Can employers pay workers in 10- or 15-minute increments?

Every business has different policies regarding how they treat their workers. So long as companies comply with federal regulations and California state law, they can create the type of work culture that they deem appropriate given the nature of the business.

Some companies may have relatively creative approaches to employee timekeeping systems. For example, they might try to pay workers in specific increments of time. It was once a relatively common practice for businesses to pay workers in five, 10 or even 15-minute increments. However, doing so in California now could constitute a violation of workers’ wage rights.

California requires payment for all time worked.

Federal wage regulations provide a bit of flexibility for companies as they allow employers to round the time punches of their workers in certain circumstances and as long as the rounding practice is neutral.  Employers in most other states can also pay workers in specific increments of time.

Such practices are not lawful in California. Workers deserve compensation for all time worked, meaning that companies cannot force them to clock out before performing routine job functions. Additionally, the company cannot round the time that workers were on the clock, as doing so may diminish the wages that they receive.

State courts have affirmed that time clock rounding policies do not align with California wage regulations. The widespread availability and overall affordability of digital timekeeping systems make it unnecessary for employers to round the amount of time workers are on the clock to specific increments to streamline payroll procedures.

Companies have the ability to track a worker’s time down to a fraction of a second and should pay them accordingly. Employees paid on an hourly basis may find that their employers do not uphold state law and instead deprive them of pay for some of the time that they worked.

Pursuing a wage claim successfully can compensate workers for payroll practices that violate California state statutes and judicial precedence interpreting wage rules. Companies may have to change their practices after workers speak up and seek the wages they deserve.