Question: A delivery employee stopped by the post office to deliver company goods on the way home. Later, the employee sued us for not paying for this time. Did we violate labor laws?
Answer: The fundamental obligation of California employers under labor laws is to accurately pay employees for all hours worked. Employers must pay employees at least minimum wage for all hours worked, and if those hours qualify as overtime, they must also pay the applicable statutory overtime premium for those hours.
While most employers are familiar with the basic minimum wage and overtime laws, many make mistakes due to confusion about how far to extend as employee working hours. For example, not considering time spent waiting before other tasks are assigned, time spent traveling to other locations for business purposes, or breaks taken during work hours as part of the employee’s working hours. Additionally, any time an employee is not reporting as working but the employer knows or should have known that the employee is performing work during that time, it should be considered as working hours and calculated accordingly.
In your case, the time when the employee delivered company goods constitutes working hours for which the employee should be compensated, even if it was done on his/her way home. Furthermore, this case involves the employee performing work for the company outside of their designated working hours. Since it is not easy to verify whether work was actually done during such off-the-clock hours, it is crucial to have a system in place within the company to properly report these hours. This could include creating forms for reporting such hours separately, informing employees in advance that failure to adhere to these procedures may result in consequences, and, if possible, documenting such guidelines and obtaining the employees’ signatures.
Failure to pay for such off-the-clock hours, even if the unpaid amount seems small, can lead to various penalties and legal expenses, including attorney fees and litigation costs, so extra caution is required for employers to avoid violations of labor laws.