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This case was before the Third Circuit on the plaintiffs-employees’ appeal of the district court’s order granting the defendants-employers summary judgment. Plaintiffs sought unpaid overtime wages for time they spent donning and doffing their uniforms and protective gear and performing “shift relief” before and after their regularly-scheduled shifts. Defendant contended that it could offset compensation it gave Plaintiffs for meal breaks during their shift—for which defendant was not required to provide compensation under the FLSA—against such required overtime. The District Court agreed with defendant and granted defendant summary judgment. On appeal the Third Circuit concluded that the FLSA compelled the opposite result and reversed the district court’s order granting summary judgment.

The Third Circuit summarized the relevant facts as follows:

Appellants worked twelve-hour shifts at DuPont’s manufacturing plant in Towanda, Pennsylvania. In addition to working their twelve-hour shifts, Plaintiffs had to be on-site before and after their shifts to “don and doff” uniforms and protective gear. DuPont also required them to participate in “shift relief,” which involved employees from the outgoing shift sharing information about the status of work with incoming shift employees. The time spent donning, doffing, and providing shift relief varied, but ranged from approximately thirty to sixty minutes a day.

DuPont chose to compensate Plaintiffs for meal breaks—despite no FLSA requirement to do so—during their twelve-hour shifts. The employee handbook set forth DuPont’s company policy for compensating meal breaks, stating that “[e]mployees working in areas requiring 24 hour per day staffing and [who] are required to make shift relief will be paid for their lunch time as part of their scheduled work shift.” Employees who worked twelve-hour, four-shift schedules, as did Plaintiffs in this case, were entitled to one thirty minute paid lunch break per shift, in addition to two non-consecutive thirty minute breaks. The paid break time always exceeded the amount of time Plaintiffs spent donning and doffing and providing shift relief.

The court then began its analysis of the issue at bar, with an analysis of why the paid breaks constituted “hours worked” under the FLSA and explained:

“Hours worked” includes all hours worked “under [an employee’s] contract (express or implied) or under any applicable statute.” 29 C.F.R. § 778.315. In general, “hours worked” includes time when an employee is required to be on duty, but it is not limited to “active productive labor” and may include circumstances that are not productive work time. See 29 C.F.R. § 778.223. Employers have a measure of flexibility in determining whether otherwise non-productive work time will be considered “hours worked” under the FLSA. For instance, meal periods—while not necessarily productive work time—may nevertheless be considered “hours worked” under the Act. Id. (“Some of the hours spent by employees … in meal periods … are regarded as working time and some are not. … To the extent that those hours are regarded as working time, payment made as compensation for these hours obviously cannot be characterized as ‘payments not for hours worked.’ ”). The decision to treat otherwise non-productive work time as “hours worked” is fact dependent. Relevant here, the regulations provide that “[p]reliminary and postliminary activities and time spent in eating meals between working hours fall into this category [of work that an employer may compensate his employees for even though he is not obligated to do so under the FLSA.] The agreement of the parties to provide compensation for such hours may or may not convert them into hours worked, depending on whether or not it appears from all the pertinent facts that the parties have agreed to treat such time as hours worked.” 29 C.F.R. § 778.320.

Thus, if the time at issue is considered hours worked under the Act, the corresponding compensation is included in the regular rate of pay. 29 C.F.R. § 778.223. Whether or not the time is considered hours worked under the Act, however, if the time is regarded by the parties as working time, “the payment is nevertheless included in the regular rate of pay unless it qualifies for exclusion from the regular rate as one of a type of ‘payments made for occasional periods when no work is performed due to failure of the employer to provide sufficient work, or other similar cause’ as discussed in § 778.218 or is excludable on some other basis under section 7(e)(2).” Id.

After discussing the limits on permissible overtime offsets contained within 207(h), the court held that the paid breaks were not such a permissible offset under its own prior jurisprudence or otherwise:

Nothing in the FLSA authorizes the type of offsetting DuPont advances here, where an employer seeks to credit compensation that it included in calculating an employee’s regular rate of pay against its overtime liability. Rather, the statute only provides for an offset of an employer’s overtime liability using other compensation excluded from the regular rate pursuant to sections 207(e)(5)-(7) and paid to an employee at a premium rate.

In Wheeler, as here, the employer, Hampton Township, had voluntarily included non-work pay—which did not need to be included in the regular rate under the Act—in the regular rate calculation. It sought to offset compensation it was required to include in the regular rate, but did not, with compensation it voluntarily chose to include in the regular rate. Wheeler, 399 F.3d at 243. We held that this was not permitted. We could not find any “textual reason to ‘credit’ the Township for including such pay in its regular rate.” Id. at 244. We explained that “while § 207(e) protects the Township from having to include non-work pay in the regular rate, it does not authorize the Township now to require such augments to be stripped out, or to take a credit for including such augments.” Id. In essence, at the point at which compensation is included in the regular rate (regardless of whether the Act required it be included), an employer may not use that compensation to offset other compensation owed under the Act. We determined that “[w]here a credit is allowed, the statute says so.” Id. at 245. The Township was not entitled to a credit under the explicit offset contemplated by section 207(h), so we concluded that the FLSA did not permit the offset. Id. (“The Township seeks a credit for allegedly including non-work pay—presumably at a non-premium rate—in the CBA’s basic annual salary. The FLSA does not provide for such an offset.”).

We based our conclusion that offsetting was limited to the type addressed by section 207(h) on our recognition that Section 207(h) offsetting pertained only to “extra compensation,” which is distinct from regular straight time pay. Wheeler, 399 F.3d at 245. Indeed, “such ‘extra compensation’ is a kind of overtime compensation, and thus need not be added to the regular rate. Likewise, such compensation may be credited against the Act’s required overtime pay.” Id. Courts have widely recognized that an employer may offset its overtime liability with accumulated premium pay given to employees under sections 207(e)(5)-(7). See, e.g., Singer v. City of Waco, 324 F.3d 813, 828 (5th Cir. 2003); Kohlheim v. Glynn Cty, 915 F.2d 1473, 1481 (11th Cir. 1990). The offset created by section 207(h) is logical because it authorizes employers to apply one type of premium pay to offset another, both of which are excluded from the regular rate. See 29 U.S.C. § 207(e). It is undisputed that the compensation paid for meal breaks was included in plaintiffs’ regular rate of pay, and thus could not qualify as “extra compensation.” Accordingly, DuPont may not avail itself of the offset provisions explicitly allowed by § 207(h)(2).

Addressing/rejecting the defendant’s argument that regular rate compensation may be used as an offset to overtime compensation under the FLSA, the court explained:

DuPont argues that the FLSA’s failure to expressly prohibit offsetting where the compensation used to offset is included in the regular rate indicates that offsetting is allowed. We disagree with DuPont’s notion that the FLSA’s silence indicates permission. While it is true that the statute does not explicitly set forth this prohibition, the policy rationales underlying the FLSA do not permit crediting compensation used in calculating an employee’s regular rate of pay because it would allow employers to double-count the compensation. The DOL convincingly urges this viewpoint. It observes that “[t]here is no authority for the proposition that compensation already paid for hours of work can be used as an offset and thereby be counted a second time as statutorily required compensation for other hours of work.” DOL Letter Br. 6. Further, “there is no reason to distinguish between compensation for productive work time and compensation for bona fide meal breaks.” Id. Compensation included in, and used in calculating, the regular rate of pay is reflective of the first forty hours worked. We agree with the reasoning of the DOL that allowing employers to then credit that compensation against overtime would necessarily shortchange employees.

The statutory scheme that limits crediting to the three types of “extra compensation” excluded from the regular rate against overtime obligations makes sense. “To permit overtime premium to enter into the computation of the regular rate would be to allow overtime premium on overtime premium—a pyramiding that Congress could not have intended.” Bay Ridge Operating Co. v. Aaron, 334 U.S. 446, 464 (1948). Excludable premium compensation may offset other excludable premium compensation. To allow compensation included in the regular rate to offset premium-rate pay, however, would facilitate a “pyramiding” in the opposite direction by allowing employers to pay straight time and overtime together. This approach fundamentally conflicts with the FLSA’s concern that employees be compensated for all hours worked. As the Ninth Circuit observed in Ballaris, “it would undermine the purpose of the FLSA if an employer could use agreed-upon compensation for non-work time (or work time) as a credit so as to avoid paying compensation required by the FLSA.” Ballaris, 370 F.3d at 914.

