On February 13, 2020, the California Supreme Court ruled on the Frlekin v. Apple, Inc. case, setting a standard for California time and attendance laws. The court ruled that Apple must pay its employees for time spent having their bags searched before they left for the day. The court determined that “[employee] time spent on Apple’s premises waiting for, and undergoing, mandatory exit searches of bags, packages, or personal Apple technology devices, such as iPhones, voluntarily brought to work purely for personal convenience is compensable as ‘hours worked’ within the meaning of Wage Order 7” (Frlekin v. Apple, Inc. Cal. Supreme Court, 2020, No. S243805, p. 26).

What does “hours worked” entail?

Industrial Welfare Commission Wage Order 7 requires employers to pay their employees a minimum wage for all “hours worked” (Cal. Code Regs., tit. 8, § 11070, subd. 4(B).). “Hours worked” is defined as “the time during which an employee is subject to the control of an employer and includes all the time the employee is suffered or permitted to work, whether or not required to do so.”

Based on this definition, the court in the Frlekin v. Apple, Inc. highlighted that the “hours worked” control clause in Wage Order 7 requires proving that (1) the employer restrains the employee’s action during the activity in question and (2) the employee has no plausible way to avoid the activity.

As such, the court looked at the following factors in determining the application of the control clause to exit searches:

1. “The level[s] of the employer’s control over its employees, rather than the mere fact that the employer requires the employees’ activity” (Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575, 582.);
2. Whether an activity is required; and
3. Cases involving onsite employer-controlled activities should consider, but are not limited to, these factors:
   1. Mandatory nature of an activity,
   2. Location of the activity,
   3. Degree of the employer’s control,
   4. Whether the activity primarily benefits the employee or employer, and
   5. Whether the activity is enforced through disciplinary measures.

How did this affect the case?

Based on the language of the control clause, the court determined that Apple employees are entitled to compensation for the time during which they are subject to Apple’s control (Cal. Code Regs., tit. 8, § 11070, subd. 2(G).). The court outlined how Apple employees were clearly under Apple’s control while awaiting, and during, the exit searches, including:

1. Apple confines its employees to the premises as they wait for and undergo an exit search;
2. Apple’s exit searches are required as a practical matter;
3. Apple compels its employees to perform specific and supervised tasks while awaiting and during the search (e.g., locating a manager or security guard and waiting for that person to become available, unzipping and opening all bags and packages, moving around items within a bag or package, removing any personal Apple technology devices for inspection, and providing a personal technology card for device verification);
4. The searches primarily benefit Apple (and their loss prevention policy); and
5. Apple requires its employees to comply with the bag-search policy under threat of discipline, up to and including termination.

The California Supreme Court noted that for non-California claims, the United States Supreme Court’s decision in Integrity Staffing Solutions, Inc. v. Busk (2014) would apply. In Integrity Staffing, the US Supreme Court held that time spent undergoing mandatory security screenings was not compensable under the Fair Labor Standards Act of 1938 (29 U.S.C. § 201 et seq.), as amended by the Portal-to-Portal Act of 1947 (29 U.S.C. § 251 et seq.; Portal-to-Portal Act).

If you are a business with California employees and have mandatory searches, this court decision will affect you. Please contact Hackler Flynn and Associates if you need assistance in this or other employment law matters.

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