Wage Law

Existing law, the Domestic Worker Bill of Rights (Labor Code section 1451-1453), regulates the hours of work of domestic work employees who are personal attendants and provides an overtime compensation rate for those employees. The Domestic Worker Bill of Rights defines terms for its purposes and requires the Governor to convene a committee to study and report to the Governor on the effects of its provisions on personal attendants and their employers.

Pursuant to Labor Code section 1453, the Domestic Worker Bill of Rights would be repealed as of January 1, 2017. SB 1015 deletes that repeal date. By extending the effect of the Domestic Worker Bill of Rights, the violation of which is a misdemeanor, this bill would expand the definition of a crime, which would impose a state-mandated local program. Here is the full text of the heart of the Domestic Worker Bill of Rights, Labor Code section 1451:

1451.  As used in this part, the following definitions apply:
   (a) (1) "Domestic work" means services related to the care of persons in private households or maintenance of private households or their premises. Domestic work occupations include childcare
providers, caregivers of people with disabilities, sick, convalescing, or elderly persons, house cleaners, housekeepers, maids, and other household occupations.
   (2) "Domestic work" does not include care of persons in facilities providing board or lodging in addition to medical, nursing, convalescent, aged, or child care, including, but not limited to,
residential care facilities for the elderly.
   (b) (1) "Domestic work employee" means an individual who performs domestic work and includes live-in domestic work employees and personal attendants.
   (2) "Domestic work employee" does not include any of the
following:
   (A) Any person who performs services through the In-Home Supportive Services program under Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of, or Sections 14132.95, 14132.952, and 14132.956 of, the Welfare and Institutions Code.
   (B) Any person who is the parent, grandparent, spouse, sibling, child, or legally adopted child of the domestic work employer.
   (C) Any person under 18 years of age who is employed as a babysitter for a minor child of the domestic work employer in the employer's home.
   (D) Any person employed as a casual babysitter for a minor child
in the domestic employer's home. A casual babysitter is a person whose employment is irregular or intermittent and is not performed by an individual whose vocation is babysitting. If a person who
performs babysitting services on an irregular and intermittent basis does a significant amount of work other than supervising, feeding, and dressing a child, this exemption shall not apply and the person
shall be considered a domestic work employee. A person who is a casual babysitter who is over 18 years of age retains the right to payment of minimum wage for all hours worked, pursuant to Wage Order
No. 15-2001 of the Industrial Welfare Commission.
   (E) Any person employed by a licensed health facility, as defined in Section 1250 of the Health and Safety Code.
   (F) Any person who is employed pursuant to a voucher issued through a regional center or who is employed by, or contracts with, an organization vendored or contracted through a regional center or the State Department of Developmental Services pursuant to the Lanterman Developmental Disabilities Services Act (Division 4.5 (commencing with Section 4500) of the Welfare and Institutions Code) or the California Early Intervention Services Act (Title 14 (commencing with Section 95000) of the Government Code) to provide services and support for persons with developmental disabilities, as defined in Section 4512 of the Welfare and Institutions Code, when any funding for those services is provided through the State Department of Developmental Services.
   (G) Any person who provides child care and who, pursuant to subdivision (d) or (f) of Section 1596.792 of the Health and Safety Code, is exempt from the licensing requirements of Chapters 3.4 (commencing with Section 1596.70), 3.5 (commencing with Section 1596.90), and 3.6 (commencing with Section 1597.30) of Division 2 of the Health and Safety Code, if the parent or guardian of the child to whom child care is provided receives child care and development services pursuant to any program authorized under the Child Care and Development Services Act (Chapter 2 (commencing with Section 8200) of Part 6 of Division 1 of Title 1 of the Education Code) or the California Work Opportunity and Responsibility to Kids Act (Chapter 2 (commencing with Section 11200) of Part 3 of Division 9 of the Welfare and Institutions Code).
   (c) (1) "Domestic work employer" means a person, including corporate officers or executives, who directly or indirectly, or through an agent or any other person, including through the services of a third-party employer, temporary service, or staffing agency or similar entity, employs or exercises control over the wages, hours, or working conditions of a domestic work employee.
   (2) "Domestic work employer" does not include any of the following:
   (A) Any person or entity that employs or exercises control over the wages, hours, or working conditions of an individual who performs domestic work services through the In-Home Supportive Services program under Article 7 (commencing with Section 12300) of Chapter 3 of Part 3 of Division 9 of, or Sections 14132.95, 14132.952, and 14132.956 of, the Welfare and Institutions Code or who is eligible for that program.
   (B) An employment agency that complies with Section 1812.5095 of the Civil Code and that operates solely to procure, offer, refer, provide, or attempt to provide work to domestic workers if the relationship between the employment agency and the domestic workers for whom the agency procures, offers, refers, provides, or attempts to provide domestic work is characterized by all of the factors listed in subdivision (b) of Section 1812.5095 of the Civil Code and Section 687.2 of the Unemployment Insurance Code.
   (C) A licensed health facility, as defined in Section 1250 of the
Health and Safety Code.
   (d) "Personal attendant" means any person employed by a private householder or by any third-party employer recognized in the health care industry to work in a private household, to supervise, feed, or dress a child, or a person who by reason of advanced age, physical disability, or mental deficiency needs supervision. The status of personal attendant shall apply when no significant amount of work other than the foregoing is required. For purposes of this subdivision, "no significant amount of work" means work other than the foregoing did not exceed 20 percent of the total weekly hours worked.

AB 1066, a bill authored Assemblymember Lorena Gonzalez (D-San Diego), to provide daily overtime to California agricultural workers, has been signed into law by Governor Brown.

Existing law sets wage, hour, meal break requirements, and other working conditions for employees and requires an employer to pay overtime wages as specified to an employee who works in excess of a workday or workweek, as defined, and imposes criminal penalties for the violation of these requirements. Existing law has exempted agricultural employees from these requirements.

AB 1066, the Phase-In Overtime for Agricultural Workers Act of 2016, removes this exemption for agricultural employees regarding hours, meal breaks, and other working conditions, and creates a schedule phases in overtime requirements for agricultural workers over the course of 4 years (from 2019 to 2022). Beginning January 1, 2022, the bill will require any work performed by a person, employed in an agricultural occupation, in excess of 12 hours in one day to be compensated at the rate of no less than twice the employee’s regular rate of pay. The bill would provide employers who employ 25 or fewer employees an additional 3 years to comply with the phasing in of these overtime requirements. The bill also authorizes the Governor to delay the implementation of these overtime pay provisions if the Governor also suspends the implementation of a scheduled state minimum wage increase. The bill would require the Department of Industrial Relations to update a specified wage order for consistency with these provisions, as specified.

Here is the full text of the new law:

SB 435 (compensation, meal and rest or recovery periods) amending Labor Code § 226.7 concerning meal and rest periods, has been signed by Governor Brown:

Existing law prohibits an employer from requiring an employee to work during any meal or rest period mandated by an order of the Industrial Welfare Commission (IWC) and establishes penalties for an employer’s failure to provide a mandated meal or rest period.

This bill would make that prohibition applicable to a meal or rest or recovery period mandated by applicable statute or applicable regulation, standard, or order of the IWC, the Occupational Safety and Health Standards Board, or the Division of Occupational Safety and Health. The bill would exempt specified employees from the prohibition. The bill would require an employer to pay an employee, for any meal or rest or recovery period mandated by law, one additional hour of pay at the employee’s regular rate of compensation for each workday that the meal or rest or recovery period is not provided. The bill would define “recovery period” for those purposes.

