On February 1, 2006, a California Court of Appeal issued a published decision in Overton v. Walt Disney Company. The Court of Appeal held that Disney did not need to compensate its employees for the time they spent riding on a shuttle from the employee parking lot to the employee entrance because the employees were not required to park in the employee parking lot.

Disneyland provides several parking lots for its employees, some of which are adjacent to the theme park and some of which are offsite. Employees are assigned to a particular parking lot; meaning, that if they choose to drive their car to work they must park in their assigned parking lot. Disneyland provides a free shuttle for employees who park in the Katella lot, which is approximately one mile from the employee entrance. In this case, the Plaintiff was assigned to park in the Katella lot and claimed he needed to arrive to work “substantially earlier” in order to ensure he arrived at the employee entrance on-time for work. The Plaintiff claimed that he should have been compensated for the time he spent riding the shuttle bus to the employee entrance and he sought to bring a class action on behalf of all employees who were assigned to park in the Katella lot.

The issue in this case is whether the time that employees spend on the shuttle is considered “hours worked” for which compensation is owed. Employers must compensate employees for all “hours worked.” The California Supreme Court has previously held that the definition of “hours worked” is not limited to time the employee spends actually working because “hours worked” also includes time that the employee is “subjected to the control of an employer.” The Supreme Court has also held that if employees are required to utilize a shuttle to travel to the worksite, this time is considered “hours worked.”

In this case, employees could choose to be dropped off at the employee entrance or take public transportation and 10% of Disney employees did not drive their cars to work. In addition, Disney offered incentives to employees who carpooled including the right to park in a lot that is closer than the Katella lot.

Plaintiff suggested that Disney could eliminate the “unfairness” of the situation by placing a time-clock at the Katella lot so that the employees could clock-in before they boarded the shuttle. The Court rejected Plaintiff’s suggestion on the basis that Disney would then be paying unnecessary compensation to many of its employees. For example, if the time-clock were located at the Katella lot, Disney would be forced to pay employees even if they chose to walk the one-mile distance as well as employees who simply arrived to work early.

The Court of Appeal ultimately held that because the employees were not required to park in the Katella lot in order to get to work, the time spent riding in the employee shuttle did not constitute “hours worked.” Accordingly, Disney did not need to compensate the employees for the time they spent riding in the employee shuttle.