On February 17, 2011, two California Court of Appeal divisions gave California private employers both some very encouraging news, and perhaps a little bad news. First, in the what could be a sign of the death knell for many future class-actions-to-be, one court held that class action certification is appropriately denied for alleged missed meal and rest periods, where an employer provides meal and rest periods to employees because individual issues predominate in determining if and why any individual employee missed a meal or rest period.
In Tien v. Tenet Healthcare Corporation, hourly employees of Tenet and its subsidiaries brought suit against the company for various State wage and hour violations including alleged missed meal and rest periods, waiting time penalties and pay stub violations. The employees sought class certification which the trial court initially granted. Tenet moved for reconsideration of the trial court's order and six days later, Brinker Restaurant Corp. v. Superior Court was published by the Court of Appeal holding that an employer satisfies its obligation to "provide" a meal period by making meal periods available; the employer need not guarantee that employees actually take their breaks.
The California Supreme Court then granted review of Brinker which resulted in depublication (meaning it was no longer authority upon which a trial court may rely for the time being). A few days later, Court of Appeal division reached a decision similar to Brinker in Brinkley v. Public Storage, Inc., holding that an employer's obligation to "provide" a meal period only obligates the employer to offer a period during which an employee could eat a meal, but did not obligate the employer to ensure the employee took the break. The trial court in Tien then declared Brinkley to be a "change of law" and granted Tenet's motion, finding that Tenet made meal periods available to employees as a matter of practice and policy and, therefore, class certification was inappropriate because it required an individualized analysis as to if and why each individual plaintiff missed a meal or rest period. Thus, class certification was similarly unavailable for the waiting time penalties and for pay stub violations because Brinkley also requires employees to show actual damages from any nonconforming pay stub.
The trial court agreed to stay the proceedings to see if the California Supreme Court would also grant review of Brinkley, which it did in January, 2009 (meaning again that Brinkley is no longer "good law" for the time being). However, the trial court declined to change its denial of certification order, stating that courts appear to be favoring the Brinkley/Brinker view and the analysis in those cases seemed stronger. The plaintiffs appealed and the Court of Appeal affirmed the trial court's order denying class certification.
Currently, both Brinkley and Brinker are awaiting decision by the California Supreme Court as to whether an employer need only "provide," but need not ensure, that a non-exempt employee take his or her statutorily required meal and rest periods. Until the Supreme Court issues its decision, employers are left wondering, as well as cautiously hovering over their employees.
A class action will not be permitted if each member of the proposed class is required to litigate substantial and numerous factually unique questions because it means common questions of fact do not predominate. The court in Tien held that individual questions were involved as to the reasons an employee might not take a meal or rest period which will predominate if the employer need only offer meal periods, but need not ensure employees take those periods, as the Courts of Appeal held in Brinker and Brinkley. The court also agreed that class certification was inappropriate for alleged pay stub violations under Labor Code section 226 because it requires individual class members to show actual injury from noncomplying pay stubs.
What does the Tien decision mean for California employers? It means that, if the California Supreme Court ultimately holds in Brinkley and Brinker that although California employers must provide meal and rest period for employees, but need not ensure that the employees are taking the meal or rest periods, it will be substantially easier for employers to defeat class action status for alleged missed meal and rest periods. This case may very well signal a death knell for meal and rest period class actions for employers who provide by policy and practice meal and rest periods for employees but may lack the capability or resources to ensure that the employees are actually taking the meal and rest periods being offered.
The bad news, though not necessarily unexpected, is the second decision issued February 17, 2011. The California Court of Appeal held that an employer is liable for one hour of premium pay for each missed meal period and each missed rest period in a single workday. In United Parcel Service v. Superior Court, truck drivers for UPS brought several coordinated actions against their employer for, among other things, UPS's failure to provide meal and rest periods pursuant to Labor Code section 226.7.
Labor Code section 226.7 provides that, if an employer fails to provide an employee a meal period or rest period in accordance with the applicable Wage Order, the employer must pay the employee one additional hour of pay at the employee's regular rate of pay for each work day the meal or rest period is not provided. Most of the Industrial Wage Commission's Wage Orders generally provide an additional hour of pay per work day for a missed meal period and also provide an additional hour of pay per work day for a missed rest period.
UPS moved the trial court to make a determination concerning the amount of damages available under section 226.7, specifically, whether an employer is liable for one hour of additional pay if an employee misses a meal period and another additional hour of pay if the employee misses a rest period in the same day. In other words, is an employer liable for one or two hours of additional pay if the employee is not provided both a meal and rest period in the same day?
The trial court held, and the Court of Appeal affirmed, if an employer fails to provide a meal period to an employee, the employer must pay one additional hour of pay. If the employee is also not provided a required rest period in the same day, the employer must pay another additional hour of pay.
In sum, employers should have in place, both in written policy and in practice, agreement that employees must be provided a duty-free meal period and rest periods for the length of time and at the frequency throughout the workday required by the Wage Order applicable to the particular employee's occupation.
This article was written by Frances Rogers, an attorney with the labor and employment law firm of Liebert Cassidy Whitmore. Ms. Rogers is an Associate in the San Diego office and can be reached at (310) 981-2000 or firstname.lastname@example.org. For more information regarding the discussion above or on our firm please contact one of our offices below.
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