Tenth Circuit rules that, at least for some jobs, time spent turning on computers is work time under FLSA

The Tenth Circuit ruled that, at least for the jobs in the case before it, the time that employees spent turning on computers was compensable work time, which, for non-exempt workers, must be paid and must count towards overtime.

First the court held that the time counted as work time (or in the words of FLSA law, “compensable” time) because the employees did their work on the computers and had to boot them up to do their jobs:

In sum, we reach the same conclusion that the district court did: The preshift activities of booting up a computer and launching software are integral and indispensable to the CCRs’ principal duties of servicing student loans by communicating with borrowers over the phone and by email. Busk, 574 U.S. at 36; see also Jackson v. ThinkDirect Mktg. Grp., Inc., No. 16-cv-03449, 2019 WL 8277236, at *4 (N.D. Ga. Dec. 9, 2019) (explaining that “requirement of logging in and out of electronics systems needed to process calls is at least integral to the work of answering phone calls” (quoting Gaffers v. Kelly Servs., Inc., No. 16-cv-10128 (E.D. Mich. June 2, 2016)). Booting up a computer and launching software is “an intrinsic element of” servicing student loans and communicating with borrowers because the data and tools necessary to those principal duties exist on the computer. Busk, 574 U.S. at 35. Likewise, Nelnet could not have eliminated these activities “without impairing the employees’ ability to complete their work.” Id. Such integral and indispensable activities are compensable under the FLSA.

Next the court rejected the argument that such time was de minimis (so small it needn’t be counted). The court held it was not de minimis because (a) it could be estimated by the company (b) and occurred with “consistent regularity, (c) even though it could be considered, according to the court, indeed a small amount in the aggregate.

Moreover, because Nelnet’s ability to estimate the amount of time at issue and the consistent regularity with which the CCRs perform these activities weigh more heavily than the relatively small size of the claims in this case, the de minimis doctrine does not apply to excuse Nelnet’s obligation to pay its employees for their work.

In reaching its holding, the Tenth Circuit emphasized that it was expressly noting its decision does not necessarily reach so far as teleworking during the pandemic.

Nelnet also raises general policy concerns about the application of the FLSA in our modern and digital age, including during the COVID-19 pandemic, when telework is increasingly common.

But we need not speculate about the FLSA’s application to teleworkers or the pandemic’s broad implications for our digital age. We need only decide the case before us, which doesn’t concern teleworking.

Source: Peterson v. Nelnet Diversified Solutions, LLC, case no. 19-1348 (10th Cir. 10/8/2021).

Tenth Circuit expands ability to file retaliation claims under Title VII

Title VII is the nation’s leading anti-discrimination law. It also prohibits employers from retaliating against employees who oppose unlawful acts such as discrimination. But what if the employee is opposing an act that isn’t actually unlawful discrimination? What constitutes an unlawful discriminatory act prohibited by Title VII can be a surprisingly complicated legal issue.

In a recent case, titled Reznik v. inContact, Inc., the plaintiff sued for retaliation because, she claimed, she’d been retaliated against for opposing discrimination against foreigners who worked for the company in that other country (or as the Court said “aliens”). However, being a foreigner who works in a foreign country is not itself a protected class under Title VII. However, the Tenth Circuit held the plaintiff wasn’t required to prove she opposed an actual violation. Rather, the test is whether the employee both subjectively and objectively believed the practice was prohibited by Title VII.  To prove her subjective believe, she needed to prove she herself really had believed it was prohibited by Title VII. To prove it was the objective element, she needed to prove that a reasonable employee would have thought it was prohibited by Title VII.

We adopt an objective reasonableness inquiry that considers the law against what a reasonable employee would believe, not “what a reasonable labor and employment attorney would believe.”

Because Title VII protects both “race” and “national origin,” a reasonable employee, the Tenth Circuit held, might think those protected classes include being a foreigner who works in a foreign country.

The decision drew a sharp dissent that would have held the company was entitled to rely on the clear language of Title VII, which does not protect foreigners working in a foreign country.

