Wage Law

In Banda v. Richard Bagdasarian, Inc. the Fourth District Court of Appeal, Division Two, has issued a tentative opinion, not to be published, calling meal and rest period pay a penalty.

The opinion is peculiar in several respects. First and foremost, it admits that "the hour of pay in section 226.7 ... is calculated to compensate an employee for the employer's statutory violation." That's a good enough start for one's analysis. But that sentence ends with "and as such is a penalty." We don't see the connection.

We might expect that conclusion to follow after a statement that the hour of pay is intended to punish the employer for breaking the law. But if it is to compensate the employee, the remedy is compensatory, not penal. Nobody ever says, for example, that someone who recovers $100,000 in damages and $5,000,000 in punitive damages was "compensated" $5.1 million. They were compensated $100,000, and awarded another $5 million in punitive damages.

The Court of Appeal also found "incalculable" the monetary value of a lost 10-minute break, saying that it "more accurately should be called a restroom break." While we admit that the loss of the ability to kick back for ten minutes is hard to measure, the monetary loss is easy to calculate, because what was lost was ten minutes of pay for one's first ten minutes of rest. If the employee has to work through what should be ten minutes of leisure, the value of the ten minutes of labor is the minimum value of the loss.

The opinion was not a total loss for the workers, however. The Court of Appeal reversed a finding by the trial court that there is no private right of action for meal and rest pay, relying upon the Caliber Bodyworks holding entitling workers to sue directly  for "statutory" penalties, without pursuing claims through the DLSE or under the PAGA. The opinion also holds that grape pickers who are forced to sample the crops, without washing the grapes or their hands first, can seek injunctive relief outside the scope of the Workers' Compensation Act. And the opinion rejects any applicability of the "primary jurisdiction" doctrine.

[Update: The opinion was filed later in the day. You can read the whole thing for yourself here. We did not post about this decision earlier because we did not get a copy of the tentative ruling until June 7, 2006. Neither side requested oral argument. It is still possible that one side or the other will file petitions for review.]