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    « Murphy: It's a Wage | Main | Fireside Bank: No One-Way Invention in Class Actions »

    Comments

    kent

    Isn't this a big win for both employers and employees?

    I know for litigators, this is an employee victory (three/four years statute, fees, interest, punitives, etc.). But, from a daily management perspective (some people work rather than litigate for a living), it's an employer win.

    Rather than violate the Labor Code and Wage Orders, now employers can force employees to work through (skip) mandatory meal and rest breaks. Instead of facing penalties, employers need only pay a "premium" for refusing to allow breaks. Just as FLSA makes it illegal to employ workers for over 40 hours unless you pay overtime, now it's illegal to violate break rules unless you pay a premium wage. Employers are thus "discouraged" and "disincentivized" rather than prohibited from forcing employees to work without breaks.

    Sure, everyone had "lunch meetings" when going off-duty wasn't permitted, but that at least had the whiff of an illicit requirement that violated of the law. For example, if someone refused to work through lunch and was fired, I assume that would be a firing in violation of public policy (the requirement for off-duty breaks). Now, however, it's permissible to require the skipping of an off-duty break (and likewise permissible to fire someone who refuses to give up their off-duty meal break) provided the extra-hour premium is paid.

    michael walsh

    Nothing in the opinion says that employers can force employees to work through mandatory meal and rest breaks. To the contrary, the court noted that the break requirements were a matter of health and workplace safety. The question wasn't whether employers could avoid penalties by paying the hour of pay. The question was whether the hour of pay was, itself, a penalty. Employers who decide to simply pay the hour and continually disregard the Wage Orders will find themselves (i.e., Darden Restaurants, Wal-Mart) facing verdicts that include BOTH the hour of pay and penalties or punitive damages.

    kent

    Thank you for your reply. I understand the opinion was characterizing the "extra hour" rather than examining the underlying situation (employers forcing employees to skip breaks). Even so, the practical consequences -- that employers must pay an extra hour when they force employees to skip a break -- authorizes that activity rather than prohibits it.

    The opinion makes clear the additional hour of pay is compensation for the employee's losses, and points out that a penalty was included in the initial version (but deleted from later versions) of AB 2509. This appears to suggest that there isn't a penalty involved in requiring employees to skip breaks, but only compensation to them (ala overtime premium pay).

    If requiring employees to work through breaks is still "illegal" (violates the Wage Orders), the payment of the premium hour would be an admission by the employer of violating the Wage Orders. And the fact that it was a knowing violation would prompt punitives for willful disregard of rights, wouldn't it? Basically, if forcing employees to skip lunch is still illegal, the decision requires the employer to pay extra for an illegal act (kind of like requiring drug dealers to pay for tax stamps to sell illegal drugs).

    Can you think of any other illegal act that requires premium pay (e.g., maybe we should require employers to pay 2x the regular rate when sexually harassing an employee)? When is premium pay required other than for permissible work?

    In contract law, there's a difference between (1) a breach (violation) and remedy and (2) an alternative performance contemplated by the contract. I'm suggesting that the Supreme Court has said that employers may simply comply with an "alternative" to providing a break by paying 226.7 wages, rather than that they are in violation of the law.

    Do you think employers have to pay extra for making employees skip lunch but can't make them skip lunch? Is your view that only if they "continually disregard" the break rules that they'll bother someone enough to prompt penalties, but otherwise they can flaunt violations here and there?

    For example, if an employer wanted to have a working lunch meeting, would you say you can't do it legally at all, or would you say you might get away with the violation if you pay for the worktime plus the premium (and assume the risk of additional penalties, a misdemeanor conviction, and punitive damages), or would you say that it was sanctioned by this opinion?

    michael walsh

    The fact that the hour of pay is a wage does not mean that it is the only consequence to the employer. You read too much into the opinion. The opinion simply does not address, in any way, an employer's ability to avoid other punishment for violating the wage orders. There is none.

    You ask for an example. Here's a good example: Disregarding the break requirements is much like disregarding Labor Code sections 551 and 552 (551: "Every person employed in any occupation of labor is entitled to one day's rest therefrom in seven." 552: "No employer of labor shall cause his employees to work more than six days in seven.") The wage orders provide that employees working on a seventh day get overtime pay, at either 1 1/2 times (for the first 8 hours), or double time (after 8 hours). However, that does not satisfy the employer's obligation to have obeyed sections 551 and 552 in the first place. See also section 553: "Any person who violates this chapter is guilty of a misdemeanor."

    An employer who works an employee for 30 days in a month must pay the premium rate of pay on every seventh day, but may also face injunctive relief, penalties, punitive damages or criminal prosecution, though such consequences are unlikely if the violations are few.

    My responses to your final three questions would be
    1. Yes.
    2. Yes.
    3. Sometimes an on-duty lunch period can sometimes be permitted, but this opinion did nothing to address such circumstances.

    BP

    Is the Supreme Court's decision really that difficult to understand? To me it's as simple as 1, 2, 3:

    1. If an employer doesn't provide a timely meal break to an employee, the employee is due one (1) hour of extra pay, to be paid at the employee's "regular rate."

    2. The extra payment is a wage, not a penalty. Hence, it is subject to a 3 year statute of limitations claims period (4 years in a B&P 17200 case).

    3. As a wage, a terminated employee can pursue LC 203 waiting time penalties if he/she did not receive payment of this wage at the time of discharge/termination.

    From an employee financial perspective, that't it! However, least anyone think the Supreme Court is providing a legal safe haven for employers to deprive employees of their legally-mandated LC 512, meal breaks (at the cost of one hour of extra pay), do not overlook the trump card of LC 553: "Any person who violates this chapter is guilty of a misdemeanor," with all of its attendant legal consequences.

    The comments to this entry are closed.

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