© Walsh & Walsh, P.C., wage & hour, meal periods, rest periods, recovery periods.

Q:  If an employer doesn't let the employee take her lunch, doesn't it owe her overtime for that missed lunch break?

A:  California's overtime and meal period laws imposed entirely separate obligations to the employer. A missed meal period does not necessarily mean the employer owes overtime. There are times when that is the case, however. For example, if the employer had the employee clock out for the meal period, but the employer was required to work during the meal period, and also worked 8 hours on the clock that day. In that example, the employee's meal period should count as hours worked, and since the additional time makes the employee's workday exceed 8 hour, and the additional time should be paid at one and a half times the employee's regular rate of pay.

Independent of the overtime issue, however, an employer who causes an employee to miss a required meal period will owe the employee an extra hour of pay at the employee's regular rate, pursuant to Labor Code § 226.7.

Under Labor Code § 512, the employer may not employ an employee for a work period of more than five hours per day without providing the employee with a meal period of not less than thirty minutes, except that if the total work period per day of the employee is no more than six hours, the meal period may be waived by mutual consent of both the employer and employee.

A second meal period of not less than thirty minutes is required if an employee works more than ten hours per day, except that if the total hours worked is no more than 12 hours, the second meal period may be waived by mutual consent of the employer and employee only if the first meal period was not waived.

If the employer requires the employee to remain on premises during the meal period, it must be a paid meal period, whether or not the employee is relieved of all duties during the meal period. Bono Enterprises, In. v. Bradshaw (1995) 32 Cal.App.4th 968.

Due to some post-hearing briefing, the Brinker case is no longer considered submitted. The Supreme Court has posted this docket entry:

Pursuant to California Rules of Court, rule 8.520(f)(7) and this court's December 2, 2011, order, the parties' answers to the amicus curiae brief of the California Employment Law Council, addressing the grounds for prospectively applying portions of this court's eventual decision on the merits, are due Tuesday, January 3, 2012. Each party may file a simultaneous reply to the other party's answer within 10 days thereafter. Submission of the cause is vacated. (See Cal. Rules of Court, rule 8.524(h)(1) [submission runs from expiration of the time in which to file briefs, including supplemental briefs].) The cause will be resubmitted on January 13, 2012.

As a result, don't expect a decision until sometime next Spring. It could be as late as April 12, 2012.

If you didn't get a chance to watch the Brinker argument live, you can watch it here at your leisure.

We received word from Katie Lichty, the Project Coordinator for the California Channel, that the Brinker hearing will indeed be broadcast live tomorrow morning at 9:00 a.m. You can watch it on cable if you get the California Channel, or you can watch it streamed live at www.calchannel.com.

This proceeding will be heard at the Supreme Court’s Courtroom, Earl Warren Center, 350 McAllister Street, San Francisco, where you can watch it in person - if you come early enough to get a seat. For more information please contact the court’s press office at (415) 865.7726.

We've been told that the California Supreme Court's oral argument in the Brinker Restaurant Corp. v. Superior Court matter will be broadcast live on the California Channel on November 8, 2011 at 9 a.m. If so, you can access the broadcast here. We haven't been able to confirm this ourselves, however, as the current broadcast schedule on the site only covers the period through October 29, 2011.

Brinker Restaurant v. Superior Court (Hohnbaum), one of the most eagerly-awaited cases on the California Supreme Court's docket, will be argued on Tuesday, November 8, 2011 at 9:00 a.m. in San Francisco. The petition for review of the decision in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25 was filed more than three years ago. The case presents issues concerning the proper interpretation of California's statutes and regulations governing an employer's duty to provide meal and rest breaks to hourly workers.

Here is our take on the original opinion, published on July 22, 2008. There are quite a few companion cases.

There are now four cases in which the California Supreme Court has granted review and held pending further decision in the Brinker Restaurant v. Superior Court matter. Brinker, which "presents issues concerning the proper interpretation of California's statutes and regulations governing an employer's duty to provide meal and rest breaks to hourly workers" is fully briefed and awaits a hearing date for oral argument. The first grant-and-hold review was in Brinkley v. Public Storage (2008) 167 Cal.App.4th 1278, followed by the unpublished decision in Bradley v. Networkers International, LLC (Petition for review after the Court of Appeal affirmed the judgment in a civil action).

Add to them now Faulkinbury v. Boyd & Associates (2010) Cal.App.4th 1363 (Petition for review after the Court of Appeal affirmed in part and reversed in part an order denying class certification in a civil action) and the unpublished opinion in Brookler v. Radioshack Corporation (Petition for review after the Court of Appeal reversed an order decertifying a class action).

Next on the likely list of cases to be granted review and held - Hernandez v. Chipotle Mexican Grill, Inc. (2010) __ Cal.App.4th __.  (Opinion in pdf here, or in Word here). The Chamber of Commerce is taking a bit of a victory lap for this opinion, which was originally handed down as an unpublished decision, but was ordered published on October 28. It is likely to be a short lap, at least until and unless the Supreme Court weighs in on Brinker in favor of the employers.

The Supreme Court denied petitions for review and depublication in Brewer v. Premier Golf Properties (2008) 168 Cal.App.4th 1243. We discussed the opinion in an earlier post that can be found at this link. The case was notable both for declaring punitive damages unavailable in claims made for Labor Code wage-and-hour violations, and for upholding the trial court's award for meal period and rest period violations. A remittitur was issued on March 23, 2009.

The FLSA has no meal period requirement, but 21 U.S. states or other jurisdictions have meal period requirements; seven of those (California, Colorado, Kentucky, Minnesota, Nevada, Oregon, and Washington) also have rest periods requirements. Meal periods for minor workers are mandated in 35 states or territories. For a comparison of all states' meal and rest period laws, check out this page at the DOL's website.

We wondered what happened in Banda v. Richard Bagdasarian, Inc. 2008 WL 888524, one of the penalty/wage cases that was a companion case to Murphy v Kenneth Cole Productions, Inc. (2007) 40 C4th 1094, and checked to see if it was still pending. It is not. In April 2008, in an unpublished opinion, the Fourth District, Division Two, ordered the Superior Court to approve a settlement agreement in the matter. In Banda, a class of farmworkers challenged the defendant’s failure to provide meal periods and rest breaks, and its practice of requiring them to taste unwashed and pesticide-laden grapes for sweetness. The claims were brought under the Unfair Competition Law. The first unpublished Fourth District opinion, 2006 WL 1554441, had been transferred by the Supreme Court back to the Fourth District on May 23, 2007, for reconsideration in light of Murphy.

The main provisions of the settlement agreement create a settlement fund to be distributed by a settlement administrator (1) to pay specified fees, costs, and expenses and (2) to make specified payments in compensation for omitted breaks ( Lab.Code, § 226.7) to plaintiffs and other persons employed by defendant during the 2001 and 2002 harvests who show their entitlement under the settlement agreement by timely submitting a settlement claim form. No provision is made for payment of wait time penalties. ( Lab.Code, § 203.) Claimants must execute a release of any and all claims “resulting from or occurring in connection with [the claimant's] employment by [defendant].” The settlement agreement includes a procedure to notify potentially eligible claimants.

...