While Ballaris is distinguishable because the employer in that case excluded meal break compensation when calculating the employee’s regular rate and the parties agreed that the meal break period was excluded from each employee’s hours worked, its reasoning nonetheless applies here. The Ninth Circuit concluded that “[c]rediting money already due an employee for some other reason against the wage he is owed is not paying that employee the compensation to which he is entitled by statute. It is, instead, false and deceptive ‘creative’ bookkeeping that, if tolerated, would frustrate the goals and purposes of the FLSA.” 370 F.3d at 914 (internal footnote omitted). Here, permitting DuPont to use pay given for straight time—and included in the regular rate of pay—as an offset against overtime pay is precisely the type of “creative bookkeeping” that the Ninth Circuit cautioned against and the FLSA sought to eradicate.

The court concluded that the district court had not properly applied these concepts, and that the district court erred by concluding that regular rate compensation may be used as an offset to unpaid overtime compensation:

While the District Court cited Wheeler in passing, it did not apply our holding but, instead, looked at the two circumstances that the statute expressly states preclude offsetting by an employer:

First, employers cannot use paid non-work time to offset unpaid work time when the paid non-work time is excluded from the regular rate of pay. Second, if the parties agree to treat paid non-work time as “hours worked,” and this time is included in the regular rate of pay, the employer cannot offset.

App. 12. The District Court concluded that because neither of these circumstances was present in this case, the FLSA does not expressly prohibit an offset. It recited the prohibition set forth in 29 U.S.C. § 207(h)(1), which generally bars employers from offsetting incurred overtime liability with sums excluded from the regular rate of pay. The District Court observed that “defendants cannot offset if the FLSA expressly excludes plaintiffs meal periods—non-work time—from plaintiffs’ regular rate of pay.” App. 12-13. After reviewing section 207(e)’s list of mandatory exclusions from the regular rate of pay, it concluded that the one category of exclusions that was arguably implicated by the facts, 29 U.S.C. § 207(e)(2), was not applicable because the meal periods were not the type of absences covered by the exclusion. “Accordingly, section 207(e)(2) does not prohibit defendants from including plaintiffs’ meal period time in their regular rate of pay, rendering section 207(h)’s prohibition against an offset inapplicable.” App. 14. Thus, like DuPont, the District Court focused on the lack of express prohibition. In light of our holding in Wheeler that offsetting is limited to circumstances where an employer is paying “extra compensation” at a premium rate, we reject the District Court’s reasoning that the absence of a direct prohibition controls the analysis of the offset issue.

Moreover, we do not accept the significance that the District Court and DuPont place on two lingering issues: first, whether the parties had an agreement to treat the breaks in question as hours worked, and second, whether the FLSA required DuPont to compensate the employees for the breaks in question. With respect to the former, both the Ninth Circuit in Ballaris and the FLSA’s implementing regulations advance the notion that employers may not offset if there is an agreement to treat otherwise uncompensable time as “hours worked,” and the compensation at issue is included in the regular rate. But inclusion in the regular rate is sufficient for our purposes, as noted above, so the existence of an agreement is beside the point.⁸ As to the latter, 29 C.F.R § 785.19 simply states that employers are not required by the FLSA to treat meal breaks as hours worked, but it does not prohibit them from doing so. Indeed, section 778.320 expressly contemplates that an employer may agree to treat non-work time, including meal breaks, as compensable hours worked.

The District Court relied on the Seventh Circuit’s opinion in Barefield v. Village of Winnetka, 81 F.3d 704 (7th Cir. 1996), and the Eleventh Circuit’s opinion in Avery v. City of Talladega, 24 F.3d 1337 (11th Cir. 1994), in concluding that DuPont could offset using meal break compensation. The two opinions did not analyze the offset issue in detail, but instead focused on compensability. The courts in both Barefield and Avery presumed an offset was permissible and focused on the fact that the FLSA did not require employers to compensate employees for the bona fide meal break periods at issue. Notably, neither opinion addresses the most relevant provision in the FLSA on the issue of offsetting—29 U.S.C. 207(h). Given our holding in Wheeler, limiting offsetting to “extra compensation” not included in the regular rate, it is irrelevant whether the breaks were compensable.

Thus, the Third Circuit reversed.

Click Smiley v. E.I. Dupont De Nemours and Co., et al. to read the entire Opinion.

D.Kan.: FLSA Plaintiffs’ Motion to Compel Entry Into Defendant’s Facility To Conduct A Time & Motion Study Related To “Walk Time” Claims Granted

February 14, 2011 8:35 am / Leave a comment

McDonald v. Kellogg Co.

In this Fair Labor Standards Act (“FLSA”) wage and hour case, plaintiffs, current and former hourly production employees at defendant’s bakery facility, claimed that defendant violated the overtime provisions of the FLSA, 29 U.S.C. § 201 et seq., by, among other things, failing to compensate them for time spent walking to and from workstations. Following a ruling on the parties’ cross motions for summary judgment– which in part held that plaintiffs’ time spent walking to their workstations was compensable– plaintiffs’ moved to compel defendant to allow entry into its facility for the purpose of conducting a time and motion study related to plaintiffs’ walk time.

Describing the plaintiffs’ proposed study the court explained:

“Plaintiffs have served a request, pursuant to Fed.R.Civ.P. 34, seeking access to defendant’s bakery facility for their expert, Dr. Kenneth S. Mericle, to gather data on the time employees spend walking to and from their workstations (see doc. 195). Dr. Mericle proposes to use Radio Frequency Identification technology (“RFID”) to gather this data. To conduct an RFID study, Dr. Mericle would first place electronic readers at the employees’ locker rooms and at the time clocks outside their workstations. Next, Dr. Mericle would issue credit-card-sized cards to employees to carry with them during the study. When the cards pass in the proximity of the readers, a time stamp in the reader would record the time that the employee passed through the area. Thus, the readers would record the time that card-carrying employees leave the locker room and the time that they arrive at the workstations (and vice versa). In addition, Dr. Mericle would place small sensors at various locations in the factory, such as bathrooms, to register detours in the employees’ paths to and from their workstations. Plaintiffs suggest that only Dr. Mericle and, perhaps, one other individual would need to be on-site during the study to ensure that there are no problems with the RFID equipment.

Plaintiffs request that Dr. Mericle enter defendant’s facility on two occasions. On the first entry, Dr. Mericle would simply observe plant conditions and employee habits in order to plan placement locations for the RFID readers and sensors. On the second entry, Dr. Mericle would set up the readers and sensors, and issue cards to the employees. Plaintiffs propose that the study then be conducted over a period of several days.

Defendant objects to the RFID study as overreaching discovery. Defendant asserts that nothing in the Federal Rules of Civil Procedure requires it to alter its factory by attaching readers and sensors to its property, or to mandate that its employees carry reader cards. According to defendant, the proposed RFID study is overly broad and burdensome.”

Granting plaintiffs’ motion, the court reasoned:

“In objecting to plaintiffs’ proposed RFID study, defendant broadly asserts that “[c]onducting such a study during working hours will consume considerable time at [defendant’s] expense, will interfere with operations, potentially jeopardize the safety of individuals conducting the study, and expose [defendant’s] proprietary production processes to disclosure to third parties.” Defendant suggests that plaintiffs can estimate employee walking time much more simply by measuring the distances between employee locker rooms and workstations, and then using expert information concerning reasonable walk times.

The court rejects defendant’s objections and grants plaintiffs’ motion to compel. Pursuant to Rules 34(a)(2) and 26(b)(1), the court clearly has the authority to order access to defendant’s facility for the purpose of conducting the RFID study and gathering relevant walk-time data. While there may be, as defendant suggests, alternate means to gather data regarding employee walking time, such is not the test for determining whether the discovery requested should be compelled. Defendant is not at liberty to dictate how plaintiffs should gather information to support their case. Rather, the rules permit plaintiffs to enter defendant’s property for the purpose of gathering relevant information unless defendant makes a “particularized showing” that the discovery plaintiffs propose would create an undue burden or danger. Defendant has made no attempt to meet this burden-defendant has not submitted an affidavit discussing the burdens or dangers that would accompany the proposed RFID study, nor has defendant even “provide[d] a detailed explanation as to the nature and extent of the claimed burden.” Although during the hearing defense counsel requested an opportunity to supplement the record in this regard, the undersigned denied defendant’s tardy request for a second bite at the apple.

