There’s a monumental case at the Supreme Court that has got me obsessed, bewitched, enraged and mildly despondent. Technically, it’s called Integrity Staffing v. Busk. It actually is Amazon v. Amazon’s warehouse workers. (Integrity Staffing is the subcontractor stooge hired by Amazon to employ its warehouse workers).

After Amazon workers finish a 12 hour shift in which they can run an average of 10 miles on concrete, they are required to go through a security screening at the warehouse exit. The screening lanes are understaffed and the wait is often 25 – 35 minutes. The workers are not paid for the wait or the screening time. The workers sued to get paid for the long wait. Integrity Staffing (for ease of understanding I’m going to call Integrity Staffing, alone and with Amazon, “Amazon” in this post) moved to dismiss the case and won. Later, a panel of judges disagreed, saying that, yes, the workers could have a claim and deserve a day in court. Now, Amazon has appealed, arguing that the workers are not entitled to money.

To the surprise and outrage of most progressives, the Obama administration has come out forcefully against the workers, arguing that going through long security lines is not something for which they should be paid.

I have read the Amicus Brief — it is dreadful. I have annotated it, so you can take a look at bad lawyering and worse policy. You can find my annotated brief here. I Promise: you won’t have to read lawyer language. I translated it and included my comments (apologies for the profanity). I have been so enraged by the Obama involvement with this case, I did my show on it, I made an ugly infographic about it, I annotated the Obama Amicus Brief and I wrote this explanation of the case and why it makes me so damned mad.

If you can’t read any longer, here is what I want you to realize: It is bad enough that someone with power is arguing that bosses don’t have to pay for time and chores that are outside the scope of the job when they ordered those chores and could make them go quicker.  But, it is a tragedy that our government — led by a Democrat — is pushing an illogical, cruel and degrading argument that 5% of a worker’s time is so dispensable as to not be compensable.

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Every decade or so, this fight breaks out: Employees who work on a factory floor fight for compensation for the time spent either doing prep work or clean-up. How much prep work and how much cleanup gets paid is always the controversy. The line goes back and forth between paid and unpaid time. But, usually you can count on the pro business people wanting a narrow line and the pro labor people wanting a wide line. Until now. This time, the Obama Department of Labor says that people should not get paid for the part of their cleanup that is going through a security line to prove they didn’t steal during their shift. The Obama administration sided with Amazon — and has argued, forcefully and dishonestly — that people waiting to go through an understaffed, remotely located security line on their way to the parking lot should have to bear the cost of that time.

Here is what it boils down to: Do we pay people for chores performed at the boss’s request? Or do we only pay people for work deemed productive that produces an actual benefit for the boss? If we only pay people for productive work then we still have workers making contributions of time and energy, but now free of charge. What the government is really saying is that if you make an average of $12.00 per hour, your waiting and walking time is worthless.

The Law – Quick and Mean

Here is a very fast explanation of the law, as clearly and vibrantly as I can write it:

Factory workers must be paid from portal to portal. In the 1940s, a factory refused to pay its workers for the 3–8 minutes it took them to walk from their time clock to their work station. The workers sued and the Supreme Court said employers have to pay workers for the walking time — they must be paid from portal to portal.

Congress Freaks Out. Congress thought this created “wholly unexpected liabilities, immense in amount and retroactive in operation.”^[1] So, the Congress passed the Portal-to-Portal Act of 1947, which clarified nothing. Here’s why:

Portal-to-Portal says that bosses only have to pay for principal activities or where compensation is required by contract, custom or practice.^[2] They then forgot to define that stuff.

Time Spent Following Orders = Paid. In the 1950s, this came up again. This time, workers in a battery factory had to change clothes into uniforms and lab clothes provided by the company and then take them off and shower after work because otherwise they carried lead and acid on their bodies and hair. The Supreme Court said that this was paid time.^[3]

Don to Doff. And, as recent as 2005, poultry processing workers sued for prep time. The Supreme Court unanimously said that workers have to be paid from the minute they put on the gear in the locker room to the moment they take it off.

But, now comes our Democratic President, who got elected with Labor’s help, turning on all workers.

The federal government makes a basic argument that lacks wisdom or truth. Here it is:

The law says bosses only have to pay workers for chores that are part of the work the employees are hired to do. Waiting in line and getting searched is not related to pulling merchandise off shelves. Waiting in line for security screens is not integral and indispensable to the work. So, Amazon doesn’t have to pay the employees for the time since it isn’t part of their “work.”

Making workers go through the security lines – slowly – is just like when we make other workers – airport workers, prison guards, soldiers – go through security lines for free. All kinds of people have to go through security for free and the fact that these people are at work doesn’t mean they should be paid for doing this at work. The rules (that we write and tinker with) really have us in a bind, but we are just following the rules.

Funky, huh?

All the Things About This That Ought to Piss You Off

Betrayal.