Pursuant to the Supreme Court's transfer order, the opinion previously filed June 8, 2006, is vacated. Pursuant to the stipulation of the parties, the judgment is reversed. This reversal of the judgment does not indicate a ruling on the merits of the judgment, but serves only to vacate the judgment and restore jurisdiction to the trial court so that it may carry out the following directions implementing and enforcing the parties' settlement agreement.

The clerk of this court is directed to send, with the copy of this opinion sent to the superior court, a copy of the recitals re: stipulation to reverse, with the attached settlement agreement, filed in this court April 2, 2008. The trial court is directed: (1) to approve the settlement agreement, and to approve the form and content of the settlement notice and claim form attached to the settlement agreement; (2) to enter a judgment ordering the agreed permanent injunction, which shall terminate at the conclusion of the 2012 grape harvest, and ordering the parties to abide by the terms of the settlement agreement; and (3) to retain jurisdiction until the permanent injunction is terminated to take any actions necessary to implement and enforce the injunction, the judgment, and the settlement agreement.

The opinion did not mention the dollar amount of the settlement, but two news stories reported that the cash value of the settlement was $585,000.

The Supreme Court has extended its time to grant or deny a petition for review that was filed in January in Brewer v. Premier Golf Properties (2008) 168 Cal.App.4th 1243. We discussed the opinion in a post that can be found at this link. The case was notable both for declaring punitive damages unavailable in claims made for Labor Code wage-and-hour violations, and for upholding the trial court's award for meal period and rest period violations. The time for granting or denying review in the above-entitled matter is now extended to and including April 8, 2009, or the date upon which review is either granted or denied.

As we wait for the California Supreme Court to decide Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25, we can assume with a high degree of certainty that any state court opinion dealing with provide/permit issues or meal/rest break certification orders will be reviewed as a companion case to Brinker. For the next few months, therefore, we will have only Cicairos v. Summit Logistics (2005) 133 Cal.App.4th 949 as controlling authority in Superior Court, but in U.S. District Court, judges are free to guess what they think the California Supreme Court would decide.** When interpreting state law, federal courts are bound by decisions of the state's highest court (In re Kirkland (9th Cir.1990) 915 F.2d 1236, 1238), but in the absence of such a decision, a federal court shall apply the rule that it believes the state supreme court would adopt if faced with the same issue. Arizona Electric Power Cooperative, Inc. v. Berkeley (9th Cir.1995) 59 F.3d 988, 991.

The "make available" and/or denied certification cases that reject or distinguish Cicairos include:

** Well, maybe not entirely free to guess. As a reader points out, a Ninth Circuit case from Oregon holds that a federal court is obligated to follow the decisions of the state's intermediate appeallate courts, unless there is convincing evidence that the state supreme court would decide differently. Ryman v. Sears-Roebuck & Co. (9th Cir. 2007) 505 F.3d 993, 995. 

‘[W]here there is no convincing evidence that the state supreme court would decide differently, a federal court is obligated to follow the decisions of the state's intermediate appellate courts.’ ” Vestar Dev. II, LLC v. Gen. Dynamics Corp., 249 F.3d 958, 960 (9th Cir.2001) (quoting Lewis v. Tel. Employees Credit Union, 87 F.3d 1537, 1545 (9th Cir.1996) (internal quotation marks omitted)). The district court did not cite any evidence that the Oregon Supreme Court would disaffirm Yeager. It merely disagreed with Yeager. FN1 Because there is no evidence that the Oregon Supreme Court would have decided the OFLA issue differently, the district court erred in not applying the Yeager rule.FN2

FN1. We note that the district court did cite opinions by other federal district judges expressing their disagreement with the Yeager rule. The opinions of other federal judges on a question of state law do not constitute “convincing evidence that the state supreme court would decide [an issue] differently,” Vestar, 249 F.3d at 960, nor do those opinions contain any relevant “convincing evidence.”

FN2. Although not dispositive, we note that the Oregon Supreme Court declined to grant review of Yeager. See Yeager v. Providence Health Sys. Or., 337 Or. 658, 103 P.3d 641 (2004) (table).

Given the decision of the Supreme Court not to review Cicairos v. Summit Logistics (2005) 133 Cal.App.4th 949 and Bufil v. Dollar Financial Group, Inc. (2008) 162 Cal.App.4th 1193, and their decision to grant review in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25, and Brinkley v. Public Storage, Inc. (2008) 167 Cal.App.4th 1278, in a case where the employer cannot clearly distinguish Cicairos, the District Court should feel obligated to follow it.

The Supreme Court has denied review in Dimon v. County of Los Angeles (2008) 166 Cal.App.4th 1276, a meal/rest period case in which the court held that charter counties are not bound by Industrial Welfare Commission wage orders concerning such breaks. We briefly discussed the case last week.

A petition for review has been granted in Brinkley v. Public Storage, Inc. (2008) 167 Cal.App.4th 1278, the paystub violation and meal and rest break case that was published on October 28, 2008. As we predicted, the case was given a Rule 8.512(d) grant-and-hold review, and is now a companion case to Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25.

The petition for review is GRANTED. Further action in this matter is deferred pending consideration and disposition of a related issue in Brinker Restaurant Corp. v. Superior Court, S166350 (see Cal. Rules of Court, rule 8.512(d)(2)), or pending further order of the court. Submission of additional briefing, pursuant to California Rules of Court, rule 8.520, is deferred pending further order of the court.

George, C.J., was absent and did not participate. Votes: Corrigan, A.C.J., Kennard, Baxter, Werdegar, Chin and Moreno, JJ.

 We previously discussed Brinkley in posts that can be found here and here.

Brinkley is no longer good law and cannot be cited in California courts. California Rules of Court, Rule 8.115 prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, and Rule 8.1105(e)(1) provides that unless otherwise ordered, an opinion is no longer considered published if the Supreme Court grants review.

Briefing in the Brinker case gets underway next week.

Employees working for a charter county are not governed by any IWC Wage Orders, and the county has exclusive authority to provide for the compensation and conditions of employment of its employees. Therefore, the employees cannot state a cause of action for failure to provide meal periods. Dimon v. County of Los Angeles (2008) 166 Cal.App.4th 1276.

the County has exclusive authority, as a charter county, to provide for the compensation and conditions of employment of its employees, and has done so with respect to probation officers through a collective bargaining agreement adopted by resolution.  It is thus exempt from state statutes and regulations governing meal breaks. 

You can download the full text of Dimon (for a while, at least), at links here in pdf or word format.

This opinion piece was first published in the Daily News on November 4, 2008. We reprint it here today with the permission of the author, Aaron T. Knapp:

In recent years, defense lawyers have enjoyed a pro-business trend in California court decisions.  The Court of Appeal’s decision in Brinker Restaurant Corp., et al. v. Superior Court of San Diego, 2008 DJDAR 11267, which many of us have been watching closely, is no exception.

In Brinker, employees of a large international restaurant chain operating more than 175 restaurants in California, claim they were improperly denied meal and rest breaks.  The plaintiffs argue their case is certifiable as a class action under California law.  The Court of Appeal disagreed, vacating a lower court’s order certifying the case as a class action.

On October 22, the California Supreme Court agreed to review the case.

The Court of Appeal’s core legal holding was that break periods need not be “ensured” by the employer but only “made available.” This, despite the fact that an earlier case, Cicairos v. Summit Logistics, Inc., 133 Cal.App.4th 949 (2005), held that California “employers have ‘an affirmative obligation to ensure that workers are actually relieved of all duty’” during a break.

