California Meal and Rest Penalties to Cost More

by | Aug 8, 2011

We all know that employees in California need to be paid for meal and rest periods that are missed.  A recent ruling by California’s Second Court of Appeals has clarified how much an employee is to be compensated for a missed meal or rest period, and it is probably more than you think!


California state labor code mandates that employees are to be provided a 10-minute rest period after four hours of work and a 30-minute meal after five hours of work.  California Labor Code Section 226.7(b) states that “if an employer fails to provide an employee a meal period or rest period…the employer shall pay the employee one additional hour of pay at the employee’s regular rate of compensation for each work day that the meal or rest period is not provided.”


Last Wednesday, the Second Court of Appeals in Los Angeles, ruled that employees are entitled to up to two hours of compensation: one hour for the missing meal and one hour for the missing rest period.  A PDF of the ruling can be found here.  This decision supports an earlier ruling by the federal district court in Marlo v. United Parcel Service, Inc.


The Marlo court tackled the question of whether employers were liable for one hour for each meal or rest period missed, or one hour per work day in which one or more violations occurred.  Ultimately, the court focused on the the language of the labor code, the language of California’s Industrial Welfare Commission work orders, and legislative history to determine that an employee is entitled to a one-hour wage premium for each meal and rest violations in a day.


While the appellate court acknowledged that the labor code’s language is easy to misinterpret, it agreed with the Marlo court’s decision explaining that the purpose of the code was to protect the employee.  After all the court said, the alternate interpretation encourages employers “to require an employee who has missed a ten-minute rest break to also miss his or her lunch period.”


As workforce management professionals, we need to update our WFM systems to properly apply meal and rest penalties based on this new ruling.  In all likelihood, your current system applies one penalty per day regardless of whether a meal and/or rest period was missed.  If this is the case for your system, you’ll need to reconfigure it to apply one penalty for each violation.


The challenge is to determine what constitutes a violation and, just as importantly, how to identify it in your WFM system.  For some, the answers to these questions will be black-and-white.  For others, the answers may be less clear.  Consider the following two situations:


  • Some employers give their employees the ability to voluntarily return from a meal or rest period early. How do you determine when an early return results in a meal and rest penalty?
  • Many employers provide paid breaks and do not require employees to punch in or out for these breaks.  This means that the WFM system has no record of whether the breaks were taken.  How are rest period penalties recorded?


Processes for handling meal and rest penalties will need to be modified or created and then implemented in the WFM system.


As always, include your legal team on these discussions.  They will help you interpret the law and if the solution implemented in your WFM system complies with their interpretation.

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