California Supreme Court Issues Decision on Construction Employees’ Travel Time

03.25.2024

On March 25, 2024, the California Supreme Court issued a long-awaited decision on the compensability of travel time to and from a construction project under California law. In Huerta v. CSI Electrical Contractors (Supreme Court Case No. S275431), the Court answered three questions certified to it by the United States Court of Appeals for the Ninth Circuit:

Is time spent on an employer’s premises in a personal vehicle and waiting to scan an identification badge, having security guards peer into the vehicle, and then exiting a security gate compensable as “hours worked” within the meaning of California Industrial Welfare Commission Wage Order 16?
Is time spent on an employer’s premises in a personal vehicle, driving between the security gate and the employee parking lots, while subject to certain rules of the employer, compensable as “hours worked” or as “employer-mandated travel” within the meaning of IWC Wage Order 16?
Is time spent on an employer’s premises, when employees are prohibited from leaving but not required to engage in employer-mandated activities, compensable as “hours worked” under Wage Order 16 or under Labor Code section 1194, when that time was designated as an unpaid ‘meal period’ under a qualifying collective bargaining agreement (CBA)?

The Court largely answered these questions in the affirmative, with certain qualifications It found that the exit process is compensable, and that the travel time between the security gate and the parking lots is compensable as “employer mandated travel” if the security gate was the first location where the employee’s presence was required “for an employment-related reason other than the practical necessity of accessing the workplace.” And the Court found that the unpaid meal period is compensable if the employer “prohibits the employee from leaving the employer’s premises or a designated area during the meal period and this prohibition prevents the employee from engaging in otherwise feasible personal activities.”

The case involved employee travel to and from the California Flats Solar Project in Monterey and San Luis Obispo Counties, at which there was a designated road which provided access between a guard shack located at the site’s perimeter and the employee parking lots. A security gate was located on that road, from which it would take employees such as the plaintiff George Huerta 10 to 15 minutes to reach the parking lots in their personal vehicles. Huerta underwent security checks at the security gate and contends that he was told by management of his employer that the gate was the first place he had to be at the start of the workday. Vehicles formed a long line outside the security gate where guards scanned the employees’ badges and peered inside vehicles and truck beds at the beginning of the workday. They performed these same functions at the end of the workday (during which the exit procedure could allegedly take between five and thirty minutes) by visually inspecting the truck beds for stolen tools or endangered species. Huerta was not paid for the time he spent waiting to pass through the security gate at the beginning or end of the workday.

Huerta was also not paid for the time spent driving between the security gate and the employee parking lots, during which he was required to honor a 20 mile per hour speed limit in order to not disturb endangered species’ habitats and to avoid honking his horn or playing loud music that could disturb local wildlife. Violation of these work rules could subject him to suspension or termination. Huerta’s employment was governed by a CBA which specified that the standard workday included an unpaid 30 minute meal period, and Huerta alleged that employees were not allowed to leave the site during their meal periods.

The Court began its analysis by reiterating the two grounds upon which time can be counted as “hours worked: (1) time during which an employee is “subject to the control of the employer,” and (2) time the employee is “suffered or permitted to work, whether or not required to do so.” The Court noted that an employee does not have to be actually working when subject to an employer’s control, and an employee who is “suffered or permitted to work” does not have to be under an employer’s control “provided the employer has or should have knowledge of the employee’s work.”

Relying largely on the case of Frlekin v. Apple Inc. (2020) 8 Cal.5th 1038, which held that time spent by Apple employees to undergo exit searches including bag checks when leaving Apple stores, the Court held that time spent during the exit procedure was compensable because it was strictly required of every employee, prevented the employee from using the time for their own purposes, and required the employee to perform specific and supervised tasks such as driving to the security gate, rolling down their window to present their identification badges, and submitting their vehicle to visual inspection and possible physical search. The Court also found the exit procedure to be compensable because the employer required employees to undergo it primarily in service of its own interests as opposed to those of its employees. The Court rejected the employer’s contention that the security checks were strictly for the purpose of ingress or egress.

As to the second question, the Court found that the travel time between the security gate and the employee parking lots constituted compensable employer-mandated travel time based on Section 5(A) of Wage Order 16, which provides that such time must be paid at the employer’s regular rate of pay when the travel occurs “after the first location at which the employee’s presence is required.” While stating that “standard commutes need not be compensated in California,” the Court stated that the time could be compensable if it was determined that the employer “directed and commanded” that the employees drive from the security gate to the employee lots “for an employment-related reason other than accessing the worksite,” but refused to decide whether that test had been met in the instant case. At the same time, the Court concluded that this travel time did not constitute compensable work time under the “hours worked” test, because the speed limit and other “rules of the road” employees were required to observe are necessary and appropriate in virtually every workplace and did not amount to a level of control sufficient to render the travel time compensable. The Court also found that this travel time was not time that the employees were “suffered or permitted to work,” because simply driving their personal vehicles on an access road was not a task “that a manager would recognize as work.”

Finally, with respect to the unpaid meal period issue, the Court construed the employer’s argument as enabling employees and employers to “bargain away employees’ right to an on-duty meal period,” which it rejected. Instead, it interpreted the Wage Order to enable parties to CBAs to negotiate voluntary on-duty meal periods, which neither party contended was done in this instance. The Court specifically found that the Wage Order exemptions from meal period requirements for employees working under qualifying CBAS did not override their right to seek compensation in the form of at least minimum wages for hours worked during an unpaid meal period. The Court further held, consistent with prior case law, that such compensation is required when an employer prohibits an employee form leaving the premises and forecloses the employee from engaging in activities that they could have engaged in if permitted to leave. However, the Court did not undertake to decide whether the unpaid meal period was compensable in this case, even though Huerta claimed that he was required to stay at an assigned work area, because it was uncertain whether the restrictions on travel at the site would have rendered him unable to engage in personal activities he “would otherwise have been able to engage in.”

The decision is important because it clarifies the two work situations in which an employee is entitled to compensation: (1) if the employee is “under the control” of the employer,” and (2) if the employee is “suffered or permitted to work.” The Court provides guidance to the lower courts in defining when “control” is sufficient to justify compensation, and whether driving a personal vehicle is “work.”

Based on the Court’s decision, employers should consider the following to reduce risk going forward:

Eliminate or reduce security checks to the extent feasible;
Place as few restrictions as possible on the activities employees may engage in while traveling to and from work in company vehicles; and
Do not prohibit employees form leaving a work site during meal or rest breaks.

In the interest of full disclosure, AALRR was counsel for three employer associations which submitted “friend of the court” briefs in this case. Employers with questions about the case the issued raised in the case may reach out to the authors or their usual employment law counsel at AALRR.