According to the Court of Appeal, the statistical proof offered by the plaintiffs showed only that breaks were not taken. While this might have resolved the question of whether the defendants “ensured” the breaks, it did not show that the defendants failed to “make them available.” The Court of Appeal held that too much individualized proof would be needed to litigate the claims on the latter standard, making class certification inappropriate.

The Court of Appeal’s underlying legal holding in Brinker is rife with problems. The California Labor Code indicates that employers must “provid[e]” meal breaks.  The Industrial Welfare Commission similarly mandates rest periods.  Plaintiffs argue that under these provisions, employers should be required to make sure employees take their breaks.  The Court of Appeal rejected this argument, emphasizing how burdensome it would be for the corporate defendants to ensure that employees utilize their break time; and how under this standard, individual employees might game the system to the significant detriment of their employers.

According to the Court of Appeal, therefore, all employers should be required to do is merely permit meal and rest breaks.   This was the court’s fundamental error.

To be sure, “providing” breaks to employees does not mean holding a gun to their heads until they take them.  The requirement cannot be that employers force employees to take breaks.  But, by the same token, requiring employers merely to permit breaks, without any additional teeth, seems far too lenient under the circumstances.

So worried was the Court of Appeal about not imposing any additional administrative burden on employers, and about individual employees “gaming” their bosses, that it failed to recognize how its relaxed standard could be unfairly exploited by California employers.

The Court of Appeal suggested that an employer complies with the statutes so long as employees are not “forced to forego” breaks.  But this ignores the many ways in which organized managers can unfairly treat employees in connection with break time, short of actually “forcing” an employee not to take a break.

An employer can comply by merely granting (or at least not refusing) express requests, if any, to take permissible breaks, but failing otherwise to broach the issue.  Meanwhile, the employer is free to pile substantial work on employees under time requirements and a demeanor that suggest no break should or can be taken.

The Court of Appeal’s holding focuses too narrowly (and too inflexibly) on a pointy-headed dictionary definition, ignoring the practical context in which these rights are exercised, or not. In a busy, time-constrained work environment, there are many natural disincentives to take breaks. Managers and supervisors, even while recognizing break rights, often look askance at them and the employees who dutifully take them.

Employees who work through their breaks, or take shorter breaks, may get more praise and credit than those who don’t. The dynamic is intensified in an uncertain economy and for many immigrant groups who can be exceedingly obedient and timid.

If affirmed, Brinker will substantially “chill” the exercise and enforcement of break rights because employees may not be able to find representation.  Plaintiffs’ lawyers are less likely to pursue individual meal and rest break cases because it will not be worth it to them.

Without lawyers, these important individual rights will not be asserted as much in court. And an unasserted right is, for all intents and purposes, a nonexistent right. Brinker’s procedural holding therefore has immense practical ramifications that I’m not sure the Court of Appeal, in its pro-employer analytical framework, properly took into account.

Taking into account context and good policy, the law can, and should, be read to require employers not only to give meaningful, individualized notice of break rights, but also affirmatively to schedule breaks for all employees.  Breaks should be part of each employee’s schedule, and employers should be required regularly to encourage and remind employees to take them.

Under this more balanced standard, these cases would be about whether breaks were scheduled and regularly encouraged by the employer -- which would be the employer’s burden to prove. Class status would be easier to attain since the cases would not involve lots of individualized proof.  And with class status comes a more level playing field, and therefore a fairer result.

The Supreme Court should buck the pro-business judicial trend and reverse the Court of Appeal in Brinker.

Aaron T. Knapp is a writer, speaker, and sole practitioner in San Francisco with significant experience in employment matters. He is also the founder of The Post Partisan (http://postpartisannews.com), a public affairs opinion/blogging/community website.

In 2003, a California trial court certified a class in Savaglio v. Wal-Mart Stores, Inc., reportedly consisting of more than 115,000 hourly Wal-Mart employees, which sought to recover premium payments from Wal-Mart under Labor Code § 226.7 for missed or late meal periods. In December 2005, an Alameda County jury awarded the class more than $66 million in premium payments and $115 million in punitive damages. Wal-Mart appealed and the case is currently pending before the First Appellate District, Division Four.

The appeal is now fully briefed, and the First District granted numerous requests for leave to file amicus briefs. However, after the parties requested oral argument, and before any argument could be heard, the Supreme Court granted review in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25. Consequently, the First District has issued a stay:

"Subject to further order of this court, appellants' motion to stay further proceedings pending the Supreme Court's decision in Brinker v. Superior Court is granted. The request to establish a briefing schedule following the decision in Brinker will be addressed at a later time."

Among the issues that Wal-Mart raised on appeal was whether California's "new right-exclusive remedy" rule bars a punitive damage award in a wage and hour case. The 4th District Court of Appeal recently ruled that punitive damages are generally unavailable as part of a claim for meal break, rest break or overtime claims based upon Labor Code violations in Brewer v. Premier Golf Properties (2008) __ Cal.App.4th __.

While Brinker will be binding upon the Court of Appeal in the Savaglio case, Brewer will not be binding upon the First District, and the case does present a possibility of a split between appellate districts. However, we expect a petition for review to be filed in Brewer, and the Supreme Court will likely have denied or granted review in that case long before the stay is lifted in Savaglio.

We previously discussed Savaglio in posts you can find at links here, here, here and here.

As the legislature mulls over proposals to weaken the meal and rest period statutes and regulations, here's a link to the report of the Public Forums on Meal and Rest Breaks by State Labor Commissioner Angela Bradstreet, as well as a link to the Summary of Comments and a link to the transcripts.

The California legislature has convened a special session to consider some of the proposals governor Arnold Schwarzenegger made in November. A copy of the governor's proclamation regarding the special session can be seen at this link.

Among the proposals on the table:

Broaden Overtime Exemptions:

Exempt employees in executive, sales, administrative, and professional jobs who earn more than $100,000 annually from overtime pay.

Eliminate Eight Hour Work Days:

Allow employees to work flexible hours in excess of 8 per day, i.e., 10/40 work weeks without overtime.

Weaken Meal And Rest Period Laws:

Relax existing law regarding meal and rest periods to provide employers and employees with a clear understanding of meal breaks and offering flexibility to both businesses and workers.

We haven't been able to find yet exactly what meal and rest period proposals are on the table, but we have a list of meal and rest period bills that were vetoed or stalled in 2008:

AB 124 - Price - Meal and rest periods (Vetoed)

This bill would have extended protections afforded to employees covered by an order of the Industrial Welfare Commission to pool lifeguards and stage assistants who employed in the public sector. The bill specified that pool lifeguards and stage assistants employed by a city, county, or special district, shall not be required to work during any meal and rest period required for non-exempt employees under existing law.   The bill specified that if the public sector employer failed to provide a meal or rest period, the employer shall pay the employee one additional hour of pay at the employee’s regular rate of compensation.  In addition, the bill specified that should these requirements be in conflict with the provisions of a memorandum of understanding (MOU) reached between an employer and a recognized employee organization, the provisions of the MOU shall control.

