Wage Law

Last week, the Supreme Court granted review of the pro-employer meal period opinion in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25. Now comes Brinkley v. Public Storage, Inc. (2008) __ Cal.App.4th __, in which the Second District Court of Appeal also disagrees with Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949 regarding the extent of an employer's duty to make sure employees can take their lunch breaks. The case also involves an issue regarding the need to prove intent and injury from a paystub violation. The appeal arises out of an order granting summary adjudication of three claims asserted in a certified class action pending in Los Angeles. The holding reads:

Plaintiff asserts class action and individual claims for violations of the Labor Code. He alleges that defendant, his former employer, provided paystubs containing misstatements in violation of Labor Code section 226. An employer, however, cannot be liable for misstatements on paystubs unless it knowingly and intentionally makes such misstatements and an employee suffers injury as a result. Plaintiff cannot prove either element in this case.

Plaintiff also asserts causes of action based on section 226.7 on the ground that defendant failed to ensure that plaintiff and other class members took all meal periods and rest periods they were entitled to take. California law, however, only requires that employers make available such periods, which defendant did here.

 We affirm the trial court’s order granting defendant summary adjudication with respect to plaintiff’s section 226 and section 226.7 causes of action.

On the more interesting issue concerning meal periods, the court followed White v. Starbucks Corp. (N.D.Cal. 2007) 497 F.Supp.2d 1080, 1089, while attempting to reconcile itself with Cicairos.

The court noted that it would be impossible for employers with large work forces to enforce such meal breaks. (Ibid.) It further stated that “employees would be able to manipulate the process and manufacture claims by skipping breaks or taking breaks of fewer than 30 minutes, entitling them to compensation of one hour of pay for each violation.[ ] This cannot have been the intent of the California Legislature, and the court declines to find a rule that would create such perverse and incoherent incentives.” (Id. at p. 1089.) We agree with this analysis.

The court doesn't explain how it came to the conclusion that an employer with a large work force would find it impossible to schedule enforceable meal periods any more than it finds it impossible to schedule starting and quitting times for its employees, but in so doing, it found no triable issue of material fact as to whether the employer had met its burden.

The court also weighed in on the issue of meal period timing, stating that there is nothing in the law that mandates that a meal period occur "within the first five hours" of a shift.

Plaintiff argues that California law requires defendant to provide meal periods within the first five hours of a shift. We disagree. Nothing in the applicable statutes or wage order supports plaintiff’s position.

The evidence supporting the employer was summed up as follows:

In the present case, defendant produced substantial evidence that the employer provided meal periods to plaintiff and other meal period subclass members. Defendant showed that (1) defendant had a written policy providing for meal periods; (2) plaintiff and other managers were aware of this policy; (3) defendant reprimanded employees for not taking meal periods; and (4) defendant advised plaintiff and others at a meeting that they were required to take lunch and rest breaks. Defendant also produced 21 declarations of managers who worked for defendant. Each of these managers stated that they were allowed to take meal periods at their own discretion.

In response, the court found that the Plaintiff failed to meet his burden of showing a material issue of fact, supported by admissible evidence:

Plaintiff stated in a declaration: “I rarely if ever took timely rest breaks, that is a ten (10) minute break during the middle of any four (4) hour shift. As [an] hourly Bench Property Manager employee I was generally the manager on duty and could not take breaks.” We agree with the trial court that “[t]his is not an unequivocal statement that he was not authorized or permitted to take a ten-minute break every four hours.”

This is significant for at least two reasons: (i) the court essentially holds that "provide" means precisely the same thing as "authorize and permit", and (ii) the court expects clearer evidentiary facts to be set forth with specificity in the declarations. Worse for the plaintiff, an argument that might have carried the day was deemed waived:

Plaintiff claims on appeal that he and other employees were not allowed to leave the premises or lock the office during their meal periods. Such meal periods, plaintiff contends, were effectively “on duty,” and thus entitled employees to one hour of wages per meal period. (See Bono Enterprises, Inc. v. Bradshaw (1995) 32 Cal.App.4th 968, 975, disapproved on other grounds in Tidewater Marine Western, Inc. v. Bradshaw (1996) 14 Cal.4th 557, 574.) Plaintiff, however, did not raise these facts or this argument in his brief or separate statement opposing defendant’s motion for summary adjudication. We therefore deem the argument waived. (City of San Diego v. Rider (1996) 47 Cal.App.4th 1473, 1493.)

Similar evidentiary issues plagued the plaintiff class's certified claims for rest period violations.

Plaintiff did not set forth any facts indicating that as a practical matter, he could not take rest breaks. Instead, he simply alleged that he “could not” do so, without describing any factual basis for this allegation. The closest plaintiff came was his statement that “[a]s a Bench Property Manager, I was required to be on the property at all times during my shift.” An employer’s requirement that an employee be “on the property” at all times, however, does not necessarily prohibit rest periods. Indeed, in many employment settings, there is no practical way for an employee to take a 10-minute rest period without staying on the property. Plaintiff therefore failed to raise a triable issue of material fact with respect to his rest period cause of action. (See Toigo v. Town of Ross (1998) 70 Cal.App.4th 309, 329.) ¶ Moreover, plaintiff’s statement that he “could not” take rest breaks is a conclusory allegation and does not raise a triable issue of material fact. [our emphasis]

In other words, don't just say you can't take a break. Tell the court specifically why you can't take a break, so that the court can decide whether the employer is to blame.

Finally, on the issue of paystub violations under  Labor Code § 226, the court upheld the summary adjudication order because (i) plaintiff could not prove that the violations were intentional; and (ii) the violations did not cause any sort of injury. On the first point:

Defendant met its burden of production by filing a declaration stating that the misstatement of the associated mileage rate was inadvertent and, when discovered, corrected. This evidence showed that plaintiff could not establish an essential element of his claim, namely that defendant intentionally and knowingly failed to provide required information on its paystubs. The burden of production thus shifted to plaintiff. Plaintiff, however, produced no evidence of knowing or intentional conduct by defendant.

With respect to the second element, the court distinguished Brinkley's claims with those in Wang v. Chinese Daily News, Inc. (C.D.Cal. 2006) 435 F.Supp.2d 1042, which continues to stand as a good example of how a paystub violation can cause actual injury.

Plaintiff argues that the receipt of an inaccurate paystub ipso facto constitutes injury within the meaning of section 226, subdivision (e). This interpretation, however, renders the words “suffering injury” surplusage and meaningless. Such an interpretation is disfavored. (Jones v. The Lodge at Torrey Pines Partnership (2008) 42 Cal.4th 1158, 1184.) We hold that section 226 means what it says: a plaintiff must actually suffer injury to recover damages or statutory penalties. The present case is distinguishable from Wang v. Chinese Daily News, Inc. (C.D.Cal. 2006) 435 F.Supp.2d 1042. In Wang, the paystubs stated that the employees worked 86.66 hours regardless of the number of hours actually worked, the length of the pay period, or the number of work days in the pay period. This caused the employees to suffer injury because they might not be paid for overtime work to which they were entitled and they had no way of challenging the overtime rate paid by the employer. (Id. at p. 1050.) Here, by contrast, plaintiff was not underpaid or given insufficient information to challenge the payments he received. This inadvertent technical violation of section 226 caused no resulting damages.

You can download Brinkley here in pdf or MS Word format. Mark your calendars for the last week in January, when the Supreme Court is likely to issue a "grant and hold" review order, deeming this a related case to Brinker Restaurant Corp. v. Superior Court.