The statutory text of Title VII expressly excludes aliens abroad. 42 U.S.C. § 2000e-1(a). Thus, no employer reasonably would have understood that Title VII prohibited the conduct Plaintiff opposed. Measuring one employee’s subjective good-faith belief that Title VII prohibits an employer from making offensive comments about aliens abroad against the text of Title VII, which precludes application to aliens abroad, I would hold that Plaintiff lacked an objectively reasonable belief that Defendant’s conduct constituted unlawful discrimination and affirm the district court.

Because this distinction is both significant and poses a clear question of law that has not been addressed by the Supreme Court, it is the kind of issue that may, if appealed, draw either reconsideration by the full bench of the Tenth Circuit and/or review by the Supreme Court. Unless either occurs, the majority opinion stands as law in the Tenth Circuit.

More states adopt pay transparency laws following Colorado’s lead

Following Colorado’s groundbreaking (and highly controversial) pay transparency law, which includes a requirement that job postings disclose a range of wages and benefits (among other things), New York has adopted a similar law effective May 15, 2022, as have Connecticut, Nevada and (effective 1/1/2023) Rhode Island. California, Maryland and Washington have also adopted similar laws with various conditions, depending on the particular state’s laws, that trigger the obligation to disclose the range upon request by an applicant or employer, or by request after an initial interview, or by request after a job offer. Employers should anticipate such laws will be adopted by additional states.

CDLE publishes new crop of rules and posters for 2022

The CDLE (Colorado Department of Labor and Employment) posted a new crop of rules and posters for 2022. Included are the following:

  • COMPS Order #38 with a supplementary PAY CALC Order. The new COMPS Order is effective 1/1/2022.
    • The new order includes:
      • The new minimum hourly wage in Colorado ($12.56, or for tipped employees, $9.54).
      • A new exemption under Colorado state employees for Highly Compensated Employees who earn at least the minimum weekly guaranteed salary for exempt employees ($515) and, annually, at least 2.25 times the minimum guaranteed salary required for other exemptions ($101,250 for 2022, equaling 2.25x$45,000). This new exemption applies to individuals who perform at least one of the exempt duties of a white-collar exemption and whose primary duty is office or non-manual work.
      • A rule (5.2.4) that states the remedies for failure to permit the required rest 10-minute periods include an extension of the employee’s actual hours worked that day by the required 10 minutes. In other words the employer cannot count the 10 minutes as a rest period, rather, it counts as hours worked that day.
      • An explanation of how to calculate the regular rate of pay for employees working at two or more non-exempt hourly rates during a single week.
    • Employers are also reminded to post the new COMPS Order (and the new PAY CALC Order’s numbers) or if not practical in any given physical site, to distribute the same pursuant to Rule 7.4.
  • Wage Protection Rules, effective 1/1/2022, includes Rule 2.17 defining “vacation” (which is required to be paid out at termination and cannot be subject to use-it-or-lose-it forfeitures) as including any paid leave the employee may use “at the employee’s discretion … rather than leave usable only upon occurrence of a qualifying event (for example, a medical need, caretaking requirement, bereavement or holiday),” in other words, and as an example, PTO is now considered “vacation” that must be paid out at termination and cannot be subject to use-it-or-lose-it forfeitures.

Tenth Circuit narrowly applies Joint Employer doctrine

In a narrow application of the Joint Employer doctrine, the Tenth Circuit rejected claims of sexual harassment by the plaintiff who worked for a construction and maintenance company that had contracted with another company. She claimed that three of the employees of that other company sexually harassed her. Since that other company was not her actual employer, she claimed it was nonetheless liable as a Joint Employer along with her actual employer.

She claimed that the other company’s workers frequently told her what to do and how to do it. She claimed that she believed that they had the authority to fire her or at least have her fired if she did not follow their direction. The Tenth Circuit rejected her claims holding that “even if (she) believed that (the other company’s employees) could fire her, her statements do not support the claim that (they) had such authority.” The Court noted that the other evidence showed that other company did not hav ethe authority to fire her, discipline her, determine her pay. It did not oversee her payroll taxes.

Her statement that Plains Defendants supervised some aspects of her work would not, under Knitter or New Mexico state law, overcome the overwhelming evidence that C3 was an independent contractor. In short, even if discovery could substantiate every assertion 41 in Ms. Adams’s affidavit, Plains Defendants would be entitled to summary judgment under Knitter and New Mexico state law.