New Court Ruling: Payroll Rounding and Clock-In Rules Raise Wage Liability Risk

Required preshift tasks – and whether employees are paid for them – are at the center of a former hospital nurse’s wage dispute.

Chestnut Hill Hospital required nurses to change into surgical scrubs by 7 a.m. for a morning huddle. Pamela McBride sued under the Fair Labor Standards Act, alleging the hospital didn’t pay her for time she spent changing.

A Pennsylvania federal court recently denied the hospital’s motion for summary judgment, allowing McBride’s claims to proceed.

How the Clock-In Cap and Payroll Rounding Worked Together

Hospital policy barred employees from clocking in more than seven minutes before shifts or clocking out more than seven minutes after. At the same time, its timekeeping system rounded punches to the nearest quarter hour. For example, if McBride clocked in at 6:53 a.m., the system would round her start time to 7 a.m. She testified that changing took 10 to 15 minutes and said the hospital didn’t pay her for that time.

The hospital said its payroll rounding practices were neutral, but the court found a factual dispute over whether they excluded required changing time from pay. A punch had to be at least eight minutes early to round back to 6:45 a.m., but hospital policy prohibited employees from clocking in that early. 

The hospital also argued that 418 extra minutes paid through rounding canceled out any unpaid changing time. The court disagreed.

Protected Leave Counted Against Attendance

McBride also challenged how the hospital tracked her attendance. She used intermittent leave under the Family and Medical Leave Act (FMLA) and said the hospital assessed attendance points for some of that protected time.

The court said the hospital couldn’t avoid potential FMLA interference liability simply because an automated system assessed the points. The case continues.

Payroll Takeaway

A payroll rounding policy may look neutral on paper. But when paired with strict clock-in rules, it can exclude work hours from employee pay. Check whether clock-in limits keep employees from being paid for required preshift work. Extra minutes paid through rounding don’t make up for that unpaid time. For attendance tracking, ensure your timekeeping system doesn’t assign points for protected FMLA absences.

More info: McBride v. Chestnut Hill Hospital, LLC