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On March 25, 2024, the California Supreme Court issued its decision in Huerta v. CSI Electrical Contractors. The decision provides guidance on three specific issues related to the scope of the term “hours worked” under California Wage Order No. 16, which governs wages, hours, and working conditions in the construction, drilling, logging, and mining industries. However, all California employers should take note of this significant decision.

George Huerta, the plaintiff in this case, and other workers were required to undergo a security check at the company’s security gate prior to starting their workday. The plaintiff generally waited 10 to 15 minutes to reach the employer’s parking lots once he went through the security gate. Employees were subject to the employer’s general work rules during this drive time, such as abiding by the anti-discrimination and harassment policy, drug and alcohol policy, etc. Workers were also required to undergo a security check when they exited the premises at the end of their shift. The security checks could result in workers waiting in line anywhere from five to 30 minutes before security guards scanned their badge and sometimes inspected their vehicle. The plaintiff was not paid for the time he spent waiting to go through the security check at the beginning or end of his work shift.

The plaintiff’s employment was governed by two collective bargaining agreements (CBAs), which stated that workers were entitled to an unpaid 30-minute meal period each standard workday. However, the employer did not allow the workers to leave the premises during their meal periods and instead, required them to take their meal periods at a designated area on the premises near their assigned worksite. The plaintiff filed suit against the employer seeking compensation for three separate instances:

• The time he spent waiting in line and undergoing the security inspections.

• The time he spent traveling in his vehicle between the security gate and the work site.

• The time he spent on his unpaid meal break where he was confined to a designated area on the employer’s premises.

The California Supreme Court answered the following three questions certified from the U.S. Court of Appeals for the Ninth Circuit:

• Is time spent on an employer’s premises in a personal vehicle and waiting to scan an identification badge, have security guards peer into the vehicle, and then exit a Security Gate compensable as “hours worked” within the meaning of . . . Wage Order No. 16?

• Is time spent on the employer’s premises in a personal vehicle, driving between the Security Gate and the employee parking lots, while subject to certain rules from the employer, compensable as “hours worked” or as “employer-mandated travel” within the meaning of . . . Wage Order No. 16?

• Is time spent on the employer’s premises, when workers are prohibited from leaving but not required to engage in employer-mandated activities, compensable as “hours worked” within the meaning of . . . Wage Order No. 16, or under California Labor Code Section 1194, when that time was designated as an unpaid “meal period” under a qualifying collective bargaining agreement?

In answering the first question, the California Supreme Court held that the time an employee spends on the employer’s premises waiting in their personal vehicle to have their identification badge scanned and have a security guard “peer into” their vehicle before entering or exiting a security gate is compensable as “hours worked” because the employee was subject to sufficient control by the employer.

As to the second question, the California Supreme Court held that the driving time may be compensable as “employer-mandated travel” under Wage Order 16 but is not compensable as “hours worked.” The “employer-mandated travel” rule is specific to Wage Order 16, which states that “All employer-mandated travel that occurs after the first location where the employee’s presence is required by the employer shall be compensated at the employee’s regular rate of pay or, if applicable, the premium rate . . . .” 

In this case, the Court held that this was not considered “employer-mandated travel” subject to compensation because the employees’ presence at the security gate was required based on “the practical necessity of reaching the worksite” rather than a requirement for an “employment-related reason.” The Court further explained that the driving time is not compensable as “hours worked” because an employer’s general workplace rules, such as anti-discrimination, alcohol and drugs, safety, etc., on employees during their drive to the employer’s premises does “not amount to a level of control sufficient to render the travel time compensable as ‘hours worked.’”   

Finally, as to the third question, the Court held that employees who are prohibited from leaving the employer’s premises during their meal period is considered “hours worked” even if the CBA designated that meal period as unpaid and even when the employee is not required to be engaged in employer-mandated activities. The meal period is compensable as “hours worked” because the employer’s prohibition on employees leaving the premises or designated area prevents employees from engaging in personal activities during their break, thus still being subject to the employer’s control.

Although this decision focuses on Wage Order 16, this ruling will have broad implications for all California employers. If you have questions about your organization’s employee screening or exit procedures, or your meal period practices, please contact our California Legal Services team at CAinfo@employerscouncil.org.