By Nicholas Grether, Esq., The Maloney Firm, APC

In this article, we discuss the California appellate court ruling in Michael Oliver v. Konica Minolta Business Solutions U.S.A., Inc. (June 2, 2020) Appellate No. H045069, Santa Clara County Super. Ct. No. 2014-1-CV-263183, which states that commute time could be paid while carrying employers’ tools and equipment. The Court found that there was a factual dispute as to whether or not the employees were under the employer’s control. If the employees were under the employer’s control during their commutes, they must be paid for that time.

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Service Technicians Carried Their Tools in Personal Cars

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The Plaintiff in this matter was a former service technician for Konica Minolta Business Solutions’ (Konica) printing, copying, and scanning products.  Service technicians were responsible for maintaining or repairing products at the customer’s site.  They were required to commute in their own cars and to be at the site of the first customer by 8:00 a.m.  The technicians were expected to leave their last customer site by 5:00 p.m.  The technicians were paid for their work hours and reimbursed for mileage between 8:00 a.m. and 5:00 p.m., which included drive time between customer sites during regular work hours.  The technicians were not paid wages or reimbursed for mileage for commuting to the first site or commuting home from the last site.

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Ordinarily, when an employee has no regular, fixed location, they are not entitled to be paid for the time spent commuting to and from work.  However, Konica required service technicians to have a car with at least 25 cubic feet of space to “hold their tools and anything else they need for the job.”  Konica supplied all the tools and parts needed to work on the machines, and expected technicians to have all the tools and parts necessary to do their job.  Depending on the machines worked on by the particular technician, they carried different tools.  Storing the tools in the technician’s residence or other non-approved area was forbidden, unless the technician received written permission.

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Technicians were judged on the percentage of jobs that were completed on their first visit, which meant that it would be in a technician’s interest to carry as many tools and parts as necessary to complete jobs on the first visit.  Additionally, Konica had a policy where it could perform a check on their technicians.  During this check, the technician was expected to find 20 items within 20 seconds.  This meant that for all practical purposes during working hours, a technician needs to have at least 20 tools and parts with them in the event Konica decided to perform a check.  For these reasons, the technicians argued that driving with the tools and parts constituted “hours worked,” and they should be compensated for the time spent traveling from home to the first customer site and traveling from the last customer site back home.  The Plaintiff filed a class action lawsuit for unpaid wages and unreimbursed business expenses. 

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The Santa Clara Superior Court granted summary adjudication in favor of Konica.  It found that transporting tools did not mean Konica controlled the technicians’ routes or prevented them from completing personal errands before arriving to the first customer site or when returning home. The Plaintiff appealed the ruling, arguing that there was a question of fact whether technicians’ commutes constituted “hours worked.”  The Appellate Court found there was sufficient evidence that the technicians were under Konica’s control and reversed the grant of summary adjudication. 

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What Does Control of an Employee Mean in California?

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In California, hourly (non-exempt) employees must be paid at least the minimum wage for all “hours worked,” which is defined in California as the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, “whether or not required to do so.”  In its analysis, the Court reviewed cases for what is considered “control.”  Typically, this is when an employer “directs, commands, or restrains” an employee.  An employer may also hire an employee “to do nothing, or to do nothing but wait for something to happen…”  Courts observed that readiness to serve may be hired, just as service itself.  There is no requirement that an employee actually be working to be compensated. The level of control exercised over employees is determinative when deciding if the time is compensable.

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The Court noted the general proposition that commute time is not compensable.  If an employer provides optional free transportation, commute time is not compensable.  On the other hand, compulsory commute time is compensable where employees must meet at a certain time and place and use the employer’s transportation. 

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The analysis evolves when employees are transporting tools or equipment required for the job.  In Hernandez v. Pacific Bell Telephone Co., (2018) 29 Cal.App.5th 131, the court found that an optional program that allowed employees to drive a company vehicle home did not require that employees be paid for their commute time to the first work site and from the work site home.  Even though the employees could not use the company vehicle for personal use and contained the company’s tools and equipment, the program was optional.  Employees could also choose to start their day at the employer’s premises and drive the company vehicle from there, and they would be paid for the travel time from the employer’s premises to the first work site.