Considering the record as it stands, the court finds that defendant has offered no support for its conclusory assertion that the proposed RFID study would consume a considerable amount of defendant’s time and would interfere with defendant’s operations. As plaintiffs explained at the hearing, the readers and sensors can be placed unobtrusively and without having to make permanent modifications to defendant’s property. They will record no data other than the time that the cards pass in their vicinity. Indeed, this proposed methodology appears to be less intrusive than other methods of conducting time and motion studies (e.g., videotaping employees or having experts follow employees as they walk the designated paths). With regard to defendant’s concern that its proprietary information is at risk, the Stipulated Protective Order already entered in this case (doc. 56) is sufficient to protect defendant’s trade secrets.

Nor has defendant demonstrated or explained what legitimate safety concerns would be faced by persons conducting the study. Nonetheless, the court will permit defendant to conduct safety-training, limited to one hour, as a prerequisite for access to the facility. In addition, as discussed below, defendant’s safety manager may accompany Dr. Mericle while he is in the facility.

Finally, as to defendant’s complaint that its employees should not be required to carry the small reader cards, the court agrees that no employee should be compelled to carry the card against his or her will. However, as noted by plaintiffs, the vast majority of hourly production workers whose walk time the RFID study would measure are opt-in plaintiffs in this case. The court finds it likely that these employees will voluntarily carry the card. The court permits plaintiffs’ counsel and expert to supply cards to employees who voluntarily consent to carry them during the study.”

Click McDonald v. Kellogg Co. to read the entire order.

6th Cir.: Although Changing Into PPE At Food-Processing Plant Is “Changing Clothes” and Excluded Under 203(o), It Is A Principle Activity And Begins The “Continuous Workday”

September 3, 2010 7:07 am / Leave a comment

Franklin v. Kellogg Co.

This case was before the Sixth Circuit on appeal from the order at the court below granting Defendant summary judgment in all respects with regard to Plaintiff’s claims that she was entitled to be paid for changing into required personal protection equipment (“PPE”) each day, before she could perform their work on Defendant’s plant floor. The Court affirmed the lower court’s holding that time spent changing into the PPE could be properly excluded by continued practice under 203(0), but remanded the case to determine whether there was significant time the that elapsed after the donning of the PPE, before Plaintiff was put “on the clock,” because such time was compensible under the “continuous workday” if it was not deemed de minimus.

The Court reasoned:

“B. Post-Donning/Pre-Doffing Walking Time

Franklin argues that if we conclude that her time spent donning and doffing the uniform and equipment is excluded under § 203(o), she is still entitled to compensation for her time spent walking between the locker room and the time clock, because those activities are “principal activities.” Under the “continuous workday” rule, “the ‘workday’ is generally defined as ‘the period between the commencement and completion on the same workday of an employee’s principal activity or activities.’ “ IBP, Inc. v. Alvarez, 546 U.S. 21, 29 (2004) (quoting 29 C.F.R. § 790.6(b)). In addition, “during a continuous workday, any walking time that occurs after the beginning of the employee’s first principal activity and before the end of the employee’s last principal activity is … covered by the FLSA,” and must be compensated. Id. at 37. Principal activities are those that are an integral and indispensable part of the activities which the employee is employed to perform. See Steiner v. Mitchell, 350 U.S. 247, 256 (1956).

1. Does Exclusion Under § 203(o) Affect Whether an Activity is a Principal Activity?

One court recently explained that “[t]he courts have taken divergent views” on the issue of whether activities deemed excluded under § 203(o) may still constitute “principal activities.” In re Tyson Foods, Inc., 694 F.Supp.2d 1358, 1370 (M.D.Ga.2010). Some courts have concluded that time that is excluded under § 203(o) may still be a “principal activity,” because § 203(o) only addresses the compensability of the time, not whether it is integral and indispensable. See, e.g., id. at 1371 (“After considering both of these positions, the Court concludes that § 203(o) only relates to the compensability of time spent donning, doffing, and washing of the person and that it does not mean that § 203(o) tasks cannot be considered principal activities that start the continuous workday.”); Andrako v. U.S. Steel Corp., 632 F.Supp.2d 398, 413 (W.D.Pa.2009) (“Section 203(o) relates to the compensability of time spent donning, doffing, and washing in the collective-bargaining process. It does not render such time any more or less integral or indispensable to an employee’s job.”); Gatewood v. Koch Foods of Miss., LLC, 569 F.Supp.2d 687, 702 (S.D.Miss.2008) (“Although the act of ‘changing clothes’ itself is barred based on § 203(o) …, the activities that occur after changing into sanitary gear and before changing out of sanitary gear are not impacted by the defense.”); Figas, 2008 WL 4170043, at *20 (“[T]he character of donning and doffing activities is not dependent upon whether such activities are excluded pursuant to a collective-bargaining agreement.”). In contrast, some courts-including the district court presiding over the instant case-have concluded that “once an activity has been deemed a section 3(o) activity, it cannot be considered a principal activity.” Sisk v. Sara Lee Corp., 590 F.Supp.2d 1001, 1011 (W.D.Tenn.2008); see also Salazar v. Butterball, LLC, No. 08-cv-02071-MSK-CBS, 2009 WL 6048979, at * 14 (D.Colo. Dec. 3, 2009) (following Sisk); Hudson v. Butterball, LLC, No. 08-5071-CV-SW-RED, 2009 WL 3486780, at *4 (W.D.Mo. Oct. 14, 2009) (“Because time [plaintiff] spent sanitizing, donning, and doffing is excluded from hours worked under § 203(o), the walking time did not follow or precede a principal work activity, and therefore is not compensable.”). Although the latter position was consistent with the 2007 Opinion Letter, the June 16 Interpretation rejected that position and concluded that “clothes changing that is covered by § 203(o) may be a principal activity.” Compare 2007 Opinion Letter with June 16 Interp.

We agree with the courts that have taken the position that compensability under § 203(o) is unrelated to whether an activity is a “principal activity.” Accordingly, we must consider whether time spent donning and doffing the standard equipment and uniform is integral and indispensable to Franklin’s job.

2. Integral and Indispensable

Kellogg asserts that even though it requires its employees to wear these items, changing into them is not “integral and indispensable” under the FLSA. In Steiner, the Supreme Court concluded that changing into protective gear before beginning the shift and showering and changing out of the protective gear at the end of the shift was an integral and indispensable part of employment at a battery-manufacturing plant. 350 U.S. at 256 (“[I]t would be difficult to conjure up an instance where changing clothes and showering are more clearly an integral and indispensable part of the principal activity of the employment than in the case of these employees.”) The Court did not address whether “changing clothes and showering under normal conditions” was integral and indispensable to the principal activity of work, and it did not explicitly hold that changing clothes and showering can only be integral and indispensable when the working environment was toxic or lethal. See id. at 249, 256. Nonetheless, at least one court applying Steiner has made that distinction. See Gorman v. Consol. Edison Corp., 488 F.3d 586, 594 (2d Cir.2007). In Gorman, the Second Circuit held that donning and doffing of protective gear-helmet, safety glasses, and steel-toed boots-was not integral and indispensable to employment at a nuclear power plant. Id. It distinguished Steiner because “the environment of the battery plant could not sustain life-given the toxic substances in liquid, solid, powder, and vapor form (and in the dust of the air) that ‘permeate[d] the entire [battery] plant and everything and everyone in it.’ “ Id. at 593 (quoting Steiner, 350 U.S. at 249) (alterations in original). It interpreted Steiner narrowly for the proposition “that when work is done in a lethal atmosphere, the measures that allow entry and immersion into the destructive element may be integral to all work done there.” Id. However, under Gorman, when such a lethal environment is not present and the gear is not literally required for entry into the plant, donning and doffing gear is not integral.

