp. No. 2 (2008) 163
Cal.App.4th 1157, 1191, the court declined to read into a municipal living wage
ordinance an exception for workers who performed only a small amount of work
on city contracts. In interpreting the unemployment insurance statutes, courts
have construed them to contain a de minimis exception when that construction was
15
consistent with the statutes’ purpose of cushioning the impact of involuntary
unemployment (see Cooperman v. Unemployment Ins. Appeals Bd. (1975) 49
Cal.App.3d 1, 10 [finding that despite de minimis services rendered by applicant,
he was “unemployed” per section 1252 of the Unemployment Insurance Code])
while declining to find such an exception when it would run counter to that
protective purpose (see Jaffe v. Unemployment Ins. Appeals Bd. (1984) 156
Cal.App.3d 719, 725 [refusing to invoke a de minimis rule where unemployment
benefits would have been temporarily interrupted]).
We have said that application of a de minimis rule is inappropriate when
“the law under which this action is prosecuted does care for small things.”
(Francais v. Somps (1891) 92 Cal. 503, 506.) In deciding whether application of
the de minimis rule in this case would be consistent with the governing wage order
and Labor Code statutes, we observe that the regulatory scheme of which the
relevant statutes and wage order provisions are a part is indeed concerned with
“small things.” For example, California law ensures that most nonexempt
employees receive two daily 10-minute rest breaks. (Wage Order No. 5,
subd. (12)(A); see Brinker, supra, 53 Cal.4th at p. 1031.) We have interpreted
Wage Order No. 5 as requiring strict adherence to that requirement, and we have
scrupulously guarded against encroachments on this 10-minute period. Thus, we
recently held that the obligation to relieve employees of any work-related duties
during the rest period barred employers from requiring employees to be on call
during their rest breaks and that breach of this duty triggers an employer’s
obligation under section 226.7, subdivision (b) to pay the employee an additional
hour of pay. (ABM Security, supra, 2 Cal.5th at p. 265.)
ABM Security, though addressing a different issue, is instructive in two
respects. First, although the de minimis principle was not explicitly invoked, we
implicitly rejected the argument that a de minimis intrusion into a 10-minute rest
16
period would pass muster under the statute. Second, the strict construction of a
law prohibiting any interference with or reduction of a 10-minute rest break is
difficult to reconcile with a rule that would regard a few minutes of compensable
time per day as a trifle not requiring compensation if too inconvenient to record.
Although the IWC has not specifically addressed the de minimis rule, we
note that its regulations have been more expansive than the FLSA in defining the
time for which an employee must be compensated. Most closely on point is the
IWC’s response to the federal Portal-to-Portal Act (29 U.S.C. § 251 et seq.). This
legislation was a 1947 amendment to the FLSA relieving “employers from paying
minimum wages or overtime compensation to employees for the following
activities: ‘(1) walking, riding, or traveling to and from the actual place of
performance of the principal activity or activities which such employee is
employed to perform, and (2) activities which are preliminary to or postliminary to
said principal activity or activities . . . .’ ” (Morillion, supra, 22 Cal.4th at p. 589.)
The amendment was “partly in response to [Congress’s] concern that the FLSA
‘has been interpreted judicially in disregard of long-established customs, practices,
and contracts between employers and employees . . . .’ ” (Id. at p. 590, quoting 29
U.S.C. § 251.) More specifically, the amendment was a response to Anderson’s
holding that the time walking to a workstation was compensable. (See Linder,
Class Struggle at the Door: The Origins of the Portal-to-Portal Act of 1947
(1991) 39 Buff. L.Rev. 53, 106–130.) At the same time, the IWC amended its
definition of “hours worked” in its wage orders, eliminating reference to specific
preliminary or postliminary activities such as “waiting time,” while broadening the
definition to include “ ‘the time during which an employee is subject to the control
of an employer.’ ” (Morillion, at p. 591.) We concluded that this amended
language was evidence of an intent to depart from the federal exclusion of various
forms of travel time in the Portal-to-Portal Act. (Id. at pp. 591–592.)
17
Although the IWC amendment, which postdated Anderson by one year, did
not specifically address the de minimis doctrine, we find it instructive that the
amended wage order broadly defined “hours worked” to include preliminary and
postliminary activities excluded by the FLSA. It is also instructive that the IWC
in defining “hours worked” appeared to give little weight to the customary
employment practices that informed Congress’s decision to enact the Portal-toPortal
Act and instead placed more importance on the policy of ensuring that
employees are fully compensated for all time spent in the employer’s control.
Moreover, although FLSA case law can be persuasive authority in
interpreting our own wage laws, the reasoning of Anderson is questionable. We
do not hold that payment for time worked must account for “[s]plit-second
absurdities.” (Anderson, supra, 328 U.S. at p. 692.) But it is not clear that
“[s]plit-second absurdities” can be readily equated with “minutes of work beyond
the scheduled working hours” or that an action should be permitted only when “an
employee is required to give up a substantial measure of his time and effort.”
(Ibid.) Nor is it clear why, when it is difficult to keep track of time worked, the
employee alone should bear the burden of that difficulty.
Two additional considerations reinforce our reluctance to fully adopt
Anderson’s reasoning as a matter of state law. First, the modern availability of
class action lawsuits undermines to some extent the rationale behind a de minimis
rule with respect to wage and hour actions. The very premise of such suits is that
small individual recoveries worthy of neither the plaintiff’s nor the court’s time
can be aggregated to vindicate an important public policy. As we explained in
Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, a class action suit involving a
4 cents per gallon surcharge on gasoline customers using credit cards: “Setting
aside the fact that class members who were repeat customers might be entitled to
recover far more than the minimal 80-cent damage figure noted by the trial court,
18
it is firmly established that the benefits of certification are not measured by
