Wage rule avoids innumerable lawsuits, 'absurdities,' Starbucks argues in Supreme Court filing

By John Breslin | Apr 18, 2017

SAN FRANCISCO — A rule that employees do not have to be paid for the brief amount of time between clocking out and closing a store applies in California, Starbucks argues in a filing with the state Supreme Court.

SAN FRANCISCO — A rule that employees do not have to be paid for the brief amount of time between clocking out and closing a store applies in California, Starbucks argues in a filing with the state Supreme Court.

The Supreme Court is reviewing a federal court decision, which agreed that the few minutes it takes to close up a store is covered by the de minimis rule - and one in place to avoid "absurdities" and "innumerable lawsuits," according to Starbucks.

The long standing de minimis rule states that an employer does not generally have to pay if it takes less than 10 minutes to close up a facility.

Former shift supervisor Douglas Troester sued Starbucks, claiming it violated California labor laws by not paying him for the time it took to close up a store.

The suit went to the 9th Circuit Court of Appeals, which ruled in Starbucks' favor. But the court asked the state Supreme Court to review that decision and rule on whether it lined up with all state laws.

Troester claims it took him between four and 10 minutes after clocking out to log out of the store computer, walk to the exit and lock up. Starbucks calculated it took him less than four minutes.

The plaintiff's initial brief was filed late last year, with Starbucks answering in January. Troester then filed his rebuttal to Starbucks in late March.

Seattle-headquartered Starbucks, in its answer to an opening brief by the plaintiff, argued that it was clear that the de minimis rule applies to California. The company said the rule has been the "backbone" of California law for nearly 150 years.

"There is no reason that this court should not apply it to California wage claims too, as many courts have done," lawyers for Starbucks said. 

Troester's position regarding "all" hours worked leads to "absurdities," according to the company.

"If an employee has to spend a few seconds leaving work after clocking out, then there is a labor law violation, according to Troester," the brief states. "This means there could be innumerable lawsuits over a few seconds of time. The de minimis rule is one of common sense and everyday practicalities, which prevents such absurdities."

The California Division of Labor Standards Enforcement has endorsed the rule for more than three decades, Starbucks said in its filing. The company also said that the legislature has effectively ratified the standard by not interfering with long-standing practice. 

Troester alleged Starbucks failed to pay him for time spent walking out of the store after closing down the computer, activating the security alarm, turning the lock on the store’s front door and occasionally re-opening the door so that a co-worker could retrieve a coat.

The plaintiff, represented by attorney David Spivak of the Spivak Law Firm in Los Angeles, filed a class-action lawsuit under the California Labor Code for failure to pay minimum and overtime wages, failure to provide accurate written wage statements and failure to timely pay all final wages

In his reply to the Starbucks' answer, Troester said that the defendant failed to directly address the legislature's enactments, the state's Industrial Welfare Commission's regulations and previous decisions by the California Supreme Court.

"Defendant, instead, touts federal law, claiming that California Courts look to federal law for guidance where there is no conflict between state and federal law," Troester's lawyers said in their brief. "But here, California has implemented an employee-protection framework that exceeds federal protections and defines the obligation to compensate to negate the need for a judicially created de minimis defense to wage payment obligations."

Tort reform advocates and business groups have come out strongly against the lawsuit. The California Chamber of Commerce has indicated it will file an amicus brief in support of Starbucks.

Erika Frank, general counsel for California Chamber of Commerce, in an interview earlier this year, told the Northern California Record that she is confident the court will back up the doctrine that the few minutes it takes to close up should not be compensated.

“It’s a federal standard, and we have numerous cases where courts have adopted the de minimis standard,” Frank said. “While there is no specific California law, it is in the Department of Labor Standards Enforcement manual. Nevertheless, employers are still exposed to being sued.”

Fank said that if the court rules against the standard "the flood gates will open."

“I am hoping the court will look at the precedent, the 9th Circuit and U.S. Supreme Court rulings and adopt it for California," Frank said.

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