1021-00005 · Verimark Hospitality Group · Analysis & Advice

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MEMORANDUM

PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGE / ATTORNEY WORK PRODUCT

TO: Bernard Crawford, Responsible Partner, Labor & Employment Renata Vasquez, Billing Partner, Labor & Employment

FROM: James Underwood, Working Associate, Labor & Employment

DATE: February 9, 2026

RE: Compensability of Alleged Pre-Shift and Post-Shift Activities Under the Fair Labor Standards Act — Verimark Hospitality Group Inc.

MATTER NO.: 1021-00005

CLIENT: Verimark Hospitality Group Inc.

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I. Executive Summary

This memorandum analyzes whether the pre-shift and post-shift activities alleged in the demand letter of Garza, Linden & Okafor LLP ("GLO"), dated January 14, 2026, on behalf of Daniela M. Serrano, constitute compensable work under the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. (the "FLSA"). This analysis is one component of the broader wage-and-hour compliance audit that Calderwood & Harkness LLP ("C&H") is conducting on behalf of our client, Verimark Hospitality Group Inc. ("VHG" or the "Company"), and is intended to inform the scoping and prioritization of the audit's initial investigative phase.

The GLO demand letter alleges that hourly, non-exempt employees at seven Verimark-branded hotel and resort properties in the State of Florida are required to perform uncompensated pre-shift and post-shift activities totaling an estimated fifteen to twenty-five (15–25) minutes per shift. These activities are not reflected in the employees' recorded time punches in the Luminos TimeTrack system and, accordingly, are not compensated in the employees' regular or overtime pay calculations.

The demand letter identifies three discrete categories of allegedly uncompensated activities:

1. Donning and doffing required uniforms. Employees allege they are required to change into VHG-branded uniforms in on-site locker rooms before clocking in and to change out of their uniforms after clocking out, consuming an estimated five to eight (5–8) minutes per shift.

2. Booting up computer systems and logging into point-of-sale and property-management software. Front-desk associates, concierge staff, and certain other roles allege they must power on computer terminals and log into multiple software applications before they can begin serving guests, a process estimated to take five to ten (5–10) minutes per shift.

3. Participating in shift-handover briefings. Incoming and outgoing shift employees allege they are required to participate in mandatory briefings during which operational information — including guest issues, VIP arrivals, maintenance concerns, and other matters — is communicated between shifts, consuming an estimated five to ten (5–10) minutes per shift.

Preliminary Conclusion. The compensability of each of these activities is a fact-intensive inquiry that turns on whether the activity is "integral and indispensable" to the employees' principal activities under the Portal-to-Portal Act, 29 U.S.C. §§ 254(a)(1)–(2), and on the application of the continuous-workday doctrine as articulated by the Supreme Court in IBP, Inc. v. Alvarez, 546 U.S. 21 (2005). Based on the preliminary factual information available, there is meaningful litigation risk on each of the three categories, with computer boot-up time and shift-handover briefings presenting the greatest exposure. Donning and doffing of uniforms presents moderate risk that is heavily dependent on the specific nature of VHG's uniform requirements and whether employees are effectively compelled to change on-site.

The estimated uncompensated time at stake — fifteen to twenty-five minutes per shift, with a midpoint of approximately twenty (20) minutes — is not trivial. Across a standard five-shift workweek, this amounts to approximately one hundred (100) minutes, or 1.667 hours, per week per affected employee. At the blended average hourly rate of $16.50 for the affected workforce, this represents $27.50 per employee per week in unpaid straight-time wages, with additional exposure for overtime premiums where the uncompensated time pushes employees above the forty-hour weekly threshold.

The scope of the potentially affected workforce is substantial. Approximately 1,895 current hourly, non-exempt employees work at the seven at-issue properties. Over the applicable lookback period (two or three years depending on whether VHG's conduct is found to be "willful"), the putative collective could encompass an estimated 4,100 to 5,900 individuals when accounting for employee turnover. As detailed in Section VII below, the pre-shift and post-shift claim category contributes an estimated $6–$10 million to the overall mid-range exposure estimate of $22–$38 million (inclusive of liquidated damages) and could represent as much as $50.6 million under the broadest theoretical scenario.

This memorandum proceeds as follows: Section II sets forth the relevant factual background. Section III outlines the governing legal framework. Section IV applies that framework to each of the three categories of alleged activities. Section V addresses property-level and role-level variations that may affect both the merits and any future collective-action certification analysis. Section VI evaluates VHG's available defenses. Section VII quantifies the impact of these claims on the overall exposure model. Section VIII provides recommendations for the audit's scoping phase, including specific factual investigation priorities, document preservation steps, and the proposed engagement of Ridgepoint Advisory Group LLC for forensic payroll analysis. Section IX concludes with a summary of findings and next steps.

II. Factual Background

A. The Demand Letter Allegations

On January 14, 2026, Marco A. Garza of Garza, Linden & Okafor LLP, 600 Brickell Avenue, Suite 2200, Miami, Florida 33131, transmitted a twenty-three-page demand letter to VHG's General Counsel, Thomas L. Nakamura, on behalf of Daniela M. Serrano. Ms. Serrano is a former front-desk associate at the Verimark Regency Tampa property (Employee ID VHG-EMP-20220314-5587), who was employed by VHG from March 14, 2022, through August 22, 2025. The demand letter asserts five categories of alleged FLSA violations; this memorandum addresses Allegation No. 3, which concerns the failure to compensate employees for pre-shift and post-shift work.

Allegation No. 3 of the demand letter asserts that VHG fails to compensate its hourly, non-exempt employees for pre-shift and post-shift activities that, in the aggregate, total approximately fifteen to twenty-five (15–25) minutes per shift. The demand letter describes these activities in the following terms:

(a) Donning and doffing required uniforms. Employees are required to arrive at the property and change into VHG-branded uniforms in on-site locker rooms before clocking in via the Luminos TimeTrack terminal. At the conclusion of their shifts, employees are required to change out of their uniforms after clocking out. The demand letter contends that this donning and doffing process consumes approximately five to eight (5–8) minutes per shift, depending on the employee's role and the specific uniform requirements applicable to that role.

(b) Booting up computer terminals and logging into software applications. Front-desk associates, concierge staff, and certain other computer-dependent roles are required to power on desktop computer terminals at their workstations, boot the operating system, and log into the property-management system ("PMS"), the reservation system, the point-of-sale ("POS") system, and other software applications before they can begin performing their job duties. The demand letter asserts that this process takes approximately five to ten (5–10) minutes per shift and that employees are expected to have all systems fully operational by the time their scheduled shift begins, thereby requiring them to initiate the boot-up process before their compensated shift commences.

(c) Attending mandatory shift-handover briefings. Incoming shift employees are required to participate in a briefing session during which the outgoing shift employees communicate information regarding ongoing guest issues, VIP arrivals, pending maintenance requests, and other operational matters. Similarly, outgoing shift employees are required to remain at the property to participate in the handover after their scheduled shift has ended. The demand letter alleges that these briefings are mandatory, last approximately five to ten (5–10) minutes, and are not reflected in employees' compensated time because they occur before the incoming employee clocks in or after the outgoing employee clocks out.

The demand letter applies these allegations across all seven VHG-branded properties that are the subject of the broader demand. Those properties are:

1. Verimark Regency Tampa

2. Verimark Grand Orlando

3. Verimark Shores Clearwater

4. Verimark Bayfront St. Petersburg

5. Verimark Resort & Spa Boca Raton

6. Verimark Oceanview Fort Lauderdale

7. Verimark Key West Collection

Claimant's counsel asserts that these pre-shift and post-shift activities are required by VHG corporate policy and/or by the actual practice at each property, that they are performed for the employer's benefit, and that the time consumed by these activities is not de minimis. The demand letter further asserts that VHG's failure to compensate for these activities is part of a "systemic" practice that affects the entire non-exempt hourly workforce at the seven at-issue properties, rather than an isolated occurrence affecting only the named claimant.

B. Verimark's Workforce and Timekeeping Practices

VHG operates fourteen (14) hotel and resort properties across the State of Florida, employing approximately 8,200 individuals in total. Of this workforce, approximately 5,900 employees — or approximately 71.95% — are classified as non-exempt, hourly workers subject to the overtime and minimum-wage provisions of the FLSA. The remaining employees are classified as exempt under one or more of the FLSA's white-collar exemptions (executive, administrative, professional, or highly compensated employee), the proper application of which is the subject of a separate memorandum addressing Allegation No. 1 of the demand letter.

The seven properties at issue in the demand letter collectively employ approximately 2,620 individuals, of whom approximately 1,895 are hourly, non-exempt employees. The breakdown by property is as follows:

VHG's payroll processing and timekeeping functions are handled by Luminos Payroll Solutions Inc. ("Luminos") through the Luminos TimeTrack platform (System ID: LTT-VHG-2022-0041). VHG transitioned to the Luminos TimeTrack platform effective January 1, 2022, and has used the system continuously since that date. Prior to January 1, 2022, VHG utilized a different timekeeping system, the records of which are maintained by VHG's Director of Payroll & Workforce Compliance, Enrique J. Fuentes.

Under the current system, employees clock in and out using Luminos TimeTrack terminals located at designated stations within each property. The terminals capture the precise time of each clock-in and clock-out event (the "time punch"). The system applies rounding rules and automatic deductions as configured by VHG's payroll team. Relevant to the broader audit, the system applies a thirty-minute automatic meal-break deduction rule (Rule ID: AR-MEAL-030) for all shifts of six (6) or more hours, which is the subject of separate analysis under Allegation No. 4 of the demand letter.

For purposes of the pre-shift and post-shift analysis, the critical feature of the Luminos TimeTrack system is that it records only the time when employees physically interact with the terminal — i.e., the time of the clock-in punch and the time of the clock-out punch. Any work performed before the clock-in punch or after the clock-out punch is not captured by the system and, accordingly, is not compensated. The demand letter's core contention is that VHG's practices systematically require employees to perform compensable work outside the boundaries of their recorded time punches.

The current VHG Employee Handbook (Version 7.2, effective January 1, 2025) contains policies relevant to this analysis, including policies on uniform requirements, shift scheduling, time-recording procedures, and expectations regarding shift readiness. Historical versions of the Employee Handbook — including versions in effect during the three-year lookback period — must be obtained and reviewed as part of the audit. Our preliminary understanding is that prior versions (Versions 6.0, 6.1, and 7.0, at minimum) contain substantially similar provisions, but this must be confirmed through document collection.

Preliminary information obtained from VHG's Director of Payroll & Workforce Compliance, Enrique J. Fuentes, and VP of Human Resources, Carla S. Whitfield, during the initial fact-gathering interview conducted on January 24, 2026, indicates the following:

• Employees are generally expected to be "floor-ready" at the commencement of their scheduled shift. The term "floor-ready" is understood at the property level to mean that the employee is in uniform, at his or her workstation, and prepared to begin serving guests.

• For computer-dependent roles such as front-desk associates and concierge staff, "floor-ready" is understood to include having all necessary computer systems and software applications powered on, logged in, and operational.

• Shift-handover briefings are a "longstanding practice" at multiple VHG properties, though neither Mr. Fuentes nor Ms. Whitfield could confirm whether the briefings are mandated by corporate policy or are the product of property-level management practices. Both acknowledged that the briefings occur regularly and that property-level managers participate in scheduling them.

• VHG does have a general policy discouraging "off-the-clock work," though the specific language and enforcement mechanisms of that policy require further review.

These preliminary indications, while subject to verification through the detailed factual investigation recommended in Section VIII, are consistent with the demand letter's core allegations and suggest that VHG's practices may give rise to compensable pre-shift and post-shift time.

C. Time and Damages Impact

The financial impact of the pre-shift and post-shift claims can be estimated as follows based on the preliminary data available. These estimates are necessarily rough and will be refined as part of the forensic payroll analysis proposed by Ridgepoint Advisory Group LLC.

