Wednesday, March 3, 2010

Ninth Circuit Reverses Dismissal of State-Law Commute Time Claim in Rutti v. Lojack Corp.

On March 2, 2010, the Ninth Circuit reversed, in part, a district court’s grant of summary judgment in Rutti v. Lojack Corp., 2010 U.S. App. LEXIS 4278 (9th Cir. 2010). The case – a proposed class action/FLSA collective action brought on behalf of Lojack alarm installation technicians – challenged Lojack’s failure to pay for time spent commuting to client locations. The district court granted Lojack’s summary judgment, holding that the plaintiff’s commute was not compensable as a matter of law under both California law, as well as under the Portal to Portal Act (a component of the FLSA).

With regard to FLSA claim, the Court upheld the district court’s order, reasoning that a 1996 amendment to the Portal to Portal Act permitted an employer and an employee to informally agree that commute time and preliminary/postliminary activities are non-compensable where the employee uses a company vehicle. See Rutti, 2010 U.S. App. LEXIS 4278, at 11-14.

However, the exact opposite finding occurred with regard to the plaintiff’s state-law claim. As reasoned by the Court, “California law requires that employees be compensated for all time ‘during which an employee is subject to the control of an employer’” and based on Lojac’s policies, “[t]here is simply no denying that Rutti was under Lojack's control while driving the Lojack vehicle en route to the first Lojack job of the day and on his way home at the end of the day.” See Rutti, 2010 U.S. App. LEXIS 4278, at 40-44 (citing Morillion v. Royal Packing Co., 22 Cal. 4th 575, 578 (2000)).

Another point of particular significance -- the Court noted that the Ninth Circuit has not adopted a hard and fast rule that preliminary/postliminary activities which are only 10 to 15 minutes in duration are not per se de minimis under the FLSA:
Furthermore, we have not adopted a ten or fifteen minute de minimis rule. Although we noted in Lindow, that "most courts have found daily periods of approximately 10 minutes de minimis even though otherwise compensable," we went on to hold that "[t]here is no precise amount of time that may be denied compensation as de minimis" and that "[n]o rigid rule can be applied with mathematical certainty." 738 F.2d at 1062. The panel went on to set forth a three-prong standard, which would have been unnecessary if the panel had intended to adopt a ten or fifteen minute rule.
See Rutti, 2010 U.S. App. LEXIS 4278, at 31-32.

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