AB 628 – Price - Meal and rest periods: pool lifeguards (Vetoed)

This bill would have extended protections afforded to employees covered by an order of the Industrial Welfare Commission to pool lifeguards who are employed in the public sector. The bill specified that pool lifeguards employed by a city, county, or special district shall not be required to work during any meal and rest period required for non-exempt employees under existing law.   The bill specified that if the employer failed to provide a meal or rest period, the employer would have to pay the employee one additional hour of pay at the employee’s regular rate of compensation for each workday that the meal or rest period was not provided.  In addition, the bill specified that if these requirements were in conflict with the provisions of a memorandum of understanding (MOU) reached between an employer and a recognized employee organization, the provisions of the MOU shall control. This bill was very similar to AB 124 (Price) from the previous year which addressed meal and rest period requirements for both pool lifeguards and stage assistants, however, this bill targets only pool lifeguards.

AB 1666 – Price - Meal and rest periods: stage assistants (Vetoed)

This bill would have extended protections afforded to employees covered by an order of the Industrial Welfare Commission to stage assistants who are employed in the public sector. The bill specified that stage assistants employed by a city, county, or special district shall not be required to work during any meal and rest period required for non-exempt employees under existing law.   The bill specified that if the employer failed to provide a meal or rest period, the employer would have to pay the employee one additional hour of pay at the employee’s regular rate of compensation for each workday that the meal or rest period was not provided.  In addition, the bill specified that if these requirements were in conflict with the provisions of a memorandum of understanding (MOU) reached between an employer and a recognized employee organization, the provisions of the MOU shall control. This bill was very similar to AB 124 (Price) from the previous year which addressed meal and rest period requirements for both pool lifeguards and stage assistants; however, this bill targets only stage assistants.

SB 342 – Torlakson - Employment: rest and meal periods. (Without further action)

This bill would have declared the intent of the legislature to clarify the law regarding on-duty meal periods for employees who work in the armored car industry. 

SB 1192 – Margett - Employment: meal and rest periods. (Without further action)

This bill would have allowed employees to take their first meal period before the conclusion of the 6th hour of work, decreased the statute of limitations on penalties for failing to provide a meal period, and defined the employer’s responsibility to provide a meal period as making a meal period available without interference.

SB 1539 – Calderon - Meal periods. (Without further action)
            
This bill would have required an employer to provide meal periods to employees covered by Industrial Welfare Commission Wage Orders before the conclusion of the sixth hour of work; defined an employer responsibility to provide a meal period as giving the employee an opportunity to take a meal period; would have exempted all employees covered by collective bargaining agreements from meal period requirements if the collective bargaining agreement covers meal periods, and would have codified and expanded on-duty meal period requirements.

AB 1034 – Keene - Employment: meal periods. (Without further action)

This was originally introduced as a bill related to water; later it was re-referred to this committee ( L. & I.R.) pursuant to Senate Rule 29.10.  Bill was held in committee pursuant to Senate Rule 29.10. This bill would have stipulated that meal periods must begin no later than the conclusion of an employee’s 6th hour of work, exempted employees covered by a collective bargaining agreement that dealt with meal periods, codified on-duty meal period regulations, and permitted the Department of Industrial Relations (DIR) to adopt regulations specifying the circumstances preventing employees from being relieved of all duty during a meal period.

The sessions, so far, have been unproductive.

A petition for review has been filed in Brinkley v. Public Storage, Inc. (2008) 167 Cal.App.4th 1278, the paystub violation and meal and rest break case that was published on October 28, 2008. We previously discussed Brinkley in posts that can be found here and here. We think that, even if there was no Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25, the Brinkley opinion's break with Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949 would make a compelling case for Supreme Court review. Among other things, Brinkley draws the conclusion that it would be "impossible" for employers with large work forces to enforce meal breaks; that there is no requirement for employers to schedule breaks within the first five hours; and that employers only have to make breaks available, applying a standard that equates the "provide" language in the meal period regulations with the "permit and authorize" language of the rest period regulations.

You can download Brinkley here in pdf or MS Word format. The Supreme Court has 60 days from December 4, 2008, to decide whether to grant or deny review. Absent an order granting themselves another 30 days, which is somewhat unlikely in this case, that means that a decision on the petition for review can be expected on or before January 28, 2009. We expect the Supreme Court to issue a "grant and hold" review order, deeming this a related case to Brinker Restaurant Corp. v. Superior Court.

We offer a hearty welcome to those of you who found this blog after attending Bridgeport's seminar on Wage & Hour litigation at UCLA on Tuesday and Wednesday. Every time I present something on recent developments in wage and hour law, I recite the mantra that this is one of the most busily changing areas of practice, and that rarely does a week go by without some significant development in the law coming from the courts, the legislatures, the DLSE or the DOL. Usually, something interesting pops up in the first few days after the seminar, and this was no exception.

Yesterday, the 4th District Court of Appeal ruled that punitive damages are generally unavailable as part of a claim for meal break, rest break or overtime claims based upon Labor Code violations, but attorney's fees are recoverable under  Labor Code § 218.5 "because it is now settled that compensation for missed meal and rest breaks are wages" [citing Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094]. Brewer v. Premier Golf Properties (2008) __ Cal.App.4th __.

The question of whether an aggrieved employee is entitled to punitive damages in an overtime case had never been squarely addressed in a published holding in a California case. The closest thing we had to a ruling on that issue was a bit of dictum in Gentry v. Superior Court (2007) 42 Cal.4th 443, that began with "Although exemplary damages are not available in overtime suits (see section 1194.2...)"

Employers seeking to avoid punitive damage claims would cite Gentry, and would argue something along these lines: Where a right is created by statute and the statute does not expressly permit punitive damages, punitive damages under California Civil Code section 3294 are not available. Turnbull & Turnbull v. ARA Transp., Inc. (1990) 219 Cal. App.3d 811, 826-27, 268 Cal. Rptr. 856 ("when a new right . . . is created by statute and a statutory remedy for the infringement thereof is provided, such remedy is exclusive of all others") (citing Orloff v. L.A. Turf Club (1947) 30 Cal.2d 110, 112-13, 180 P.2d 321); Czechowski v. Tandy Corp. (N.D. Cal 1990) 731 F.Supp. 406, 410 (penalty provision provided by Labor Code precludes award of punitive damages). Furthermore, claims under section 17200 of the Business and Professions Code will not support an award of punitive damages. Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal. 4th 1134, 1148.

The employees would argue Greenberg v. Western Turf Ass'n (1903) 140 Cal.357, 73 P. 1050, in which the California Supreme Court upheld the imposition of punitive damages where a statutory penalty had already been awarded, because it determined that the civil penalty was not meant to punish. Labor Code penalties, similarly, are not meant to punish, therefore, punitive damages are permitted for certain types of Labor Code violations where the defendant is guilty of blatant violations of law. See Bender v. Darden Restaurants, Inc. (2002) 26 Fed.Appx. 726 (compensatory damages in the sum of $9,860 and punitive damages in the sum of $943,000 for one plaintiff, and compensatory damages in the sum of $5,970 and punitive damages in the sum of $890,000 for the other plaintiff, all based upon denied meal and rest periods.)

Now, the analysis is much clearer:

"[P]unitive damages are not recoverable when liability is premised solely on the employer's violation of the Labor Code statutes that regulate meal and rest breaks, pay stubs, and minimum wage laws."  Brewer v. Premier Golf Properties (2008) __ Cal.App.4th __. "Labor Code statutes regulating meal and rest breaks, pay stubs, and minimum wages provide express statutory remedies, including penalties for violation of those statutes that are punitive in nature, that are available when an employer has violated those provisions, and are exclusive remedy available for such statutory violations absent evidence that statutory remedy is inadequate."