The Second Circuit’s position appears to be unique. The Ninth and Eleventh Circuits have both interpreted Steiner less narrowly. For example, relying on 29 C.F.R. § 790.8(c), the Ninth Circuit explained that “ ‘where the changing of clothes on the employer’s premises is required by law, by rules of the employer, or by the nature of the work,’ the activity may be considered integral and indispensable to the principal activities.” Ballaris v. Wacker Siltronic Corp., 370 F.3d 901, 910 (9th Cir.2004), quoting Mitchell v. King Packing Co., 350 U.S. 260, 262-63 (1956) (holding that changing into and out of plant uniforms was integral and indispensable to the principal activities because the employer required its employees to wear the uniforms and doing so was performed for the benefit of the company); see also Alvarez, 339 F.3d at 902-03 (“To be ‘integral and indispensable,’ an activity must be necessary to the principal work performed and done for the benefit of the employer.”). Similarly, the Eleventh Circuit held that the following three factors are relevant to the issue of whether an activity is integral and indispensable: “(1) whether the activity is required by the employer; (2) whether the activity is necessary for the employee to perform his or her duties; and whether the activity primarily benefits the employer.” Bonilla v. Baker Concrete Constr., Inc., 487 F.3d 1340, 1344 (11th Cir.2007) (concluding that time spent going through security screening made mandatory by the FAA was not integral and indispensable because it was not for the benefit of the employer). We follow the reasoning of Ballaris and Bonilla.

Under the broader interpretation of integral and indispensable, donning and doffing the uniform and equipment is both integral and indispensable. First, the activity is required by Kellogg. Second, wearing the uniform and equipment primarily benefits Kellogg. Certainly, the employees receive protection from physical harm by wearing the equipment. However, the benefit is primarily for Kellogg, because the uniform and equipment ensures sanitary working conditions and untainted products. Because Franklin would be able to physically complete her job without donning the uniform and equipment, unlike the plaintiffs in Steiner, it is difficult to say that donning the items are necessary for her to perform her duties. Nonetheless, considering these three factors, we conclude that donning and doffing the uniform and standard equipment at issue here is a principal activity. See IBP, Inc., 546 U.S. at 37 (“[A]ny activity that is ‘integral and indispensable’ to a ‘principal activity’ is itself a ‘principal activity.’ ”) Accordingly, under the continuous workday rule, Franklin may be entitled to payment for her post-donning and pre-donning walking time. Because there are questions of fact as to the length of time it took her to walk from the changing area to the time clock and whether that time was de minimis, however, we reverse and remand to the district court for further consideration of this issue.”

To read the entire opinion, click here.

7th Cir.: 203(o) Does Not Preempt State Law; Notwithstanding The Fact That Time Spent Donning/Doffing Of PPE Constitutes Changing “Clothes” Under the FLSA, Such Time Is Compensable Under WI State Law And Not Waivable By CBA

August 4, 2010 9:52 am / Leave a comment

Spoerle v. Kraft Food Global, Inc.

In this case, the Plaintiff-employees brought a collective action against employer under the Fair Labor Standards Act (FLSA) and state law, contending that hourly employees at employer’s plant should be paid for time spent donning and doffing safety and sanitation articles and walking to and from their work stations at the beginning and end of their shifts. The trial court granted employees’ motion for summary judgment, and employer appealed. The Seventh Circuit held that the employees’ claims were not preempted by FLSA and affirmed.

The Court framed the issue as “whether § 203(o ) preempts state law that lacks an equivalent exception[?]” Answering in the negative, the Court reasoned:

“The Fair Labor Standards Act has a saving clause:

No provision of this chapter … shall excuse noncompliance with any Federal or State law or municipal ordinance establishing a minimum wage higher than the minimum wage established under this chapter or a maximum work week lower than the maximum workweek established under this chapter…. No provision of this chapter shall justify any employer in reducing a wage paid by him which is in excess of the applicable minimum wage under this chapter, or justify any employer in increasing hours of employment maintained by him which are shorter than the maximum hours applicable under this chapter.

29 U.S.C. § 218(a). This means, the district court concluded, that donning and doffing time counts toward the workweek (and overtime rates) if state law so provides. Kraft Foods concedes that Wisconsin requires time spent donning and doffing safety gear to be compensated at the minimum wage or higher, and that this time counts toward the limit after which the overtime rate kicks in. See Wis. Stat. §§ 109.03, 103.02; Wis. Admin. Code § DWD 272.12(2)(e). (This makes it unnecessary to decide whether federal law would require payment for this time, in the absence of a § 203(o ) agreement. See Pirant v. United States Postal Service, 542 F.3d 202, 208-09 (7th Cir.2008) (discussing which kinds of required safety gear are “integral and indispensable” for purposes of the analysis in IBP ).) Kraft Foods contends, however, that § 203(o ) preempts Wisconsin’s law. The district judge rejected that argument and entered judgment in plaintiffs’ favor as a matter of Wisconsin rather than federal law, see 626 F.Supp.2d 913 (W.D.Wis.2009), a step supported by the supplemental jurisdiction of 28 U.S.C. § 1367.

Kraft Foods contends that § 203(o ) embodies a federal decision to permit a collectively bargained resolution to supersede the rules otherwise applicable to determining the number of hours worked. That’s an accurate statement, as far as it goes. But “as far as it goes” means “as far as § 203(o ) itself goes.” And the statute tells us exactly how far it goes. The first words of § 203(o ) are: “In determining for the purposes of sections 206 and 207 of this title the hours for which an employee is employed …”. Section 206 sets the federal minimum wage per hour worked. Section 207 specifies how many hours a person may work in a given period before overtime pay commences. These are rules of federal law. States are free to set higher hourly wages or shorter periods before overtime pay comes due. That’s what § 218(a) says. Nothing in § 203(o ) limits the operation of § 218(a).

As far as we can tell, this is the first time an employer’s argument that § 203(o ) preempts state law has reached a court of appeals. All three district judges who have considered this argument have rejected it. In addition to the decision under review, see In re Cargill Meat Solutions Wage & Hour Litigation, 632 F.Supp.2d 368, 392-94 (M.D.Pa.2008); Chavez v. IBP, Inc., 2005 U.S. Dist. LEXIS 29714 at *112-22 (E.D.Wash. May 16, 2005). If Wisconsin had provided for a minimum hourly wage exceeding the rate in the collective bargaining agreement between Kraft Foods and Local 538, the state law would trump the CBA. And if this is so for the hourly rate, it must be equally so for the number of hours, because how much pay a worker receives depends on the number of hours multiplied by the hourly rate. It would be senseless to say that a state may control the multiplicand but not the multiplier, or the reverse, because control of either one permits the state to determine the bottom line (provided that the state’s number exceeds the federal minimum; § 218(a) does not allow a state to authorize employers to pay less than the federal floor).

As Kraft Foods sees things, Wisconsin is meddling with collective bargaining, so that federal labor law preempts state law if § 203(o ) does not do the trick. Yet nothing in the Wisconsin statutes gives a state court, or other state official, any role in interpreting or enforcing a collective bargaining agreement. What Wisconsin requires is that the collective bargaining agreement be ignored, to the extent that it sets lower wages or hours than state law specifies. Cf. Lingle v. Norge Division of Magic Chef, Inc., 486 U.S. 399, 108 S.Ct. 1877, 100 L.Ed.2d 410 (1988) (state rules that disregard, rather than interpret, collective bargaining agreements are not preempted by federal labor policy). Suppose the CBA set a wage of $8 per hour, higher than the current federal minimum wage of $7.25, while Wisconsin law set a minimum wage of $8.25. (Wisconsin’s actual minimum wage is $7.25, but some states, including Illinois, use $8.25.) No one would contend that the employer could pay the workers $7.25 an hour, even though that is allowed by federal law if labor and management agree (this is the same sense that excluding donning and doffing time is allowed by § 203(o )). Which rate would prevail: $8 from the CBA or $8.25 from state law? According to § 218(a), the employer must pay $8.25 an hour; state law supersedes the collective bargaining agreement. And if this is so about the wage per hour, it is equally true about the number of hours.

