A recent decision from the Court of Appeal for the Second Appellate District in the case of Naranjo v. Spectrum Security Services, Inc. (September 26, 2019) Case No. B256232 addresses several unresolved questions pertaining to meal and rest periods in California.
First, the Court upheld the trial court’s ruling that Spectrum had not met the requirements for an on-duty meal period because, during part of the class period, it did not have a written agreement in which the employees were advised that the agreement could be revoked. In reaching this conclusion the Court rejected Spectrum’s argument that it had substantially complied with the on-duty meal period requirements.
Next, the Court turned to the question of what penalties workers can recover when they have been denied meal and rest periods. The Court began this analysis by noting that confusion had reigned regarding this question ever since the California Supreme Court decided Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244 (holding that an action under Labor Code section 226.7 for nonprovision of meal and rest periods is not an action for the nonpayment of wages, and thus a prevailing party is not entitled to attorneys’ fees under Labor Code section 218.5).
In light of that holding, are workers who prevail on their claims for meal and rest periods entitled to recover waiting time penalties under Labor Code section 203? Ling v. P.F. Chang’s China Bistro, Inc. (2016) 245 Cal.App.4th 1242 had answered this question in the negative, but federal district courts were split on the issue.
After considering the applicable law, the Naranjo court sided with Spectrum, holding that meal and rest period violations do not trigger section 203’s derivative penalties for failure to pay all wages due at the time of termination. The Naranjo court also held that meal and rest period violations could not support a cause of action for inadequate wage statements under Labor Code section 226.
The holding regarding wage statement violations under Labor Code section 226 was particularly harmful to the workers because the trial court had awarded them attorneys’ fees under that statute, and that was apparently the only statute under which their attorneys had requested attorneys’ fees. It is unclear from the Naranjo opinion whether the workers had brought a derivative claim under the Private Attorneys General Act (“PAGA”) based upon the meal and rest period violations. If they had, that claim would provide an alternate avenue for recovering attorneys’ fees. See Labor Code § 2699(g)(1).
Finally, the Naranjo court addressed the issue of what interest rate should apply in the event that an employer is found to have broken the law with regard to meal and rest periods. The Court rejected Spectrum’s argument that no prejudgment interest applied. Instead, prejudgment interest on these claims was to be calculated at seven percent under Civil Code section 3287.
Naranjo addresses a number of issues that warrant either Supreme Court review or a Legislative clarification. Stay tuned for more developments.
The attorneys at Hunter Pyle Law handle meal and rest period claims throughout California for individual employees, in class actions, and in representative actions under the Private Attorneys General Act {“PAGA”). If you have a question about your breaks, please do not hesitate to contact us. We can be reached at inquire@hunterpylelaw.com or at (510) 444-4400.