Per-Shift Uncompensated Time. The demand letter alleges uncompensated pre-shift and post-shift time totaling fifteen to twenty-five (15–25) minutes per shift. Using a midpoint of twenty (20) minutes per shift, and assuming five (5) shifts per week (consistent with VHG's standard full-time scheduling), the weekly uncompensated time per affected employee is:

20 minutes/shift × 5 shifts/week = 100 minutes/week = 1.667 hours/week

Straight-Time Wage Impact. The blended average hourly rate for the affected hourly, non-exempt workforce at the seven at-issue properties is estimated at $16.50 per hour, based on C&H's preliminary analysis of VHG's payroll data for the most recent complete pay period. At this rate, the weekly per-employee straight-time value of the alleged uncompensated time is:

1.667 hours/week × $16.50/hour = $27.50/week per employee

Overtime Exposure. The uncompensated pre-shift and post-shift time may also generate overtime exposure under 29 U.S.C. § 207(a)(1). If an employee's compensated hours total, for example, 39 hours in a given week, and the addition of 1.667 hours of previously uncompensated pre-shift and post-shift time brings the employee's total hours to 40.667 hours, the employee would be entitled to overtime compensation at a rate of one and one-half times the regular rate ($16.50 × 1.5 = $24.75/hour) for the 0.667 hours in excess of forty. The overtime premium — the additional half-time component — is $8.25 per hour ($24.75 − $16.50 = $8.25).

Preliminary analysis suggests that many of the affected employees regularly work scheduled hours close to or in excess of forty (40) hours per week. Average weekly hours including the alleged pre-shift and post-shift time are estimated at approximately 42.5 hours, indicating that a significant proportion of the uncompensated time falls within overtime territory. The precise overtime exposure will depend on individual employee schedules and will be quantified by Ridgepoint as part of the forensic payroll analysis.

Aggregate Exposure. As detailed more fully in Section VII below, the pre-shift and post-shift claim category is a significant component of the overall Calderwood & Harkness mid-range exposure estimate of $22–$38 million (inclusive of liquidated damages) and an even more significant component of the theoretical Scenario B ceiling of approximately $202.4 million. The contribution of the pre-shift and post-shift claims to these exposure models underscores the importance of a thorough factual investigation during the audit's initial phase.

III. Legal Framework

This section sets forth the legal principles governing the compensability of pre-shift and post-shift activities under the FLSA, including the Portal-to-Portal Act's exclusions for preliminary and postliminary activities, the "integral and indispensable" test, the continuous-workday doctrine, the de minimis doctrine, and the "suffered or permitted" standard for employer knowledge.

A. The Fair Labor Standards Act — Hours Worked

The FLSA requires covered employers to pay non-exempt employees at least the federal minimum wage for all "hours worked" and overtime compensation at a rate of one and one-half times the regular rate of pay for all hours worked in excess of forty (40) in a workweek. 29 U.S.C. §§ 206(a), 207(a)(1). The threshold question in any wage-and-hour dispute is therefore what constitutes "hours worked."

The FLSA defines "employ" to include "to suffer or permit to work." 29 U.S.C. § 203(g). The Department of Labor's implementing regulations elaborate on this broad definition. Under 29 C.F.R. § 785.7, "[w]ork not requested but suffered or permitted is work time." An employer who "knows or has reason to believe" that an employee is continuing to work is required to count that time as hours worked. 29 C.F.R. § 785.11. This principle extends to work performed away from the employer's premises or at home, provided the employer has actual or constructive knowledge that the work is being performed. Id.

The regulations further provide that all hours worked in the first and last week of the employment period must be counted. 29 C.F.R. § 785.47. The general principle underlying the FLSA's hours-worked standard is that the statutory workweek includes "all time during which an employee is necessarily required to be on the employer's premises, on duty or at a prescribed work place." 29 C.F.R. § 785.7. Time spent in activities that are controlled or required by the employer, and pursued necessarily and primarily for the employer's benefit, constitutes compensable work time. Tennessee Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590, 598 (1944).

B. The Portal-to-Portal Act of 1947

Congress enacted the Portal-to-Portal Act in 1947 in response to a wave of litigation seeking compensation for time spent traveling to and from the worksite and for various pre-shift and post-shift activities. The Act narrows the FLSA's broad definition of compensable work by excluding two categories of activities from the computation of hours worked:

(1) Walking, riding, or traveling to and from the actual place of performance of the principal activity or activities which the employee is employed to perform; and

(2) Activities which are "preliminary" to a principal activity or "postliminary" to a principal activity.

29 U.S.C. § 254(a)(1)–(2).

The critical term "principal activity" is not defined by the statute. However, in Steiner v. Mitchell, 350 U.S. 247, 256 (1956), the Supreme Court held that the term "principal activity" embraces all activities that are an "integral and indispensable part of the principal activities" that the employee is employed to perform. In Steiner, the Court held that time spent by battery-plant workers showering and changing clothes at the end of their shifts was compensable because the showering and changing were integral and indispensable to the workers' principal activities, given the toxic chemicals to which they were exposed during their shifts. Id. at 249–51, 256.

The Supreme Court further refined the "integral and indispensable" test in two subsequent decisions that are of central importance to the present analysis:

IBP, Inc. v. Alvarez, 546 U.S. 21 (2005). In IBP, the Court addressed the compensability of time spent donning and doffing protective gear in meatpacking plants. The Court held that donning unique protective gear was a "principal activity" under the Portal-to-Portal Act because the gear was "integral and indispensable" to the employees' work on the meatpacking production line. Id. at 37. The employer could not have eliminated the gear requirement without impairing the employees' ability to perform their principal activities safely and effectively. The Court further held that, once the employees commenced a principal activity by donning their gear, the continuous workday had begun, and all subsequent time — including time spent walking from the locker room to the production line — was compensable. Id. at 37–40.

Integrity Staffing Solutions, Inc. v. Busk, 574 U.S. 27 (2014). In Integrity Staffing, the Court addressed the compensability of time spent by Amazon warehouse workers undergoing mandatory post-shift security screenings designed to prevent employee theft. The Court held that the screenings were not compensable because they were not "integral and indispensable" to the employees' principal activities of retrieving products from warehouse shelves and packaging them for shipment. Id. at 35–36. The Court emphasized that the employer "could have eliminated the screenings altogether without impairing the employees' ability to complete their work." Id. at 35. The screenings were undertaken for the employer's benefit (to prevent theft), but they were not intrinsic to the work the employees were hired to perform.

Synthesizing these authorities, the "integral and indispensable" test asks two questions:

(1) Is the activity an intrinsic element of the employees' principal activities? That is, is the activity directly connected to the productive work the employees are employed to perform?

(2) Is the activity one with which the employee cannot dispense if he or she is to perform the principal activities? That is, would eliminating the activity impair the employees' ability to perform their work?

If both questions are answered in the affirmative, the activity is a principal activity (or an integral and indispensable part thereof) and is compensable. If either question is answered in the negative, the activity is preliminary or postliminary and falls within the Portal-to-Portal Act's exclusion.

C. The Continuous-Workday Doctrine

The continuous-workday doctrine, as articulated by the Supreme Court in IBP, provides that once an employee commences a "principal activity," the continuous workday has begun, and all subsequent time — including time spent walking between locations, waiting, and performing other activities — is compensable until the employee completes his or her last principal activity of the day. 546 U.S. at 37. The doctrine is an important corollary to the "integral and indispensable" test because it determines the temporal boundaries of the compensable workday.

The practical implication for the present analysis is significant. If any one of the three alleged pre-shift activities (donning a uniform, booting up a computer, or attending a handover briefing) constitutes a "principal activity," then the continuous commences at that point. All time from that first principal activity through the employee's last principal activity (which may be doffing the uniform, logging off the computer, or completing a post-shift handover briefing) is potentially compensable, including any intervening time that might otherwise be considered non-compensable walking or waiting time.

For example, if a front-desk associate dons her uniform in the locker room at 6:50 a.m., walks to the front desk, begins booting up the computer at 6:53 a.m., attends a handover briefing from 6:55 to 7:00 a.m., and then clocks in at 7:00 a.m. (the scheduled shift start), the continuous-workday doctrine would render compensable all time from 6:50 a.m. (the first principal activity) through the end of the employee's last principal activity, even though the employee did not clock in until 7:00 a.m.

D. The De Minimis Doctrine

Under the FLSA, courts have recognized a de minimis doctrine pursuant to which otherwise compensable working time may be disregarded as too insubstantial to warrant compensation. The doctrine originates in the Supreme Court's decision in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946), and is reflected in 29 C.F.R. § 785.47. The regulation provides that "[i]n recording working time under the Act, insubstantial or insignificant periods of time beyond the scheduled working hours, which cannot as a practical administrative matter be precisely recorded for payroll purposes, may be disregarded."

Courts applying the de minimis doctrine have generally considered three factors:

(1) The amount of daily time at issue — typically, only a few seconds or minutes per day qualifies as de minimis;

(2) Whether the time can be recorded as a practical administrative matter, taking into account the available timekeeping technology; and

(3) Whether the time occurs on a regular basis or only sporadically and irregularly.

See Lindow v. United States, 738 F.2d 1057, 1063 (9th Cir. 1984) (articulating the three-factor test).

Several important caveats apply to the de minimis doctrine in the context of this analysis. First, there is a growing trend among courts to narrow or question the doctrine, particularly where modern electronic timekeeping systems — such as the Luminos TimeTrack platform used by VHG — make it practicable to record even small increments of time. The California Supreme Court's decision in Troester v. Starbucks Corp., 5 Cal.5th 829 (2018), which declined to adopt the de minimis doctrine under California's wage-and-hour statutes, is illustrative of this trend. While Troester is not controlling under the FLSA and does not apply in Florida, it reflects a broader judicial skepticism toward the doctrine that may influence federal courts, including those in the Eleventh Circuit.

Second, and more practically significant for this matter, the volume of time alleged — fifteen to twenty-five (15–25) minutes per shift — is almost certainly too substantial to qualify as de minimis. Courts applying the doctrine have generally done so only where the daily time at issue amounts to a few minutes or less. See, e.g., Bustillos v. Board of County Comm'rs, 310 F. Supp. 3d 1255, 1266 (D.N.M. 2018) (7–8 minutes per day not de minimis); Singh v. City of New York, 524 F.3d 361, 370–71 (2d Cir. 2008) (suggesting that even small amounts of regularly occurring compensable time should not be dismissed as de minimis). The de minimis defense is therefore unlikely to provide VHG with a viable defense against the full scope of the pre-shift and post-shift claims, though it may have limited applicability to discrete sub-components of the alleged time (such as a few seconds spent swiping a badge or hanging a jacket).

E. Employer Knowledge — The "Suffered or Permitted" Standard

As noted above, the FLSA's definition of "employ" includes "to suffer or permit to work." 29 U.S.C. § 203(g). Under this standard, if VHG knew or should have known that employees were performing pre-shift and post-shift work, the time is compensable regardless of whether the employer expressly authorized the work. 29 C.F.R. § 785.11. The employer's obligation is affirmative: it must exercise reasonable diligence discover whether employees are working beyond their recorded hours.

Critically, an employer's policy prohibiting off-the-clock work does not, standing alone, relieve the employer of liability if the employer had actual or constructive knowledge that the policy was not being followed. See Allen v. Board of Public Educ., 495 F.3d 1306, 1319 (11th Cir. 2007) (holding that an employer may not "sit back and accept the benefits" of an employee's labor while claiming ignorance of the work performed). Where supervisors or managers are aware that employees routinely perform uncompensated pre-shift or post-shift work — or where the employer's own policies effectively require such work (such as a "floor-ready" policy that necessitates pre-shift preparation) — the employer cannot credibly claim lack of knowledge.

