A panel from the Third Circuit Court of Appeals ruled last month that the time temp workers spent being bused from a hotel and crossing a picket line to an assignment is not compensable under the Fair Labor Standards Act.

In August 2015, Allegheny Technologies Inc., or ATI, locked out its union workers in Pennsylvania and Oregon. Allegheny Technologies manufactures metal alloys for aerospace and defense, oil and gas, electrical energy, medical, automotive, and other industrial markets.

ATI contracted with Strom Engineering Corp. to provide a temporary workforce to operate the facility during the lockout. Strom Engineering housed its workers at a hotel about 45 minutes away from the ATI facility and transported the workers across the picket line formed by the locked-out workers. Workers Ralph Smith and Ignatius Harris filed a class and collective action complaint in July 2017, alleging that ATI and Strom violated the FLSA, the Oregon minimum wage statute, and the Pennsylvania Minimum Wage Act, as well as unjustly enriched themselves under Pennsylvania law, by failing to compensate them for travel between the hotels and the ATI facilities before and after their shifts.

While the FLSA requires employers to pay overtime to employees who work more than 40 hours in a workweek, the Portal-to-Portal Act relieves employers from compensating employees for:

  1. walking, riding or traveling to and from the actual place of performance of the principal activity or activities that the employee is employed to perform; and
  2. activities occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time on any particular workday at which such principal activity or activities cease.

Citing Integrity Staffing Solutions Inc. v. Busk, the panel noted the US Supreme Court “has consistently interpreted the term ‘principal activity or activities’ [to] embrac[e] all activities which are an ‘integral and indispensable part of the principal activities.’” Thus, employees will receive overtime pay for commuting when the commute is (1) a principal activity or (2) integral and indispensable to a principal activity. “That an employer mandates certain travel procedures does not make the travel a principal activity,” the court noted.

The case is Smith et al. v. Allegheny Technologies Inc. et al.