2006-2 -- Special Alert

Meal Break Update

For the past year, employers have been anxiously waiting for the Labor Commissioner to finalize proposed regulations on meal breaks . As we previously reported, the proposed regulations would clarify several important ambiguities in the law, provide greater flexibility on when meal breaks must be given, give employees the option to skip meal breaks, and limit claims for missed breaks to one year. The proposed regulations were met with intense opposition from organized labor, and the plaintiffs' bar who has been capitalizing on the uncertainty in the law to extract multi-million dollar settlements from employers.

In an apparent bow to political pressure, the Labor Commissioner announced on January 13, 2006, that it has withdrawn the proposed regulations. The Labor Commissioner intends to issue new proposed regulations in the future, which must again go through the lengthy approval process before taking effect.

One positive note for employers is that the Labor Commissioner continues to assert that the statute of limitations for meal and rest break claims is only one year, instead of the four-year statute of limitations that applies to wage claims. In withdrawing the proposed regulations, the Labor Commissioner referred to its earlier Precedent Decision, and a recent decision from the Court of Appeal in San Francisco in Murphy v. Kenneth Cole Productions, which both conclude the one-year statute of limitations applies.

However, in another blow to employers, the Court of Appeal in San Diego issued a contrary ruling on January 20, 2006 in Godinez v. National Steel and Shipbuilding Company. In this case, the Court refused to follow the Murphy decision, and ruled meal and rest break claims are subject to the longer four-year statute of limitations applicable to claims for unpaid wages. There are several other cases pending in the Court of Appeal around the State. Given the split in rulings, the issue will likely be reviewed by the California Supreme Court. As such, the debate over the appropriate statute of limitations will not be resolved for several years.

After a year of waiting for the proposed regulations to become law, employers must continue to operate under an ambiguous set of rules. The much publicized recent verdict against Wal Mart for $170 Million Dollars for widespread meal break violations, and the uncertainty over the statute of limitations, will also raise the stakes for employers.

Please call your BRGS contact for more information about these latest developments, and steps you should take to ensure compliance with the rest and meal break rules.

The Labor Commissioner's announcement withdrawing the proposed regulations can be found at: http://www.dir.ca.gov/DIRNews/2006/IR2006-02.html

The Court's decision in Godinez can be found at: http://www.courtinfo.ca.gov/opinions/documents/D046692.PDF

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