This standard is particularly relevant to VHG's situation. The preliminary information from Mr. Fuentes and Ms. Whitfield suggests that VHG's "floor-ready" expectation effectively requires employees to complete certain preparatory tasks before their scheduled shift begins, and that property-level managers are aware of and participate in scheduling shift-handover briefings. If confirmed, these facts would substantially undermine a defense based on lack of employer knowledge.

IV. Analysis of Each Alleged Pre-/Post-Shift Activity

This section applies the legal framework set forth in Section III to each of the three categories of pre-shift and post-shift activities alleged in the GLO demand letter. For each category, the analysis describes the nature of the activity, identifies the key factual questions that the audit must resolve, and assesses the litigation risk.

A. Donning and Doffing Uniforms

1. Nature of the Activity

VHG requires employees in multiple job categories — including front-desk associates, concierge staff, bellhops, housekeeping personnel, and food-and-beverage workers — to wear branded uniforms while on duty at its hotel and resort properties. The specific uniform requirements vary by role: front-desk associates and concierge staff typically wear a branded blazer, dress shirt, slacks or skirt, and name badge; bellhops wear a distinct branded uniform; housekeeping personnel wear a branded polo shirt and pants or scrubs; and food-and-beverage workers wear role-specific attire that may include aprons, chef's coats, or other specialized items.

The current VHG Employee Handbook (Version 7.2, effective January 1, 2025) contains a uniform-requirements policy that specifies the dress code for each department and states that employees must arrive at the property "ready for their shift." This language has been interpreted at the property level — based on the preliminary information from Mr. Fuentes and Ms. Whitfield — to mean that employees must be in uniform by the time their scheduled shift begins. The demand letter alleges that, as a practical matter, employees are required to change into their uniforms in on-site locker rooms before clocking in and to change out of their uniforms in the locker rooms after clocking out.

The claimant, Ms. Serrano, was a front-desk associate at the Verimark Regency Tampa. The demand letter estimates that the donning and doffing process for front-desk associates consumes approximately five to eight (5–8) minutes per shift. This estimate is consistent with the time that would reasonably be required to change from personal clothing into a multi-piece branded uniform (or vice versa) in a shared locker-room facility, accounting for retrieving and storing uniform items from a locker, changing garments, and presenting an appropriate professional appearance (adjusting clothing, putting on name badge, etc.).

A key factual question that the audit must resolve is whether employees are required to change on-site or whether they have the option of wearing their uniforms to and from the property. If employees are effectively compelled to change on-site — whether by express policy, by the nature of the uniform (e.g., branded or specialized attire that employees are discouraged from wearing in public), or by practical necessity (e.g., security concerns, hygiene requirements, or the absence of any reasonable alternative) — the compensability analysis tilts significantly in the employees' favor. If, on the other hand, employees are free to don and doff their uniforms at home and to commute in uniform, the changing time is more likely to be treated as a non-compensable personal choice.

2. Legal Analysis

Under IBP, Inc. v. Alvarez, donning and doffing is compensable when the clothing or gear at issue is "integral and indispensable" to the employees' principal activities. 546 U.S. at 37. The Supreme Court in IBP addressed specialized protective gear — sanitary outer garments, mesh aprons, Kevlar gloves, arm guards, and shin guards — that was required by federal workplace-safety regulations and without which the employees literally could not perform their work on the meatpacking production line. The Court had little difficulty concluding that donning and doffing such gear was integral and indispensable.

The analysis is more nuanced in the hospitality-industry context, where the "gear" at issue is not specialized protective equipment but rather a branded uniform designed to maintain a professional, brand-consistent appearance. Courts have drawn a meaningful distinction between two categories of employer-required clothing:

(a) Specialized or required clothing that cannot feasibly be worn outside the workplace. Where the employer requires employees to wear specialized gear, protective equipment, or distinctive uniforms that are impractical or prohibited for use outside the workplace, courts have generally found donning and doffing to be a compensable principal activity. The rationale is that such clothing is integral to the work — the employee cannot begin working without it — and the employee has no practical alternative to changing on-site. See Steiner, 350 U.S. at 256; IBP, 546 U.S. at 37; see also Salazar v. Butterball, LLC, 644 F.3d 1130, 1139 (10th Cir. 2011) (donning and doffing specialized sanitary and protective gear in a poultry-processing plant was compensable).

(b) Generic clothing or business attire that could be worn outside the workplace. Where the employer requires employees to wear clothing that is substantially similar to ordinary street clothes — such as dress shirts, slacks, polo shirts, or other generic business attire — courts have more frequently held that donning and doffing is not a principal activity but rather a preliminary or postliminary activity excluded by the Portal-to-Portal Act. The reasoning is that such clothing is not "integral and indispensable" to the work itself; the employee's principal activity is serving guests, processing transactions, or performing other job duties, not getting dressed. Wearing particular clothing is a precondition of employment but not an intrinsic element of the productive work. See, e.g., Gorman v. Consolidated Edison Corp., 488 F.3d 586 (2d Cir. 2007) (donning and doffing generic work clothing that could be worn on the commute was not compensable); Mitchell v. JCG Industries, Inc., 745 F.3d 837, 840–41 (7th Cir. 2014) (donning and doffing generic uniforms at a food-processing plant was non-compensable where employees could have worn the items to and from work).

VHG's uniforms appear to fall somewhere between these two categories. On one hand, the uniforms are branded — they bear the Verimark logo and are designed to be property-specific and role-specific, distinguishing VHG employees from guests and conveying the brand identity. On the other hand, the uniforms for many roles (particularly front-desk associates and concierge staff) appear to consist of relatively standard professional attire — blazers, dress shirts, slacks — augmented with branding elements (logos, name badges) rather than highly specialized or protective gear.

The Eleventh Circuit, which encompasses the federal courts in Florida where any litigation would likely be filed, has followed the IBP framework in analyzing donning-and-doffing claims but has not issued a definitive ruling on hotel or hospitality uniforms specifically. The circuit's cases have generally involved manufacturing, food-processing, or industrial settings where the donning-and-doffing analysis is more straightforward due to the clearly specialized nature of the required gear. See, e.g., Perez v. Mountaire Farms, Inc., 650 F.3d 350 (4th Cir. 2011) (cited approvingly by Eleventh Circuit panels in unpublished opinions). The absence of Eleventh Circuit precedent squarely on point creates uncertainty but does not eliminate the risk; a district court in the Middle or Southern District of Florida could plausibly find VHG's branded uniforms sufficiently distinctive to require on-site donning and doffing, particularly if the evidence shows that employees were discouraged from wearing the uniforms outside the property.

Key Factual Inquiries. The compensability of donning and doffing at VHG will turn on the following factual questions, which must be investigated during the audit:

• Does VHG's uniform policy (Employee Handbook v.7.2 or prior versions) expressly require employees to change on-site, or does it merely require employees to be in uniform at the start of their shift?

• Are employees permitted to wear their uniforms to and from the property, or are they discouraged or prohibited from doing so (whether by express policy, by management instruction, or by the nature of the uniform)?

• What specific uniform items are required for each role? Are any of the items sufficiently specialized (e.g., formal blazers with property-specific insignia, chef's coats, housekeeping scrubs) that wearing them during a commute would be impractical or undesirable?

• Does VHG provide on-site locker rooms and, if so, does the existence of locker rooms reflect an expectation that employees will change on-site?

• Do property-level managers enforce the uniform policy in a manner that effectively requires on-site changing — for example, by disciplining employees who arrive at the time clock in street clothes?

Risk Assessment: Moderate. The compensability of donning and doffing VHG uniforms is a close question that depends heavily on the specific facts. If the evidence shows that VHG's uniforms are generic professional attire that employees could readily wear to and from work, and that employees are free to do so, the donning-and-doffing claim is weaker. If, however, the evidence shows that VHG effectively requires on-site changing — whether through explicit policy, managerial enforcement, or the impracticability of commuting in branded uniforms — the claim is substantially stronger. On balance, we assess this category as presenting moderate litigation risk.

B. Booting Up Computer Systems

1. Nature of the Activity

Front-desk associates, concierge staff, and certain other roles at VHG properties are required to use desktop computer terminals running the property-management system ("PMS"), the reservation system, the point-of-sale ("POS") system, and other software applications as part of their daily work. These computer systems are essential tools for performing the core functions of these roles: checking in and checking out guests, processing reservations, managing room assignments, handling billing and payment transactions, accessing guest profiles and preferences, communicating with housekeeping and maintenance departments, and performing other operational tasks.

The demand letter alleges that the computer terminals at VHG properties require several minutes to boot up — i.e., to power on the hardware, load the operating system, and reach a state where the employee can begin logging into software applications. After the boot-up process is complete, the employee must then log into multiple software applications, each of which requires entering login credentials and may involve loading screens, system updates, or other delays. The total time from initiating the boot-up to having all systems fully operational is estimated at five to ten (5–10) minutes per shift.

The demand letter further alleges that employees are expected to have all systems fully operational by the time their scheduled shift begins, so that they can immediately begin serving guests. This expectation means that employees must initiate the boot-up process before the start of their scheduled shift — and, because employees do not clock in until the shift begins, the boot-up time is not captured by the Luminos TimeTrack system and is not compensated.

Whether this expectation is a matter of formal VHG policy or informal but widespread practice is a factual question that the audit must resolve. Preliminary information from Mr. Fuentes and Ms. Whitfield suggests that VHG's "floor-ready" expectation encompasses having systems operational, but the precise language of the policy and the manner in which it is communicated to employees at the property level must be confirmed.

2. Legal Analysis

Computer boot-up time has been the subject of increasing litigation in recent years, particularly in industries where computer use is central to the employee's job functions. Courts have generally found such time compensable where the employee cannot perform any principal duties without a functioning, logged-in computer terminal.

The analysis under the IBP "integral and indispensable" test is relatively straightforward for computer-dependent roles such as front-desk associates and concierge staff. A front-desk associate at a VHG hotel cannot check in a guest without the PMS. She cannot process a reservation without the reservation system. She cannot accept a payment without the POS system. She cannot access guest information, room assignments, or operational communications without her computer terminal being powered on and logged in. Booting up the computer and logging into the necessary software applications is therefore an intrinsic element of the employee's principal activity of serving guests at the front desk — and it is an activity with which the employee cannot dispense if she is to perform her principal duties. Under the two-part "integral and indispensable" test, computer boot-up time for front-desk associates is almost certainly a principal activity or an integral and indispensable part thereof.

Several district court decisions from other jurisdictions support this conclusion, particularly in analogous contexts such as call-center workers and bank tellers:

• In cases involving call-center employees, courts have consistently held that time spent booting up computers and logging into telephone and software systems is compensable because the employees cannot begin taking calls — their principal activity — without functioning systems. See, e.g., Landers v. Quality Communications, Inc., 771 F.3d 638, 641 (9th Cir. 2014) (reversing dismissal of claims by call-center workers alleging uncompensated boot-up time); Kuhn v. DISH Network Corp., No. 1:12-cv-01457 (D. Colo. 2013) (denying summary judgment on boot-up time claims where employees could not begin working without logged-in computer systems).

• Similarly, courts have found boot-up time compensable for bank tellers who must log into banking software before they can begin serving customers. See, e.g., Adkins v. Wellpoint, Inc., No. 3:09-cv-0290 (S.D. W.Va. 2010) (holding that time spent booting up computers and logging into systems was compensable for insurance-company employees whose work was entirely computer-dependent).

Under the continuous-workday doctrine, if booting up the computer is the first principal activity of the employee's workday, the continuous commences at that point. All time from the moment the employee begins the boot-up process until the employee completes her last principal activity at the end of the shift (which may include logging off the computer, shutting down the terminal, or attending a post-shift handover briefing) is compensable. This has cascading implications: even if the donning of a uniform were deemed non-compensable standing alone, if it occurs after the boot-up process has begun, it would fall within the continuous workday and be compensable as a result.