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Sufficient Evidence Existed that the Technicians were Under Konica’s Control¹

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The court noted two undisputed facts.  One, technicians were required to use their personal vehicle to commute to the customer site.  Two, they were free to engage in other activities prior to their first service appointment at 8:00 a.m. 

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However, the Court found there were factual disputes that warranted reversing the grant of summary adjudication.  It focused on two issues essential to determining if the technicians were under the employer’s control.  First, there was a dispute as to whether the technicians were required to carry the tools.  Some technicians had access to and the option to use a field stocking location where parts could be stored, but some did not have access.  The Court found there was a reasonable inference that technicians were better able to accomplish their performance goals by carrying tools and parts in their vehicle.  In effect, a jury could find that while not required to carry the tools and parts in their vehicles, the demands of their job did not afford the technicians a real option.

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Second, there was a factual dispute about the volume of tools and parts the technicians were required to carry.  Konica required at least 25 cubic feet of space.  Some technicians drove vehicles without sufficient space.  One technician claimed he had to carry upwards of 400 pounds, another claimed his trunk was full, and another claimed he could fit everything in an Audi coupe.  The Court noted that one technician drove his spouse’s car on weekends to avoid unloading his car, and another took all the tools and parts out each weekend and put them back in Sunday night.

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Given these factual disputes, the Court determined that if carrying the tools and parts was optional, the technicians would not be under the control of their employer.  If technicians had to carry tools and parts, this would not be control if the technicians could use the time commuting for their own purposes.  On the other hand, if being required to carry the tools and parts as a practical matter prevented the technicians from using the time effectively for their own purposes, the technicians would be subject to Konica’s control and must be compensated at least the minimum wage for this time.  Since the evidence was disputed on these issues, summary adjudication for Konica was not warranted.²

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What Can Employers Do?

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This case underscores a key issue in California employment law.  Namely, when an employee is subject to the control of the employer, an employee needs to be paid.  We have just seen that employers must pay for employees waiting for and undergoing bag checks.  Even small amounts of time that are for the employer’s benefit must be recorded and paid.  Commute time mandated by the employer as to type and time should be paid. 

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In addition, employers should make sure they are not exposing themselves to liability when employees carry around tools and parts.  Think if your employees are required by policy or practicality to carry tools, equipment, or parts to do their jobs.  A policy that allows employees to either pick up their tools before the start of the work day or carry the tools with them at the employee’s convenience would not necessitate paid commute time. 

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If your business requires employees to carry company property, now is a good time to determine if there is potential wage and hour liability.  If this practice is essential to your business, consider if you need to pay your employees for their commute time.  If employees cannot use the commute time for their own purposes, a court could find that employees are subject to your control, subjecting your business to wage and hour liability.  Lastly, ensure that your policies are up to date in your employee handbooks and that optional practices are clearly communicated to your employees.  If an employee chooses to use a company vehicle or wants to carry tools in their car to make their work day easier, have them sign an acknowledgment that this is an optional practice and is provided for the benefit of the employee.

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.A copy of the opinion can be found here.

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About the Author:

Nicholas Grether is an employment attorney in the Employment Law Department at The Maloney Firm, APC. If you have questions regarding this alert, contact Nicholas Grether at ngrether@maloneyfirm.com.

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¹ This court is reviewing an order granting summary adjudication.  Thus, all reasonable inferences must be drawn in the light most favorable to the opposing party.  The court did not find that commute time was compensable, rather that triable issues of fact existed as to whether the technicians were under Konica’s control during their commutes.  A jury may find that the Konica did not subject their technicians to control and did not have to compensate them for commute time.

² The Court noted that if service technicians are owed wages for their commute time, then they are also owed reimbursement for their mileage while commuting under Labor Code section 2802.  Konica only provided reimbursement when the travel took the technicians outside of a defined area for this commute time from home to the first customer site and from the last customer site back home.  Konica reimbursed technicians for mileage driven during regular work hours.

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