Do your employees spend time waiting for and undergoing entry and exit searches? If so, there is new authority that may impact your time and attendance policies. Earlier this month, the California Supreme Court decided Frlekin v. Apple, Inc. ("Frlekin").
"Is time spent on the employer's premises waiting for, and undergoing, required exit searches of packages, bags, or personal technology devices voluntarily brought to work purely for personal convenience by employees was compensable as 'hours worked' within the meaning of Wage Order 7?"
At the time of the case, Apple, Inc. ("Apple") imposed an Employee Package and Bag Search policy on employees that required its employees to submit to searches of their bags, packages, purses, backpacks, briefcases, and personal Apple technology devices any time they left the store, whether after work, during their meal/rest breaks, or for any other reason. Much of the time spent by employees waiting for and undergoing searches occurred off-the-clock.
The Supreme Court decided that Apple should have compensated its employees for time spent waiting for and undergoing mandatory searches.
The Court found that Apple clearly controlled its employees during this time. It imposed discipline on employees who failed to abide by the search policy, confined employees to the work premises during the time they waited for and underwent the search, and required employees to undertake tasks - such as seeking out a manager to conduct the search and facilitate the search by opening zippers, bags, and packages - when going through the search.
Apple attempted, unsuccessfully, to circumvent this finding by arguing it did not require employees to undergo the search, because employees could avoid the search altogether if they refrained from bringing packages, bags, or Apple devices into the workplace. The Court found this argument unconvincing for several reasons:
- The Court found that definition of "control" did not include only "required" or "unavoidable" time, but instead all time during which Apple controlled the activities of its employees, which include time spent waiting for and undergoing the searches.
- The Court distinguished cases holding, heldthat non-mandatory employee travel time on employer provided transportation is non-compensable. It found that the Frlekin case presented an "inherent difference" from those previous cases, in that time spent traveling to and from work is fundamentally different than time spent at work because the latter involves a higher level of employer-control over employees. It also found those previous cases differed significantly from Frlekin because they involved optional services provided for the benefit of the employee, as opposed to the searches at issue in Frlekin, which served Apple's interest in deterring theft at its retail locations under the threat of disciplinary action for non-compliance.
- The Court reasoned that employees have little choice but to bring in common items such as purses and cellphones into the workplace, and, even assuming they could avoid the search as a practical matter, the ability to do so did not change the fact that Apple exercised control over employees who chose to bring goods into the workplace during the searches in question.
In its concluding remarks, the California Supreme Court determined that its decision applied retroactively, meaning that California employers who imposed an exit-search similar to Apple's may be liable for uncompensated time worked in years past, despite just receiving clarification from the California Supreme Court of the applicable rule.
California employers should ensure that they are paying employees for time spent waiting for and undergoing entry and exit searches, at least where the searches are conducted for the employer's benefit and where, as a practical matter, the searches are unavoidable. Although the Frlekin decision provides employers with some certainty, significant questions remain. Companies across California should ensure they have adopted search policies that are compliant with California law and ensure that those policies are carried out appropriate. If your Company has questions about how the decision in Frlekin will affect your Company's operations, contact an attorney at Sagaser, Watkins & Wieland PC to ensure that your business does not face the same, costly fate as Apple, Inc.
 Wage Order 7 defines the phrase "hours worked" 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[.]" The definition of "hours worked" in Wage Order 7 is used in almost every wage order in California. Wage orders specify minimum requirements with respect to wages, hours, and working conditions and are legally binding on California employers.