VHG's vulnerability on this claim is significant. The Company's "floor-ready" expectation — which, based on preliminary information, requires employees to have systems operational at the start of their scheduled shift — is strong evidence that the employer is requiring (or at a minimum suffering and permitting) pre-shift computer work. Even if VHG were to argue that it does not expressly require boot-up before the shift, the practical reality that employees cannot begin serving guests without operational systems — combined with the expectation that they will be ready to serve guests immediately at shift start — effectively compels pre-shift boot-up. Moreover, VHG's management knows or should know that employees must power on and log into computers before they can begin working, making a lack-of-knowledge defense untenable for this category of activity.

Risk Assessment: High. Computer boot-up time is likely VHG's greatest area of exposure for pre-shift claims. The legal framework strongly supports compensability for computer-dependent roles, and VHG's "floor-ready" policy reinforces the conclusion that boot-up time is required by the employer. The time involved — five to ten minutes per shift — is substantial enough that the de minimis doctrine is unlikely to apply. We assess this category as presenting high litigation risk.

C. Shift-Handover Briefings

1. Nature of the Activity

At many VHG properties, outgoing and incoming shift employees participate in a brief handover meeting at the point of shift transition. During these briefings, the outgoing shift employees communicate information to the incoming shift regarding matters such as:

• Ongoing guest issues (complaints, special requests, maintenance problems affecting occupied rooms);

• VIP guest arrivals, departures, or special-status notifications;

• Pending maintenance or engineering requests and their current status;

• Operational updates from management (policy changes, upcoming events, staffing adjustments);

• Any other matters that the incoming shift needs to be aware of to provide seamless guest service.

The demand letter alleges that these briefings are mandatory, last approximately five to ten (5–10) minutes, and are not compensated because they occur before the incoming employee clocks in or after the outgoing employee clocks out. Specifically, the incoming employee is expected to arrive before the scheduled shift start to receive the handover, and the outgoing employee is expected to remain after the scheduled shift end to deliver the handover. Neither the incoming employee's arrival before shift start nor the outgoing employee's departure after shift end is captured in the time-punch data, and neither is compensated.

Whether these briefings are formally required by VHG corporate policy or are instead an informal but deeply embedded property-level practice is a factual question that the audit must investigate. The preliminary information from Mr. Fuentes and Ms. Whitfield suggests that the briefings are a "longstanding practice" but that neither could confirm a corporate-level policy mandate. However, both acknowledged that property-level managers participate in scheduling and conducting the briefings, which is strong circumstantial evidence that the briefings are, as a practical matter, mandatory.

2. Legal Analysis

The Department of Labor's regulations directly address the compensability of meetings and training sessions in 29 C.F.R. § 785.27. Under this regulation, attendance at lectures, meetings, training programs, and similar activities is not compensable work time only if all four of the following criteria are satisfied:

(a) Attendance is outside of the employee's regular working hours;

(b) Attendance is in fact voluntary;

(d) The employee does not perform any productive work during such attendance.

All four criteria must be met for the meeting time to be excluded from compensable hours. Failure to satisfy even one criterion renders the time compensable.

Applied to VHG's shift-handover briefings, the analysis is as follows:

Criterion (a) — Outside regular working hours. The briefings occur at the boundary of the employee's regular working hours — either immediately before the incoming shift or immediately after the outgoing shift. Whether this satisfies criterion (a) is debatable, but the fact that the briefings are contiguous with the shift suggests they are at least closely connected to regular working hours, if not within them.

Criterion (b) — Voluntary attendance. The demand letter alleges that attendance at handover briefings is mandatory. If this allegation is substantiated — and the preliminary information from Mr. Fuentes and Ms. Whitfield does not contradict it — criterion (b) is not satisfied, and the briefing time is compensable on this basis alone. The critical question is whether employees are truly free to decline attendance without adverse consequences. If an employee who skips a handover briefing is subject to disciplinary action, negative performance reviews, or other adverse consequences — or if employees reasonably believe they would face such consequences — attendance is not voluntary within the meaning of the regulation.

Criterion (c) — Not directly related to the employee's job. The content of the handover briefings — guest issues, VIP arrivals, maintenance concerns, and other operational information — is directly and inextricably related to the employees' job duties. This criterion is clearly not satisfied.

Criterion (d) — No productive work performed. During the handover briefing, outgoing employees are communicating operational information and incoming employees are receiving that information to enable them to perform their duties. This exchange of job-related information is itself productive work within the meaning of the regulation. Criterion (d) is therefore not satisfied.

Because criteria (b), (c), and (d) are almost certainly not satisfied — and criterion (a) is at best debatable — the shift-handover briefings are compensable work time under 29 C.F.R. § 785.27.

The compensability of the briefings is reinforced by the continuous-workday doctrine. If the handover briefing is the first principal activity of the incoming employee's day, the continuous commences at the start of the briefing, and all subsequent time is compensable. If the handover briefing is the last principal activity of the outgoing employee's day, the continuous workday does not end until the briefing concludes, and all time from the first principal activity through the end of the briefing is compensable.

The only plausible defense would be for VHG to demonstrate that the briefings are truly voluntary — that employees are genuinely free to leave without attending, that no adverse consequences follow from non-attendance, and that sufficient employees in fact decline to attend that voluntariness can be established as a factual matter. Based on the preliminary information available, this defense appears weak. The briefings appear to be a standard, expected part of the shift-transition process at multiple VHG properties, and managers participate in scheduling and conducting them.

Risk Assessment: High. Mandatory, job-related briefings are almost certainly compensable under the FLSA's meeting-time regulations and under the integral-and-indispensable test. The five-to-ten-minute duration is well beyond any plausible de minimis threshold. We assess this category as presenting high litigation risk, comparable to the computer boot-up claims.

V. Application to VHG Properties and Roles

A. Variations Across Properties and Job Codes

While the demand letter characterizes the pre-shift and post-shift practices as "systemic" across all seven at-issue properties, it is important to recognize that the specific practices may vary — perhaps significantly — from property to property and from department to department. These variations affect both the merits of the claims and the potential procedural posture of any future litigation, particularly with respect to motions for conditional certification of an FLSA collective action under 29 U.S.C. § 216(b).

The seven at-issue properties differ in size, type (urban hotel versus beachfront resort versus boutique collection), management structure, and operational practices. The breakdown of hourly, non-exempt employees by property is as follows:

Each of the three categories of alleged pre-shift and post-shift activities may vary by property and by department:

Donning and doffing. Uniform requirements differ by role. Front-desk associates wear a multi-piece branded ensemble; housekeeping personnel wear a simpler branded polo and pants; food-and-beverage workers may wear chef's coats, aprons, or other specialized attire. The time required for donning and doffing will differ across roles, and the compensability analysis may yield different results for different uniform types. For example, a chef's coat may be considered more specialized (and less suitable for commuting) than a branded polo shirt. The audit must assess uniform requirements and donning-and-doffing practices for each department at each property.

Computer boot-up. Not all roles are computer-dependent. Front-desk associates, concierge staff, and certain administrative roles rely heavily on computer systems and are most directly affected by boot-up time claims. Housekeeping personnel, bellhops, and maintenance workers may have little or no daily computer use, reducing or eliminating their exposure on this claim category. The audit must map which job codes involve computer-dependent duties and assess boot-up practices for those roles at each property.

Shift-handover briefings. The format, duration, and mandatory nature of handover briefings may vary across properties and departments. Some properties may conduct formal, scheduled briefings; others may rely on informal, ad hoc handovers between individual employees. Some departments (such as front desk and concierge) may have more formalized briefing procedures than others (such as housekeeping or maintenance). The audit must determine the nature and extent of briefing practices at each property and in each department.

These property-level and department-level variations are significant for two reasons. First, on the merits, the compensability analysis must be conducted with reference to the specific facts at each property and in each department, rather than on a generalized basis. A finding that computer boot-up time is compensable for front-desk associates does not necessarily extend to housekeeping personnel who do not regularly use computers.

Second, for purposes of any future collective-action proceeding, property-level and department-level variations may support VHG's arguments against conditional certification under 29 U.S.C. § 216(b). To obtain conditional certification, the named plaintiff must demonstrate that she and the proposed collective members are "similarly situated" — that is, that they share a common policy or practice that affected them in a similar manner. If VHG can demonstrate that its pre-shift and post-shift practices vary materially across properties and departments, it may argue that the putative collective is not sufficiently cohesive for collective treatment, thereby limiting the scope of the action. This procedural strategy is addressed in a separate memorandum on collective-action conditional certification; however, the factual investigation recommended in this memorandum will generate evidence relevant to that analysis as well.

B. The Palomar-Managed Property (Verimark Shores Clearwater)

One of the seven at-issue properties — the Verimark Shores Clearwater — is not owned by VHG but is instead owned by Palomar Realty Partners LLC ("Palomar"), whose Managing Member is Ricardo E. Montalvo. VHG operates the Verimark Shores Clearwater property under a Hotel Management Agreement dated June 1, 2021 (Reference: HMA-2021-0601-PC). Under that agreement, VHG provides all operational management services for the property, including the employment and supervision of all on-site staff.

VHG directly employs all hourly, non-exempt workers at the Verimark Shores Clearwater. The employees are on VHG's payroll, are paid through VHG's Luminos TimeTrack and payroll systems, and are subject to VHG's Employee Handbook and HR policies. VHG sets work schedules, manages day-to-day operations, and exercises supervisory authority over the workforce. Palomar's involvement is primarily as the property owner and, under certain provisions of the HMA, as a participant in high-level operational and budgetary decisions.

The joint-employer analysis — i.e., whether Palomar may be deemed a "joint employer" under the FLSA and thus share liability for wage-and-hour violations at the Verimark Shores Clearwater — is addressed in a separate memorandum. For purposes of this memorandum, VHG's obligations as the direct employer of the Verimark Shores Clearwater workforce are the same as its obligations at VHG-owned properties. The pre-shift and post-shift compensability analysis applies equally to the Palomar-managed property, and the approximately 190 hourly, non-exempt employees at that property are included in the affected workforce count.

VI. Available Defenses

This section evaluates the defenses potentially available to VHG with respect to the pre-shift and post-shift claims. While several defenses are theoretically applicable, each has significant limitations when assessed against the specific facts of VHG's situation.

A. Portal-to-Portal Act — Preliminary/Postliminary Activity Defense

As discussed in Section III.B, the Portal-to-Portal Act excludes from compensable time activities that are "preliminary" to or "postliminary" to the employee's principal activity. 29 U.S.C. § 254(a)(2). VHG may argue that some or all of the alleged pre-shift and post-shift activities fall within this exclusion.

The strength of this defense varies across the three categories of activities:

Donning and doffing. This is the strongest candidate for a preliminary/postliminary defense, at least for roles where the uniform consists of generic professional attire (polo shirts, slacks, dress shirts) that employees could feasibly wear to and from the property. If the uniforms are not sufficiently specialized to require on-site changing, donning and doffing may be characterized as a preliminary activity analogous to getting dressed in the morning — a personal task that precedes the workday rather than an integral part of it. However, as discussed in Section IV.A, this defense weakens significantly if the evidence shows that VHG effectively requires on-site changing.

Computer boot-up. This defense is substantially weaker for computer boot-up time. As analyzed in Section IV.B, booting up the computer and logging into software applications is integral and indispensable to the principal activities of front-desk associates and other computer-dependent roles. A court is unlikely to characterize boot-up time as "preliminary" when the employee literally cannot perform any productive work without a functioning computer. The defense has minimal viability for this category.

