Pre-shift wait time not compensation under Portal Act

The Portal-to-Portal Act (PPA) precluded the pre-shift wait time of three employees working on an oil refinery expansion project from being compensable under the FLSA, ruled the Fifth Circuit. The court observed that the waiting itself was neither tied to nor necessary to the erection and dismantling of scaffolding-the work the employees were employed to perform. Accordingly, because the preliminary wait time was not intrinsic to the employees’ principal activities it was not compensable. Thus, the judgment of the district court was affirmed.
The owners of an oil refinery undertook an expansion project to double the refinery’s capacity. It hired Empire Scaffold to erect and dismantle scaffolding at the refinery as part of the project. Empire’s employees worked in teams with six to 10 individuals. They were compensated for scheduled shift times of 7:00 a.m. to 5:30 p.m. on Monday through Thursday, and 7:00 a.m. to 3:30 p.m. on Friday.

Pre-shift wait time

Empire required its employees to take buses from the refinery’s parking lot to the refinery on a first-come, first-served basis between 5:00 a.m. and 6:15 a.m. Its policy was that any employee who missed the last bus at 6:15 a.m. would not be able to work until the next day. Employees were not allowed to access the refinery by any other means, such as riding in another contractor’s van. The bus ride to the refinery took approximately 20 to 30 minutes. Employees were dropped off at Empire’s lunch tent where they signed in. Empire did not mandate any other work activities prior to the 7:00 a.m. time for commencing the shift. However, employees were required to wear personal protective equipment (PPE) upon reporting to work.
In 2012, Empire’s employees and other workers on the project commenced this action against their employers asserting that they were not paid for compensable time. In May 2013, the district court severed some of the claims and created a separate action against Empire. Later, the Empire employees filed a motion for partial summary judgment alleging that Empire violated the FLSA by failing to compensate its workers for pre-shift time and failing to properly record their work hours. Empire also sought summary judgment contending that it was not required to compensate its employees for time spent riding the bus, for pre- and post-shift activities, and for pre-shift wait time; and that its recordkeeping was proper, among other contentions.
In March 2016, a magistrate recommended granting (1) summary judgment against all of the employees’ claims, except for one employee’s claim for riding the bus; (2) summary judgment against all workers’ claims for time spent donning and doffing PPE; and (3) summary judgment in favor of Empire on the improper recordkeeping claim. The magistrate recommended denying summary judgment with respect to all other employees’ claims, except for claims by three employees for compensation for pre- and post-shift activities. The magistrate found that those three employees did not engage in pre-shift activities that could be considered compensable. The magistrate’s report was adopted by the district court.
In April 2016, the three employees appealed the district court’s decision, but the Fifth Circuit dismissed that appeal for lack of jurisdiction because a final judgment had not been entered. Subsequently, the district court denied the employee’s motion for reconsideration of its grant of summary judgment. The employees then filed this appeal in which they argue that their pre-shift wait time at the refinery was compensable under the FLSA.

Preliminary and postliminary activity

The issue in this case was whether the PPA excluded pre-shift wait time of the three employees from being compensable under the FLSA. The PPA exempts employers from liability for claims based on activities such as walking, riding, or traveling to and from the actual place of performance of the principal activity, and such activities are preliminary to or postliminary to the principal activity. The Supreme Court has determined that the PPA does not exempt activities performed either before or after the regular work shift if those activities are an integral and indispensable part of the principal activities for which the workmen are employed and are not specifically excluded by 29 U.S.C §254(a)(1).
Here, the compensability of the pre-shift wait time for the employees turned on whether this wait time was integral and indispensable to the principal activities they were employed to perform. In this context, the employees’ principal activities included erecting and dismantling scaffolding, safety meetings, and completing joint safety analysis paperwork. Empire’s policy was not to begin such activities until after 7:00 a.m., during the compensated shift time. While reporting to the right location on time at 7:00 a.m. was intrinsic to efficiently implementing the productive work time, the time spent waiting for principal activities to begin at 7:00 a.m. was not. Therefore, the wait time in this instance was not compensable.

Principal activities

Moreover, unlike their coworkers, the three employees did not claim that they participated in principal activities prior to 7:00 a.m. Rather, each employee testified that he used the wait time for his own purposes, either smoking, chatting with colleagues or just waiting.
Thus, none of the three employees created a genuine dispute of material fact with respect to performing principal activities prior to 7:00 a.m.

Predominant benefit test

Still, the employees contended that the predominant benefit test was the correct legal framework to apply to analyzing the compensability of the pre-shift wait time. The predominant benefit test focuses on whether the wait time primarily benefited the employer. Under this test, when an employer requires an employee to report at a specific time and the employee cannot perform work at that time for some reason beyond his control, the wait time predominantly benefits the employer. The employees contended that Empire required its employees to report to the refinery before the 7:00 a.m. shift and that the wait time predominantly benefited the employer because the employees were surrounded by hazardous conditions and had to follow safety procedures.
However, the Fifth Circuit was not persuaded by this argument. The appeals court observed that the decisions on which this argument was based were decided before the Supreme Court’s decision in Integrity Staffing Solutions, Inc v. Busk.
Under Busk, whether an activity is integral and indispensable to an employee’s principal activities does not turn on whether the activity benefits the employer or whether the employer requires the activity. Accordingly, the integral and indispensable test was the relevant test for determining the compensability of the employee’s pre-shift wait time. Thus, the judgment of the district court was affirmed. (Bridges v. Empire Scaffold, LLC, 5thCir, 168 LC ¶36,575.)

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