Starbucks Has Million Dollar Liability Over Unpaid Minutes

Employers have relied on the de minimis doctrine to defend against wage claims for insignificant amounts of time employees spend on job-related tasks while off the clock. In a lawsuit, a court applies the de minimis doctrine to avoid litigation over trivial matters that are not worthy of judicial scrutiny.  Prior to a recent California Supreme Court ruling requiring a non-exempt employee to walk other employees to their cars after closing, performing a security check, or other work commonly performed in minutes after clocking out was not commensurable under the de minimis doctrine.

In Troester v. Starbucks Corporation, the California Supreme Court ruled that the “de minimis” doctrine generally does not apply.  The California Supreme Court found that California wage laws “do not allow employers to require employees to routinely work for minutes off-the-clock without compensation.” This decision has a high likelihood of generating allegations of unpaid wage claims and class action liability.

Troester’s Wage Claim

Troester worked as a non-exempt shift supervisor for Starbucks and commonly had “store closing” responsibilities.  He claimed that closing procedures were required to be performed after clocking out for his shift.  These included walking employees to cars, reopening the store to retrieve belongings, and setting the store alarm, among others. He alleged that on average he worked 4-10 minutes each closing shift unpaid.   Over the 17-month period of employment he claimed and had supporting evidence that he worked 13 hours unpaid.

Magnitude of Liability

Experts have estimated that Starbucks could end up spending seven figures to settle all such claims.  San Francisco attorney Kirsten Muller, a partner at Hirschfeld Kraemer LLP, said that each case could rack up millions of dollars in fees, court costs and judgments.  Ironically, Troester claimed he was due to about $102.

Employer Action Items

Proactively managing employer risk has become integral to protecting employers’ wealth.  Mitigating this risk will require employers to review all job duties that could result in non-exempt employees working off the clock. This includes taking calls after hours, meal period interruptions, office opening processes, and more.

Solutions should be developed to reverse engineer policies, pay practices, time tracking methods and technology applied.  Consider an implementation strategy to educate employees and managers on how follow new policies.

About Employer’s Guardian

Employer’s Guardian provides Human Resource, Safety, Management, and Payroll services. Employer’s Guardian regularly creates solutions for employers to help them strategically navigate court decisions such as these.

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