Nothing that labor and management put in a collective bargaining agreement exempts them from state laws of general application. If a CBA were to say: “the workers will receive the minimum wage under FLSA, and not one cent more no matter what state law provides,” that would be ineffectual. So too would an agreement along the lines of: “Because our base hourly rate is more than 150% of the minimum wage, we need not pay overtime rates under state law.” States can set substantive rules that determine the effective net wage, even when a CBA plays a role (as it does when a law requires overtime pay at some multiple of the base pay set in a collective bargaining agreement). Every state’s overtime-compensation rule could affect collective bargaining-knowing that state law requires pay at time-and-a-half, labor and management might agree to a lower base rate per hour-but that effect would not prevent application of the state’s wage-and-hour statutes.

Management and labor acting jointly (through a CBA) have no more power to override state substantive law than they have when acting individually. Imagine a CBA saying: “Our drivers can travel at 85 mph, without regard to posted speed limits, so that they can deliver our goods in fewer compensable hours of work time.” That clause would be ineffectual. And a CBA reading instead that “our drivers can travel at a reasonable rate of speed, no matter what state law provides” would be equally pointless. Making a given CBA hard to interpret and apply (as the word “reasonable” would be) would not preempt state law on the theory that states must leave the interpretation of CBAs to the National Labor Relations Board and the federal judiciary; states would remain free to enforce laws that disregarded CBAs altogether. That is what Wisconsin does when determining which donning and doffing time is compensable.

The district court therefore did not err in concluding that plaintiffs are entitled to be paid for all time required by Wisconsin law, and the judgment is AFFIRMED.”

To read the entire opinion, click here.

203(o) Does Not Extend To PPE Worn By Employees That Is Required By Law, The Employer Or Due To The Nature Of The Job; Changing Clothes May Be Principal Activity, Starting Continuous Workday, Says DOL

June 16, 2010 1:11 pm / 1 Comment on 203(o) Does Not Extend To PPE Worn By Employees That Is Required By Law, The Employer Or Due To The Nature Of The Job; Changing Clothes May Be Principal Activity, Starting Continuous Workday, Says DOL

Administrator’s Interpretation No. 2010-2

Today, the DOL issued its second Administrative Interpretation of 2010. The subject of this interpretation was the oft-litigated issue of the definition of “clothes” under 29 U.S.C. 203(0), which has been the subject of countless so-called “donning and doffing” cases.

Significantly the DOL concluded that:

(1) “Based on its statutory language and legislative history, it is the Administrator’s interpretation that the § 203(o) exemption does not extend to protective equipment worn by employees that is required by law, by the employer, or due to the nature of the job. This interpretation reaffirms the interpretations set out in the 1997, 1998 and 2001 opinion letters and is consistent with the “plain meaning” analysis of the Ninth Circuit in Alvarez. Those portions of the 2002 opinion letter that address the phrase “changing clothes” and the 2007 opinion letter in its entirety, which are inconsistent with this interpretation, should no longer be relied upon.”

and

(2) “Consistent with the weight of authority, it is the Administrator’s interpretation that clothes changing covered by § 203(o) may be a principal activity. Where that is the case, subsequent activities, including walking and waiting, are compensable. The Administrator issues this interpretation to assist employees and employers in all industries to better understand the scope of the § 203(o) exemption.”

To read the entire Administrator’s Interpretation, click here.

D.Colo.: Time Spent By Police Officers Donning And Doffing Their Uniforms And Equipment Is Compensable, Because It Is Integral And Indispensable To Their Police Duties

May 17, 2010 7:32 pm / Leave a comment

Rogers v. City and County of Denver

This case was before the Court on the parties’ respective motions for summary judgment. Plaintiffs made several claims for unpaid wages based on a variety of “off-the-clock” claims. Although the Court denied the parties’ motions with respect to most of the claims–either because the record was not fully developed, or because there were issues of fact–it held that the donning and doffing of uniforms and equipment by certain officers was compensable time.

“The first claim seeks compensation for time spent putting on and taking off the police uniform and equipment required for conducting police activity. For convenience of analysis, this claim is considered as it applies to patrol officers. The DPD Operations Manual prescribes the basic uniform to be worn on duty. It consists of a uniform shirt, uniform trousers, trouser belt, socks and authorized footwear. (DPD Op. Manual § 111.02.) A uniformed officer is generally required to carry a metal badge and nameplate, current DPD identification card, a valid Colorado driver’s license, and a standard uniform belt (“duty belt”) containing an authorized holster and firearm, ammunition case and ammunition, handcuffs and handcuff case, department issued tear gas and holder, flashlight, baton ring and belt “keepers.” (Id. § 111.03.) Uniformed officers are not required to wear basic hats or reflective apparel or carry batons, but officers must have those items available at all times. (Id. §§ 111.02(1), 111.02(12) & 111.03(13)). The Operations Manual describes particular situations in which basic hats and reflective apparel must be worn. The wearing of ballistic vests is encouraged, but not required. (Id. § 111.05(2)(e)).

The DPD does not require that donning and doffing the basic uniform take place at the assigned work station. Some district headquarters have storage lockers and rooms available for use at the officer’s individual choice. Some district buildings are too small and the officers must report in full uniform. The City argues that the option to put on and take off the uniform at home or elsewhere distinguishes this case from precedents established in the context of the meat industry and other hazardous occupations.

The option to change away from the duty station is not determinative. The principal activity of the patrol officers is policing the community. The police uniform is not “clothing” in any ordinary sense. It is the visible sign of authority and an essential element of the officer’s ability to command compliance with his commands and directives. It is analogous to the judicial robe. The uniform includes the equipment that are the tools that enable the officer to use physical force, including deadly force, for the protection of himself and others as circumstances require.

The City argues that the Plaintiffs’ clothes changing activities are excluded from compensation under 29 U.S.C. § 203(o). That section provides:

Hours Worked.-In determining for the purposes of sections 206 and 207 of this title the hours for which an employee is employed, there shall be excluded any time spent in changing clothes or washing at the beginning or end of each workday which was excluded from measured working time during the week involved by the express terms of or by custom or practice under a bona fide collective-bargaining agreement applicable to the particular employee.

CBAs between the City and the Denver Police Protective Association have been in effect since January 1, 1996. DPD officers have never been compensated for donning and doffing their uniforms and personal equipment. The City contends that this history of non-compensation shows an established custom or practice under the CBAs.

That argument is not persuasive. Silence in collective bargaining is not the equivalent of a custom or practice of non-compensability.

In December 1985, the United States Department of Labor (“DOL”) issued a Wage and Hour Opinion Letter, stating that the time spent by a uniformed police officer donning and doffing the required uniform was not compensable time under the FLSA, where a collective bargaining agreement between a city and the union had no express provision regarding the compensability of clothes-changing time and there had been no custom or practice between the parties to consider such clothes changing time compensable. Wage & Hour Opinion Letter, Dec. 30, 1985, 1985 WL 1087351, Def.’s Ex. A-98. That opinion letter is not persuasive, but may be considered with respect to the issue of willfulness. Similarly, Wage & Hour Advisory Memorandum No.2006-2 dated May 31, 2006 (opining that changing into gear is not a principal activity if employees have the option and the ability to change at home) is relevant only to the issue of willfulness.

The judicially-created de minimis rule provides an exception to the FLSA’s requirement that all work be compensated. There are genuine issues of material fact regarding the time and effort required to don and doff the DPD uniform and protective gear. The City’s de minimis defense is a factual issue for trial.

While donning and doffing the patrol officers uniform and equipment is compensable time under the FLSA as activity that is integral and indispensable to their police duties, the continuous work day does not begin or end with that activity. The plaintiffs are not asking for time spent commuting for those officers who chose to change at home. This ruling is applicable only to the uniformed officers on official duty. The facts concerning wearing uniforms and equipment during secondary employment are not adequately presented in the papers filed. Similarly there is no clear evidentiary record concerning detectives and other non-uniformed officers.”

This decision appears to be in direct conflict with the Ninth Circuit’s recent decision discussed here, which held that time spent donning and doffing police uniforms and equipment was not compensable, because officers had the option of doing it at home.

Click here to read the entire decision.