It is left to our imagination what kind of evidentiary showing would be necessary to establish that the statutory remedy under the Labor Code would be inadequate. We suspect that this holding would not have compelled a different result under so-called "slavery" cases, such as Bureerong v. Uvawas (1996) 922 F.Supp. 1450, where the District Court permitted punitive damages to be asserted in a wage claim brought by garment workers who were denied minimum wage and overtime.

Elsewhere in the Brewer opinion, the court upheld the trial court's award of $6,000 for unpaid meal and rest break wages (Labor Code § 226.7), $4,000 in pay stub penalties (Labor Code § 226), and $15,300 for "minimum wage" penalties (Labor Code § 1197.1). The court rejected the employer's statute of limitations defense on the penalties, rejected the employee's appeal of an order denying a JNOV based upon a claim for waiting time penalties, and held that the plaintiff had no obligation to exhaust any administrative remedies as a condition to the recovery of any penalties. The last point was founded upon the holding in Mokler v. County of Orange (2007) 157 Cal.App.4th 121, 133-136 that a party's failure to exhaust administrative remedies may not be raised for the first time in the appeal from the allegedly void judgment.

The published part of the opinion also addressed various FEHA issues, which is off topic for us, and we will leave that for others to discuss. For a the next few weeks, you will be able to download the full text of the opinion in Brewer here in PDF or MS Word format.

In a press conference today, Governor Schwarzenegger called for a temporary 1½ cent statewide sales tax increase, along with new taxes on liquor and oil as part of a plan to increase revenues $4.4 billion to make up part of an $11 billion budget deficit. At the same time, Schwarzenegger proposed $4.5 billion in spending cuts.

To save money on wages to state workers, the governor proposes to require them to take a one-day unpaid furlough each month. Columbus Day and Lincoln's Birthday would no longer be paid state holidays, and premium pay for working a holiday would be dropped. State agencies would be given the option of establishing 10-hour, four-day work weeks, and employees would no longer be allowed to count leave time as hours worked while computing overtime pay.

Oddly enough, part of this plan requires "[k]eeping high paying jobs in California by providing overtime exemptions and allowing more flexible work schedules to increase productivity; and " [c]larifying meal and rest periods to save businesses hundreds of millions of dollars in litigation costs and create less confusion from meal break violations which will mean fewer terminations."

The governor proposes to:

Provide Overtime Exemptions: Exempt employees in executive, sales, administrative, and professional jobs who earn more than $100,000 annually from overtime pay.
· Keep high-paying jobs from leaving the state. (For every 10,000 jobs paying more than $100,000 placed out of state, California’s economy misses out on $1 billion in employee spending.)
· Save approximately $90 million per year in employee classification costs.

Allow More Flexible Work Schedules: Allow employees to work more flexible hours upon request, such as 10 hour work days for a 40 hour work without being paid overtime.
· Reduce absenteeism and boost productivity, which save employers real dollars.
· Raise employee retention rates, which will reduce claims on the Unemployment Insurance trust fund.

Clarify Meal And Rest Period Laws: Clarify existing law regarding meal and rest periods to provide employers and employees with a clear understanding of meal breaks and offering flexibility to both businesses and workers.
· Will save businesses hundreds of millions of dollars in litigation costs.
· Less confusion means fewer terminations over meal break violations and a more welcoming work environment.

Full details of the governor's plan have not been released.

Before it becomes even more irrelevant, here's a list we compiled of commentary about Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25:

• Brinker International simply announced it as a "Favorable Ruling From California Court of Appeal"
• Shaw Valenza blogged: Brinker: The Watershed Meal Period Decision Comes Down
• The UCL Practitioner quoted from the Recorder: "Workers Can't Catch a Break from Calif. Court"
• and then published this analysis: REST BREAK AND MEAL PERIOD CLAIMS AFTER MURPHY V. KENNETH COLE PRODUCTIONS.
• Cal Labor Law blogged about "Brinker Court Favorably Resolves Dispute on "Providing" Meal Breaks"
• Storm was his usual cautious self with: Brinker: Not So Fast
• California Workforce Resource blogged about how there were Meal and Rest Break Requirements Clarified By Court in Brinker v. Hohnbaum
• The Complex Litigator had Meal break class actions dealt major blow in Brinker Restaurant Corporation, et al. v. Hohnbaum, et al.
• The Retail Law Observer had a post titled after the case name.
• Class Action Defense chimed in with the long title: Labor Law Class Action Defense Cases–Brinker v. Superior Court: California Appellate Court Reverses Trial Court Order Certifying Labor Law Class Action Holding Employers Need Not “Ensure” Employees Take Meal And Rest Breaks
• First Mediation's blog had this: The Clock is Ticking … The Future of Meal and Rest Break Class Actions Remains to be Seen
• Sheppard Mullin wrote: Appellate Court Clarifies Meal and Rest Period Obligations
• Crowell Moring published this alert: Anxiously-Awaited Brinker Decision Holds That Employers Need Not Police Whether Employees Take Meal Periods
• Mofo was quiet, for obvious reasons. They said what they had to say in a lunch seminar.
• Ford Harrison issued a Legal Alert: California Court of Appeal Clarifies Meal and Rest Period Requirements for California Employees
• Wilson Sonsini put out a WSGR alert: California Appellate Court Clarifies Employers' Obligations Regarding Meal Period and Rest Breaks
• Littler told us how they really felt with: A Ray of Hope: California Court of Appeal Decides Compliance with Meal Period Obligations Requires an Opportunity, Not a Guarantee
• Gibson Dunn wrote: State Court of Appeal Holds That California Employers Need Only "Provide" Meal Periods, Not Ensure That Employees Take Them
• Jones Day had: ALERT: California Appellate Court Holds that Meal Periods Must be Made Available to Employees; California Labor Commissioner Follows Suit
• Nixon Peabody published this pdf: A major break for California employers: Court rules on longstanding meal and rest period issues.
• McGuire Woods published New Major Decision Holds California Meal Period, Rest Period, Off-The-Clock And “Time Shaving” Wage Claims “Not Amenable To Class Treatment”
• Seyfarth Shaw wrote: Court Provides Better Meal Deal For California Employers

If we didn't include your blog or firm alert on this list, you need to read up on Google's search algorithms.

The DLSE memo issued July 22, 2008 July 25, 2008, by Angela Bradstreet, Denise Padres, and Robert Roginson has been withdrawn. A new memo, dated October 23, 2008, provides: "Effective immediately, neither the [Brinker] Court of Appeal decision nor the memo may be relied upon by any DLSE staff in deciding pending or future matters." However, in the same document, Labor Commissioner Angela Bradstreet essentially tells the staff to keep following the reasoning in Brinker, even though the Supreme Court’s grant of review supersedes the Court of Appeal’s decision, and the Court of Appeal decision may not be cited or relied on by a court or a party in any other action. (California Rules of Court 8.1105(e) and 8.1115(a)).

"Until such time that the Supreme Court provides guidance on this fundamental question, the Division will rely upon the language of the statute and wage order as well as existing California Supreme Court and Court of Appeal decisions and other recent, persuasive federal court decisions in interpreting Labor Code section 512 and the meal period provisions set forth in the applicable wage orders. Taken together, the language of the statute and the regulation, and the cases interpreting them demonstrates compelling support for the position that employers must provide meal periods to employees but do not have an additional obligation to ensure that such meal periods are actually taken."

