By Robert Margolis, J.D.
The time that Nike retail store employees must spend in post-shift inspections of their bags and pockets—an average of 18.5 seconds per inspection, according to Nike’s expert witness— is de minimis as a matter of law and thus not compensable, a federal district court in California has held. The court granted Nike’s motion for summary judgment dismissing claims brought by a class of nonexempt retail store employees in California (Rodriguez v. Nike Retail Services, Inc., September 12, 2017, Freeman, B.).
Nike’s nonexempt retail employees punch in and out on a timeclock to track their hours, and they are paid accordingly. Nike has imposed a policy, based on concerns for retail theft, that requires all employees to be inspected after their shift before they leave the store, but after they have clocked out. The inspections, conducted by managers, supervisors, and contract security, are not automatically compensable because the inspections (and the waiting for them) occur when employees are off the clock. All employees must be inspected or checked, but only those with bags have their bags opened and inspected; those without bags are subject only to a “visual inspection.” If an authorized inspector is not available at the time an employee is clocking out and leaving, the employee must wait for someone with proper authority.
The named plaintiff filed suit on behalf of a class of all nonexempt employees working in Nike’s California stores from February 25, 2010 to the date of filing suit. The complaint alleges violations of the California Labor Code. In a previous ruling, the court certified a class and denied Nike’s motion to dismiss. After discovery, Nike moved for summary judgment, arguing that the time employees spend on exit inspections is de minimis and therefore not compensable as a matter of law.
Expert evidence. Nike supported the motion with a retained expert’s time and motion study—a scientific sampling designed to measure the amount of time it takes workers to perform certain tasks. Combining waiting time and inspection time, the study concluded that: (1) 21.5% of combined exit inspections took no time at all; (2) 97.5% of the exits had a combined exit inspection time of less than two minutes; and (3) the average combined time of an exit inspection was 18.5 seconds. Extrapolated to the entire class, the average combined time was between 16.9 seconds and 20.2 seconds per exit.
In opposition to the motion, the plaintiffs did not offer their own study, but only an expert’s critiques of Nike’s study, and the deposition testimony of Nike store managers about longer waiting times—which contradicted the study, the plaintiffs claimed.
De minimis doctrine applies. The court first addressed the threshold legal question of whether the de minimis doctrine applies to claims for violations of the California Labor Code, holding that it does. The doctrine, which arose in the FLSA context, was set forth in the Supreme Court’s 1946 decision in Anderson v. Mt. Clemens Pottery Co., and provides that “[w]hen the matter in issue concerns only a few seconds or minutes of work beyond the scheduled working hours, such trifles may be disregarded.” While the California Supreme Court has not addressed whether the doctrine applies to California Labor Code claims, several federal courts and California intermediate courts have held that it does, the court observed. It also noted that the California Supreme Court may address the issue shortly, as it has agreed to review the issue on a certified question from the Ninth Circuit in a suit against Starbucks Corp. Tellingly, the court found no California appellate-level case holding that the de minimis doctrine does not apply to such claims.
The court also rejected the plaintiffs’ arguments that the de minimis doctrine is “archaic” given the precision with which modern technology allows time to be captured, and that it is solely a federal doctrine inapplicable to the California Labor Code, the purpose of which, they argued, is to afford more protections to employees than the FLSA. The court noted that several other courts have rejected these arguments.
Time spent on checks de minimis. The court then analyzed several de minimis doctrine factors—practical administrative difficulty, aggregate amount of compensable time, and regularity of additional work—to conclude that the doctrine defeats the plaintiffs’ claims. The court set the stage by noting that the plaintiffs did not present any evidence from a study that competes with Nike’s time and motion study, but only an expert report critiquing Nike’s study. This rebuttal did not create the disputed issues of material fact necessary to defeat summary judgment, because it did not address any of the de minimis factors, the court said. Thus, it did not consider the plaintiffs’ expert report in its summary judgment analysis.
The court then considered the duration of each individual exit, as evidenced in Nike’s study and the deposition testimony from the Nike store managers, and concluded that “it is undisputed that an exit inspection takes between zero seconds and several minutes.” Even several minutes of daily time can be considered de minimis under prior case law, the court noted, citing cases holding that up to 10 minutes is de minimis. After those preliminary considerations, the court weighed the relevant factors and found that each weighs in Nike’s favor.
Administrative difficulty. Nike stores position timeclocks in the backs of its retail stores, and Nike presented evidence there were practical reasons for doing so. While plaintiffs argued that the clocks can be moved to the exits—noting, for example, that other store chains have done so—the court credited Nike’s evidence that moving the clocks would be administratively impractical, which is all that Nike needed to show for this factor to weigh in its favor.
Aggregate time. The court then looked at “aggregate time,” concluding that even if exit inspections occasionally last as long as a few minutes, an employee who leaves the store twice a day, on a lunch break and at the end of the day, still would not spend 10 minutes a day being inspected. Thus, the “daily” amount of compensable time at issue is within the amount of time courts have found to be de minimis, and this factor also weighs in Nike’s favor.
Regularity. Nike’s study found that exit inspections often took zero seconds and inspections lasting several minutes were not regular. The plaintiffs failed to offer contrary evidence to create a genuine issue of material fact on this point. Thus, this prong weighed heavily in Nike’s favor too, the court held.
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