Obama’s Department of Labor insists that employees just have to eat the time drained from them. But, the Feds never even observe that the lines could and should be made more efficient, that 25 minutes is a significant amount of time and that the workers just ought to be treated with more dignity. How can you be anything other than sore and furious that our government — led by a Democrat — has so much contempt for the hourly wage worker.

Day in Court.

What makes the Obama administration’s betrayal even more acute is the fact that this is just a motion to dismiss – the workers have not been to trial. But, the Obama administration is arguing that the workers should not get their day in court, to make their case and present the facts. The Obama administration is using its weight and moral authority to shove this case into the garbage.

Moral Hazard.

Businesses — and Amazon — should not be allowed to escape economic incentives that motivate them to do things better, fairer and more efficiently. Here, the Feds don’t dispense with any notion that Amazon is the only one who can make the security lines go quicker — the Feds never even consider it. When did we decide that profitable businesses are so far superior to persons that all obstacles should be cleared for them at the expense of the rest of us?

Costs to Abusing Employee Time.

There are costs to abusing an employee’s time. When you treat an employee like his time and recuperation are essentially valueless, one of three things happens. He develops a serious case of apathy, which is bad for the employer’s business. The dollars the boss saves in compensation, he will more than lose in reduced productivity. Second, the employee can also put together the lack of trust in his honesty – owing to the enforced security screenings – and the disregard for his time and dignity and leave, costing the boss dollars to replace the departed employee. Third, the employee could continue to fall into learned helplessness, making him more captive to and dependent on his employers and less reliable as a stalwart voter and citizen. The reduction in wages and the erosion in rest, recreation and family time may seem minor day to day, but over the course of months, it adds up to a heavy tax on the productivity of the employee and a burden on his spending power. The amounts to the employer may be significant, but not as significant to the worker, who will spend that cash as soon as he makes it, recycling it through the economy. In fact, there are so many of these cases out there, that demanding that bosses pay for employee check out times may be stimulative to the economy.

Amazon’s Literally Getting a Steal.

Doesn’t letting Amazon get away with extracting free labor from its workers artificially heighten Amazon above the rest of the crowd? Employee theft — the biggest danger in retail — poses a serious risk. Part of Amazon’s business risk management strategies must be minimizing its employee’s theft. Having employees go through Amazon’s risk management system seems to be a reasonable cost of doing business for Amazon. Other stores with smaller staffs have a similar risk — but it is harder to keep employee morale aloft when the boss you work for everyday searches your bag and those of your few co-workers. Amazon can successfully manage its employee theft risk by using the power of anonymity to displace some of the discomfort that would result from having the company owner search the bags of the few store employees. Allowing Amazon to get some of their risk management processes executed at a steep discount seems an unseemly advantage that other companies don’t have. Amazon gets away with murder. It doesn’t have to turn a profit, it doesn’t have to collect sales tax, now, it may not have to bear a portion of its risk management costs.

The Point of Employment Wasted.

The whole point of being an employee is offloading risk onto the boss — in exchange, the boss gets all the upside. Here, the employees are actually required to shoulder risks of theft — risks that an employee up ahead in the queue gets busted, slowing the line behind him; risks that staff shortages make the line go slower; the numerous costs of missing trains, pickup times and rest.

Unjust Enrichment is Just for Rich People.

This case shows one of the different ways we treat business and people. If I tell you to shovel my driveway and you do it, I owe you money for it, even if we didn’t set a price in advance. You’re entitled to money equal to my “unjust enrichment.” In other words, I am not allowed to receive a benefit you provided without compensating you for it. Why are employees not entitled to the same right? Ironic, in that so many bad capitalists insist that workers are market players, capable of negotiating better deals for themselves, alleviating the need for legal protections and unions as a proxy for actual negotiations. But, here workers are clearly getting a worse deal than business people. Here, the workers do something at the request of the boss, provide a benefit equal to the value of their time at their prevailing rate, but walk away empty, having unjustly enriched the boss — with President Obama’s help.

Boss’s Order, Boss’s Expense.

The simplest and cleanest way to look at this is to say that any order levied by the boss on the worker that takes more than a bare (de minimis) amount of time is considered part of the principal activities. That is fair to the worker. It makes the boss more disciplined and less likely to cavalierly assign unrelated or tangential chores since he has to pay for them. It makes the boss disciplined in the use of employees’ time. It memorializes our abiding belief in the dignity of every person. It ensures that everyone counts.

Money Out of Politics, Business Out of News.

Jeff Bezos owns Amazon and the Washington Post. The Washington Post is the gossip rag and idea mover in D.C. Can you disregard a connection between Obama’s labor department welching on years of policy promises to shore up the profit and loss statement of Amazon and Bezos’ ownership of the Post? We need money out of politics. We need business out of news.

1. 29 USC 251(a).  ↑
2. 29 USC 252(a).  ↑
3. The Court said that the “term ‘principal activity or activities’ … embraces all activities which are ‘an integral and indispensable part of the principal activities,'” including the donning and doffing of specialized protective gear “before or after the regular work shift, on or off the production line.” Steiner v. Mitchell, 350 U.S. 247, 256 (1956).  ↑