In a much anticipated decision, the California Supreme Court held that employers subject to the Industrial Welfare Commission (“IWC”) Wage Orders are required to provide employees with meal and rest periods during which they are relieved “of all duty, with the employee thereafter at liberty to use the meal period for whatever purpose he or she desires, but the employer need not ensure that no work is done.” (Brinker Restaurant Corporation, et al, v. Superior Court of San Diego (Hohnbaum), — Cal.4th —-, April 12, 2012.) The Court further held that the timing of those meal and rest periods, for industries whose employees are covered by IWC, Wage Order No. 5, is found in the plain language of the Wage Order. In its lengthy decision, the Supreme Court also concluded that trial courts are not required to resolve threshold legal issues in order to certify a class action unless such “a determination is necessarily dispositive of the certification question.”
Facts
Defendants Brinker Restaurant Corporation, et al (collectively referred to as “Brinker”) own and operate several chain restaurants throughout California. Plaintiff Adam Hohnbaum, and other named plaintiffs (collectively referred to as “Hohnbaum”), are or were hourly, non-exempt employees at one or more of Brinker’s restaurants. Hohnbaum brought a putative class action against Brinker alleging it failed to provide its employees with rest breaks and meal periods, required its employees to work off the clock during meal periods, and engaged in unlawful alterations of employee time records, resulting in the misreporting of the employees’ actual time worked. Hohnbaum contended that an employer is required to provide a 30-minute meal period at least every five hours. Brinker argued that the no such timing obligation exists and that an employer satisfies the meal period requirement by providing one meal period for shifts longer than five hours and two meal periods for shifts longer than ten hours. The trial court generally agreed with Hohnbaum. Subsequently, Hohnbaum moved for class certification. Hohnbaum’s proposed class included several subclasses, three of which are at issue in this decision: 1) a “Rest Period Subclass”; 2) a “Meal Period Subclass”; and 3) an “Off-The-Clock Subclass.” Brinker opposed class certification on the basis that individualized issues predominated. After the trial court granted certification, Brinker sought a writ from the Court of Appeal. The Court of Appeal reversed the decision of the trial court, decertifying the three subclasses designated above.
The Supreme Court Decision
The Supreme Court affirmed the Court of Appeal’s decision in part, reversed in part, and remanded certain issues to the trial court for further proceedings. The Supreme Court affirmed the trial court’s grant of class certification with respect to the “Rest Break Subclass.” With respect to the “Meal Break Subclass,” the Court remanded the case to the trial court for reconsideration. As to the “Off-The-Clock Subclass,” the Court determined the trial court erred in certifying the class because there was no evidence of “common policies or means of proof.”
Class Certification
The Court engaged in a lengthy discussion regarding the principles of class certification. Specifically, the Court reiterated that class certification requires the existence of an ascertainable and sufficiently numerous class, a well-defined community of interest, and substantial benefits from certification that render the proceeding superior to the alternatives. (Code of Civ. Pro., § 382; Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089; Linder v. Thrifty Oil Co. (2003) 23 Cal.4th 429, 435; City of San Jose v. Superior Court (1974) 12 Cal.3d 447, 459.) The sole certification at issue in this case, the court noted, was “whether individual questions or questions of common or general interest predominate.” The Court, citing to Hicks v. Kaufman & Broad Home Corporation (2001) 89 Cal.App.4th 908, 916, noted that “[a]s a general rule if the defendant’s liability can be determined by facts common to all members of a class, a class will be certified even if the members must individually prove their damages.”
While the Court agreed with the Court of Appeal that the trial courts must resolve legal or factual issues necessary to a determination of whether class certification is proper, “the Court of Appeal went too far intimating that a trial court must as a threshold matter always resolve any party disputes over elements of a claim.” The Court further held that “[o]ut of respect for problems arising from one-way intervention … a court generally should eschew resolution of such issues unless necessary.”
Wage Order No. 5 and the Labor Code
Rest Periods
The Court held that the IWC’s Wage Orders “are to be accorded the same dignity as statutes.” As such, the Court engaged in a plain reading of Wage Order No. 5, subdivision 12, to determine the rate at which rest time must be authorized and permitted. The Court found that employees are entitled to 10 minutes of rest for shifts from three and one-half to six hours in length, 20 minutes of rest for shifts of more than six hours up to 10 hours, and 30 minutes for shifts of more than 10 to 14 hours.
Regarding the timing of the rest breaks, the Court rejected Hohnbaum’s suggestion that employers have a “legal duty” under Wage Order No. 5 “to permit their employees a rest period before any meal period.” Rather, the Court found that pursuant to subdivision 12, employers are “subject to a duty to make a good faith effort to authorize and permit rest breaks in the middle of each work period, but may deviate from that preferred course where practical considerations make it infeasible.”
Meal Periods
In determining the timing of meal breaks, the Court returned to the plain language of Labor Code section 512, subdivision (a) and held that absent waiver by the employee, “employees are entitled to a first meal period no later than the end of an employee’s fifth hour of work and a second meal period no later than the end of an employee’s 10th hour of work.”
No Requirement That the Employer Must Ensure Work is not Being Performed
Hohnbaum also argued that Wage Order No. 5 requires employers to “ensure” that work ceases for the 30 minute period. The Court disagreed. Under Wage Order No. 5 and Labor Code section 512, subdivision (a), the Court concluded that an employer must “relieve” the employee of work, “but need not ensure that the employee does no work.” The Court summarized the rule as follows:
"An employer’s duty with respect to meal breaks under both section 512, subdivision (a) and Wage Order No. 5 is an obligation to provide a meal period to its employees. The employer satisfies this obligation if it relieves its employees of all duty, relinquishes control over their activities and permits them a reasonable opportunity to take an uninterrupted 30-minute break, and does not impede or discourage them from doing so. What will suffice may vary from industry to industry, and we cannot in the context of this class certification proceeding delineate the full range of approaches that in each instance might be sufficient to satisfy the law.
On the other hand, the employer is not obligated to police meal breaks and ensure no work thereafter is performed. Bona fide relief from duty and the relinquishing of control satisfies the employer’s obligations, and work by a relieved employee during a meal break does not thereby place the employer in violation of its obligations and create liability for premium pay under Wage Order No. 5, subdivision 11(B) and Labor Code section 226.7, subdivision (b)."
Questions
The Supreme Court’s much anticipated decision in Brinker finally provides clarification to the State’s private employers regarding rest and meal periods. If you have any questions concerning the content of this Legal Alert, please contact the following from our office, or the attorney with whom you normally consult.
David W. Tyra, Bruce A. Scheidt or Laura Izon Powell | 916.321.4500