Appellate Court Orders Retailer To Pay For Security Checks

The U.S. Court of Appeals for the Ninth Circuit has reversed a federal court ruling and orders that Amazon (NASDAQ:AMZN) warehouse workers have to be paid for time spent going through loss-prevention-based security clearances. As retailers explore various ways to prevent worker theft, the ruling could signal that it might require additional hourly payments.

The issue before the panel involved whether the screenings were necessary parts of the job, done for the benefit of Amazon (or any employer). In this case, according to the ruling, employees said that Amazon's agents had required "the security screenings, which must be conducted at work. They also allege that the screenings are intended to prevent employee theft, a plausible allegation since the employees apparently pass through the clearances only on their way out of work, not when they enter. As alleged, the security clearances are necessary to employees' primary work as warehouse employees and done for (the employer's) benefit."

The lower federal court had ruled that Amazon's agents did not have to pay for the time spent doing the security screening. It was the employee theft element that made the something that Amazon's agents had to pay for. This is "a concern that stems from the nature of the employees' work, specifically, their access to merchandise. Therefore, the district court erred in assuming that (other courts had) created a blanket rule that security clearances are noncompensable instead of assessing the plaintiffs' claims under the 'integral and indispensable' test," the panel ruled.

Attorneys for the Amazon workers issued a statement applauding the panel's decision. Attorney Joshua Buck said in the statement that "nationally, hundreds of thousands, maybe millions, of people employed as warehouse workers waste 20 to 30 minutes every day just waiting in line to leave work because their employer makes them go though some sort of security check to prevent inventory theft."

"This case is not just about money, it's about respecting the time of the workers," said attorney Mark R. Thierman, another attorney for the Amazon warehouse workers. "If the employer knows it has to pay for the time that it requires these workers stand in line waiting to leave a plant or facility, the employer will hire more security personnel, open up more checkpoints, and be more respectful of an employee's time, because ultimately, it'll come out of their bottom line."

For more:

-See Amazon Workers' Lawyers' statement
-See Ninth Circuit's opinion

Related stories:

Retail Employee Theft Databases Riddled With Inaccuracies. Lawsuits, FTC Probes Pouring In
Why Amazon And Overstock Lost On Sales Tax
Federal Judge Rips Into Best Buy Loss Prevention VP

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