California Supreme Court Issues Decision Regarding Compensable “Hours Worked”

The California Supreme Court has issued a decision providing a multi-factored test to be used in determining whether an employer should count an activity as compensable “hours worked.” The court’s ruling requires Apple to pay store employees for time spent undergoing security checks of bags brought to work. Generally, courts have defined “hours worked” as including all time when the employee is “subject to the control of an employer” and “suffered or permitted to work.” The Court listed the following factors to be used in determining whether time is considered compensable “hours worked”:

• The mandatory nature of the activity;
• The location of the activity;
• The degree of the employer’s control;
• Whether the activity primarily benefits the employee or employer; and
• Whether the activity is enforced through disciplinary measures.

In the case of Apple’s bag check, although employees can choose whether or not to bring a bag, because of its enforcement with disciplinary actions and the security check benefits the employer more than the employee, time spent during bag checks was classified as “hours worked”.

Employers should be cautious ensuring they aren’t misclassifying their employees time, especially if their employees are involved in unpaid activities that primarily benefit the employer.