HR Management & Compliance

Preshift Activities: Compensable or Not Compensable? That Is the Question!

According to Albert Einstein, “Time is an illusion.” Or is it? The U.S. Court of Appeals for the 5th Circuit— which covers Louisiana, Mississippi, and Texas—recently heard a claim in which three workers said they weren’t sufficiently compensated under the Fair Labor Standards Act (FLSA) for all the work they performed. The workers, who were required to travel to their worksite by bus, claimed that the time they spent waiting to work after they arrived at the site and before their shift began was compensable. Let’s take a look.compensation

Facts

Three workers were hired by Empire Scaffold to erect and dismantle scaffolding at an oil refinery. To access the worksite, Empire employees had to take buses from a parking lot to the refinery on a first-come, first-served basis. Employees couldn’t access the site by any other means.

The buses were available from 5:00 a.m. to 6:15 a.m., but the workers’ shifts didn’t begin until 7:00 a.m. The bus ride to the refinery took approximately 20 to 30 minutes. Under Empire’s policy, an employee who missed the last bus at 6:15 wouldn’t be able to work until the next day.

The buses dropped the employees off at Empire’s lunch tents, which were about three quarters of a mile inside the refinery and a few hundred yards from the live units where the employees performed the scaffolding work. Empire required its employees to sign in at the lunch tents. At 7:00 a.m., a horn sounded to mark the beginning of the shift. Empire didn’t require anything of employees before 7:00 a.m., although it did require them to wear personal protective equipment upon reporting to work at the live units.

After filing suit, the three workers requested summary judgment (a ruling in their favor without a trial), arguing that Empire failed to compensate them for their preshift time. Empire also requested summary judgment, contending it was not required under the FLSA and the Portal-to-Portal Act to compensate the workers for time they spent riding the bus, for their preshift/postshift activities, or for their preshift wait time. After the court granted summary judgment in favor of Empire, the workers appealed, arguing their preshift waiting time at the refinery was compensable under the FLSA.

Court’s Decision

The case turned on whether the Portal-to-Portal Act excluded the workers’ preshift waiting time from being compensable under the FLSA. The Portal-to-Portal Act, passed in 1947, exempts employers from liability for claims based on (1) an employee walking, riding, or traveling to and from the actual place of the performance of the principal activity or activities he is employed to perform, and (2) activities that are preliminary or postliminary to the employee’s principal activity or activities and occur either before or after the employee commences or ceases his principal activity or activities on any particular workday.

In interpreting the Portal-to-Portal Act, the U.S. Supreme Court has determined that activities performed either before or after an employee’s regular work shift are not exempt if they are an “integral and indispensable part of the principal activities for which covered work[ers] are employed and are not specifically excluded by” the Act (i.e., walking, riding, or traveling to and from the workplace). The Court has interpreted the term “principal activity or activities” to include all activities that are an “integral and indispensable part of the principal activities.”

The Supreme Court has identified some activities that are integral and indispensable parts of employees’ principal activities. For example, changing clothes and showering are integral and indispensable to a worker’s principal activity of manufacturing automotive-type wet-storage batteries, which involves dangerous chemicals and fumes. Moreover, knife-sharpening activities are integral and indispensable to employees’ work at a meatpacking plant.

The Supreme Court has also decided that certain activities do not meet the test. For example, time spent waiting to don protective gear (not the time spent actually donning the gear) has been deemed not integral and indispensable to production workers’ principal activities of cutting and bagging meat. Furthermore, mandatory security screenings are not integral and indispensable to warehouse employees’ retrieval and packaging of products for shipment to customers.

Recognizing that precedent, the 5th Circuit acknowledged that the compensability of the Empire workers’ preshift waiting time depended on whether the time was integral and indispensable to the principal activities they were employed to perform. The employees’ principal activities included erecting and dismantling scaffolding, attending safety meetings, and completing joint safety analysis paperwork. Empire didn’t commence such activities until after 7:00 a.m., during the compensated shift time.

The court recognized that reporting to the right location on time at 7:00 a.m. was intrinsic to efficiently implementing the productive work, but the time spent waiting for principal activities to begin at 7:00 a.m. was not. According to the court, “The waiting itself was neither tied to nor necessary to the erection and dismantling of scaffolding—the work [the employees] were employed to perform.”

The court held that the preliminary waiting time was not intrinsic to the employees’ principal activities. Therefore, it was not compensable under the Portal-to-Portal Act.

Takeaway

Review your compensation policies to ensure that the time employees spend waiting before or after their shifts is being properly classified as compensable or noncompensable time. If the waiting time is “integral and indispensable” to the principal activities the employees were hired to perform, you may have an obligation to compensate them appropriately for that time.

Jennifer D. Sims, who is of counsel to The Kullman Firm, can be reached at 662-244-8824 or jds@kullmanlaw.com.