Is the De Minimis Rule dead in California?
On July 26, 2018, the California Supreme Court unanimously held in Troester v. Starbucks Corporation that California’s wage and hour statutes and regulations have not adopted the federal de minimis doctrine. The de minimis doctrine is based on the Latin phrase de minimis non curat lex, which means “the law does not concern itself with trifles.” For years federal courts have applied the doctrine in wage claims under the federal Fair Labor Standards Act excusing payment of wages for small amounts of otherwise compensable time upon a showing that the bits of time are administratively difficult to record.
The Ninth Circuit Court of Appeals asked the California Supreme Court to weigh in on the application of the doctrine to wage claims under California law. In response, the Court found that California’s wage and hour statutes and regulations have not adopted the doctrine, but it declined to decide whether a de minimis principle (which has been found in various contexts of California law) could ever apply to wage and hour claims where the time is so minute or irregular that it is unreasonable to expect the time to be recorded. It also found that in Troester’s case the de minimis doctrine was inapplicable because of the regularity of the time worked off the clock.
Troester was a Starbucks’ employee who worked the closing shift. The closing procedure required that Troester clock out from his shift prior to certain end of workday activities, which included transmitting a daily report file, activating the alarm, exiting the store and locking the door. Troester sued Starbucks claiming that over the course of a 17-month period, he spent 12 hours and 50 minutes performing these duties resulting in $102.67 of unpaid wages. The court determined the de minimis doctrine did not apply to Troester’s situation because the time was of such a regular basis that it could be tracked. The court concluded “California does not allow employers to require employees to routinely work for minutes off-the-clock without compensation.”
This is a significant departure to long standing wage and hour case law and has implications for California employers whose employees may regularly perform small amounts of unrecorded work. Based on the Court’s reasoning, there is also concern that long accepted time clock rounding principles may come into question. In response to this decision, California employers should review their timekeeping practices and policies to identify potential areas of risk.