Shift-handover briefings. This defense is also substantially weak for mandatory handover briefings. The briefings are directly related to the

MEMORANDUM
PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGE / ATTORNEY WORK PRODUCT
TO: Bernard Crawford, Responsible Partner, Labor & Employment Renata Vasquez, Billing Partner, Labor & Employment
FROM: James Underwood, Working Associate, Labor & Employment
DATE: February 9, 2026
RE: Compensability of Alleged Pre-Shift and Post-Shift Activities Under the Fair Labor Standards Act — Verimark Hospitality Group Inc.
MATTER NO.: 1021-00005
CLIENT: Verimark Hospitality Group Inc.
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I. Executive Summary
This memorandum analyzes whether the pre-shift and post-shift activities alleged in the demand letter of Garza, Linden & Okafor LLP ("GLO"), dated January 14, 2026, on behalf of Daniela M. Serrano, constitute compensable work under the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. (the "FLSA"). This analysis is one component of the broader wage-and-hour compliance audit that Calderwood & Harkness LLP ("C&H") is conducting on behalf of our client, Verimark Hospitality Group Inc. ("VHG" or the "Company"), and is intended to inform the scoping and prioritization of the audit's initial investigative phase.
The GLO demand letter alleges that hourly, non-exempt employees at seven Verimark-branded hotel and resort properties in the State of Florida are required to perform uncompensated pre-shift and post-shift activities totaling an estimated fifteen to twenty-five (15–25) minutes per shift. These activities are not reflected in the employees' recorded time punches in the Luminos TimeTrack system and, accordingly, are not compensated in the employees' regular or overtime pay calculations.
The demand letter identifies three discrete categories of allegedly uncompensated activities:
1. Donning and doffing required uniforms. Employees allege they are required to change into VHG-branded uniforms in on-site locker rooms before clocking in and to change out of their uniforms after clocking out, consuming an estimated five to eight (5–8) minutes per shift.
2. Booting up computer systems and logging into point-of-sale and property-management software. Front-desk associates, concierge staff, and certain other roles allege they must power on computer terminals and log into multiple software applications before they can begin serving guests, a process estimated to take five to ten (5–10) minutes per shift.
3. Participating in shift-handover briefings. Incoming and outgoing shift employees allege they are required to participate in mandatory briefings during which operational information — including guest issues, VIP arrivals, maintenance concerns, and other matters — is communicated between shifts, consuming an estimated five to ten (5–10) minutes per shift.
Preliminary Conclusion. The compensability of each of these activities is a fact-intensive inquiry that turns on whether the activity is "integral and indispensable" to the employees' principal activities under the Portal-to-Portal Act, 29 U.S.C. §§ 254(a)(1)–(2), and on the application of the continuous-workday doctrine as articulated by the Supreme Court in IBP, Inc. v. Alvarez, 546 U.S. 21 (2005). Based on the preliminary factual information available, there is meaningful litigation risk on each of the three categories, with computer boot-up time and shift-handover briefings presenting the greatest exposure. Donning and doffing of uniforms presents moderate risk that is heavily dependent on the specific nature of VHG's uniform requirements and whether employees are effectively compelled to change on-site.
The estimated uncompensated time at stake — fifteen to twenty-five minutes per shift, with a midpoint of approximately twenty (20) minutes — is not trivial. Across a standard five-shift workweek, this amounts to approximately one hundred (100) minutes, or 1.667 hours, per week per affected employee. At the blended average hourly rate of $16.50 for the affected workforce, this represents $27.50 per employee per week in unpaid straight-time wages, with additional exposure for overtime premiums where the uncompensated time pushes employees above the forty-hour weekly threshold.
The scope of the potentially affected workforce is substantial. Approximately 1,895 current hourly, non-exempt employees work at the seven at-issue properties. Over the applicable lookback period (two or three years depending on whether VHG's conduct is found to be "willful"), the putative collective could encompass an estimated 4,100 to 5,900 individuals when accounting for employee turnover. As detailed in Section VII below, the pre-shift and post-shift claim category contributes an estimated $6–$10 million to the overall mid-range exposure estimate of $22–$38 million (inclusive of liquidated damages) and could represent as much as $50.6 million under the broadest theoretical scenario.
This memorandum proceeds as follows: Section II sets forth the relevant factual background. Section III outlines the governing legal framework. Section IV applies that framework to each of the three categories of alleged activities. Section V addresses property-level and role-level variations that may affect both the merits and any future collective-action certification analysis. Section VI evaluates VHG's available defenses. Section VII quantifies the impact of these claims on the overall exposure model. Section VIII provides recommendations for the audit's scoping phase, including specific factual investigation priorities, document preservation steps, and the proposed engagement of Ridgepoint Advisory Group LLC for forensic payroll analysis. Section IX concludes with a summary of findings and next steps.
II. Factual Background
A. The Demand Letter Allegations
On January 14, 2026, Marco A. Garza of Garza, Linden & Okafor LLP, 600 Brickell Avenue, Suite 2200, Miami, Florida 33131, transmitted a twenty-three-page demand letter to VHG's General Counsel, Thomas L. Nakamura, on behalf of Daniela M. Serrano. Ms. Serrano is a former front-desk associate at the Verimark Regency Tampa property (Employee ID VHG-EMP-20220314-5587), who was employed by VHG from March 14, 2022, through August 22, 2025. The demand letter asserts five categories of alleged FLSA violations; this memorandum addresses Allegation No. 3, which concerns the failure to compensate employees for pre-shift and post-shift work.
Allegation No. 3 of the demand letter asserts that VHG fails to compensate its hourly, non-exempt employees for pre-shift and post-shift activities that, in the aggregate, total approximately fifteen to twenty-five (15–25) minutes per shift. The demand letter describes these activities in the following terms:
(a) Donning and doffing required uniforms. Employees are required to arrive at the property and change into VHG-branded uniforms in on-site locker rooms before clocking in via the Luminos TimeTrack terminal. At the conclusion of their shifts, employees are required to change out of their uniforms after clocking out. The demand letter contends that this donning and doffing process consumes approximately five to eight (5–8) minutes per shift, depending on the employee's role and the specific uniform requirements applicable to that role.
(b) Booting up computer terminals and logging into software applications. Front-desk associates, concierge staff, and certain other computer-dependent roles are required to power on desktop computer terminals at their workstations, boot the operating system, and log into the property-management system ("PMS"), the reservation system, the point-of-sale ("POS") system, and other software applications before they can begin performing their job duties. The demand letter asserts that this process takes approximately five to ten (5–10) minutes per shift and that employees are expected to have all systems fully operational by the time their scheduled shift begins, thereby requiring them to initiate the boot-up process before their compensated shift commences.
(c) Attending mandatory shift-handover briefings. Incoming shift employees are required to participate in a briefing session during which the outgoing shift employees communicate information regarding ongoing guest issues, VIP arrivals, pending maintenance requests, and other operational matters. Similarly, outgoing shift employees are required to remain at the property to participate in the handover after their scheduled shift has ended. The demand letter alleges that these briefings are mandatory, last approximately five to ten (5–10) minutes, and are not reflected in employees' compensated time because they occur before the incoming employee clocks in or after the outgoing employee clocks out.
The demand letter applies these allegations across all seven VHG-branded properties that are the subject of the broader demand. Those properties are:
1. Verimark Regency Tampa
2. Verimark Grand Orlando
3. Verimark Shores Clearwater
4. Verimark Bayfront St. Petersburg
5. Verimark Resort & Spa Boca Raton
6. Verimark Oceanview Fort Lauderdale
7. Verimark Key West Collection
Claimant's counsel asserts that these pre-shift and post-shift activities are required by VHG corporate policy and/or by the actual practice at each property, that they are performed for the employer's benefit, and that the time consumed by these activities is not de minimis. The demand letter further asserts that VHG's failure to compensate for these activities is part of a "systemic" practice that affects the entire non-exempt hourly workforce at the seven at-issue properties, rather than an isolated occurrence affecting only the named claimant.
B. Verimark's Workforce and Timekeeping Practices
VHG operates fourteen (14) hotel and resort properties across the State of Florida, employing approximately 8,200 individuals in total. Of this workforce, approximately 5,900 employees — or approximately 71.95% — are classified as non-exempt, hourly workers subject to the overtime and minimum-wage provisions of the FLSA. The remaining employees are classified as exempt under one or more of the FLSA's white-collar exemptions (executive, administrative, professional, or highly compensated employee), the proper application of which is the subject of a separate memorandum addressing Allegation No. 1 of the demand letter.
The seven properties at issue in the demand letter collectively employ approximately 2,620 individuals, of whom approximately 1,895 are hourly, non-exempt employees. The breakdown by property is as follows:
VHG's payroll processing and timekeeping functions are handled by Luminos Payroll Solutions Inc. ("Luminos") through the Luminos TimeTrack platform (System ID: LTT-VHG-2022-0041). VHG transitioned to the Luminos TimeTrack platform effective January 1, 2022, and has used the system continuously since that date. Prior to January 1, 2022, VHG utilized a different timekeeping system, the records of which are maintained by VHG's Director of Payroll & Workforce Compliance, Enrique J. Fuentes.
Under the current system, employees clock in and out using Luminos TimeTrack terminals located at designated stations within each property. The terminals capture the precise time of each clock-in and clock-out event (the "time punch"). The system applies rounding rules and automatic deductions as configured by VHG's payroll team. Relevant to the broader audit, the system applies a thirty-minute automatic meal-break deduction rule (Rule ID: AR-MEAL-030) for all shifts of six (6) or more hours, which is the subject of separate analysis under Allegation No. 4 of the demand letter.
For purposes of the pre-shift and post-shift analysis, the critical feature of the Luminos TimeTrack system is that it records only the time when employees physically interact with the terminal — i.e., the time of the clock-in punch and the time of the clock-out punch. Any work performed before the clock-in punch or after the clock-out punch is not captured by the system and, accordingly, is not compensated. The demand letter's core contention is that VHG's practices systematically require employees to perform compensable work outside the boundaries of their recorded time punches.
The current VHG Employee Handbook (Version 7.2, effective January 1, 2025) contains policies relevant to this analysis, including policies on uniform requirements, shift scheduling, time-recording procedures, and expectations regarding shift readiness. Historical versions of the Employee Handbook — including versions in effect during the three-year lookback period — must be obtained and reviewed as part of the audit. Our preliminary understanding is that prior versions (Versions 6.0, 6.1, and 7.0, at minimum) contain substantially similar provisions, but this must be confirmed through document collection.
Preliminary information obtained from VHG's Director of Payroll & Workforce Compliance, Enrique J. Fuentes, and VP of Human Resources, Carla S. Whitfield, during the initial fact-gathering interview conducted on January 24, 2026, indicates the following:
• Employees are generally expected to be "floor-ready" at the commencement of their scheduled shift. The term "floor-ready" is understood at the property level to mean that the employee is in uniform, at his or her workstation, and prepared to begin serving guests.
• For computer-dependent roles such as front-desk associates and concierge staff, "floor-ready" is understood to include having all necessary computer systems and software applications powered on, logged in, and operational.
• Shift-handover briefings are a "longstanding practice" at multiple VHG properties, though neither Mr. Fuentes nor Ms. Whitfield could confirm whether the briefings are mandated by corporate policy or are the product of property-level management practices. Both acknowledged that the briefings occur regularly and that property-level managers participate in scheduling them.
• VHG does have a general policy discouraging "off-the-clock work," though the specific language and enforcement mechanisms of that policy require further review.
These preliminary indications, while subject to verification through the detailed factual investigation recommended in Section VIII, are consistent with the demand letter's core allegations and suggest that VHG's practices may give rise to compensable pre-shift and post-shift time.
C. Time and Damages Impact
The financial impact of the pre-shift and post-shift claims can be estimated as follows based on the preliminary data available. These estimates are necessarily rough and will be refined as part of the forensic payroll analysis proposed by Ridgepoint Advisory Group LLC.
Per-Shift Uncompensated Time. The demand letter alleges uncompensated pre-shift and post-shift time totaling fifteen to twenty-five (15–25) minutes per shift. Using a midpoint of twenty (20) minutes per shift, and assuming five (5) shifts per week (consistent with VHG's standard full-time scheduling), the weekly uncompensated time per affected employee is:
20 minutes/shift × 5 shifts/week = 100 minutes/week = 1.667 hours/week
Straight-Time Wage Impact. The blended average hourly rate for the affected hourly, non-exempt workforce at the seven at-issue properties is estimated at $16.50 per hour, based on C&H's preliminary analysis of VHG's payroll data for the most recent complete pay period. At this rate, the weekly per-employee straight-time value of the alleged uncompensated time is:
1.667 hours/week × $16.50/hour = $27.50/week per employee
Overtime Exposure. The uncompensated pre-shift and post-shift time may also generate overtime exposure under 29 U.S.C. § 207(a)(1). If an employee's compensated hours total, for example, 39 hours in a given week, and the addition of 1.667 hours of previously uncompensated pre-shift and post-shift time brings the employee's total hours to 40.667 hours, the employee would be entitled to overtime compensation at a rate of one and one-half times the regular rate ($16.50 × 1.5 = $24.75/hour) for the 0.667 hours in excess of forty. The overtime premium — the additional half-time component — is $8.25 per hour ($24.75 − $16.50 = $8.25).
Preliminary analysis suggests that many of the affected employees regularly work scheduled hours close to or in excess of forty (40) hours per week. Average weekly hours including the alleged pre-shift and post-shift time are estimated at approximately 42.5 hours, indicating that a significant proportion of the uncompensated time falls within overtime territory. The precise overtime exposure will depend on individual employee schedules and will be quantified by Ridgepoint as part of the forensic payroll analysis.
Aggregate Exposure. As detailed more fully in Section VII below, the pre-shift and post-shift claim category is a significant component of the overall Calderwood & Harkness mid-range exposure estimate of $22–$38 million (inclusive of liquidated damages) and an even more significant component of the theoretical Scenario B ceiling of approximately $202.4 million. The contribution of the pre-shift and post-shift claims to these exposure models underscores the importance of a thorough factual investigation during the audit's initial phase.
III. Legal Framework
This section sets forth the legal principles governing the compensability of pre-shift and post-shift activities under the FLSA, including the Portal-to-Portal Act's exclusions for preliminary and postliminary activities, the "integral and indispensable" test, the continuous-workday doctrine, the de minimis doctrine, and the "suffered or permitted" standard for employer knowledge.
A. The Fair Labor Standards Act — Hours Worked
The FLSA requires covered employers to pay non-exempt employees at least the federal minimum wage for all "hours worked" and overtime compensation at a rate of one and one-half times the regular rate of pay for all hours worked in excess of forty (40) in a workweek. 29 U.S.C. §§ 206(a), 207(a)(1). The threshold question in any wage-and-hour dispute is therefore what constitutes "hours worked."
The FLSA defines "employ" to include "to suffer or permit to work." 29 U.S.C. § 203(g). The Department of Labor's implementing regulations elaborate on this broad definition. Under 29 C.F.R. § 785.7, "[w]ork not requested but suffered or permitted is work time." An employer who "knows or has reason to believe" that an employee is continuing to work is required to count that time as hours worked. 29 C.F.R. § 785.11. This principle extends to work performed away from the employer's premises or at home, provided the employer has actual or constructive knowledge that the work is being performed. Id.
The regulations further provide that all hours worked in the first and last week of the employment period must be counted. 29 C.F.R. § 785.47. The general principle underlying the FLSA's hours-worked standard is that the statutory workweek includes "all time during which an employee is necessarily required to be on the employer's premises, on duty or at a prescribed work place." 29 C.F.R. § 785.7. Time spent in activities that are controlled or required by the employer, and pursued necessarily and primarily for the employer's benefit, constitutes compensable work time. Tennessee Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590, 598 (1944).
B. The Portal-to-Portal Act of 1947
Congress enacted the Portal-to-Portal Act in 1947 in response to a wave of litigation seeking compensation for time spent traveling to and from the worksite and for various pre-shift and post-shift activities. The Act narrows the FLSA's broad definition of compensable work by excluding two categories of activities from the computation of hours worked:
(1) Walking, riding, or traveling to and from the actual place of performance of the principal activity or activities which the employee is employed to perform; and
(2) Activities which are "preliminary" to a principal activity or "postliminary" to a principal activity.
29 U.S.C. § 254(a)(1)–(2).
The critical term "principal activity" is not defined by the statute. However, in Steiner v. Mitchell, 350 U.S. 247, 256 (1956), the Supreme Court held that the term "principal activity" embraces all activities that are an "integral and indispensable part of the principal activities" that the employee is employed to perform. In Steiner, the Court held that time spent by battery-plant workers showering and changing clothes at the end of their shifts was compensable because the showering and changing were integral and indispensable to the workers' principal activities, given the toxic chemicals to which they were exposed during their shifts. Id. at 249–51, 256.
The Supreme Court further refined the "integral and indispensable" test in two subsequent decisions that are of central importance to the present analysis:
IBP, Inc. v. Alvarez, 546 U.S. 21 (2005). In IBP, the Court addressed the compensability of time spent donning and doffing protective gear in meatpacking plants. The Court held that donning unique protective gear was a "principal activity" under the Portal-to-Portal Act because the gear was "integral and indispensable" to the employees' work on the meatpacking production line. Id. at 37. The employer could not have eliminated the gear requirement without impairing the employees' ability to perform their principal activities safely and effectively. The Court further held that, once the employees commenced a principal activity by donning their gear, the continuous workday had begun, and all subsequent time — including time spent walking from the locker room to the production line — was compensable. Id. at 37–40.
Integrity Staffing Solutions, Inc. v. Busk, 574 U.S. 27 (2014). In Integrity Staffing, the Court addressed the compensability of time spent by Amazon warehouse workers undergoing mandatory post-shift security screenings designed to prevent employee theft. The Court held that the screenings were not compensable because they were not "integral and indispensable" to the employees' principal activities of retrieving products from warehouse shelves and packaging them for shipment. Id. at 35–36. The Court emphasized that the employer "could have eliminated the screenings altogether without impairing the employees' ability to complete their work." Id. at 35. The screenings were undertaken for the employer's benefit (to prevent theft), but they were not intrinsic to the work the employees were hired to perform.
Synthesizing these authorities, the "integral and indispensable" test asks two questions:
(1) Is the activity an intrinsic element of the employees' principal activities? That is, is the activity directly connected to the productive work the employees are employed to perform?
(2) Is the activity one with which the employee cannot dispense if he or she is to perform the principal activities? That is, would eliminating the activity impair the employees' ability to perform their work?
If both questions are answered in the affirmative, the activity is a principal activity (or an integral and indispensable part thereof) and is compensable. If either question is answered in the negative, the activity is preliminary or postliminary and falls within the Portal-to-Portal Act's exclusion.
C. The Continuous-Workday Doctrine
The continuous-workday doctrine, as articulated by the Supreme Court in IBP, provides that once an employee commences a "principal activity," the continuous workday has begun, and all subsequent time — including time spent walking between locations, waiting, and performing other activities — is compensable until the employee completes his or her last principal activity of the day. 546 U.S. at 37. The doctrine is an important corollary to the "integral and indispensable" test because it determines the temporal boundaries of the compensable workday.
The practical implication for the present analysis is significant. If any one of the three alleged pre-shift activities (donning a uniform, booting up a computer, or attending a handover briefing) constitutes a "principal activity," then the continuous commences at that point. All time from that first principal activity through the employee's last principal activity (which may be doffing the uniform, logging off the computer, or completing a post-shift handover briefing) is potentially compensable, including any intervening time that might otherwise be considered non-compensable walking or waiting time.
For example, if a front-desk associate dons her uniform in the locker room at 6:50 a.m., walks to the front desk, begins booting up the computer at 6:53 a.m., attends a handover briefing from 6:55 to 7:00 a.m., and then clocks in at 7:00 a.m. (the scheduled shift start), the continuous-workday doctrine would render compensable all time from 6:50 a.m. (the first principal activity) through the end of the employee's last principal activity, even though the employee did not clock in until 7:00 a.m.
D. The De Minimis Doctrine
Under the FLSA, courts have recognized a de minimis doctrine pursuant to which otherwise compensable working time may be disregarded as too insubstantial to warrant compensation. The doctrine originates in the Supreme Court's decision in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946), and is reflected in 29 C.F.R. § 785.47. The regulation provides that "[i]n recording working time under the Act, insubstantial or insignificant periods of time beyond the scheduled working hours, which cannot as a practical administrative matter be precisely recorded for payroll purposes, may be disregarded."
Courts applying the de minimis doctrine have generally considered three factors:
(1) The amount of daily time at issue — typically, only a few seconds or minutes per day qualifies as de minimis;
(2) Whether the time can be recorded as a practical administrative matter, taking into account the available timekeeping technology; and
(3) Whether the time occurs on a regular basis or only sporadically and irregularly.
See Lindow v. United States, 738 F.2d 1057, 1063 (9th Cir. 1984) (articulating the three-factor test).
Several important caveats apply to the de minimis doctrine in the context of this analysis. First, there is a growing trend among courts to narrow or question the doctrine, particularly where modern electronic timekeeping systems — such as the Luminos TimeTrack platform used by VHG — make it practicable to record even small increments of time. The California Supreme Court's decision in Troester v. Starbucks Corp., 5 Cal.5th 829 (2018), which declined to adopt the de minimis doctrine under California's wage-and-hour statutes, is illustrative of this trend. While Troester is not controlling under the FLSA and does not apply in Florida, it reflects a broader judicial skepticism toward the doctrine that may influence federal courts, including those in the Eleventh Circuit.
Second, and more practically significant for this matter, the volume of time alleged — fifteen to twenty-five (15–25) minutes per shift — is almost certainly too substantial to qualify as de minimis. Courts applying the doctrine have generally done so only where the daily time at issue amounts to a few minutes or less. See, e.g., Bustillos v. Board of County Comm'rs, 310 F. Supp. 3d 1255, 1266 (D.N.M. 2018) (7–8 minutes per day not de minimis); Singh v. City of New York, 524 F.3d 361, 370–71 (2d Cir. 2008) (suggesting that even small amounts of regularly occurring compensable time should not be dismissed as de minimis). The de minimis defense is therefore unlikely to provide VHG with a viable defense against the full scope of the pre-shift and post-shift claims, though it may have limited applicability to discrete sub-components of the alleged time (such as a few seconds spent swiping a badge or hanging a jacket).
E. Employer Knowledge — The "Suffered or Permitted" Standard
As noted above, the FLSA's definition of "employ" includes "to suffer or permit to work." 29 U.S.C. § 203(g). Under this standard, if VHG knew or should have known that employees were performing pre-shift and post-shift work, the time is compensable regardless of whether the employer expressly authorized the work. 29 C.F.R. § 785.11. The employer's obligation is affirmative: it must exercise reasonable diligence discover whether employees are working beyond their recorded hours.
Critically, an employer's policy prohibiting off-the-clock work does not, standing alone, relieve the employer of liability if the employer had actual or constructive knowledge that the policy was not being followed. See Allen v. Board of Public Educ., 495 F.3d 1306, 1319 (11th Cir. 2007) (holding that an employer may not "sit back and accept the benefits" of an employee's labor while claiming ignorance of the work performed). Where supervisors or managers are aware that employees routinely perform uncompensated pre-shift or post-shift work — or where the employer's own policies effectively require such work (such as a "floor-ready" policy that necessitates pre-shift preparation) — the employer cannot credibly claim lack of knowledge.
This standard is particularly relevant to VHG's situation. The preliminary information from Mr. Fuentes and Ms. Whitfield suggests that VHG's "floor-ready" expectation effectively requires employees to complete certain preparatory tasks before their scheduled shift begins, and that property-level managers are aware of and participate in scheduling shift-handover briefings. If confirmed, these facts would substantially undermine a defense based on lack of employer knowledge.
IV. Analysis of Each Alleged Pre-/Post-Shift Activity
This section applies the legal framework set forth in Section III to each of the three categories of pre-shift and post-shift activities alleged in the GLO demand letter. For each category, the analysis describes the nature of the activity, identifies the key factual questions that the audit must resolve, and assesses the litigation risk.