The memo instructs employees to follow Brown v. Federal Express Corporation(C.D.Cal. 2008) 249 F.R.D. 580, 585, and to disregard the only binding precedent in California, Cicairos v Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, 962, because its "interpretation of California’s meal period requirements is not compelling."

On the issue of meal period timing, the memo observes that the DLSE "has varied in its interpretation of this so-called 'rolling five' hour rule in the past, [and] there is no controlling legal authority interpreting California’s meal period regulations to require employers to provide meal periods every five hours." Consequently, until a binding appellate opinion interprets the wage orders and Labor Code § 512 to require employers to provide meal periods every five hours, the DLSE "will not interpret California’s meal period provisions in that fashion." Instead, the DLSE position will be that:

• The first meal period provided by an employer must commence prior to the end of the fifth hour of work, unless otherwise expressly permitted by the applicable wage order; and

• Except as required in Labor Code § 512(a) and Section 11(B) of those wage orders requiring a second meal period, there is no obligation for employers to provide additional meal periods during the course of the workday, including instances in which employees work for a period of more than five hours of work between meal periods.

The memo concludes with the instruction that "any wage claim filed with DLSE that has a meal period issue is reviewed by your Senior Deputy prior to making any final determination on its merits." To us, this sounds a lot like an underground regulation adopted without complying with APA requirements. More importantly, many low-income workers who rely upon DLSE enforcement of their complaint will suffer in the next 18-24 months as we wait for the Supreme Court to decide Brinker.

The Supreme Court has posted the following statement of issues in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25:

Petition for review after the Court of Appeal granted a petition for peremptory writ of mandate. This case presents issues concerning the proper interpretation of California's statutes and regulations governing an employer's duty to provide meal and rest breaks to hourly workers.

NOTE: The statement of the issues is intended simply to inform the public and the press of the general subject matter of the case. The description set out above does not necessarily reflect the view of the court, or define the specific issues that will be addressed by the court.

It looks like anything and everything in the briefs is up for discussion.

The Supreme Court granted review today in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25. Justice Werdegar was absent for this week's conference. The vote among the participating justices was 6-0 in favor of review.

We discussed the opinion when it was published in July; we saw this review coming,

With Brinker and Cicairos presenting such starkly contrasting views on California law, with Brinker presenting so many novel ideas regarding wage and hour claims and class actions, and with so many U.S. District Court cases disagreeing with Cicairos and each other, this case looks like an outstanding candidate for Supreme Court review.

Judging from past performance under the Schwarzenegger administration, which is undoubtedly disappointed by today's decision, the DLSE enforcement memo, on the need to change policies because of Brinker, will probably stay in place until and unless a court invalidates it.

The petition for review is fully briefed in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25. Within three weeks, the court will grant review, deny review or issue an order extending their time to decide. So far, there are a dozen letters on file urging the court to review the case, including one from the California State Legislature and the Attorney General. If review is denied, there will be a lot of discussion about this case in your year-in-review seminars concerning employment litigation, wage and hour law and class action procedures. If review is granted, this will be the most highly anticipated wage and hour case since Gentry v. Superior Court (Circuit City Stores) (2007) 42 Cal.4th 443.

Angie Wei, the Legislative Director for the California Labor Federation, wrote a letter to Labor Commissioner Angela Bradstreet asking her to withdraw her one-sided July 25, 2008 Memorandum to DLSE Staff, regarding Brinker Restaurant Corp. v Superior Court of San Diego County (Hohnbaum) (2008) __ Cal App. 4th ___, 2008 WL 2806613. The letter is well written, and is must-read material for anyone unfortunate enough to be preparing for a Berman hearing on a meal period or rest period case right now. Unfortunately, we suspect that Ms. Bradstreet is taking orders from someone who makes sure that important decisions get the "green light" from lobbyists for the California Chamber of Commerce and/or the California Restaurant Association, so we would be surprised if the memorandum is withdrawn, even if the Supreme Court grants review of the Brinker case.

The Recorder had a blurb last week on its Ad Hominem (Opinion and Satire) page that overstated Brinker's effect dramatically. Under the "Bar-ometer", it reported that "A court says you can only file wage and hour cases on an individual basis. And no lawyer will take those cases." That's not a very accurate summation of the holding, and the claim that no lawyer will take those cases is quite untrue. Individual wage and hour cases are filed every day.

In a few days, we'll post links to the various blog posts, articles, client alerts and newsletters discussing the case. Legal updates, in and of themselves, are not billable, so it takes some of the defense firms a couple of weeks to get their articles, client alerts and newsletters out. We remember what it was like....

If you have been following the recent opinions concerning meal period and rest period class actions, you might also want to follow the progress in Savaglio v. Wal-Mart Stores, Inc., the largest such case yet tried in California. The appeal is fully briefed, and the First Appellate District has granted numerous requests for leave to file amicus briefs, which were filed on July 21, 2008. Today is the last day the court will entertain applications to file an amicus/amici curiae brief.

The following applications for permission to file an amicus/amici curiae brief in support of plaintiffs/respondents/cross-appellants Andrea Savaglio et al. are granted: (1) Asian Pacific American Legal Center of Southern California et al., (2) La Raza Centro Legal and Equal Rights Advocates, (3), California Employment Lawyers Association, and (4) Alameda County Central Labor Council et al. The following applications for permission to file an amicus/amici curiae brief in support of defendants/appellants/cross-respondents Wal-Mart Stores, Inc. et al. are granted: (1) Employers Group et al., (2) Chamber of Commerce of the United States of America, (3) Retail Industry Leaders Association, (4) California Employment Law Council, and (5) Civil Justice Association of California. The clerk of this court is directed to concurrently file this order and the proffered briefs. Any further applications to file an amicus/amici curiae brief must be filed no later than August 1, 2008.

An oral argument waiver notice went out on Tuesday. We doubt that the litigants will be waiving oral argument in this case. We previously discussed the case in several posts, which can be found here, here, here and here.

The Supreme Court today denied the petition for review in Bufil v. Dollar Financial Group, Inc. (2008) 162 Cal.App.4th 1193, an opinion regarding meal period and rest period claims and class certification. Bufil followed Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, and contained several passages that are difficult to reconcile with last week's opinion in Brinker Restaurant Corp. v. Superior Court of San Diego County (Hohnbaum) (2008) ___ Cal.App.4th ___. We previously discussed the case in a post that can be found at this link.

The DLSE is making sure all of its hearing officers follow Brinker Restaurant Corp. v. Superior Court of San Diego County (Hohnbaum) (2008) ___ Cal.App.4th ___. Here is the memo that was sent out by Angela Bradstreet on July 25:

Binding Court Ruling on Meal and Rest Period Requirements

On July 22, 2008, the California Court of Appeal issued its decision in Brinker Restaurant Corp. v. Superior Court of San Diego County (Hohnbaum), (2008) ___ Cal.App.4th ___ , 2008 WL 2806613.  The court in Brinker decided several significant issues regarding the interpretation of California’s meal and rest period requirements.  The decision is a published decision, and its rulings are therefore binding upon the Division of Labor Standards Enforcement (DLSE).

The decision in Brinker included the following rulings regarding the interpretation of California’s meal and rest period requirements:

Meal Periods

• The court held that Labor Code § 512 and the meal period requirements set forth in the applicable wage order mean that employers must provide meal periods by making them available, but need not ensure that they are taken.  Employers, however, cannot impede, discourage or dissuade employees from taking meal periods.

