On July 21, 2021, answering a question certified by the United States Court of Appeals for the Sixth Circuit, the Pennsylvania Supreme Court held that time spent by employees waiting to undergo and undergoing mandatory security screening on an employer’s premises is compensable “hours worked” under Pennsylvania law.  The decision from the Commonwealth’s high court, in In re Amazon.com, Inc., No. 43 EAP 2019, is in stark contrast to the U.S. Supreme Court’s 2014 holding in Integrity Staffing Solutions, Inc. v. Busk, 574 U.S. 27 (2014), which held that time spent in security screenings is not compensable under the federal Fair Labor Standards Act (“FLSA”).

Busk and Federal Law

Under amendments to the FLSA in the Portal-to-Portal Act of 1947 (and codified in 29 U.S.C. § 254(a)(2)), an employer is not required to pay for time spent in:

activities which are preliminary to or postliminary to [the] principal activity or activities [the employee is employed to perform], which occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time on any particular workday at which he ceases, such principal activity or activities.

In Busk, the plaintiffs worked in one of Amazon’s shipping warehouses retrieving products from shelves and packaging those products for shipment to Amazon customers.  The employees were required at the end of each workday to spend significant time undergoing “security screening” before they could leave the premises, and sought compensation for the time spent in those screening activities.  The U.S. Supreme Court rejected the claim, holding that time is compensable under the FLSA only if the activity at issue “is integral and indispensable to the principal activities that an employee is employed to perform”—that is, “one with which the employee cannot dispense if he is to perform his principal activities.”  The Court concluded that the security screenings—while required by the employer—were not “integral and indispensable” to the employees’ principal activities of retrieving and packaging products.

In re: Amazon.com, Inc.

States are, however, at liberty to establish higher standards and protections than the FLSA.  In the class action lawsuit underlying In re: Amazon.com, Inc., the plaintiffs similarly challenged the defendants’ policy of requiring warehouse employees to undergo security screenings and personal belonging searches after clocking out at the end of their shifts.  The district court dismissed the plaintiffs’ claims under both the FLSA, applying Busk, and under the Pennsylvania Minimum Wage Act (“PMWA”), on the ground that the PMWA did not contain language excluding the application of the federal principles underlying Busk.

Following an appeal by the employees, the Sixth Circuit certified the following questions to the Pennsylvania Supreme Court: “(1) Is time spent on an employer’s premises waiting to undergo and undergoing mandatory security screening compensable as ‘hours worked’ within the meaning of the [PMWA]?” and “(2) Does the doctrine of de minimis non curat lex as described in [U.S. Supreme Court jurisprudence] . . . apply to bar claims brought under the [PWMA]?”

The Pennsylvania Supreme Court noted that the PMWA provides greater wage protection to workers than the FLSA, reflecting Pennsylvania’s “strong public policy” to provide employees with compensation for all hours worked.  As such, the court noted that it is not bound by Busk, and that Pennsylvania has never adopted the FLSA’s language classifying “activities which are preliminary to or postliminary to” a worker’s principal activities as non-compensable.

The court also noted the Pennsylvania Department of Labor’s definition of “hours worked” as including “time during which an employee is required by the employer to be on the premises of the employer.”  Because Amazon’s employees were required to remain on its premises, the court found that the mandatory screenings and personal belonging searches constituted compensable “hours worked” within the meaning of the PMWA.

Finally, the court held that the de minimis exception does not apply to the PMWA, observing that the law “clearly and unambiguously requires payment for ‘all hours worked,’ . . . signifying the legislature’s intent that any portion of the hours worked by an employee does not constitute a mere trifle.”

Takeaways

In re Amazon.com, Inc. is a prime example of why employers must remain mindful of both federal and state law when implementing wage and hour policies.  As a result of decisions like this (and Frlekin v. Apple Inc., in which the California Supreme Court held that under California law non-exempt employees must be paid for time spent undergoing mandatory bag or other security checks), employers with multi-state operations must decide whether to implement uniform policies nationwide or whether to tailor those policies to particular locations based on state law.  Pennsylvania employers should immediately conform their pay policies to the decision.

Proskauer’s Wage and Hour Group is comprised of seasoned litigators who regularly advise the world’s leading companies to help them avoid, minimize, and manage exposure to wage and hour-related risk.  Subscribe to our wage and hour blog to stay current on the latest developments, and check out the latest Biden administration developments impacting employers on Proskauer’s Law and the Workplace blog.

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Photo of Allan Bloom Allan Bloom

Allan Bloom is the co-chair of Proskauer’s Labor & Employment Law Department and a nationally recognized litigator and advisor who represents employers, business owners, and management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended…

Allan Bloom is the co-chair of Proskauer’s Labor & Employment Law Department and a nationally recognized litigator and advisor who represents employers, business owners, and management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended many of the world’s leading companies against claims for unpaid wages, employment discrimination, breach of contract and wrongful discharge, both at the trial and appellate court levels as well as in arbitration, before government agencies, and in private negotiations. He has secured complete defense verdicts for clients in front of juries, as well as injunctions to protect clients’ confidential information and assets.

As the leader of Proskauer’s Wage and Hour Practice Group, Allan has been a strategic partner to a number of Fortune 500 companies to help them avoid, minimize and manage exposure to wage and hour-related risk. Allan’s views on wage and hour issues have been featured in The New York Times, Reuters, Bloomberg and Fortune, among other leading publications. His class-action defense work for clients has saved billions of dollars in potential damages.

Allan is regularly called on to advise operating companies, management companies, fund sponsors, boards of directors and senior leadership on highly sensitive matters including executive and key person transitions, internal investigations and strategic workforce planning. He has particular expertise in the financial services industry, where he has litigated, arbitrated, and mediated disputes for more than 20 years.

A prolific author and speaker, Allan was the Editor of the New York State Bar Association’s Labor and Employment Law Journal from 2012 to 2017. He has served as an author, editor and contributor to a number of leading treatises in the field of employment law, including ADR in Employment Law (ABA/Bloomberg BNA), Employment Discrimination Law (ABA/Bloomberg BNA), Cutting Edge Advances in Resolving Workplace Disputes (Cornell University/CPR), The Employment Law Review (Law Business Research, U.S. Chapter Author), and The Complete Compliance and Ethics Manual (SCCE).

Allan has served as longtime pro bono counsel to Lincoln Center for the Performing Arts and The Public Theater, among other nonprofit organizations.  He is a past Vice Chair of Repair the World, a nonprofit organization that mobilizes volunteers and their communities to take action to pursue a just world, and a past recipient of the Lawyers Alliance Cornerstone Award for extraordinary contributions through pro bono legal services.

Allan is a Fellow of the College of Labor and Employment Lawyers and has been recognized as a leading practitioner by Chambers since 2011.