A. Donning and Doffing Uniforms
1. Nature of the Activity
VHG requires employees in multiple job categories — including front-desk associates, concierge staff, bellhops, housekeeping personnel, and food-and-beverage workers — to wear branded uniforms while on duty at its hotel and resort properties. The specific uniform requirements vary by role: front-desk associates and concierge staff typically wear a branded blazer, dress shirt, slacks or skirt, and name badge; bellhops wear a distinct branded uniform; housekeeping personnel wear a branded polo shirt and pants or scrubs; and food-and-beverage workers wear role-specific attire that may include aprons, chef's coats, or other specialized items.
The current VHG Employee Handbook (Version 7.2, effective January 1, 2025) contains a uniform-requirements policy that specifies the dress code for each department and states that employees must arrive at the property "ready for their shift." This language has been interpreted at the property level — based on the preliminary information from Mr. Fuentes and Ms. Whitfield — to mean that employees must be in uniform by the time their scheduled shift begins. The demand letter alleges that, as a practical matter, employees are required to change into their uniforms in on-site locker rooms before clocking in and to change out of their uniforms in the locker rooms after clocking out.
The claimant, Ms. Serrano, was a front-desk associate at the Verimark Regency Tampa. The demand letter estimates that the donning and doffing process for front-desk associates consumes approximately five to eight (5–8) minutes per shift. This estimate is consistent with the time that would reasonably be required to change from personal clothing into a multi-piece branded uniform (or vice versa) in a shared locker-room facility, accounting for retrieving and storing uniform items from a locker, changing garments, and presenting an appropriate professional appearance (adjusting clothing, putting on name badge, etc.).
A key factual question that the audit must resolve is whether employees are required to change on-site or whether they have the option of wearing their uniforms to and from the property. If employees are effectively compelled to change on-site — whether by express policy, by the nature of the uniform (e.g., branded or specialized attire that employees are discouraged from wearing in public), or by practical necessity (e.g., security concerns, hygiene requirements, or the absence of any reasonable alternative) — the compensability analysis tilts significantly in the employees' favor. If, on the other hand, employees are free to don and doff their uniforms at home and to commute in uniform, the changing time is more likely to be treated as a non-compensable personal choice.
2. Legal Analysis
Under IBP, Inc. v. Alvarez, donning and doffing is compensable when the clothing or gear at issue is "integral and indispensable" to the employees' principal activities. 546 U.S. at 37. The Supreme Court in IBP addressed specialized protective gear — sanitary outer garments, mesh aprons, Kevlar gloves, arm guards, and shin guards — that was required by federal workplace-safety regulations and without which the employees literally could not perform their work on the meatpacking production line. The Court had little difficulty concluding that donning and doffing such gear was integral and indispensable.
The analysis is more nuanced in the hospitality-industry context, where the "gear" at issue is not specialized protective equipment but rather a branded uniform designed to maintain a professional, brand-consistent appearance. Courts have drawn a meaningful distinction between two categories of employer-required clothing:
(a) Specialized or required clothing that cannot feasibly be worn outside the workplace. Where the employer requires employees to wear specialized gear, protective equipment, or distinctive uniforms that are impractical or prohibited for use outside the workplace, courts have generally found donning and doffing to be a compensable principal activity. The rationale is that such clothing is integral to the work — the employee cannot begin working without it — and the employee has no practical alternative to changing on-site. See Steiner, 350 U.S. at 256; IBP, 546 U.S. at 37; see also Salazar v. Butterball, LLC, 644 F.3d 1130, 1139 (10th Cir. 2011) (donning and doffing specialized sanitary and protective gear in a poultry-processing plant was compensable).
(b) Generic clothing or business attire that could be worn outside the workplace. Where the employer requires employees to wear clothing that is substantially similar to ordinary street clothes — such as dress shirts, slacks, polo shirts, or other generic business attire — courts have more frequently held that donning and doffing is not a principal activity but rather a preliminary or postliminary activity excluded by the Portal-to-Portal Act. The reasoning is that such clothing is not "integral and indispensable" to the work itself; the employee's principal activity is serving guests, processing transactions, or performing other job duties, not getting dressed. Wearing particular clothing is a precondition of employment but not an intrinsic element of the productive work. See, e.g., Gorman v. Consolidated Edison Corp., 488 F.3d 586 (2d Cir. 2007) (donning and doffing generic work clothing that could be worn on the commute was not compensable); Mitchell v. JCG Industries, Inc., 745 F.3d 837, 840–41 (7th Cir. 2014) (donning and doffing generic uniforms at a food-processing plant was non-compensable where employees could have worn the items to and from work).
VHG's uniforms appear to fall somewhere between these two categories. On one hand, the uniforms are branded — they bear the Verimark logo and are designed to be property-specific and role-specific, distinguishing VHG employees from guests and conveying the brand identity. On the other hand, the uniforms for many roles (particularly front-desk associates and concierge staff) appear to consist of relatively standard professional attire — blazers, dress shirts, slacks — augmented with branding elements (logos, name badges) rather than highly specialized or protective gear.
The Eleventh Circuit, which encompasses the federal courts in Florida where any litigation would likely be filed, has followed the IBP framework in analyzing donning-and-doffing claims but has not issued a definitive ruling on hotel or hospitality uniforms specifically. The circuit's cases have generally involved manufacturing, food-processing, or industrial settings where the donning-and-doffing analysis is more straightforward due to the clearly specialized nature of the required gear. See, e.g., Perez v. Mountaire Farms, Inc., 650 F.3d 350 (4th Cir. 2011) (cited approvingly by Eleventh Circuit panels in unpublished opinions). The absence of Eleventh Circuit precedent squarely on point creates uncertainty but does not eliminate the risk; a district court in the Middle or Southern District of Florida could plausibly find VHG's branded uniforms sufficiently distinctive to require on-site donning and doffing, particularly if the evidence shows that employees were discouraged from wearing the uniforms outside the property.
Key Factual Inquiries. The compensability of donning and doffing at VHG will turn on the following factual questions, which must be investigated during the audit:
• Does VHG's uniform policy (Employee Handbook v.7.2 or prior versions) expressly require employees to change on-site, or does it merely require employees to be in uniform at the start of their shift?
• Are employees permitted to wear their uniforms to and from the property, or are they discouraged or prohibited from doing so (whether by express policy, by management instruction, or by the nature of the uniform)?
• What specific uniform items are required for each role? Are any of the items sufficiently specialized (e.g., formal blazers with property-specific insignia, chef's coats, housekeeping scrubs) that wearing them during a commute would be impractical or undesirable?
• Does VHG provide on-site locker rooms and, if so, does the existence of locker rooms reflect an expectation that employees will change on-site?
• Do property-level managers enforce the uniform policy in a manner that effectively requires on-site changing — for example, by disciplining employees who arrive at the time clock in street clothes?
Risk Assessment: Moderate. The compensability of donning and doffing VHG uniforms is a close question that depends heavily on the specific facts. If the evidence shows that VHG's uniforms are generic professional attire that employees could readily wear to and from work, and that employees are free to do so, the donning-and-doffing claim is weaker. If, however, the evidence shows that VHG effectively requires on-site changing — whether through explicit policy, managerial enforcement, or the impracticability of commuting in branded uniforms — the claim is substantially stronger. On balance, we assess this category as presenting moderate litigation risk.
B. Booting Up Computer Systems
1. Nature of the Activity
Front-desk associates, concierge staff, and certain other roles at VHG properties are required to use desktop computer terminals running the property-management system ("PMS"), the reservation system, the point-of-sale ("POS") system, and other software applications as part of their daily work. These computer systems are essential tools for performing the core functions of these roles: checking in and checking out guests, processing reservations, managing room assignments, handling billing and payment transactions, accessing guest profiles and preferences, communicating with housekeeping and maintenance departments, and performing other operational tasks.
The demand letter alleges that the computer terminals at VHG properties require several minutes to boot up — i.e., to power on the hardware, load the operating system, and reach a state where the employee can begin logging into software applications. After the boot-up process is complete, the employee must then log into multiple software applications, each of which requires entering login credentials and may involve loading screens, system updates, or other delays. The total time from initiating the boot-up to having all systems fully operational is estimated at five to ten (5–10) minutes per shift.
The demand letter further alleges that employees are expected to have all systems fully operational by the time their scheduled shift begins, so that they can immediately begin serving guests. This expectation means that employees must initiate the boot-up process before the start of their scheduled shift — and, because employees do not clock in until the shift begins, the boot-up time is not captured by the Luminos TimeTrack system and is not compensated.
Whether this expectation is a matter of formal VHG policy or informal but widespread practice is a factual question that the audit must resolve. Preliminary information from Mr. Fuentes and Ms. Whitfield suggests that VHG's "floor-ready" expectation encompasses having systems operational, but the precise language of the policy and the manner in which it is communicated to employees at the property level must be confirmed.
2. Legal Analysis
Computer boot-up time has been the subject of increasing litigation in recent years, particularly in industries where computer use is central to the employee's job functions. Courts have generally found such time compensable where the employee cannot perform any principal duties without a functioning, logged-in computer terminal.
The analysis under the IBP "integral and indispensable" test is relatively straightforward for computer-dependent roles such as front-desk associates and concierge staff. A front-desk associate at a VHG hotel cannot check in a guest without the PMS. She cannot process a reservation without the reservation system. She cannot accept a payment without the POS system. She cannot access guest information, room assignments, or operational communications without her computer terminal being powered on and logged in. Booting up the computer and logging into the necessary software applications is therefore an intrinsic element of the employee's principal activity of serving guests at the front desk — and it is an activity with which the employee cannot dispense if she is to perform her principal duties. Under the two-part "integral and indispensable" test, computer boot-up time for front-desk associates is almost certainly a principal activity or an integral and indispensable part thereof.
Several district court decisions from other jurisdictions support this conclusion, particularly in analogous contexts such as call-center workers and bank tellers:
• In cases involving call-center employees, courts have consistently held that time spent booting up computers and logging into telephone and software systems is compensable because the employees cannot begin taking calls — their principal activity — without functioning systems. See, e.g., Landers v. Quality Communications, Inc., 771 F.3d 638, 641 (9th Cir. 2014) (reversing dismissal of claims by call-center workers alleging uncompensated boot-up time); Kuhn v. DISH Network Corp., No. 1:12-cv-01457 (D. Colo. 2013) (denying summary judgment on boot-up time claims where employees could not begin working without logged-in computer systems).
• Similarly, courts have found boot-up time compensable for bank tellers who must log into banking software before they can begin serving customers. See, e.g., Adkins v. Wellpoint, Inc., No. 3:09-cv-0290 (S.D. W.Va. 2010) (holding that time spent booting up computers and logging into systems was compensable for insurance-company employees whose work was entirely computer-dependent).
Under the continuous-workday doctrine, if booting up the computer is the first principal activity of the employee's workday, the continuous commences at that point. All time from the moment the employee begins the boot-up process until the employee completes her last principal activity at the end of the shift (which may include logging off the computer, shutting down the terminal, or attending a post-shift handover briefing) is compensable. This has cascading implications: even if the donning of a uniform were deemed non-compensable standing alone, if it occurs after the boot-up process has begun, it would fall within the continuous workday and be compensable as a result.
VHG's vulnerability on this claim is significant. The Company's "floor-ready" expectation — which, based on preliminary information, requires employees to have systems operational at the start of their scheduled shift — is strong evidence that the employer is requiring (or at a minimum suffering and permitting) pre-shift computer work. Even if VHG were to argue that it does not expressly require boot-up before the shift, the practical reality that employees cannot begin serving guests without operational systems — combined with the expectation that they will be ready to serve guests immediately at shift start — effectively compels pre-shift boot-up. Moreover, VHG's management knows or should know that employees must power on and log into computers before they can begin working, making a lack-of-knowledge defense untenable for this category of activity.
