Are Employees Owed Pay for Going Through Security? SCOTUS Will Decide

The U.S. Supreme Court granted cert on March 3, 2014 in Integrity Staffing Solutions, Inc. v. Jesse Busk to resolve a federal circuit split on whether time employees spend in security screenings is compensable under the FLSA. The issue is whether security screenings are quintessential “preliminary” or “postliminary” activities that are non-compensable under the FLSA (as held by the Second and Eleventh Circuits) or whether time spent in security screenings is potentially compensable because it is “integral and indispensable” to an employee’s principal job duties (as held by the Ninth Circuit).

Under the FLSA, as amended by the Portal-to-Portal Act of 1947, time spent on activities that are “preliminary” or “postliminary” to the “principal activity or activities” that the employee “is employed to perform” is generally not compensable. 29 U.S.C. § 254(a). The exception to this rule is where these activities are “integral and indispensable” to an employee’s principal activities, meaning they are (1) “necessary to the principal work performed” and (2) “done for the benefit of the employer.”

In late 2010, two non-exempt Integrity employees who worked at warehouses filling orders placed by Amazon.com customers filed suit alleging that they were owed wages for time spent after their shifts going through security clearance. The security clearance involved removing their wallets, keys and belts and passing through metal detectors. The district court granted Integrity’s motion to dismiss plaintiffs’ claims, relying on out-of-circuit authority holding that security screenings are non-compensable postliminary activities under the FLSA. Busk v. Integrity Staffing Solutions, Inc., 2011 U.S. Dist. LEXIS 79773 (D. Nev. July 19, 2011).

The Ninth Circuit reversed, holding that the district court erred in assuming the out-of-circuit authority created “a blanket rule that security clearances are noncompensable.” Busk v. Integrity Staffing Solutions, Inc., 713 F.3d 525, 531 (9th Cir. 2013). Instead, the Ninth Circuit held that the district court should have applied the “integral and indispensable” test to plaintiffs’ claims to assess whether the security screenings were compensable under the specific facts of the case. The Ninth Circuit then determined that plaintiffs met their burden of showing the security screenings were “integral and indispensible” to their job because the plaintiffs alleged that (1) Integrity requires security screenings, (2) the screenings must be conducted at work, and (3) the screenings are intended to prevent employee theft (which is for Integrity’s benefit).

The Ninth Circuit distinguished contra out-of-circuit authority on the ground that, in those cases, everyone who entered the workplace had to pass through a security clearance – even visitors – and therefore the security screening was not because of “the nature of the employees’ work.” By contrast, the Integrity warehouse workers were allegedly required to go through security because of their access to merchandise, which was directly related to their job duties.

If the Supreme Court reverses the Ninth Circuit, it may affirm that security clearance time is non-compensable as a matter of federal law. Employers should be on the lookout for the Supreme Court’s decision next term.

 

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Orrick - Global Employment Law Group on:

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