9th Cir.: Time Police Officers Spent Donning/Doffing Uniforms and Equipment Not Compensable, Because Officers Had The Option Of Donning/Doffing At Home

March 27, 2010 10:38 am / 2 Comments on 9th Cir.: Time Police Officers Spent Donning/Doffing Uniforms and Equipment Not Compensable, Because Officers Had The Option Of Donning/Doffing At Home

Bamonte v. City of Mesa

Appellants, police officers employed by Appellee City of Mesa (City), challenged the district court’s entry of summary judgment in favor of the City. The officers contended that the City violated the Fair Labor Standards Act (FLSA) by failing to compensate police officers for the donning and doffing of their uniforms and accompanying gear. Because officers had the option of donning and doffing their uniforms and gear at home, the district court determined that these activities were not compensable pursuant to the FLSA and the Portal-to-Portal Act. The Ninth Circuit affirmed, and held that these activities were not compensable pursuant to the FLSA.

To read the entire opinion click here.

M.D.Tenn.: Even If Time Spent Donning And Doffing A Uniform Is Non-Compensable Under § 203(o), It Might Still Start The Workday Under § 254(a) And The Continuous Workday Rule

February 15, 2010 10:40 am / Leave a comment

Arnold v. Schreiber Foods, Inc.

Before the court was the Motion for Summary Judgment filed by defendant Schreiber Foods, Inc. The Court granted the defendant’s motion in part and denied in part. Of interest, while the Court determined certain time donning and doffing clothes was properly excluded from Plaintiffs’ compensable time under § 203(o), it held that such time spent donning and doffing clothes may still constitute the first activity integral to the Plaintiffs’ principle activities and start the so-called continuous workday, requiring Defendant to compensate Plaintiffs for all time spent after donning such clothes.

In discussing the applicability of § 203(0), to exclude time Plaintiffs spent “changing clothes,” the Court explained that, “[t]he defendant’s plant is unionized, and the United Food and Commercial Workers Union (“UFCW”) is the exclusive bargaining agent for all hourly employees. In September 2004, Schreiber and the UFCW negotiated a new collective-bargaining agreement. One of the UFCW’s proposals was for Schreiber to compensate employees for time spent donning and doffing uniforms at the beginning and end of the workday. After further negotiation, this proposal was withdrawn, and it was not included in the final agreement. The same thing happened when the two sides negotiated a new agreement in 2008.”

The Court next addressed Plaintiff’s argument that “because their workday begins when they don their uniforms and ends when they doff them, post-donning and pre-doffing ‘travel and waiting time’ is compensable” explaining that:

“Under the continuous workday rule, the workday begins at the commencement of the employee’s “principal activities,” which include activities that are an “ ‘integral and indispensable part of the principal activities.’ ” IBP, 546 U.S. at 30 (quoting Steiner, 350 U.S. at 252-53). The factors relevant to determining whether an activity is integral and indispensable are (1) whether the activity is required by the employer, (2) whether the activity is necessary to the employee’s principal activities, and (3) whether the benefit of the activity inures primarily to the employer. Jordan v. IBP, Inc., 542 F.Supp.2d. 790, 808 (M.D.Tenn.2008) (citing Alvarez, 339 F.3d at 902-03;Bonilla v. Baker Concrete Constr., Inc., 487 F.3d 1340, 1344 (11th Cir.2007)). “The changing of clothes may be considered integral and indispensable to an employee’s principal activities ‘where the changing of clothes on the employer’s premises is required by law, by rules of the employer, or by the nature of the work.’ ” Id. (quoting Ballaris v. Wacker Siltronic Corp., 370 F.3d 901, 910 (9th Cir.2004)).

Here, it is at least a question of fact whether the act of donning and doffing uniforms is integral and indispensable to the plaintiffs’ job. It is undisputed that Schreiber requires its employees to wear clean uniforms, as mandated by Tennessee state regulations. See Tenn. Dep’t of Agric. Rule 0080-3-3-.04(5) (requiring that dairy plant employees who engage in the “manufacturing, packaging, or handling dairy products” wear “[c]lean white or light-colored washable outer garments”). Employees are required to don the uniforms at Schreiber’s plant, and the benefit of the sanitary uniforms to Schreiber is obvious-it allows the company to create uncontaminated food products. Numerous cases involving similar circumstances have found that donning and doffing uniforms can be an integral and indispensable activity. E . g., Jordan, 542 F.Supp.2d at 810 (finding that it was integral and indispensable for meat processing plant employees to don and doff safety and sanitary gear); Johnson v. Koch Foods, Inc., No. 2:07-CV-51, 2009 U.S. Dist. LEXIS 106058, at *28-30 (E.D.Tenn. Nov. 13, 2009) (finding a question of fact as to whether donning and doffing safety and sanitary gear was integral and indispensable for chicken processing plant employees); Gatewood v. Koch Foods of Miss., LLC, 569 F.Supp.2d 687, 696-98 (S.D.Miss.2008) (same). A reasonable jury could find that, under the continuous workday rule, the plaintiffs’ workday starts when they don their uniforms and ends when they doff them.

‘[D]uring a continuous workday, any walking time that occurs after the beginning of the employee’s first principal activity and before the end of the employee’s last principal activity is excluded from the scope of [§ 254(a) ], and as a result is covered by the FLSA .’ IBP, 546 U.S. at 37. Each day, Schreiber employees spend time walking and waiting (1) after donning their uniforms but before clocking in, and (2) after clocking out but before doffing their uniforms. Disregarding § 203(o), and assuming that donning and doffing is integral and indispensable, this walking and waiting time is compensable.

This raises two questions. The first is whether § 203(o) affects the compensability of the plaintiffs’ walking and waiting time. Courts are split on this issue. Some courts have held that when donning and doffing “is excluded from hours worked under § 203(o), [post-donning and pre-doffing] walking time [does] not follow or precede a principal work activity, and therefore is not compensable.” Hudson v. Butterball, LLC, No. 08-5071-CV-SW-RED, 2009 U.S. Dist. LEXIS 104649, at *1 1 (W.D.Mo. Oct. 14, 2009); see also Sisk v. Sara Lee Corp., 590 F.Supp.2d 1001, 1011 (W.D.Tenn.2008) (“[O]nce an activity has been deemed a section 3(o) activity, it cannot be considered a principal activity.”) This accords with the Department of Labor’s current view that “activities covered by section 3(o) cannot be considered principal activities and do not start the workday.” U.S. Dep’t of Labor, Wage & Hour Div. Advisory Op. Ltr. No. FLSA2007-10.

A greater number of courts, however, have held that determining what constitutes a “principal activity” and determining what constitutes “changing clothes” are separate inquiries. Even if time spent donning a uniform is non-compensable under § 203(o), it still might start the workday, making subsequent activities compensable under § 254(a) and the continuous workday rule. See Sandifer, 2009 U.S. Dist. LEXIS 96715 at *40 (“The court can’t conclude as a matter of law that the non-compensability … under [§ 203(o) ] excludes consideration of whether, pursuant to [§ 254(a) ], those activities are an integral and indispensable part of the employees’ principal activities….”); Andrako v. United States Steel Corp., 632 F.Supp.2d 398, 412-13 (W.D.Pa.2009) (“Section 203(o) relates to the compensability of time spent donning, doffing, and washing in the collective-bargaining process. It does not render such time any more or less integral or indispensable to an employee’s job.”); Johnson, 2009 U.S. Dist. LEXIS 106058 at *32 (“[I]f the donning, doffing, and washing excluded by § 203(o) are determined by the trier of fact to be integral and indispensable, those activities could commence the workday.”); Gatewood, 569 F.Supp.2d at 702 (“Although the statute precludes recovery for time spent washing and ‘changing clothes,’ it does not affect the fact that these activities could be the first ‘integral and indispensable’ act that triggers the start of the continuous workday rule for subsequent activities….”); Figas v. Horsehead Corp., No. 06-1344, 2008 U.S. Dist. LEXIS 87199, at *66-67 (W.D.Pa. Sept. 3, 2008) (“The Court is not convinced that § 203(o) changes the ‘principal’ nature of donning and doffing activities, or that ‘principal’ activities somehow become ‘preliminary’ or ‘postliminary’ under the Portal Act simply because they are rendered noncompensable by a collective-bargaining agreement in accordance with § 203(o).”).

