Articles

Does Senate Bill 1539 Really “Provide” A Solution To The Meal Period Morass

Originally Published December 2008 in the Orange County Lawyer

A new California Senate Bill recently passed in the Senate Labor Committee, and it is intended to amend Labor Code 512 to "clarify" existing law. There is no question that existing law could benefit from clarification. What is less certain is whether SB 1539 actually provides the much needed clarity, or whether it adds further confusion and, thereby, further ammunition for litigation. Discussed below are a few of the key areas of existing law that SB 1539 hopes to "clarify." Ultimately, these authors believe that SB 1539 does provide some needed clarification but that it continues to leave employers in the dark -- and thus exposed to costly litigation -- with respect to some key aspects of the meal period laws.

By way of background, existing statutory law does not define what it means to "provide" a meal period. Labor Code Section 512 simply mandates that employers must provide their employees with a 30 minute meal period if they work more than 5 hours in a workday, and another 30 minute meal period if they work more than 10 hours in a workday. Although the Industrial Welfare Commission ("IWC") Orders also set forth various requirements for meal periods, they are likewise silent in defining what it means to "provide" a meal period to employees.

The California Appellate Court in Brinker Restaurant Corporation v. Superior Court, No. D049331, 2008 WL 2806613 (July 22, 2008), recently tussled with trying to interpret whether an employer's duty to provide a meal period means the employer must ensure its employees actually take a meal period, or whether an employer satisfies its obligation by simply making a meal period available to its employees. In a closely watched case, the appellate court held that an employer is only required to make meal periods available to employees. In Brinker, the appellate court found that the trial court "incorrectly assumed that, in order to render an informed certification decision, it did not have to resolve the issue of whether Brinker had a duty to ensure that its employees take their meal periods." (Id. at *16.) The appellate court reasoned that the trial court did not properly evaluate whether common questions regarding plaintiffs' meal period claim predominate over individual issues. Thus, the appellate court held that class certification was improper. (Id. at *23) (The trial court's decision was wrong "because meal breaks need only be made available, not ensured, individual issues predominate in this case and the meal break claim is not amenable class treatment." Id at 58))...)

Employment lawyers have certainly paid close attention to the Brinker case because it casts doubt on the decision in Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, which had previously suggested that an employer's obligation to provide its employees with meal periods is not satisfied by assuming that the meal periods were taken. Instead, Cicairos suggested employers have an affirmative duty to ensure that the employees take meal periods. The appellate court in Brinker distinguished Cicairos and limited the case to its facts. (Id. at *22) (stating that the Cicairos court "only decided meal breaks must be provided, not ensured").)

The California appellate court in Brinker, however, was not the first court to distinguish Cicairos. The United States District Court, Northern District, essentially disagreed with Cicairos and granted summary judgment in favor of the employer. (See White v. Starbucks (N.D. Cal. 2007) 497 F.Supp.2d 1080.) Faced with a putative class action for alleged meal period and rest break violations, Starbucks successfully argued that employers cannot be required to actually make sure that all employees take their 30 minute meal periods, because doing so would create an unreasonable and unworkable strict liability standard. (See id. at 1088 (it "cannot be the rule that employers must ensure that a meal period is actually taken, regardless of what an employee does, because that would create a strict liability standard").) Accepting Starbuck's argument, the Northern District limited the Cicairos case to the facts presented. (Id. at 1088.) Ultimately, the district court concluded that "the California Supreme Court, if faced with this issue, would require only that an employer offer meal breaks, without forcing employers actively to ensure that workers are taking these breaks." (Id. at 1088-89 (reasoning that "the employee must show that he was forced to forego his meal breaks as opposed to merely showing that he did not take them regardless of the reason"); see also Kenny v. Supercuts, Inc., No. C-06-07521, 2008 WL 2265194 at *7 (N.D. Cal. Jun. 2, 2008) (denying class certification in meal period case and following Starbucks).)

The Central District also adopted the reasoning in Starbucks. In Brown v. Federal Express Corp., 249 F.R.D. 580 (C.D. Cal. 2008), the Central District held that California law only requires employers to make available a meal period, "not ensure that employees take advantage of what is made available to them." (Id. at 585.) The court further stated: "It is an employer's obligation to ensure that its employees are free from its control for thirty minutes, not to ensure that the employees do any particular thing during that time." (Id.) The court specifically declined to rely on Cicairos: "This Court is not persuaded of the contrary holding in Cicairos." (Id. at 586.) Instead, the Central District court relied on dicta in Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, implying that an employer is not required to ensure that an employee take a meal period so long as the employer does not force its employee to work through a meal period. (Id.; see also Salazar v. Avis Budget Group, Inc., No. 07-CV-0064, 2008 WL 2676626 at *4 (S.D. Cal. 2008) (denying class certification in meal period case and following Brown, Kenny, and Starbucks). )

In light of the uncertainties left in the wake of recent California and federal case law, SB 1539 would provide some needed statutory clarity. Specifically SB 1539 defines "providing the employee with" a meal period as "giving the employee an opportunity to take," such that the requirement that an employer "provide an employee with" a meal period is satisfied when the employer provides the employee with an opportunity to take the meal period. SB 1539 thus rejects a strict liability standard and employers could rest assured that they do not have an affirmative obligation to self police their employees or hire employees whose sole function it is to have a stopwatch to ensure that employees actually take their scheduled meal periods. SB 1539 suggests that the Legislature never intended to require employers to police their employees in this manner. Thus, SB 1539's clarification is appropriate and needed, especially given the appellate court's decision in Cicarios.

