A May article on HR.BLR.com stated that many Maryland employers regularly wonder how to treat the time employees spend waiting before the start of their shift or traveling to the jobsite. In some cases, employees may be “engaged to wait” and should therefore be paid for their waiting time. Similarly, employees who are required to travel from jobsite to jobsite as part of their normal workday should be paid for their travel time in most cases.
However, some circumstances in which employees have to wait in the plant or at the office to begin working or travel from home or the office to their first jobsite may not constitute compensable time. The U.S. District Court in Maryland addressed many of these issues and provided some clear guidance in a recent decision.
Herbert Jones, Joseph Jones, Rodney McFadden, and Raymond Green sued their former employer, Hoffberger Moving Services LLC (HMS), in a collective action under theFair Labor Standards Act (FLSA), seeking unpaid minimum wages and overtime.
HMS is a commercial moving and storage company. The former employees worked primarily as “helpers,” responsible for loading and unloading HMS’s trucks. During their employment, they traveled to HMS jobsites and were paid an hourly wage to move furniture, boxes, and other materials for HMS clients.
HMS offered a van service from its warehouse to the jobsites every morning. If the employees wanted to use HMS’s van service, they were required to arrive at the warehouse at a time specified by the company dispatcher.
Occasionally, when the employees arrived at the warehouse to use HMS’s van service, they were asked to load moving equipment, including dollies, crates, padding, and Masonite floor covers, onto the moving trucks. They were compensated for that work time only if they filled out time sheets indicating they had done warehouse work.
The employees contended that they regularly spent a substantial amount of time working for HMS without proper compensation in violation of the FLSA. Many HMS employees allegedly spent unpaid time at the warehouse each morning waiting to be transported to jobsites.
While waiting, they sometimes were assigned to particular jobsites for the day and sometimes helped load trucks with moving equipment without signing the warehouse time sheet. In all instances, the employees were not compensated for warehouse waiting time.
In addition, the employees typically weren’t compensated for their travel time from the warehouse to the jobsites. The employees contended that the vans regularly arrived at the jobsite approximately 30 minutes before the moving trucks.
They complained that they were directed to log their start time only after the moving trucks had arrived, and they weren’t compensated for their waiting time at the jobsite. Finally, they complained that they weren’t compensated for the time spent traveling back to the warehouse to pick up their paychecks.
HMS and the employees both filed motions for summary judgment (a ruling in their favor without a trial). In considering the cross-motions for summary judgment, the trial court reviewed the provisions of the Portal-to-Portal Act, an amendment to the FLSA that addresses whether or when certain activities are compensable.
Trial court’s decision
First, under the Portal-to-Portal Act, an employer generally is not liable for an employee’s time spent “walking, riding or traveling to and from the actual place of performance of the principal activity or activities which [the] employee is employed to perform.”
Second, an employer generally is not liable for an employee’s time spent on activities that are preliminary or postliminary to his principal activity, meaning they occur either before the time on any particular workday at which he begins his principal activity or after the time on any particular workday at which he ceases his principal activity.
The key inquiry for determining an employer’s liability for unpaid wages and overtime is whether his “principal activities” are properly labeled. The U.S. Supreme Court has interpreted that term to embrace all activities that are an “integral and indispensable” part of the principal job duties. In December 2014, the Court offered a more precise definition of “integral and indispensable.”
According to the Court, the test is tied to the productive work the employee is employed to perform. An activity is only “integral and indispensable” to the performance of an employee’s principal activities if it is an intrinsic element of those activities and an activity with which the employee cannot dispense if he is to perform his principal activities.
The Supreme Court illustrated the application of this test with examples from prior cases. According to Court precedent, employers are liable for time battery plant workers spend showering and changing clothes after working with toxic materials and for time meatpacking employees spend sharpening knives. In both cases, the employer cannot eliminate the disputed activity without impairing its employees’ ability to work safely and efficiently.
By contrast, employers are not liable for time poultry plant workers spend waiting to don and doff protective gear or for time warehouse workers spend waiting in line to go through a postshift security screening. In those cases, the employer could dispose of the disputed activity without impairing its employees’ ability to perform the work they were employed to perform.
An employer may also be liable for unpaid work even if activities are not found to be integral and indispensable to an employee’s principal work. The Portal-to-Portal Act imposes liability on an employer for unpaid compensation if an activity is compensable by either an express provision of a written or unwritten contract or a custom or practice.
In considering the issues raised by both parties, the court first examined whether the employees’ claims for unpaid work involved their principal activities and if the work was integral and indispensable to the performance of their principal activities. The court then assessed whether the work was nonetheless compensable if the employer was party to a contract or developed a custom that mandated compensation regardless of the employee’s principal activities.
The employees claimed that HMS violated the FLSA by failing to compensate them for the following time:
Waiting time at the warehouse each morning before they traveled to jobsites;
Travel time from the warehouse to jobsites;
Waiting time at the jobsite before the moving trucks and equipment arrived; and
Travel time after completing their work at a jobsite to pick up paychecks at the warehouse.
As a threshold matter, the court found that no reasonable jury could find that the employees were employed to wait at the warehouse, travel to jobsites, wait at jobsites, or pick up paychecks. Instead, they were employed to load and unload trucks for HMS’s clients.
