The Supreme Court is poised to hear arguments regarding some of Amazon’s employment and business practices regarding workers in their large warehouse units. A class action lawsuit was filed in 2010 alleging that Amazon and its contractors were breaking wage and overtime laws with their security check practices. The warehouse workers complain that they are forced to wait in line for nearly a half hour go through a security screening at the end of their shifts. They are required to clock out before going through the security screening, so the time that they spend waiting is uncompensated.
At issue before the court is whether these security checks and waiting times are part of the employee’s regular workday and should be compensated or whether they should be considered as occurring after the employee is off work and should not be compensated. The employees argue that since they are required to be present for these security checks and are not allowed to leave until they have gone through the process, it should be considered as a part of their time at work performing the job they were hired to do. Arguments against compensating employees for this time claim that the security check and the related waiting time are “preliminary” or “postliminary” activities and are not compensable under the Portal-to-Portal Act signed into law by Congress in 1947, which subsequently found that compensation was only required for tasks that were “integral and indispensable” to workers’ “principal activities.”
In friend-of-the-court briefs filed with the Supreme Court, retailers expressed concern that they would have to pay employees for time performing antitheft checks at the end of the workday, increasing their labor costs substantially while the employee was not performing any actual work for the company. Many of Amazon’s warehouse workers actually work under the guidance of temporary employment agencies. This employee outsourcing allows Amazon to keep its labor costs low and shields them from most of the responsibilities associated with hiring these types of employees, who often supply physical labor for up to twelve hours a shift.
The Supreme Court’s decision could have wide implications for the retail industry. Amazon is not the only company that uses this practice when it comes to warehouse workers. These types of security checks have been used throughout the retail industry to dissuade employees from stealing goods and most of the employees that undergo these checks are not paid for the time they spend waiting in the security lines. Nearly 63 percent of retailers performed these kinds of checks at the end of their employees’ shifts in 2013.
