Schemes to Avoid Paying Prevailing Wage Payments
TGIF Mediation Update

Schwarzenegger Administration "Proud" To Have Violated Law Against Government Propaganda

Government Code § 15254 prohibits the use of state communication facilities from being "used for political, sectarian or propaganda purposes." Despite this, a California state agency has spent public money to produce a video promoting the withdrawal of lunch and rest period rights for California workers. California Assemblyman Paul Koretz has asked Attorney General Bill Lockyer to investigate the matter.

Twelve television stations have broadcast the video made by the California Labor and Workforce Development Agency. The video was distributed with suggested news copy for reporters to read on the air, including the claim that regulations "interpreting" Labor Code § 226.7 would resolve uncertainty in the business community and create better workplaces.

The claim is completely false. The battle over the governor's new regulations may shape up to be the single most significant development in California wage and hour law this year, but its outcome will not resolve any uncertainty. Instead, the proposed regulations would turn almost every pending lawsuit involving meal and rest periods into a potential Supreme Court case, since there are substantial questions over the regulations' constitutionality.

The video does not discuss that issue, nor does it show the overwhelming worker opposition to the proposed rules. It presents only the new administration's favored position. The agency's undersecretary, Rick Rice, boasted of the video's effectiveness, calling it "a very successful video news release ... We hit 1.6 million people" at a cost of just $1,260. "I'm proud of that too," he added.

Asked whether the video indicates that the agency has already made up its mind about the proposed regulations, currently undergoing public comment and review, Rice issued the following non-denial denial: "Every word of testimony is reviewed to see if we should have potential changes on the regulations. In fact, they are thinking of tweaking some of the wording." Rice also says there are technical defenses to charges that the agency violated the law. Among other things, he says, it was not propaganda. Besides, he added, the law "only applies to broadcasting to the public, which we didn't do."

The fight has turned nasty in part because the proposed regulations are among the worst anti-employee proposals made recent years, and they are intended to aid the most pervasive violators -- companies like Wal-Mart, which has been known to sometimes clock its employees out, lock the doors, and have them finish work without pay. If enacted and upheld, the new rules would, among other things, give employers a means to avoid giving meal periods to their employees by merely informing employees of their right to a meal period.

While decent employers do not prevent employees from taking meal periods, the worst of the lot -- car dealerships, restaurant chains, Wal-Mart and similar employers -- have pervasive policies under which employees are afraid that they will lose their jobs if they insist on taking their breaks. We recently had a manager testify in a meal period case that she never even thought about letting the employees take breaks, because it was "so widely accepted" that no one at her company got breaks.

Under the new proposed rules, there would be nothing wrong with that.


Peter Green

I am the Controller for a California Car Dealership and take a special interest in Wage and Hour issues.
Why do you indicate Car Dealerships are 'the worst of the lot'? Is this opinion based on your own experience, from actual court records or anecdotal information? Can you direct me to actual cases, apart from the famous Keyes and AutoStiegler ones.
I'm in the process of writing a Guide to Wage and Hour Law for California Dealerships and any information you can provide would be appreciated. I'm not an attorney, just an accountant who thinks Dealerships would be better served by being fully aware of the Law and the means to get into compliance.

michael walsh

We have represented probably 25 employees of car dealerships and automotive repair shops in the past five years. We have yet to turn even one away after telling them that the dealership or repair shop was complying with the law. The only ones whose cases we did not take were those whose claims were too small to justify a filing fee, and were not amenable to class action status. We're sure that somewhere out there, a dealership is complying with the law. We just haven't encountered one yet, and 25/25 is a fairly significant sampling.

And, by the way, in the AutoStiegler case, the arbitrator slammed the dealership pretty hard, and they had to pay the arbitration costs, to boot.

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