2005-16 - Special Alert

MEAL BREAK UPDATE

As we have previously reported, the long-awaited meal break regulations have been under review by the Labor Commissioner since last December. One of the provisions in the proposed regulations which is particularly important to employers, is a clarification that the one hour of pay for meal and rest break violations is a penalty rather than a wage. This means meal and rest break penalty claims are subject to a one-year statute of limitations. Since the statute of limitations for wage claims is as long as four years, the penalty vs. wage debate could mean millions of dollars in potential exposure for employers.

Although the proposed regulations appear to have stalled in the administrative process, several court cases have been making their way through the appeals process. The first published Court of Appeal case to rule on the issue was decided last Friday. In Murphy v. Kenneth Cole Productions, the First District Court of Appeal in San Francisco gave a big victory to employers by ruling the one hour of pay is a penalty which is subject to the one-year statute of limitations. There are two more cases that will decide this issue which are pending in the Courts of Appeal in Los Angeles and in Riverside. Depending on the rulings in these or other future cases, the California Supreme Court may have to weigh in on the issue.

The ruling in Murphy not only means an employee seeking meal and rest break penalties can only go back one year from the date the claim is filed, other potential damages that are available in wage cases ? such as attorney?s fees and waiting time penalties ? cannot be recovered in a meal or rest break case. Please call your BRG&S contact if you have any questions about this important case, or how it may affect your company.

A copy of the Murphy decision can be obtained from the following link:

http://www.courtinfo.ca.gov/opinions/documents/A107219.PDF

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