Home Depot Files Opening Brief In California Supreme Court Case Set To Determine Validity Of Time Clock Rounding

• Published date: 08 June 2023
• Subject Matter: Employment and HR, Employee Benefits & Compensation, Employee Rights/ Labour Relations
• Law Firm: Sheppard Mullin Richter & Hampton
• Author: Mr Tyler J. Johnson and Richard Simmons

As we wrote about previously here, in October 2022, the Sixth District of the California Court of Appeal in Camp v. Home Depot U.S.A., Inc., 84 Cal.App.5th 638 (2022), ignored a decade of precedent and found Home Depot's total time rounding for its non-exempt employees was unlawful. In so holding, the court held, "if an employer, as in this case, can capture and has captured the exact amount of time an employee has worked during a shift, the employer must pay the employee for 'all the time' worked." The court rejected at least half a dozen prior appellate opinions and instead focused on carefully selected passages from the California Supreme Court's holding in Troester v. Starbucks, 5 Cal.5th 829 (2018) and Donohue v. AMN, 11 Cal.5th 58 (2021). In Troester, the Supreme Court held the federal de minimis doctrine did not apply in California, and employees must be paid for all time worked, even during activities that occur regularly but take only a few minutes per day before clocking in (e.g., undergoing a bag check). In Donohue, the Supreme Court rejected time rounding for 30-minute meal periods, although it did not address whether rounding of clock punches for in and out times when shifts begin and end was improper.

The Camp court found rounding of employees' total time is impermissible when the employer records actual time and has the ability to pay by the minute. In reaching its decision, the court relied primarily on one plaintiff who lost time due to rounding. Strikingly, the court ignored the fact that the other plaintiff was admittedly overpaid due to rounding. The underpayment of one plaintiff and overpayment of another suggests rounding evened out over time as a whole. However, the Camp court did not consider this highly significant fact and overlooked the settled principle that rounding systems should not be assessed or found unlawful solely on the basis of their isolated impact on a single employee.

After Home Depot appealed, the California Supreme Court granted review of the opinion in February 2023. The parties' briefing is underway, and on June 1, 2023, Home Depot filed its...