The court agrees that this is the best way to reconcile the application of § 203(o) with Supreme Court precedent. In IBP, the Supreme Court made it clear that the continuous workday starts upon the employee’s first principal activity. 546 U.S. at 29, 37. Logically, whether an activity counts as “changing clothes” under § 203(o) does not necessarily affect whether it is a principal activity. One court found it odd that the uncompensated act of changing clothes might convert an employee’s subsequent, otherwise-non-compensable activity into compensable activity. Sisk, 590 F.Supp.2d at 1011. But this oddity diminishes as the period of the subsequent activity grows longer. For example, if an employer required employees to don uniforms in a company locker room and then spend 30 minutes traveling to a work site, it would not seem “illogical,” id., to require the employer to pay for the travel time. The court finds that § 203(o) does not bar the plaintiffs from receiving compensation for post-donning and pre-doffing activities.

The second question is whether the plaintiffs’ walking and waiting time is noncompensable because it is de minimis. “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.” Mt. Clemens Pottery, 328 U.S. at 692.

Courts look to three factors in deciding whether otherwise compensable time is de minimis: “1) the practical administrative difficulty of recording the additional time; 2) the size of the claim in the aggregate; and 3) whether ‘the claimants performed the work on a regular basis.’ “ Brock v. City of Cincinnati, 236 F.3d 793, 804 (6th Cir.2001) (quoting ( Lindow v. United States, 738 F.2d 1057, 1062-63 (9th Cir.1984)). Although there is no rigid mathematical rule, “[m]ost courts have found daily periods of approximately 10 minutes de minimis even though otherwise compensable.” Lindow, 738 F.2d at 1062;see also Von Friewalde, 339 Fed. Appx. at 454. “The burden is on the employer to show that the time consumed by the activity is de minimis.” Gilmer v. Alameda-Contra Costa Transit Dist., No. C 08-05186, 2010 U.S. Dist. LEXIS 3405, at *24 (N.D.Cal. Jan. 15, 2010) (citing Rutti v. Lojack Corp., Inc., 578 F.3d 1084, 1095 n .11 (2009)).

As explained earlier, § 203(o) covers the plaintiffs’ clothes-changing activities through the time that they retrieve and don their hairnets, beard nets, and earplugs. According to the plaintiffs’ declarations, “[o]nce the Workers retrieve their hairnets, beard nets (if applicable), and ear plugs, the Workers clock-in.” (E.g., Docket No. 42, Ex. 1 ¶ 12). The hairnet, beard net, and earplug dispensers are located approximately 40 feet from the time clocks. (Docket No. 36, Ex. 1.) Although it seems unlikely that this journey takes a significant amount of time, it is possible that employees are forced to wait for some period of time before clocking in. The defendant has not presented evidence directly addressing this matter, so it has not met its burden of showing that the walking and waiting time is de minimis. Therefore, the court cannot dismiss this aspect of the plaintiffs’ claim at this stage.”

Not discussed here, the Court denied Defendant’s Motion to the extent they sought a finding that time Plaintiffs spent sanitizing their boots should be excluded.

5th Cir.: Notwithstanding The Language of § 203(o), Actual Bargaining Is Not Necessary In Order To Find That A “Custom or Practice” Exists Under § 203(o); Pattern Of Non-Compensation Sufficient

January 9, 2010 2:43 pm / Leave a comment

Allen v. McWane Inc.

This collective action under the Fair Labor Standards Act (“FLSA”), on behalf of hourly employees of McWane, Inc., sought payment for pre-and post-shift time spent donning and doffing protective gear. The district court granted summary judgment on the basis that at each plant there existed a custom or practice of not compensating pre- or post- shift time spent putting on and taking off protective gear. Despite the clear language of the statute, the Fifth Circuit affirmed, holding that absent any evidence that the parties had ever actually discussed or agreed during collective bargaining, that such time would not be compensable, any employer who has consistently failed to compensate employees for otherwise compensable work time may utilize the limited exception of § 203(o), thus barring employees’ claims seeking payment for such time.

In reaching its conclusion, the Court dismissed Plaintiff’s arguments based on the plain reading of § 203(o), stating, “Allen argues that here the facts do not establish a ‘custom or practice under a bona fide collective-bargaining agreement’ that would make changing time non-compensable. Allen claims that compensation for the pre- and post-shift changing time is a pre-existing right under the FLSA, subject to exclusion only if it has been affirmatively bargained away in CBA negotiations; i.e., negotiation of whether to pay for pre- and post-shift changing time must be shown before the court may conclude that there was a custom or practice as provided in § 203(o). According to Allen, there has been no acquiescence or waiver here because the union representatives did not have knowledge of the right to compensation for this pre- and post-shift changing time, nor any knowledge of or acquiescence to a policy of nonpayment for that time.

This court addressed a related issue in Bejil: whether employees had a right to compensation for changing time where the union and the employer had discussed that very question during CBA negotiations, but the CBA ultimately remained silent on the matter. 269 F.3d at 480. We concluded that such silence in the CBA, after the parties negotiated over the matter, resulted in a “custom or practice” of not compensating the employees for the changing time, and therefore § 203(o) barred claims for back wages for such time. Id. Here, unlike in Bejil, there was no discussion of whether McWane should compensate the Allen plaintiffs for such clothes changing time.

The Third and Eleventh Circuits have considered the specific question of whether § 203(o) requires the employees and employer to have discussed the issue of compensation for pre- and post-shift changing time, where the CBA is silent on the issue, in order to find that a custom or practice of nonpayment existed pursuant to a CBA. The Third and Eleventh Circuits concluded that it was not necessary for the issue to have been raised in negotiations. Anderson v. Cagle’s, Inc., 488 F.3d 945, 958-59 (11th Cir.2007); Turner v. City of Philadelphia, 262 F.3d 222, 226 (3d Cir.2001).

Turner presented the following uncontested facts: (1) Philadelphia had not compensated corrections officers for uniform change time for over 30 years; (2) every CBA between Philadelphia and the officers had been silent as to compensation for change time; (3) the union president proposed at labor management meetings with Philadelphia’s Labor Relations Administrator that change time be made compensable, but the union did not make this request in formal CBA negotiations; (4) the union did, however, ask for and receive a uniform maintenance allowance; and (5) the union never filed a grievance or demanded arbitration based on the non-compensability of change time. Turner, 262 F.3d at 225.

The Turner plaintiffs made an argument similar to the one articulated by Allen, that “a ‘custom or practice’ of non-compensability cannot come into being unless (1) the issue of compensability is specifically raised in formal collective bargaining negotiations, and then (2) dropped by the negotiators.” Id. at 226. Rejecting this approach, the Third Circuit held that the plaintiffs and their union had acquiesced to the municipal government’s thirty-year policy of not compensating for changing time. Id. at 227. The court explained:

We think that plaintiffs interpret the phrase “custom or practice under a bona fide collective-bargaining agreement” too narrowly, placing undue emphasis on the clause “under a bona fide collective-bargaining agreement” while virtually reading the clause “custom or practice” out of § 203(o). In essence, plaintiffs construe “custom or practice under a bona fide collective-bargaining agreement” as “custom or practice established through formal collective bargaining negotiations.” To the contrary, we view the phrase as simply restating the well-established principle of labor law that a particular custom or practice can become an implied term of a labor agreement through a prolonged period of acquiescence. Id. at 226. The Turner court also rejected the argument that the plaintiffs had an antecedent right to payment under the FLSA such that they could not acquiesce to non-compensation without the issue being negotiated, noting that § 203(o) itself defines what work time is encompassed by that right to payment. Id. at 226-27.

In Anderson, the employer had not compensated the employees for time spent donning and doffing protective gear for approximately ten years. 488 F.3d at 958. Additionally, the court assumed for purposes of its decision that every CBA during the relevant time period had been silent as to compensation for changing time, and assumed that the parties had never discussed the policy. Id. at 958. The Anderson court followed Turner, also rejecting the argument that a custom or practice under § 203(o) cannot exist unless the parties negotiated about the non-compensation policy. Id. at 958-59. “Relying again on a common sense understanding of the statute’s language, we believe that a policy concerning compensation … for clothes changing, written or unwritten, in force or effect at the time a CBA was executed satisfies § 203(o)‘s requirement of a ‘custom or practice under a bona fide’ CBA.” Id. “Absence of negotiations cannot in this instance equate to ignorance of the policy. Rather, it demonstrates acquiescence to it.” Id. at 959.