Unfortunately, SB 1539 does not address the implication in Brinker that a meal period may commence after the first five hour work period. The ambiguity in Brinker is that the appellate court interpreted the language of Section 512(a) literally and stated that it "generally requires a first meal period for every 'work period of more than five hours per day.'" (Emphasis in case). This language-taken to its "literal" extreme-seems to imply that a first meal period may commence any time during the "day" after the employee works for five hours. However, it was generally understood prior to Brinker that a first meal period cannot commence after 6 hours of work (or 5 to be conservative), based on the language in Labor Code Section 512(b), which provides: "Notwithstanding subdivision (a), the Industrial Welfare Commission may adopt a working condition order permitting a meal period to commence after six hours of work if the commission determines that the order is consistent with the health and welfare of the affected employees." The IWC does not appear to have adopted a regulation allowing a meal period to commence after six hours, so this implies that a meal period must commence prior to 6 hours of work. Still, this issue is unclear and the provisions of the Labor Code, the IWC regulations, and case law is evolving and changing. Even the Brinker case discussed above may not stand if the California Supreme Court has a different perspective on the issue.

In addition to the meaning of "provide" a meal period, SB 1539 also attempts to clarify existing law regarding on-duty meal periods. Existing law, as stated in Labor Code Section 226.7 prohibits an employer from requiring its employees to "work" during any meal period mandated by an applicable Industrial Welfare Commission Wage Order. Labor Code Section 226.7 further states that if an employer fails to provide a meal period, then the employer must pay an additional hour of pay at the employee's regular rate of compensation. Based on the plain reading of this statute, an employer cannot "require" (e.g., command, compel, etc.) an employee to "work" during his or her meal period. The Legislature's intent apparently was to give employees a choice to "work" during their meal period, so long as the employer does not "require" them to "work."

Notwithstanding the Legislature's intent, the IWC has stated that unless the employee is relieved of all duty, the meal period must be considered "on duty" and counted as "time worked." This means that an employee who is relieved of all duty during his or her meal period would be considered "off-duty," although no California case has engaged in this analysis or clarified what it means to be "relieved of all duty." Further, according to the IWC, on-duty meal periods are only permitted if (1) the nature of the work prevents an employee from being relieved of all duty, and (2) when the employee agrees to an on-the-job meal period in writing. Thus, if an employee is not relieved of all duty and the foregoing requirements are not met, the employer is vulnerable to liability under Labor Code Section 226.7 for failing to provide a meal period in accordance with an applicable IWC Wage Order.

Although Labor Code Section 226.7 seems to allow employees the flexibility to agree to work during their meal periods, the language of applicable IWC Wage Orders is ambiguous because the language fails to offer any guidance for determining when a meal period is considered on-duty versus off-duty. Conspicuously, there is no definition or guidance provided for determining when an employee is "relieved of all duty." One reasonable interpretation is that a "working" meal period (i.e. a meal period during which an employee is actually performing duties and tasks for his or her employer) is equivalent to an "on-duty" meal period. If, however, the IWC's definition of "on-duty" means something less than being engaged in "work," then it is unclear whether the IWC's requirements are properly based on statutory authority and/or whether they are consistent with statutory authority and case law. For example, an employee would not seem to be "on-duty" if he or she was required to remain on premises (and thus was entitled to compensation for such time) during a paid lunch period but was not required to do any work?

While SB 1539 plainly states that an "off-duty meal period" means a meal period that lasts 30 minutes during which time the employee is relieved of all duty, it fails to provide a much needed definition of the phrase "relieved of all duty." Notably, Labor Code Section 512 currently does not include the term on-duty or off-duty, but the IWC Wage Orders generally define on-duty meal periods as those meal periods where the employee is not relieved of all duty. Thus, the "current law" regarding on-duty versus off-duty meal periods remains unclear because, as discussed above, there is no statutory distinction or explanation of what it means to be on-duty or off duty.