• The court rejected the so-called “rolling five-hour” requirement as being inconsistent with the plain meaning of Labor Code § 512 and the applicable wage order.   An employer must make a first 30-minute meal period available to an hourly employee who is permitted to work more than five hours per day, unless (1) the employee is permitted to work a “total work period per day” that is six hours or less, and (2) both the employee and the employer agree by “mutual consent” to waive the meal period.   The court also found section 512 to plainly provide that an employer must make a second 30-minute meal period available to an hourly employee who has a “work period of more than 10 hours per day” unless (1) the “total hours” the employee is permitted to work per day is 12 hours or less, (2) both the employee and the employer agree by “mutual consent” to waive the second meal period, and (3) the first meal period “was not waived.”  

Employers are not required to provide a meal period for every five consecutive hours worked.   The court held that the employer’s practice of providing employees with an “early lunch” within the first few hours of an employee’s arrival at work did not violate California law, even though that would mean that the employee might then work in excess of five hours without an additional meal period.

Rest Periods

• The court held that the rest period requirements set forth in the applicable wage order mean that employers must provide rest periods, but need not ensure that they are taken.  Employers, however, cannot impede, discourage or dissuade employees from taking rest periods.

• The court held that employers need only authorize and permit rest periods every four hours or major fraction thereof and they need not, where impracticable, be in the middle of each work period.   The court interpreted the phrase “major fraction thereof” to mean the time period between three and one-half hours and four hours and not to mean that a rest period must be given every three and one-half hours.   In so doing, the court rejected as incorrect a 1999 interpretation by the Labor Commissioner that the term “major fraction thereof” means an employer must provide its employees with a 10-minute rest period when the employees work any time over the midpoint of each four hour block of time.   The court ruled that the rest periods must be given if an employee works between three and one-half hour and four hours, but if four or more hours are worked, it need be given only every four hours, not every three and one-half hours.

The court also ruled that the applicable wage order rest period provisions do not require employers to authorize and permit a first rest period before the first scheduled meal period.  Rather, the applicable language of the wage order states only that rest periods “insofar as practicable shall be in the middle of each work period.”  Accordingly, the court concluded, as long as employers make rest periods available to employees, and strive, where practicable, to schedule them in the middle of the first four-hour work period, employers are in compliance with that portion of the applicable wage order.

The court relied upon the plain meaning of the Labor Code and applicable wage order provisions in making its determinations.  The court found persuasive the reasoning in the federal district court decisions in White v. Starbucks (ND Cal. July 2, 2007) 497 F.Supp.2d 1080 and Brown v. Federal Express Corp. (CD Cal. Feb. 26, 2008) 2008 WL 906517, and concluded that employers need not ensure meal periods are actually taken, but need only make them available.   The court distinguished the decision in Cicairos v. Summit Logistics, Inc. (2006) 133 Cal.App.4th 949, concluding that the facts in Cicairos established that the employer failed to make meal periods available to employees and that the court there only decided meal periods must be provided, not ensured.

All staff must follow the rulings in the Brinker decision effective immediately and the decision shall be applied to pending matters.  Please ensure that any wage claim filed with DLSE that has a meal or rest period issue is reviewed by your Senior Deputy prior to making any final determination on its merits.

The DLSE posted copies of the memo, with footnotes omitted above, in both pdf and word format.

The repackaged opinion in Brinker Restaurant Corp. v. Superior Court (2008) __ Cal.App.4th __ was finally published today. The opinion is 53 pages long, and as interesting as it is, I'm going to have to pass on the opportunity to do an in-depth analysis for the same reason that I missed a wage and hour class action mediation today - my son's birth. The opinion is just as pro-employer and just as adverse to class action litigation as the original opinion, which was vacated shortly after a petition for review was filed last October. The case can be summed up with the following excerpts from the opinion:

In this action involving alleged violations of laws governing rest and meal breaks, we are presented with the following question:  Did the trial court err in certifying this matter as a class action without first determining the elements of plaintiffs and real parties in interest Adam Hohnbaum, Illya Haase, Romeo Osorio, Amanda June Rader and Santana Alvarado's (collectively plaintiffs) claims against defendants Brinker Restaurant Corporation, Brinker International, Inc., and Brinker International Payroll Company, LP (collectively Brinker)?

Reconsidering the matter following a transfer from the California Supreme Court and our vacating of the original opinion in this matter, we first recognize that "in light of the remedial nature of the legislative enactments authorizing the regulation of wages, hours and working conditions for the protection and benefit of employees, the statutory provisions are to be liberally construed."  (Industrial Welfare Com. v. Superior Court (1980) 27 Cal.3d 690, 702.)   We also recognize mandatory rest and meal breaks have "have long been viewed as part of the remedial worker protection framework" designed to protect workers' health and safety.  (Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1105, 1113 (Murphy).)  In addition, we note that in construing the applicable statutes and regulations, we look to the plain language of the laws and interpret them in a manner consistent with the Legislature's intent.  (Fitch v. Select Products Co. (2005) 36 Cal.4th 812, 818.)

With these principles in mind, we conclude the class certification order is erroneous and must be vacated because the court failed to properly consider the elements of plaintiffs' claims in determining if they were susceptible to class treatment.  Specifically, we conclude that (1) while employers cannot impede, discourage or dissuade employees from taking rest periods, they need only provide, not ensure, rest periods are taken; (2) employers need only authorize and permit rest periods every four hours or major fraction thereof and they need not, where impracticable, be in the middle of each work period; (3) employers are not required to provide a meal period for every five consecutive hours worked; (4) while employers cannot impede, discourage or dissuade employees from taking meal periods, they need only provide them and not ensure they are taken; and (5) while employers cannot coerce, require or compel employees to work off the clock, they can only be held liable for employees working off the clock if they knew or should have known they were doing so.  We further conclude that because the rest and meal breaks need only be "made available" and not "ensured," individual issues predominate and, based upon the evidence presented to the trial court, they are not amenable to class treatment.  Finally, we conclude the off-the-clock claims are also not amenable to class treatment as individual issues predominate on the issue of whether Brinker forced employees to work off the clock, whether Brinker changed time records, and whether Brinker knew or should have known employees were working off the clock.  Accordingly, we grant the petition and order the superior court to vacate its order granting class certification and enter a new order denying certification of plaintiffs' proposed class.

You can download the full text of Brinker Restaurant Corp. v. Superior Court here in pdf or Word format. If you do any wage and hour work, or any class action work, this is must reading until and unless the Supreme Court grants review.

Glancing over the opinion, I couldn't help but think that if this had been the first appellate decision in California concerning wage and hour class actions, there might never have been a second wage and hour class action. However, it was not the first, and Brinker disagrees with many prior opinions, most specifically, Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, 962-963, which it discussed at length, and Bufil v. Dollar Financial Group, Inc. (2008) 162 Cal.App.4th 1193, which it did not even mention, and more generally, a string of cases which promote class actions as an efficient way to resolve wage and hour disputes and a string of cases which discuss the remedial nature of wage and hour laws in California. With Brinker and Cicairos presenting such starkly contrasting views on California law, with Brinker presenting so many novel ideas regarding wage and hour claims and class actions, and with so many U.S. District Court cases disagreeing with Cicairos and each other, this case looks like an outstanding candidate for Supreme Court review.