However, the court noted that holding wasn’t fatal to the employees’ claims. The court went on to assess each allegedly unpaid activity, considering whether it was integral and indispensable to the job of loading and unloading trucks and, if so, whether it would be compensable under the FLSA.
Were any activities integral and indispensable?
Waiting time at the warehouse. According to the court, the employees were not entitled to compensation for time they spent waiting at the warehouse before traveling to jobsites. As the court noted, HMS could have eliminated the waiting time altogether without impairing the employees’ ability to complete their work; therefore, the waiting time would not be considered indispensable. By arriving directly at the jobsites each morning, the employees would still have been able to do the job they were employed to perform, loading and unloading HMS’s trucks.
The employees countered that HMS benefited from their presence at the warehouse because it could reassign their jobsites or direct some employees to perform warehouse work. Moreover, the employees claimed they were virtually required to use HMS’s van service and had no choice but to wait at the warehouse each morning. The court found those claims were not persuasive.
The court is not required to consider whether the activities benefited the employer, nor should it focus on whether the employer required a particular activity. Instead, the integral and indispensable test is tied to the productive work an employee was employed to perform.
Looking at the facts in the light most favorable to the employees, the court ruled that no reasonable jury could find the time spent waiting at the warehouse each morning was integral and indispensable to loading and unloading moving trucks for HMS clients. As a result, the waiting time wouldn’t be compensable under the FLSA.
However, the court noted that the employees may be entitled to compensation for their occasional warehouse work, such as lifting equipment and loading other necessary items into the moving trucks. In fact, HMS acknowledged that employees would be paid for that work if they filled out a time sheet according to company policy. An employee’s failure to comply with the policy did not render the time uncompensable.
Travel time from warehouse to jobsites. According to the court, the employees were not entitled to compensation for their travel time to and from the warehouse unless they performed a principal activity prior to such travel. Commuting time is expressly exempted from the FLSA, even when employees are dependent on employer-provided transportation.
The fact that HMS would occasionally give the workers instructions while they were waiting to be transported to the jobsite didn’t convert the travel time to compensable work time. Moreover, the court determined that no reasonable jury could find that the employees were required to meet at the warehouse to perform work while they were waiting for the van to transport them to the jobsite.
Waiting time at jobsites. The court found there were genuine issues of material fact about whether the employees were properly compensated for the time they spent waiting for HMS’s moving trucks and equipment to arrive at the jobsite each morning.
The employees claimed that HMS’s employee transport vans would regularly arrive at jobsites well before the moving trucks that carried the equipment, and they couldn’t begin work without the equipment. HMS countered that the employees were paid as soon as they arrived at the jobsite, regardless of the moving truck’s presence.
The court found that once employees arrived at the day’s jobsite, the employees’ time spent waiting became a principal activity integral and indispensable to the performance of the work that the employees were employed to perform. In a sense, the employees were “engaged to wait,” which is a compensable activity under the FLSA.
However, where the employees waited at HMS’s warehouse before traveling to the first jobsite, they were merely “waiting to be engaged,” which is not considered compensable work time.
Time spent picking up paychecks. The court found that the employees were not entitled to compensation for time spent collecting their paychecks. Such activity is squarely within the definition of an exempt postliminary activity under the Portal-to-Portal Act, and no reasonable jury could find that time spent picking up paychecks is integral and indispensable to the work the employees were employed to perform.
Contract, custom, or practice. The employees argued that in the alternative, HMS was liable for unpaid travel time based on a contract, custom, or practice under the Portal-to-Portal Act. The court considered, and rejected, that claim.
First, according to the court, there was no written or unwritten contract. The closest the employees could come to a “contract” was a statement on the employment application that travel time for a specific job would be authorized at the discretion of the salesperson responsible for the job.
HMS’s general conditions of employment also confirmed the discretionary nature of its travel compensation policy, which indicates that travel time is limited to jobsites at extreme distances. Second, the court found no evidence to suggest that HMS has cultivated a custom or practice of compensating employees for travel time.
In summary, the court found the employees’ claims for unpaid wages would be limited to their claims for compensation for work performed at the warehouse before being taken to the first jobsite and for their subsequent travel time to the first jobsite.
Further, the employees may seek compensation for the waiting time at the first jobsite when HMS’s moving trucks were delayed. Aside from those claims, all the other allegations raised by the employees were denied. Herbert Jones, et al., v. Hoffberger Moving Services LLC, et al., MD. D.C., Civil Number JKB-13-535, decided March 24, 2015.
This is a helpful case for Maryland employers with employees who regularly travel to jobsites. As the facts of this case indicate, determining whether waiting and travel time is compensable in any given circumstance requires a very careful analysis. There are a few clear rules, however.
First, the time employees spend traveling to their initial jobsite generally isn’t compensable, even if the employer provides transport services to get there. That would be true even if, as in this case, the employees who use the employer’s van service to get to the first jobsite are required to wait for the van to arrive. Likewise, the time spent traveling back to the warehouse generally isn’t considered compensable work time.
However, if employees waiting for transportation to the initial jobsite perform any meaningful work related to their principal activities (e.g., loading equipment and other items onto trucks), then that time would be considered compensable.
Moreover, if they perform such compensatory work while waiting for their transportation, then the time spent traveling in the van to the initial jobsite would also be compensable. Finally, once the employees arrive at the initial jobsite, any time spent waiting for the moving trucks to arrive so they may begin work would also be compensable.