Attorney Joseph Ainley discusses UPS v. Superior Court

This case illustrates the importance of gauging correctly the zeitgeist of the times.  Here, the court illustrates a theme that is becoming more and more common: a hostile attitude towards overtime claims where the workers are relatively well paid and who do not perform manual labor.  We believe that the case is poorly decided and the court mis-applies the law in an almost willful way.  Nevertheless, it will stand as good law and this attitude must be considered when putting the pieces of a case together.  Attorney Joseph Ainley, like most good employment lawyers looks at the facts of each case but also to the subtext, the story within the story, that each case presents.

 United Parcel Service, Inc v. Superior Court (Allen), 192 Cal.App.4th 1043 (2011).

The question presented in this case was how many hours of pay should be awarded to employees who are unlawfully denied rest and meal periods during their shifts.  The relevant statute is Labor Code § 226.7, which provides:

“(a) No employer shall require any employee to work during any meal or rest period mandated by an applicable order of the Industrial Wage Commission.  (b) If an employer fails to provide an employee a meal period or rest period in accordance with an applicable order of the Industrial Welfare Commission, 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.”

The issue was whether the employee is entitled to one hour of pay where both the break and meal periods are missed or, whether the employee is entitled to one hour of pay for each of the breaks denied.  Relying on Marlo v. United Parcel Service, Inc. (CD Cal., May 5, 2009, CV03-04336 DDP (RZx) 209 U.S. Dist. Lexis 41948), the court held that an employee is entitled to one hour for each rest break and meal break, up to two hours per day.  (In its decision, the court noted an interesting historical fact that the Industrial Welfare Commission has mandated meal and rest periods since 1916, nearly 31 years before the federal government required such breaks to be given.)

A remaining ambiguity from this case is whether there is an upper limit of two hours of premium pay regardless of how many meal breaks and/or rest breaks are missed.  In the case of a 12-hour or longer shift, two meal breaks are required, along with at least three rest periods.  By the court’s analysis, Labor Code § 226.7 provides “up to” two premium payments per work day, and the language of the decision suggests that two hours of premium pay is the upper limit.  It reads:  “We believe it is more reasonable to construe the statute as permitting up to two premium payments per work day – one for failure to provide one or more meal periods, and another for failure to provide one or more rest periods.” Id. at 1053.  This language tends to suggest that the court views two hours of premium payment as the upper limit of the wage penalty.  This case should be read in conjunction with Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1103, which holds that the penalties of Labor Code § 226.7 that extend for three years backwards in time – as opposed to one year for an ordinary penalty – and that the wage to be paid by the employer is the employer’s “regular rate of pay” rather than time and a half or double time.