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Posts Tagged ‘meal breaks’

On-Premises Rest Breaks: Should I Stay or Should I Go?

Posted on: July 18th, 2018

By: Allison Hyatt

Under California law, non-exempt employees are entitled to a 30-minute meal break if the employee works more than 5 hours in a workday, and a 10-minute break for every 4 hours worked (or “major fraction” thereof).  In the past, employers commonly required employees to remain on the premises during rest breaks.  However, with the California Supreme Court’s decision in Augustus v. ABM Services, Inc. (2016) 2 Cal. 5th 257, which emphasized the fact that employers must “relinquish any control over how employees spend their break time,” employers should discontinue any such policies still in practice.

Although the issue in Augustus was on-call rest periods and therefore the Court did not directly consider an on-premises rest break policy, the California Labor Commissioner’s office updated its fact sheet on rest breaks to specially address on-premises break policies in light of the Augustus opinion.  Quoting the Supreme Court’s opinion, the Labor Commissioner’s office explained that employers cannot impose such restraints, stating: “‘during rest periods employers must relieve employees of all duties and relinquish control over how employees spend their time.’  As a practical matter, however, if an employee is provided a ten minute rest period, the employee can only travel five minutes from a work post before heading back to return in time.”

Moving forward, it is unclear as to how courts will address pre-Augustus on-premises rest break policies believed to be legal at the time.  The Augustus Court did not clarify any limitations to what appears to be a sweeping ruling described by the Dissent in Augustus as a “marked departure from the approach we have taken in prior cases.”  2 Cal. 5th 257, 277.  In one post-Augustus case, Bell v. Home Depot U.S.A., Inc. 2017 U.S. Dist. LEXIS 55442 (E.D. Cal. April 11, 2017), the Eastern District of California declined to reconsider a summary judgment ruling in favor of Home Depot on the plaintiffs’ claims that Home Depot violated California law by requiring employees to remain on premises during rest breaks.  The Eastern District had ruled, prior to the decision in Augustus, that such a policy did not violate the applicable California wage order and statute.  In response to the plaintiffs’ motion for reconsideration, Home Depot argued that the Augustus decision implies that restricting employees to the premises, without additional duties or constraints, does not violate the rule.  The Eastern District declined to alter its ruling, noting:

“[t]he facts in Augustus and the present matter are distinct, as the present case does not concern ‘on-call’ rest periods. . . The Augustus court did not directly consider an on-premises rest break policy which does not require employees to remain on call such as the one at issue here.  While the Court finds Defendants’ reading of Augustus more persuasive and accurate than Plaintiffs, it does not specifically adopt Defendant’s interpretation that Augustus affirmatively condones on-premises rest breaks.  Rather, the Court finds that the holding in Augustus does not go as far as Plaintiffs contend.”  2017 U.S. LEXIS 55442 at *5.

It will be interesting to see how other courts interpret the implications of the Augustus opinion.  For now, employers are encouraged to follow the California Labor Commissioner’s advice and discontinue any practices that impose any restraints on how employees spend their break periods.  If you have any questions or would like more information, please contact Allison Hyatt at (916) 472-3302 or email at [email protected].

California Appellate Court Concludes That Employer Lawfully Rounded Employee Time Up and Down

Posted on: July 12th, 2018

By: Laura Flynn

The Second District of the California Court of Appeal has ruled that calculating payroll by automatically rounding workers’ hours either up or down to the nearest quarter-hour is legal as long as it does not result in workers being systematically underpaid over time. In a published opinion, the three-judge panel found the payroll system implemented by a Southern California hospital system was neutral both on its face and in the way it was applied.

Under the employer’s payroll system, an hourly worker who clocked in between 6:53 and 7:07, was paid as if they clocked in at 7:00.  Meal breaks that lasted between 23 and 37 minutes were rounded to 30 minutes.  The legality of the calculation method was challenged by two former employees who alleged they weren’t paid properly or given adequate meal breaks or rest periods.  The primary allegation was that the rounding system did not comply with the California Labor Code because it did not use employees’ exact clock-in and clock-out times.

A statistical expert analyzed the time records for all of the hospital employees over a four-year period.  Although some employees lost work time, the remainder either gained time or broke even. Overall, the calculation method resulted in the employer over compensating employees.  The Appellate Court held a rounding system is valid if it “average[s] out sufficiently,” rejecting claims that minor discrepancies in an individual employee’s wage calculations establish that the employee is entitled to assert a claim for underpayment.

The Court relied on Section 785.48 of title 29 of the Code of Federal Regulations which allows employers to round work time as long as it doesn’t result in workers being underpaid over statistically significant periods of time. California’s Division of Labor Standards Enforcement has adopted the federal regulation as part of its enforcement standards.  The Court’s opinion confirms Section 785.48 and the policies underlying it “apply equally to the employee-protective policies embodied in California labor law.”

AHMC Healthcare, Inc. v. Superior Court, filed 6/25/18, Los Angeles Superior Court Case No. B285655.

If you have any questions or would like more information, please contact Laura Flynn at [email protected].

Constructive Knowledge Defense Gains Steam

Posted on: December 5th, 2012

By: Marty Heller

With an ever increasing federal docket of FLSA claims, employers have been pushing for a defense based upon lack of knowledge of the unpaid overtime.  In the last month, this defense gained some important support.  In White v. Baptist Memorial Health Care Corp., 2012 WL 5392621 (6th Cir. Nov. 6, 2012), the Sixth Circuit precluded an employee from bringing an FLSA claim based upon working during meal breaks because the employee never recorded the time she worked during her breaks.  In this case, the employer had a policy which automatically deducted an unpaid meal break from an employee’s time if they worked six or more hours.  Importantly, the employees were paid if they had to work during their meal break, however, the employees were expected to record the time they spent working during a meal break in the employer’s “exception log.”

The Sixth Circuit ruled that employers are held to a “knew or should have known” standard for unpaid overtime arising out of working off the clock.  Here, although the plaintiff alleged she told her supervisors that she was working during her meal breaks, she did not inform them that she was not being compensated and she stopped recording the time on the Company’s exception log.

This case joins the Fifth, Eighth and Ninth Circuit rulings that employers are not liable for unpaid overtime that they are not aware of due to the employee failing to follow the employer’s established procedures for working off the clock.  The focus of these cases is the lack of knowledge.  At least one court within the Eleventh Circuit also has supported this constructive knowledge rule, but there is yet to be any ruling on the issue by the Eleventh Circuit Court of Appeals.  (See Chandra Lewis v. The Keiser School, Inc. 2012 WL 4854724 (S.D. Fla. Oct. 12, 2012)).