In a welcome decision for retailers, a federal district court in California, after granting the plaintiffs' motion for class certification, granted Apple's motion for summary judgment against the class, holding the time that store employees spent waiting for and undergoing security bag checks when leaving the stores was not compensable time under the California Labor Code because the employees could avoid the bag checks by not bringing a bag to work.
Concerned with internal theft, Apple, like many retailers, implemented a written policy that imposed mandatory searches of employees' bags, such as purses or backpacks, whenever employees left the stores. Apple also required that an employee's personal Apple devices be verified as the employee's own before exiting the store. Employees had to clock out before undergoing a bag check and, therefore, as a general rule, received no compensation for the time involved in the bag checks.
The decision, Frlekin, et al. v. Apple, Inc., had a winding procedural history. Apple first moved for summary judgment as to the named plaintiffs' California claims in April 2014, which the court denied due to then-existing disputes regarding employee reasons for bringing a bag to work. Then, in July of this year, the plaintiffs obtained certification of a 12,400-member California class (for particular issues only under Rule 23(c)(4)) after they agreed to limit their theory of liability to the discrete legal issue of whether Apple had to pay its employees for standing in line to have their bag searched, regardless of why they brought the bag to work. The court also gave both sides a second bite at the apple, permitting each side to move for summary judgment on the certified legal issue based on the most common factual scenario—i.e., an employee who voluntarily brought a bag to work purely for personal reasons.
In granting Apple's motion, the court considered whether the time spent waiting for and undergoing bag checks constituted "hours worked" under either the "subject to the control of an employer" or "time the employee is suffered or permitted to work" prongs of the California wage order. As to the "subject to the control of an employer" prong, the court concluded that, even though the bag search was mandatory, bringing a bag to work was not—it was the employee's choice. While the court noted that there was no decision on point, it surveyed the case law and held that employee choice regarding whether to bring a bag to work doomed the plaintiffs' claims.
As to the second prong, the court made short work of the plaintiffs' argument that the time associated with the bag checks was time during which Apple's employees were "suffered or permitted to work." Instead, the court held that Apple's employees "merely passively endured the time it took for their managers and security guards to complete the peripheral activity of a search." Notably, the court found the U.S. Supreme Court's Integrity Staffing v. Busk decision—which was decided under the FLSA—useful on this point.
The Frlekin decision is no mixed bag: it is a complete win and a longed-for development for retailers that have employee bag check policies, as it affirms that employee choice in bringing a bag to work is fatal to these types of unpaid wage claims. The implications of the decision are potentially game-changing, as it may be relied upon by retailers to defeat similar claims being asserted in the recent wave of employee bag check class action lawsuits, and it may well discourage plaintiffs' attorneys from asserting these types of claims in the future. Retailers that have employee bag check policies should review them in light of the Frlekin decision and ensure they make clear that bag checks are required only for employees who choose to bring a bag to work and that, if employees do not wish to undergo a bag check, they should not bring a bag into the store.
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