The Eleventh Circuit noted that the issue in Anderson was not controlled by the Fifth Circuit’s decision in Hoover v. Wyandotte Chemicals Corporation, 455 F.2d 387 (5th Cir.1972). In Hoover, another action to recover overtime pay under the FLSA, this court held that employees were not entitled to additional compensation for the extra eight to ten minutes of clothes changing time that they requested during collective bargaining negotiations, but which was not incorporated into the executed CBA. Id. at 388. The custom and practice of the employer for approximately fifteen years had been to pay for fifteen minutes of changing time. During the most recent CBA negotiations, pay for 23-25 minutes of time had been requested but not adopted. Hoover held that the request did not change the custom or practice, which was to pay only for fifteen minutes of changing time. Id. at 389. Although the employer had agreed to pay for changing time, where the employees raised the issue during CBA negotiations but there was no change in practice by the employer or change to the CBA on the issue, the relevant custom of non-payment for clothes changing time over fifteen minutes remained unaltered.

Allen both criticizes the reasoning of Turner and Anderson and tries to distinguish them. Allen observes that in Anderson the plaintiffs did not contend that they lacked notice of the relevant compensation policy, whereas here the employees and their union representatives were unaware of the potential for compensation under the FLSA. 488 F.3d at 959. However, neither Turner nor Anderson address the employees’ awareness of the law, much less find it to be a controlling factor in their holding. Anderson merely observed that the plaintiffs were aware that the company had a policy of not paying for pre- and post-shift clothes changing time. Id. Similar facts were present in Turner. 262 F.3d at 225. Both courts concluded that silence by the employees and their union as to the non-compensability of this time when the CBAs were executed meant that a custom or practice of nonpayment was established pursuant to a CBA, and thus the time was not to be calculated as “hours worked” under § 203(o).

Allen relies heavily on the reasoning employed by Kassa v. Kerry, Inc., 487 F.Supp.2d 1063, 1071 (D.Minn.2007). In Kassa, the defendant moved for summary judgment based on § 203(o). The court voiced its agreement with Turner, and determined that § 203(o) may apply even where non-payment for changing time was never raised in negotiations. The court then identified three elements as essential to determine the existence of a “custom or practice” under § 203(o): time, knowledge, and acquiescence. Id. at 1070-71 (relying on Detroit & Toledo Shore Line R.R. Co. v. United Transp. Union, 396 U.S. 142, 154 (1969)). Kassa assigned the burden to the defendant to show that “its policy of non-compensation for clothes-changing time lasted for a sufficiently long time, with sufficient knowledge and acquiescence by [the] employees, that the policy became an implicit term-a ‘custom or practice’-under the CBA.” Id. at 1071. In Kassa, the record established that the non-payment by defendant had occurred for six years and the union had never complained about non-payment when executing the CBA. Id. The district court found this insufficient as a matter of law to establish a custom or practice, and denied summary judgment.

Allen also relies on the Supreme Court’s statement in Barrentine v. Arkansas-Best Freight System, Inc., 450 U.S. 728, 740 (1981), that “FLSA rights cannot be abridged by contract or otherwise waived….” Barrentine addressed whether employees at a union-organized plant operating under a CBA could sue their employer for violations of the minimum wage provisions of the FLSA. The CBA in Barrentine required the employees to submit the claim to a grievance committee; when they did so, the committee rejected their claims. The Court held that the right to sue for the violation of the FLSA could not be abridged or waived. Id. at 740. There is a significant distinction between the minimum wage provision at issue in Barrentine and the application of § 203(o) in the instant case: the FLSA rights at issue in Barrentine are independent of the collective bargaining process. Id. at 745. By contrast, under § 203(o) the right to be paid for pre- or post-shift changing time may be abridged by contract-a bona fide CBA. See also Livadas v. Bradshaw, 512 U.S. 107, 131-32 (1994) (addressing question of meaningful bargaining under the National Labor Relations Act, referring to § 203(o) of the FLSA as an example of a “narrowly drawn opt-out provision,” and noting employees have full protection of the minium standard “absent any agreement for something different”).

We are persuaded by the reasoning of the Third and Eleventh Circuits, and join them in holding that even when negotiations never included the issue of non-compensation for changing time, a policy of non-compensation for changing time that has been in effect for a prolonged period of time, and that was in effect at the time a CBA was executed, satisfies § 203(o) ‘s requirement of “a custom or practice under a bona fide” CBA. See Anderson, 488 F.3d at 958-59 (policy of non-compensation had been in place for at least ten years); Turner, 262 F.3d at 226 (policy of non-compensation had been in place for thirty years). In such instances, regardless of whether the parties negotiated regarding compensation for changing time, acquiescence of the employees may be inferred. By contrast, where there have been no relevant negotiations and the facts do not demonstrate that a policy of non-compensation for changing time has been in effect for a prolonged period of time, other evidence of knowledge and acquiescence by the employees will be required. See Gatewood v. Koch Foods of Miss., 569 F.Supp.2d 687, 698-700 (S.D.Miss.2008) (holding that even in the absence of a long-standing tradition of non-compensation or negotiations for compensation of time spent changing clothes, “when employees and union representatives are conclusively aware of the facts surrounding compensation policies for changing clothes at the beginning and end of each workday, and reach an agreement under a CBA that does not compensate employees for the time, a ‘practice’ exists under the CBA sufficient to invoke the § 203(o) defense”).

Thus, as long as there was a company policy of non-compensation for time spent changing for a prolonged period of time-allowing the court to infer that the union had knowledge of and acquiesced to the employer’s policy-and a CBA existed, the parties need not have explicitly discussed such compensation when negotiating the CBA. McWane “only need prove that the parties had a ‘custom or practice’ of non-compensation under the agreement.” Bejil, 269 F.3d at 479. It is undisputed that McWane has never compensated its employees for changing time, going as far back as 1965. After more than forty years of non-compensation, we may safely infer that McWane’s employees had knowledge of and acquiesced to the policy of non-compensation. Therefore, we conclude that McWane has demonstrated a “custom” of non-compensation for changing time.”

Interestingly, the Court noted that the parties had stipulated that the time spent donning and doffing personal protective equipment was synonymous with “changing clothes” and thus potentially waivable, creating the narrow issue before the Court. Inasmuch as there are recent decisions from around the country falling on both sides of this issue (i.e. some finding such time not to constitute “changing clothes”) the Court’s holding may have limited application going forward, because if the disputed time was not time spent “changing clothes” 203(O) would have no applicability.

4th Cir.: Because Donning and Doffing of Protective Clothing Constitutes “Changing Clothes,” Compensability of Such Time is Waivable, Under § 203(o), By Collective Bargaining Agreement

January 5, 2010 11:18 am / Leave a comment

Sepulveda v. Allen Family Foods

Deciding an issue that has divided courts across the country, the 4th Circuit held that, because the donning and doffing of personal protective equipment (PPE) constitutes “changing clothes,” the right to be compensated for such time may be collectively bargained away in a Collective Bargaining Agreement (CBA).

“Under the Fair Labor Standards Act, 29 U.S.C. § 201 seq.bargaining to exclude “any time spent in changing clothes. . . at the beginning or end of each workday” from compensable work time. § 203(o). In this case, we are asked to determine whether the donning and doffing of protective gear at a poultry processing plant constitutes “changing clothes” within the meaning of Section 203(o). We conclude that it does. Consequently, the employer and union here may—as they currently have—exclude donning and doffing from compensable work time.”

Realizing the factually intensive nature of most, if not all so-called donning and doffing cases, the Court noted that its decision did not mean that the donning and doffing of such PPE was not compensable time, stating “[o]ur holding, of course, does not mean that employees should not be paid for time spent donning and doffing protective gear. Instead, it simply recognizes that the purpose of Section 203(o) is to leave this issue to the collectivebargaining process. Employers and unions are free to determine for themselves how much compensable time should be allocated and for what activities of “changing clothes.” This sort of fact-intensive determination has classically been grist for the mill of collective bargaining, and Congress ensured that employers and unions could keep it that way by enacting Section 203(o).”

To read the entire decision click here.

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