While not answering the question of what it means to be relieved of all duty, SB 1539 does set forth a definitive list of conditions under which an employee would be allowed to take an on-duty meal period. Specifically, SB 1539 allows "on-duty" meal periods if (a) the employees are covered by an IWC Wage Order that authorizes an "on-duty" meal period, (b) the employee and employer enter into an on-duty meal period agreement, (c) the employee is allowed to eat while on-duty, (d) the meal period is counted as time worked, and (e) the nature of the work prevents the employee from being relieved of all duty based on one of the following 6 enumerated statutory conditions:

  1. The employee is working alone, or is the only person in the employee's job classification, or there are no other qualified employees who can "reasonably relieve the employee of all duty;"
  2. The nature of the work or the relevant circumstances make it "unreasonable" or unsafe to take a break;
  3. State or federal law requires them to be on duty;
  4. Work product or process will be destroyed;
  5. Work product is perishable, including the delivery of those products; or
  6. The employee works in a 24-hour care facility for children, the elderly, or the disabled.

Based on the language above, SB 1539 appears to expand and codify the IWC Wage Order provisions governing on-duty meal period requirements.

As discussed above, arguably the bigger problem is that SB 1539 does not establish a test for determining whether an employee is "relieved of all duty." Without any California legal authority on this issue, employers are left without a clear answer. Employers can argue, however, that the test for determining whether an employee is relieved of all duty should depend on whether the employee is actually working. This argument is reasonable, given the plain language of Labor Code Sections 226.7 and 512 (and SB 1539), as well as certain language found in California case law. In Madera Police Officers Association v. City of Madera (1984) 36 Cal.3d 403, 410, for example, the California Supreme Court said that "no one question is likely to be dispositive of the question of whether the employee was working during lunchtime." Also, the court in McFarland v. Guardsmark, LLC, 2008 WL 698481 (N.D. Cal. 2008), stated that "where the employee agrees to take an 'on duty' meal period, and gets paid for working during the time he is eating, there is no 'waiver' of the meal period." (Id. at *6.) This language supports the argument that an on-duty meal period is one where the employee is "working," and if the employee is not "working" the meal period should be treated as an "off-duty" meal period. Although no California case appears to define the term "work," the U.S. Supreme Court has defined the term "work" as "physical or mental exertion (whether burdensome or not) controlled or required by the employer and pursued necessarily and primarily for the benefit of the employer and his business." (Tennessee Coal & RR Co. v. Muscoda Local No. 123 (1944) 321 U.S. 590, 598.)

The California Legislature should consider clarifying the intended meaning of when an employee is "relieved of all duty," and clarify that an employee is not automatically "on-duty" if the employee is required to remain on the premises. Federal law specifies that "[i]t is not necessary that an employee be permitted to leave the premises if he is otherwise completely freed from duties during the meal period." (29 C.F.R. § 785.1.9) Federal courts have relied on three different tests to determine whether an employee is completely relieved of his or her duties. The first test asks whether or not the employee's time spent during the meal period is primarily for the employer's benefit. (Henson v. Pulaski County Sheriff Dep. (8th Cir. 1993) 6 F.3d 531; Hahn v. Pima County (2001) 24 P.3d 614, review denied Jan. 8, 2002.) The second test focuses on whether the employee is completely free of any work-related tasks, and is used in non-law enforcement cases. (Kohlheim v. Glynn County (11th Cir. 1990) 915 F.2d 1473.) The third test looks at whether the employees are primarily engaged in work-related activities during meal breaks. (Armitage v. City of Emporia (10th Cir. 1992) 982 F.2d 430; Lamon v. City of Shawnee (10th Cir. 1992) 972 F.2d 1145, 1157.)

In the meantime, employers in California can argue that SB 1539 implies an employee must be actually engaged in work (i.e. performing actual duties) for a meal period to be considered on-duty. On the flip side, a meal period during which an employee has no obligation to do actual work should be considered a bona fide meal period even if they are subject to some small degree of employer control. (E.g., if they are required to remain on premises but are otherwise relieved of all duties.) This interpretation is consistent with the common understanding of the term "work." It is also reasonable since no California court has defined an on-duty meal period. Although the case of Bono Enterprises, Inc. v. Bradshaw (1995) 32 Cal.App.4th 968 upheld a DLSE policy that an employee who has a duty or obligation to remain on the premises during meal periods is not "free of all duty." The California Supreme Court's opinion in Tidewater Marine Western, Inc. v. Bradshaw (1996) 14 Cal.4th 557, 574, disapproved of Bono Enterprises and held that the DLSE's policy discussed in Bono Enterprises was an invalid regulation that was not adopted in accordance with the Administrative Procedures Act ("APA"), Gov. Code, §§ 11340 et seq. Further, subsequent courts have seemed to limit the holding in Bono Enterprises to the rule that "an employee who is subject to an employer's control does not have to be working during that time to be compensated" under the IWC's definition of "hours worked." (See Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575, 578 (emphasis added).) In other words, the Bono Enterprises holding that an employee must be paid for all time spent under his or her employer's control is still good law, however, no case has reasoned that remaining under an employer's control means that the employee is not relieved of all duty such that an employer would have to pay the employee a penalty for failing to provide a meal period.

In short, SB 1539 is a step in the right direction, but it may need to further "clarify" the requirements and legal standards for on-duty meal periods to provide the much needed guidance that employers and the courts are seeking.

For more info contact Julie Trotter