reference to individual recoveries alone. Not only do class actions offer
consumers a means of recovery for modest individual damages, but such actions
often produce ‘several salutary by-products, including a therapeutic effect upon
those sellers who indulge in fraudulent practices, aid to legitimate business
enterprises by curtailing illegitimate competition, and avoidance to the judicial
process of the burden of multiple litigation involving identical claims.’ ” (Id. at
p. 445.) As one Court of Appeal observed in a case involving alleged fraudulent
practices against consumers, “[i]n this age of the consumer class action this maxim
[de minimis non curat lex] usually has little value.” (Harris v. Time, Inc. (1987)
191 Cal.App.3d 449, 458.) The same is true of employee class actions.
Second, many of the problems in recording employee work time discussed
in Anderson 70 years ago, when time was often kept by punching a clock, may be
cured or ameliorated by technological advances that enable employees to track and
register their work time via smartphones, tablets, or other devices. We are
reluctant to adopt a rule purportedly grounded in “the realities of the industrial
world” (Anderson, supra, 328 U.S. at p. 692) when those realities have been
materially altered in subsequent decades.
Both Troester and Starbucks cite See’s Candy Shops, Inc. v. Superior Court
(2012) 210 Cal.App.4th 889 (See’s Candy) in support of their positions. The main
issue in that case was the employer’s practice of rounding the time employees
punched in or out of work. As the court explained: “Under the nearest-tenth
rounding policy, in and out punches are rounded (up or down) to the nearest tenth
of an hour (every six minutes beginning with the hour mark). The Kronos time
punches are thus rounded to the nearest three-minute mark. For example, if an
employee clocks in at 7:58 a.m., the system rounds up the time to 8:00 a.m. If the
employee clocks in at 8:02 a.m., the system rounds down the entry to 8:00 a.m.”
19
(Id. at p. 892.) The court noted that although there were no reported California
decisions on the issue, such rounding policy had long been used by employers and
had been recognized as legitimate under federal regulation and the DLSE Manual.
(Id. at pp. 901–903.) The court rejected the argument that California wage or
overtime statutes prohibit such a practice. (Id. at pp. 905–907.)
Significantly, the court in See’s Candy, consistent with federal law and
DLSE directive, accepted the validity of the rounding policy only “if the rounding
policy is fair and neutral on its face and ‘it is used in such a manner that it will not
result, over a period of time, in failure to compensate the employees properly for
all the time they have actually worked.’ ” (See’s Candy, supra, 210 Cal.App.4th
at p. 907.) On this basis, the court held there was a triable issue as to whether the
company’s rounding policy “was proper under California law because it was used
in a manner that did not result over a period of time in the failure to compensate
the employees for all the time they actually worked.” (Id. at p. 908.)
In support of its position, Starbucks cites See’s Candy’s reliance on federal
law and the DLSE Manual, and its rejection of arguments similar to Troester’s
contention that the policy is barred by statutes requiring payment to the employer
of all wages. But critically, See’s Candy rested its holding on its determination
that the rounding policy was consistent with the core statutory and regulatory
purpose that employees be paid for all time worked. Starbucks argues for a
departure from that principle, and we conclude no such departure is warranted in
this case.
In light of the Wage Order’s remedial purpose requiring a liberal
construction, its directive to compensate employees for all time worked, the
evident priority it accorded that mandate notwithstanding customary employment
arrangements, and its concern with small amounts of time, we conclude that the de
minimis doctrine has no application under the circumstances presented here. An
20
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. As the facts here
demonstrate, a few extra minutes of work each day can add up. According to the
Ninth Circuit, Troester is seeking payment for 12 hours and 50 minutes of
compensable work over a 17-month period, which amounts to $102.67 at a wage
of $8 per hour. That is enough to pay a utility bill, buy a week of groceries, or
cover a month of bus fares. What Starbucks calls “de minimis” is not de minimis
at all to many ordinary people who work for hourly wages.
We recognize that one of the main impetuses behind the de minimis
doctrine in wage cases is “the practical administrative difficulty of recording small
amounts of time for payroll purposes.” (Lindow, supra, 738 F.2d at p. 1062; see
29 C.F.R. § 785.47 (2018) [insignificant periods of time “which cannot as a
practical administrative matter be precisely recorded for payroll purposes, may be
disregarded”].) But employers are in a better position than employees to devise
alternatives that would permit the tracking of small amounts of regularly occurring
work time. One such alternative, which it appears Starbucks eventually resorted to
here, was to restructure the work so that employees would not have to work before
or after clocking out. Moreover, as noted, technological advances may help with
tracking small amounts of time. An employer may be able to customize and adapt
available time tracking tools or develop new ones when no off-the-shelf product
meets its needs. And even when neither a restructuring of work nor a
technological fix is practical, it may be possible to reasonably estimate work time
— for example, through surveys, time studies, or, as See’s Candy suggested, a fair
rounding policy — and to compensate employees for that time. Under the
circumstances of this case, we decline to adopt a rule that would require the
21
employee to bear the entire burden of any difficulty in recording regularly
occurring work time.

Outcome: We hold that the relevant California statutes and wage order have not incorporated the de minimis doctrine found in the FLSA. We further conclude that although California has a de minimis rule that is a background principle of state law, the rule is not applicable here. The relevant statutes and wage order do not allow employers to require employees to routinely work for minutes off-theclock without compensation. We leave open whether there are wage claims involving employee activities that are so irregular or brief in duration that it would not be reasonable to require employers to compensate employees for the time spent on them.

Plaintiff's Experts:

Defendant's Experts:

Comments: