Understanding Time Rounding Practices in California

Some employers use a practice called “time rounding,” which adjusts an employee’s clock-in and clock-out times to the nearest preset increment—usually to the nearest five, ten, or fifteen minutes. While this might sound harmless, improper rounding can lead to wage theft and unpaid work over time.  

If your employer has recorded your work time incorrectly by rounding, contact our Orange County wage and hour lawyer to seek compensation. Schedule your free consultation today.

What Is Time Rounding?

Time rounding occurs when an employer records an employee’s time worked by rounding to the nearest increment instead of paying for the exact number of minutes worked. For example:

• If an employee clocks in at 8:56 a.m., the system rounds up to 9:00 a.m.
• If an employee clocks out at 5:04 p.m., it rounds down to 5:00 p.m.
  

In theory, this system should balance out over time—sometimes rounding in the employee’s favor, sometimes in the employer’s. However, when used improperly, rounding often benefits only the employer, resulting in systematic underpayment.

Is Time Rounding Legal in California?

California law allows time rounding under limited circumstances.

The California Supreme Court first addressed this issue in See’s Candy Shops, Inc. v. Superior Court (2012). The court ruled that rounding practices are permissible if they are:

1. Fair and Neutral on Their Face: The rounding policy must not always favor the employer.
2. Used in Good Faith: The employer must intend for rounding to even out over time, not to shortchange workers.
3. Mathematically Balanced: The policy must not result in employees losing significant amounts of pay across pay periods.
   

That said, more recent court decisions have begun to limit the use of rounding, especially as modern technology allows precise time tracking.

Recent Legal Developments

In Donohue v. AMN Services, LLC (2021), the California Supreme Court ruled that employers may not round time punches for meal breaks. The court held that even small rounding practices can violate employees’ rights to a full, uninterrupted 30-minute meal period.

In Camp v. Home Depot U.S.A., Inc. (2022), the California Court of Appeal went further, questioning whether rounding should be allowed at all when an employer’s electronic timekeeping system can record exact times. The court found that rounding in this case caused employees to lose pay over time, and therefore violated California wage laws.

These rulings signal a clear shift in that rounding may soon be considered unacceptable in most cases. 

How Rounding Affects Employees

Even a few minutes lost per shift can add up to significant unpaid time over weeks, months, or years. Common examples include:

• Early Clock-Ins: Employees who arrive a few minutes early and begin working may not be paid for that time if rounding cuts it off.
• Late Clock-Outs: Workers who stay late to finish tasks might lose minutes of compensable time.
• Meal Breaks: Improper rounding can make it appear that employees took a full 30-minute lunch when they did not.
• Shift Preparation or Cleanup: Time spent setting up or closing down before or after shifts may be rounded away and go unpaid.

What Employees Can Do

If you believe time rounding has caused you to lose pay, here are steps to take:

Keep Your Own Records

Write down your exact clock-in and clock-out times, including meal breaks.

Compare Pay Stubs

Check whether your total hours match the hours you actually worked.

Ask About the Rounding Policy

Employers should be able to explain how their system works and why it is being used.

File a Complaint

You can file a wage claim with the California Labor Commissioner’s Office or consult a wage and hour attorney  in Orange County to recover unpaid wages and penalties. Schedule your free consultation with Aegis Law Firm today.