November 3, 2022

When Neutral Isn’t Enough: California Invited to Revisit Rounding

In the recent case of Camp v. Home Depot U.S.A., Inc (October 2022), California’s Sixth Circuit Court of Appeal invites the California Supreme Court to review and refine its application of California’s long-standing approval of facially neutral rounding policies.

At issue in the case was a challenge to the employer’s application of its allegedly neutral quarter-hour rounding policy in connection with its electronic timekeeping system which captured each minute worked by its employees. In reversing and remanding the case for summary judgment, the Court limited its ruling to the issue of whether an employer runs afoul of California’s lawful time rounding practices where it utilizes a timekeeping system that allows it to capture the actual minutes worked by an employee.

Employee Camp was found to have lost more than seven hours of work time between March 2015 and October 2020 due to the employer’s rounding policy; an amount determined by the Court not to be de minimis. Noting a lack of citable authority on similar facts, as well as advances in technology, the Camp Court invited the California Supreme Court to address the validity of existing rounding standards – currently based on statutory and case law – mandating that employees must be paid for all hours worked and that even small amounts of worktime – measured in minutes – is compensable where the worktime is regularly occurring.

Of major concern to the Court is the question of whether rounding standards are still viable where an employer, through the use of technology, can now more accurately track and pay all hours worked by an employee. As a result, the issues raised in the Camp case call into question whether current technological advances – allowing an employer to track time more precisely – will give way to fewer circumstances where a facially neutral rounding policy will remain applicable.

It remains to be seen whether the California Supreme Court will undertake a meaningful review. In the meantime, employers currently utilizing precision timekeeping methods, in connection with an existing rounding policy, should consult legal counsel on whether to continue rounding in all circumstances.