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It seems to me like it only reports location when the case is opened, resulting in issues like this. I had a similar thing happen where Find My said they were at work, but in fact they were at home. Just hadn’t opened the case in several hours.
Frustrating, to be sure.
No it doesn’t just ping Find My when the case is open. That wouldn’t provide anyone much value if you think about it lol.
I am having similar issues with my AirTags. Each of my dogs have one in their harness. At 5pm 5 days a week my wife comes to my shop and takes one of the dogs home. No notice that she is no longer with me. Half way home I get a notice I left the dog that went home 3 hours earlier is no longer with me.
I had a similar issue when that dog was separated from us during our morning hike. It kept saying she was near at the place she last was seen by my phone, even when we located her at my truck 4 miles from where she was last seen it showed that she was still on the hike and not with me.
The hike issue I can understand because it needs to ping off of other iPhones to update its location.
The dog was with me and still not updating.