Amazon.com Workers Unfulfilled on State Law Wage Claims

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By Kevin McGowan

Workers in Amazon.com Inc. warehouses who fulfill customers’ orders don’t have to be paid for time spent going through security screens at the end of their shifts ( In re Amazon.com, Inc., Fulfillment Ctr. Fair Labor Standards & Wage & Hour Litig. , 2017 BL 192124, W.D. Ky., No. 14-139, 6/7/17 ).

A federal district court in Kentucky June 7 dismissed the workers’ claims that Amazon and Integrity Staffing Solutions Inc. may be liable under Nevada or Arizona state law for not paying workers for time in mandatory security checks before leaving their workplaces.

Federal law sets a floor, not a ceiling, on minimum wage and overtime pay protections for covered employees. States can enact laws that provide workers with greater protections. States with laws that track the Fair Labor Standards Act’s language, however, often follow court and agency interpretations of federal law in applying state law.

The U.S. Supreme Court in 2014 ruled that Amazon warehouse workers employed by Integrity Staffing lacked Fair Labor Standards Act claims because the time spent to clear security was noncompensable under federal law.

The workers here fare no better on their pay claims under a Nevada statute, the Nevada state constitution, or an Arizona minimum wage regulation, Judge David J. Hale wrote for the federal district court in Kentucky.

Attorney Mark Thierman, who represents the workers, said he plans to appeal. He might ask the U.S. Court of Appeals for the Sixth Circuit to send some issues to the Arizona Supreme Court, which would have greater expertise on interpreting its own state law, Thierman told Bloomberg BNA June 8.

Some workers’ claims under California wage and hour law against Integrity Staffing and Amazon still are pending in the U.S. District Court for the Western District of Kentucky, said Thierman of the Thierman Law Firm in Reno, Nevada.

A number of lawsuits challenging Amazon’s pay practices for workers in its fulfillment centers nationwide have been consolidated in the federal district court in Kentucky. Staffing agencies that supply workers to Amazon, such as Integrity, also are named as defendants. Amazon was added as a named defendant on the Integrity Staffing workers’ state law claims after the Supreme Court dismissed the federal claims.

A related case also is pending against Amazon in a Washington state court, Thierman said.

State Law Follows FLSA’s Lead

Nevada courts in deciding wage-and-hour issues generally “look to federal law” unless the state law’s language is “materially different” from or “inconsistent” with the FLSA, the court said.

There’s “no indication” the Nevada state courts “would reject the Supreme Court’s reasoning as to whether time spent on security screening is compensable,” Hale said. “There is no material difference between Nevada statutes and the FLSA on this point, and Nevada courts look to federal wage-and-hour law where state precedent is lacking.”

The workers argued the companies’ failure to pay them for “all hours worked,” including time spent in the security screening, violated an Arizona minimum wage regulation.

But the court said the Arizona law should be interpreted consistently with the FLSA. No violation occurs if employees receive at least the hourly minimum wage calculated over a standard workweek, the court said.

Attorneys for Amazon and Integrity Staffing weren’t immediately available for comment June 8.

Morgan Lewis & Bockius LLP, Fisher & Phillips LLP, and Dinsmore & Shohl LLP represented Amazon. Littler Mendelson PC represented Integrity Staffing Solutions.

To contact the reporter on this story: Kevin McGowan in Washington at kmcgowan@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Chris Opfer at copfer@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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