Risk Assessment: High. Computer boot-up time is likely VHG's greatest area of exposure for pre-shift claims. The legal framework strongly supports compensability for computer-dependent roles, and VHG's "floor-ready" policy reinforces the conclusion that boot-up time is required by the employer. The time involved — five to ten minutes per shift — is substantial enough that the de minimis doctrine is unlikely to apply. We assess this category as presenting high litigation risk.
C. Shift-Handover Briefings
1. Nature of the Activity
At many VHG properties, outgoing and incoming shift employees participate in a brief handover meeting at the point of shift transition. During these briefings, the outgoing shift employees communicate information to the incoming shift regarding matters such as:
• Ongoing guest issues (complaints, special requests, maintenance problems affecting occupied rooms);
• VIP guest arrivals, departures, or special-status notifications;
• Pending maintenance or engineering requests and their current status;
• Operational updates from management (policy changes, upcoming events, staffing adjustments);
• Any other matters that the incoming shift needs to be aware of to provide seamless guest service.
The demand letter alleges that these briefings are mandatory, last approximately five to ten (5–10) minutes, and are not compensated because they occur before the incoming employee clocks in or after the outgoing employee clocks out. Specifically, the incoming employee is expected to arrive before the scheduled shift start to receive the handover, and the outgoing employee is expected to remain after the scheduled shift end to deliver the handover. Neither the incoming employee's arrival before shift start nor the outgoing employee's departure after shift end is captured in the time-punch data, and neither is compensated.
Whether these briefings are formally required by VHG corporate policy or are instead an informal but deeply embedded property-level practice is a factual question that the audit must investigate. The preliminary information from Mr. Fuentes and Ms. Whitfield suggests that the briefings are a "longstanding practice" but that neither could confirm a corporate-level policy mandate. However, both acknowledged that property-level managers participate in scheduling and conducting the briefings, which is strong circumstantial evidence that the briefings are, as a practical matter, mandatory.
2. Legal Analysis
The Department of Labor's regulations directly address the compensability of meetings and training sessions in 29 C.F.R. § 785.27. Under this regulation, attendance at lectures, meetings, training programs, and similar activities is not compensable work time only if all four of the following criteria are satisfied:
(a) Attendance is outside of the employee's regular working hours;
(b) Attendance is in fact voluntary;
(c) The course, lecture, or meeting is not directly related to the employee's job; and
(d) The employee does not perform any productive work during such attendance.
All four criteria must be met for the meeting time to be excluded from compensable hours. Failure to satisfy even one criterion renders the time compensable.
Applied to VHG's shift-handover briefings, the analysis is as follows:
Criterion (a) — Outside regular working hours. The briefings occur at the boundary of the employee's regular working hours — either immediately before the incoming shift or immediately after the outgoing shift. Whether this satisfies criterion (a) is debatable, but the fact that the briefings are contiguous with the shift suggests they are at least closely connected to regular working hours, if not within them.
Criterion (b) — Voluntary attendance. The demand letter alleges that attendance at handover briefings is mandatory. If this allegation is substantiated — and the preliminary information from Mr. Fuentes and Ms. Whitfield does not contradict it — criterion (b) is not satisfied, and the briefing time is compensable on this basis alone. The critical question is whether employees are truly free to decline attendance without adverse consequences. If an employee who skips a handover briefing is subject to disciplinary action, negative performance reviews, or other adverse consequences — or if employees reasonably believe they would face such consequences — attendance is not voluntary within the meaning of the regulation.
Criterion (c) — Not directly related to the employee's job. The content of the handover briefings — guest issues, VIP arrivals, maintenance concerns, and other operational information — is directly and inextricably related to the employees' job duties. This criterion is clearly not satisfied.
Criterion (d) — No productive work performed. During the handover briefing, outgoing employees are communicating operational information and incoming employees are receiving that information to enable them to perform their duties. This exchange of job-related information is itself productive work within the meaning of the regulation. Criterion (d) is therefore not satisfied.
Because criteria (b), (c), and (d) are almost certainly not satisfied — and criterion (a) is at best debatable — the shift-handover briefings are compensable work time under 29 C.F.R. § 785.27.
The compensability of the briefings is reinforced by the continuous-workday doctrine. If the handover briefing is the first principal activity of the incoming employee's day, the continuous commences at the start of the briefing, and all subsequent time is compensable. If the handover briefing is the last principal activity of the outgoing employee's day, the continuous workday does not end until the briefing concludes, and all time from the first principal activity through the end of the briefing is compensable.
The only plausible defense would be for VHG to demonstrate that the briefings are truly voluntary — that employees are genuinely free to leave without attending, that no adverse consequences follow from non-attendance, and that sufficient employees in fact decline to attend that voluntariness can be established as a factual matter. Based on the preliminary information available, this defense appears weak. The briefings appear to be a standard, expected part of the shift-transition process at multiple VHG properties, and managers participate in scheduling and conducting them.
Risk Assessment: High. Mandatory, job-related briefings are almost certainly compensable under the FLSA's meeting-time regulations and under the integral-and-indispensable test. The five-to-ten-minute duration is well beyond any plausible de minimis threshold. We assess this category as presenting high litigation risk, comparable to the computer boot-up claims.
V. Application to VHG Properties and Roles
A. Variations Across Properties and Job Codes
While the demand letter characterizes the pre-shift and post-shift practices as "systemic" across all seven at-issue properties, it is important to recognize that the specific practices may vary — perhaps significantly — from property to property and from department to department. These variations affect both the merits of the claims and the potential procedural posture of any future litigation, particularly with respect to motions for conditional certification of an FLSA collective action under 29 U.S.C. § 216(b).
The seven at-issue properties differ in size, type (urban hotel versus beachfront resort versus boutique collection), management structure, and operational practices. The breakdown of hourly, non-exempt employees by property is as follows:
Each of the three categories of alleged pre-shift and post-shift activities may vary by property and by department:
Donning and doffing. Uniform requirements differ by role. Front-desk associates wear a multi-piece branded ensemble; housekeeping personnel wear a simpler branded polo and pants; food-and-beverage workers may wear chef's coats, aprons, or other specialized attire. The time required for donning and doffing will differ across roles, and the compensability analysis may yield different results for different uniform types. For example, a chef's coat may be considered more specialized (and less suitable for commuting) than a branded polo shirt. The audit must assess uniform requirements and donning-and-doffing practices for each department at each property.
Computer boot-up. Not all roles are computer-dependent. Front-desk associates, concierge staff, and certain administrative roles rely heavily on computer systems and are most directly affected by boot-up time claims. Housekeeping personnel, bellhops, and maintenance workers may have little or no daily computer use, reducing or eliminating their exposure on this claim category. The audit must map which job codes involve computer-dependent duties and assess boot-up practices for those roles at each property.
Shift-handover briefings. The format, duration, and mandatory nature of handover briefings may vary across properties and departments. Some properties may conduct formal, scheduled briefings; others may rely on informal, ad hoc handovers between individual employees. Some departments (such as front desk and concierge) may have more formalized briefing procedures than others (such as housekeeping or maintenance). The audit must determine the nature and extent of briefing practices at each property and in each department.
These property-level and department-level variations are significant for two reasons. First, on the merits, the compensability analysis must be conducted with reference to the specific facts at each property and in each department, rather than on a generalized basis. A finding that computer boot-up time is compensable for front-desk associates does not necessarily extend to housekeeping personnel who do not regularly use computers.
Second, for purposes of any future collective-action proceeding, property-level and department-level variations may support VHG's arguments against conditional certification under 29 U.S.C. § 216(b). To obtain conditional certification, the named plaintiff must demonstrate that she and the proposed collective members are "similarly situated" — that is, that they share a common policy or practice that affected them in a similar manner. If VHG can demonstrate that its pre-shift and post-shift practices vary materially across properties and departments, it may argue that the putative collective is not sufficiently cohesive for collective treatment, thereby limiting the scope of the action. This procedural strategy is addressed in a separate memorandum on collective-action conditional certification; however, the factual investigation recommended in this memorandum will generate evidence relevant to that analysis as well.
B. The Palomar-Managed Property (Verimark Shores Clearwater)
One of the seven at-issue properties — the Verimark Shores Clearwater — is not owned by VHG but is instead owned by Palomar Realty Partners LLC ("Palomar"), whose Managing Member is Ricardo E. Montalvo. VHG operates the Verimark Shores Clearwater property under a Hotel Management Agreement dated June 1, 2021 (Reference: HMA-2021-0601-PC). Under that agreement, VHG provides all operational management services for the property, including the employment and supervision of all on-site staff.
VHG directly employs all hourly, non-exempt workers at the Verimark Shores Clearwater. The employees are on VHG's payroll, are paid through VHG's Luminos TimeTrack and payroll systems, and are subject to VHG's Employee Handbook and HR policies. VHG sets work schedules, manages day-to-day operations, and exercises supervisory authority over the workforce. Palomar's involvement is primarily as the property owner and, under certain provisions of the HMA, as a participant in high-level operational and budgetary decisions.
The joint-employer analysis — i.e., whether Palomar may be deemed a "joint employer" under the FLSA and thus share liability for wage-and-hour violations at the Verimark Shores Clearwater — is addressed in a separate memorandum. For purposes of this memorandum, VHG's obligations as the direct employer of the Verimark Shores Clearwater workforce are the same as its obligations at VHG-owned properties. The pre-shift and post-shift compensability analysis applies equally to the Palomar-managed property, and the approximately 190 hourly, non-exempt employees at that property are included in the affected workforce count.
VI. Available Defenses
This section evaluates the defenses potentially available to VHG with respect to the pre-shift and post-shift claims. While several defenses are theoretically applicable, each has significant limitations when assessed against the specific facts of VHG's situation.
A. Portal-to-Portal Act — Preliminary/Postliminary Activity Defense
As discussed in Section III.B, the Portal-to-Portal Act excludes from compensable time activities that are "preliminary" to or "postliminary" to the employee's principal activity. 29 U.S.C. § 254(a)(2). VHG may argue that some or all of the alleged pre-shift and post-shift activities fall within this exclusion.
The strength of this defense varies across the three categories of activities:
Donning and doffing. This is the strongest candidate for a preliminary/postliminary defense, at least for roles where the uniform consists of generic professional attire (polo shirts, slacks, dress shirts) that employees could feasibly wear to and from the property. If the uniforms are not sufficiently specialized to require on-site changing, donning and doffing may be characterized as a preliminary activity analogous to getting dressed in the morning — a personal task that precedes the workday rather than an integral part of it. However, as discussed in Section IV.A, this defense weakens significantly if the evidence shows that VHG effectively requires on-site changing.
Computer boot-up. This defense is substantially weaker for computer boot-up time. As analyzed in Section IV.B, booting up the computer and logging into software applications is integral and indispensable to the principal activities of front-desk associates and other computer-dependent roles. A court is unlikely to characterize boot-up time as "preliminary" when the employee literally cannot perform any productive work without a functioning computer. The defense has minimal viability for this category.
Shift-handover briefings. This defense is also substantially weak for mandatory handover briefings. The briefings are directly related to the

MEMORANDUM

MATTER NO.: 1021-00005

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