Litigating California Wage & Hour and Labor Code Class Actions
Litigating California Wage & Hour and Labor Code Class Actions Litigating California Wage & Hour and Labor Code Class Actions
a jury in Alameda County awarded a class $172 million in a meal period lawsuit against Wal-Mart. 105 Labor Code Section 512 requires employers to “provide” an employee with a thirty-minute off-duty meal period on every day in which the employee works more than five hours. 106 The IWC Wage Order does not use the word “provide,” but states that an employer is not to employ a person for a work period exceeding five hours without a meal period. An employee who works no more than six hours in one day may waive the thirty-minute unpaid meal period, with the mutual consent of the employer. 107 An employee who works more than ten hours in one day must be provided a second thirty-minute meal period, although that second meal period can be waived if the employee works no more than twelve hours in a day and has not waived the first meal period. 108 During a break that qualifies as a meal period, the employee must be relieved of all work duties. 109 The Wage Orders also require an employer to allow employees to take paid rest breaks. This requirement is somewhat different than the meal period requirement in that nothing in the Wage Orders or the Labor Code restricts employees from voluntarily waiving their rights to rest periods. Waiver issues aside, Section 12(A) of the Wage Orders requires employers to allow employees a paid, ten-minute rest period for every four hours worked, or major portion thereof. No rest break is required unless an employee works three and one-half hours in a workday. 110 Employees are entitled to 10 minutes rest for shifts from three and one-half to six hours in length, 20 minutes for shifts of more than six hours up to 10 hours, and 30 minutes for shifts of more than 10 hours up to 14 hours. 111 Employers normally must provide rest breaks near the middle of each four hour work period, but need not provide a rest period before the first meal period. 112 to any requirement that the employer keeps records. Rest breaks, unlike meal periods, are not subject 105 106 107 108 109 110 111 112 Savaglio v. Wal-Mart Stores, No. C-835687 (Dec. 22, 2005 verdict). The verdict included an award of $115 million in punitive damages. The case is on appeal and was stayed pending a resolution of the Brinker decision, discussed Infra, and a ruling has not yet issued. See, e.g., Wage Order 7-2001 § 11(A). Id. Lab. Code § 512(a). Wage Order 7-2001 § 11(A). See, e.g., Wage Order 7-2001 § 12(A). Brinker Restaurant Corp. v. Superior Court, 2012 WL 1216356, at *10 (Cal. April 12, 2012). Id. at *11, 12. Seyfarth Shaw LLP | www.seyfarth.com Litigating California Wage & Hour Class Actions (12th Edition) 30
For each workday the employer fails to provide an employee with a required thirty-minute meal period or ten-minute rest break, the employee is entitled to recover one hour of pay at the employee’s regular rate. 113 Although the statute is unclear on how failure to provide multiple required meal or rest periods in a single day is punished, the DLSE has taken the position that one penalty for missed meal periods and one penalty for denied rest periods may be imposed per workday. 114 In 2009, a federal district court in Marlo v. United Parcel Service 115 analyzed the issue and agreed that an employee could recover both a meal period and a rest period penalty in the same workday. 116 However, the court determined that an employee can recover penalty pay for only one meal and only one rest period violation per day, even if the employee were to miss two meal periods or two rest periods. 117 This decision runs counter to an earlier district court decision that had decided—in a less detailed analysis—that an employee could recover penalty pay for only one violation per day, even if the employee were denied both meal and rest periods in the same workday. 118 In 2011, the California Court of Appeal agreed with Marlo in deciding United Parcel Service, Inc. v. Superior Court. 119 There, the court noted that the legislative history demonstrated that Section 226.7 was specifically drafted to conform to the IWC wage orders. 120 Because the wage orders “provide[] a separate remedy for violations of meal period requirements and violations of rest period requirements . . . up to two premium payments are allowed per work day.” 121 Therefore, it appears that this issue has finally been settled. Many employers fail to maintain records that comprehensively establish that employees in fact took their meal and rest periods. This is especially the case when an employer has mistakenly classified a position as exempt, because employers are not required to keep time records for employees covered by the most common exemptions (administrative, executive, and professional). Section 7 of the Wage Orders requires employers to record meal periods of non-exempt employees, and the DLSE generally takes the position that in the absence of records proving that meal periods were taken, the employees are presumed 113 114 115 116 117 118 119 120 121 Lab. Code § 226.7. See, e.g., Wage Order 7-2001 §§ 11(D) and 12(B). DLSE Manual § 45.2.8 and 45.3.7. 2009 WL 1258491 (C.D. Cal 2009). Id. at *7. Id. Corder v. Houston’s Restaurants, Inc., 424 F. Supp. 2d 1205, 1207 n.2 (C.D. Cal. 2006) (“Section 226.7(b) states that the employer is liable ‘for each work day’ that a break is not provided. Thus, the plain wording of the statute is clear that an employer is liable per work day, rather than per break not provided.”). 196 Cal. App. 4th 57 (2011). Id. at 67-8. Id. at 68. Seyfarth Shaw LLP | www.seyfarth.com Litigating California Wage & Hour Class Actions (12th Edition) 31
- Page 1 and 2: Litigating California Wage & Hour a
- Page 3 and 4: Table of Contents I. Introduction a
- Page 5 and 6: A. Disclosure of Class Member Names
- Page 7 and 8: associated statutory penalties. 1 T
- Page 9 and 10: who does not meet the threshold com
- Page 11 and 12: exempt work is of a kind which in e
- Page 13 and 14: 3) The employee performs his or her
- Page 15 and 16: decisions have concluded that under
- Page 17 and 18: Bell court to look beyond the Wage
- Page 19 and 20: place of business, would that quali
- Page 21 and 22: IWC had the authority to promulgate
- Page 23 and 24: stores” by providing them a porti
- Page 25 and 26: declare such a system illegal witho
- Page 27 and 28: employers should be able to defend
- Page 29 and 30: waive the right to reimbursement, s
- Page 31: Due to the ambiguity in the meaning
- Page 35 and 36: Arguably, no additional $100-per-pa
- Page 37 and 38: permitted” the employee to work t
- Page 39 and 40: federal decisions also held that an
- Page 41 and 42: for all overtime hours worked. The
- Page 43 and 44: much broader, such as the court’s
- Page 45 and 46: In the appeal of Chau, the appellat
- Page 47 and 48: years before the lawsuit, or for an
- Page 49 and 50: imposition of penalties, 194 routin
- Page 51 and 52: In one such class action, Elliot v.
