Employers and payroll services often 'round' time entries, calculating total time worked to the nearest tenth or quarter of an hour. Federal law expressly permits this, for example allowing time to be rounded down from one to seven minutes (8:01 is counted as 8:00) so long as time is rounded up from eight to fourteen minutes (8:14 is counted as 8:15). State law generally follows this rule so long as the process does not ultimately favor the employer.
Unfortunately, despite many employers' reliance on the doctrine, the same rule now does not apply to meal-period tracking. In Donohue v. AMN Services, LLC, the California Supreme Court held that the rounding rule cannot be used to record employee breaks because meal periods are designed to provide an absolute minimum time off for employees. According to the court, systems that apply rounding to meal periods do not guarantee that employees actually received a full 30-minute meal time, as an employer's system might show a half-hour break when the employee was gone for less than thirty minutes.
This decision, like so many recent appellate cases, applies retroactively and thus guarantees a host of Donohue-based individual and class-action claims. While payroll companies are sure to change their practices quickly, employers should monitor their providers and their own practices to eliminate rounding when tracking meal periods.
The Donohue case can be viewed here.