Wage & Hour Counsel : Wage & Hour Lawyer & Attorney : Littler Mendelson Law Firm : Employment Law, Labor Relations

By Alison Hightower

“It’s not what you wear—it’s how you take it off,” an anonymous author exclaimed. Whether employees must be paid for taking off and putting on a variety of items, from aprons to mesh gloves, continues to spark controversy. In the latest pronouncement on the subject, in Salazar v. Butterball, the Tenth Circuit recently concluded that the Department of Labor’s (DOL) viewpoint on what constitutes non-compensable “time spent changing clothes” should receive no weight.

The issue that has divided the courts and the DOL is what constitutes “clothes” under Section 203(o) of the Fair Labor Standards Act (FLSA) which excludes from compensable time any time spent “changing clothes” if that time is non-compensable under either the express terms or custom and practice of a collective bargaining agreement (CBA). In other words, if a union member is covered by a CBA in which, either by express language or custom and practice, time spent changing clothes is not paid, then the employer does not have to pay for that time under the FLSA. 

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By William Hays Weissman

Effective on July 20, 2011, employers in Arizona can mandate electronic payment of wages. Employees that do not elect direct deposit may be paid by payroll debit card, which now can be treated as the default option.

HR 2151 amends Ariz. Stat. sections 23-350 and 23-351 by allowing employers to choose one of four methods of payment of wages: (1) cash; (2) check; (3) if elected by the employee, direct deposit into a financial institution of the employee’s choice; or (4) if an employee does not designate a financial institution for direct deposit, by payroll debit card.

If an employer chooses to pay wages by payroll debit card, the employee must be entitled to withdraw his or her full wages without fee at least one time per pay period, but not more than once per week. The employer must also provide the employee with a list of all potential fees an employee may incur. Also, if the employee is paid by direct deposit or payroll debit card, the employer must furnish the employee with a written or electronic statement of the employee’s earnings and withholdings.

Payroll cards can be a win-win option for both employers and employees. Employers are given greater flexibility in methods of paying wages at reduced cost, and with greater security than cash or traditional checks. Employees no longer have to incur check cashing fees, and also have protection against lost cash. While it is not clear that Arizona’s bill represents any kind of trend by the states toward mandating electronic payment of wages, Arizona’s law should definitely be welcome by Arizona employers.

Photo credit: MBPHOTO, INC.

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By Jim Hart

On June 30, 2011, the California Supreme Court in Sullivan v. Oracle Corporation (S170577) considered a claim by three nonresidents of California. The plaintiffs brought claims of unpaid overtime against Oracle, a Delaware corporation with its headquarters in California. The three plaintiffs traveled to California from Colorado and Arizona for periods of time ranging from several weeks to several months to instruct customers on Oracle products. The California Supreme Court issued rulings concerning the reach of California's overtime laws to employees temporarily working in the state:

• First, California's overtime laws were found to apply to the non-resident plaintiffs for the time they were temporarily working in California, particularly since Oracle was a California-based employer and the employees worked at least a full day in the state;
• Second, the court also found that the plaintiff's temporary work in California provided a basis to seek overtime compensation under California's unfair competition law; and
• Third, the court found making a decision in California to classify the plaintiffs and others as exempt did not, standing alone, justify applying California's unfair competition law to alleged violations that occurred outside the state.

For more information about the decision and its implications for employers, please continue reading Littler's ASAP, California Supreme Court Finds Out-of-State Employees Working in California Are Protected by California Overtime Laws.

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