- Page 53 and 54: First, there has been a substantial
- Page 55 and 56: Recent court decisions have begun t
- Page 57 and 58: of her hours was paid at a rate of
- Page 59 and 60: the limitations period for a penalt
- Page 61 and 62: passage, then the employee could st
- Page 63 and 64: all, but rather simply to proceed w
- Page 65 and 66: Shortly thereafter, another Divisio
- Page 67 and 68: and the ability to bring a collecti
- Page 69 and 70: XIII. Class Action Fairness Act of
- Page 71 and 72: the plaintiff is “master of her c
- Page 73 and 74: alleged conduct or any related cond
- Page 75 and 76: Initially, the decisions were split
- Page 77 and 78: XIV. Class Certification A. General
- Page 79 and 80: expectations and the realistic requ
- Page 81 and 82: In the immediate wake of Sav-On, th
a jury in Alameda County awarded a class $172 million in a meal period lawsuit against<br />
Wal-Mart. 105<br />
<strong>Labor</strong> <strong>Code</strong> Section 512 requires employers to “provide” an employee with a thirty-minute<br />
off-duty meal period on every day in which the employee works more than five hours. 106<br />
The IWC <strong>Wage</strong> Order does not use the word “provide,” but states that an employer is not to<br />
employ a person for a work period exceeding five hours without a meal period. An<br />
employee who works no more than six hours in one day may waive the thirty-minute unpaid<br />
meal period, with the mutual consent of the employer. 107 An employee who works more<br />
than ten hours in one day must be provided a second thirty-minute meal period, although<br />
that second meal period can be waived if the employee works no more than twelve hours in<br />
a day <strong>and</strong> has not waived the first meal period. 108 During a break that qualifies as a meal<br />
period, the employee must be relieved of all work duties. 109<br />
The <strong>Wage</strong> Orders also require an employer to allow employees to take paid rest breaks.<br />
This requirement is somewhat different than the meal period requirement in that nothing in<br />
the <strong>Wage</strong> Orders or the <strong>Labor</strong> <strong>Code</strong> restricts employees from voluntarily waiving their rights<br />
to rest periods. Waiver issues aside, Section 12(A) of the <strong>Wage</strong> Orders requires employers<br />
to allow employees a paid, ten-minute rest period for every four hours worked, or major<br />
portion thereof.<br />
No rest break is required unless an employee works three <strong>and</strong> one-half hours in a<br />
workday. 110 Employees are entitled to 10 minutes rest for shifts from three <strong>and</strong> one-half to<br />
six hours in length, 20 minutes for shifts of more than six hours up to 10 hours, <strong>and</strong> 30<br />
minutes for shifts of more than 10 hours up to 14 hours. 111<br />
Employers normally must<br />
provide rest breaks near the middle of each four hour work period, but need not provide a<br />
rest period before the first meal period. 112<br />
to any requirement that the employer keeps records.<br />
Rest breaks, unlike meal periods, are not subject<br />
105<br />
106<br />
107<br />
108<br />
109<br />
110<br />
111<br />
112<br />
Savaglio v. Wal-Mart Stores, No. C-835687 (Dec. 22, 2005 verdict). The verdict included an award of $115 million in<br />
punitive damages. The case is on appeal <strong>and</strong> was stayed pending a resolution of the Brinker decision, discussed Infra,<br />
<strong>and</strong> a ruling has not yet issued.<br />
See, e.g., <strong>Wage</strong> Order 7-2001 § 11(A).<br />
Id.<br />
Lab. <strong>Code</strong> § 512(a).<br />
<strong>Wage</strong> Order 7-2001 § 11(A).<br />
See, e.g., <strong>Wage</strong> Order 7-2001 § 12(A).<br />
Brinker Restaurant Corp. v. Superior Court, 2012 WL 1216356, at *10 (Cal. April 12, 2012).<br />
Id. at *11, 12.<br />
Seyfarth Shaw LLP | www.seyfarth.com <strong>Litigating</strong> <strong>California</strong> <strong>Wage</strong> & <strong>Hour</strong> <strong>Class</strong> <strong>Actions</strong> (12th Edition) 30
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