A recent Nevada Supreme Court decision may have significant ramifications for Nevada employers and what activities are considered compensable work. In Amazon.com Servs., LLC v. Malloy, the Nevad Supreme Court answered a certified question under Nevada Rule of Appellate Procedure (“NRAP”) 5 regarding whether Nevada incorporates the Portal to Portal Act (the “PPA”) in its wage and hour laws.[1] The case originates out of a dispute over whether employee needed to be paid for time spent conducting COVID-19 testing.
During August 2020 and April 2021 time, Amazon instituted a company-wide policy that required employees to undergo COVID-19 testing before each shift. Amazon did not pay its employees for the time spent getting tested. Dwight Malloy filed a putative class action in federal court, asserting claims for relief under Nevada’s wage-hour statutes related to Amazon’s decision to not pay employees for this time. Amazon moved to dismiss, arguing that the PPA exempted the testing from compensable work. That motion to dismiss was denied, and Amazon moved to certify whether the PPA applied as a certified question to the Nevada Supreme Court.
The Nevada Supreme Court accepted the question as it is determinative of the case pending and rephrased the question to specifically determine whether the PPA’s exceptions to compensable work were included in Nevada’s wage-hour laws. The Court began by analyzing the statute’s plain language. In interpreting Nevada’s wage-hour laws, the Court also turned to its federal counterparts, the Fair Labor Standards Act (“FLSA”) and the PPA.
The FLSA was enacted to protect wage-hour employees, and the PPA was later enacted to amend the FLSA. The FLSA does define the term “work,” but the United States Supreme Court has interpreted the term to mean physical or mental exertion control or required by the employer for the benefit of the employer. The PPA then provides exceptions to that definition, exempting travel time or preliminary and postliminary activities not directly related to the employee’s job. Amazon argued that COVID-19 testing is an activity preliminary to an employee’s actual job and as such it did not need to pay employees for that time.
In contrast to the FLSA and the PPA, Nevada’s wage-hour laws do not contain similar exceptions. The Court concluded that the exceptions contained in Nevada’s wage-hour laws are materially different from the PPA provisions Amazon relies upon. The PPA exceptions are a catchall while the Nevada statutes do not contain any of the express language included in the PPA. Rather, the Nevada statutes contain a narrow exception for compensable work activity, focused on exempting sleep and meal periods. These greater protections indicate the Nevada legislature did not intend to mirror the PPA in this instance, and therefore Nevada did not incorporate the PPA exemptions into its wage-hour laws.
While this decision does not resolve the underlying case or even determine if COVID-19 testing is compensable work, the decision will have major ramifications for Nevada employers as the Nevada Supreme Court has removed categorical federal exclusions from Nevada law. Nevada courts will now address and analyze compensability under Nevada’s own statutory framework, which is much more protective than its federal counterparts.
While it remains to be seen how broadly Nevada courts will interpret compensable work, there is a strong likelihood that off-the-clock, employer-required tasks will fall within the definition, obligating employers to provide compensation for those activities.
[1] The full opinion can be found here at Document 25-47354: https://caseinfo.nvsupremecourt.us/public/caseView.do?csIID=70199.
