The U.S. Supreme Court will be reviewing a case involving the labor practices at Amazon.com (NASDAQ:AMZN). According to Bloomberg, the justices agreed Monday to evaluate a federal appeals court decision that affects the workers at Amazon warehouses who are forced to spend unpaid time undergoing security searches. Former employees of Integrity Staffing Solutions, a provider of temporary workers for Amazon, filed a lawsuit over the security lines meant to prevent employee theft at Amazon warehouses in Nevada, and now the U.S. Supreme Court has been enlisted to review the federal appeals court decision that allows such a suit to be filed.
Bloomberg reports that Jesse Busk and Laurie Castro, both employees of Integrity Staffing Solutions, claimed in their suit that workers employed in Nevada warehouses had to spend as much as 25 minutes after their shifts ended to pass through metal detectors. Similar claims have been filed against companies like CVS Pharmacy (NYSE:CVS) and Apple Inc. (NASDAQ:AAPL), and the results of those suits led corporate groups to recently urge the Supreme Court to take up the appeal against Amazon, charging that the security searches are necessary.
The Fair Labor Standards Act is expected to be the crux of the case brought to the high court. This act requires compensation for pre- and post-shift activities that are “integral and indispensable” to an employee’s principal activities, per Bloomberg. In January, a similar case was brought before the Supreme Court, in which the justices ruled that companies don’t have to pay workers for time spent putting on and taking off safety gear if a collective bargaining agreement precludes compensation. Now, it’ll be interesting to see if the high court rules similarly this month.
Employees at large companies have long used the Fair Labor Standards Act to plead their cases, but this particular case is significant simply because of who it is filed against. Amazon, one of the world’s largest employers, has worked to keep its employees satisfied and silent, but it is clear that the e-commerce giant isn’t an expert at everything. Only those employees at Amazon warehouses in Nevada have raised a fuss, but if the court rules in their favor, Amazon could see some bigger compensation issues on its hands.
As Amazon sends representatives to the court, CEO Jeff Bezos must deal with other issues currently facing the company. We learned last week that Amazon has successfully tempted some smaller retailers into teaming up with the e-commerce giant against the likes of Wal-Mart (NYSE:WMT) and Target (NYSE:TGT), but the Seattle-based company still has at least one big issue on its hands: the pricing of its Prime membership program. Amazon is reportedly mulling the possibility of increasing its subscription fees $20 to $40, and analysts are offering their predictions for what could come from the increased costs.