How to Get in Lots and Lots of Hot Water as an Employer in California

I’m not going to do an in depth analysis of yesterday’s Cal Supremes decision in Murphy v. Kenneth Cole Productions, Inc., S140308.  There’s plenty of other bloggers covering that territory in depth, including The UCL Practitioner and the often  excellent Wage Law , which has a very insightful  list of all the ways this is a win for employees and a loss for employers.  Non-exempt California employees are generally entitled to a thirty minute lunch break (which need not be paid)  and two ten minute rest breaks during a typical work day.  If the employer fails to provide either of these, then under Labor Code section 226.7 it owes the employee “one additional hour of pay” each time a lunch or rest break is missed.

The Murphy decision holds, in a nutshell, that there is a three year statute of limitations (the employer argued for a one year) for the “one additional hour of pay” that a California employer must shell out every time it fails to provide a lunch break or rest period. This means that an employee who sues for the additional hour of pay can recover three-years’ worth, not one. 

What’s interesting for out-of-state companies doing business in the Golden State is how the defendant Kenneth Cole Productions managed to do just about everything an employer can do wrong if it wants  a great big wage and hour case target on its back:

• Made sales people into “managers” to try to avoid overtime laws (although this “manager” sold product, was the receiving clerk;  processed markdowns and cleaned up the store);

• Had the “manager work through lunch nine days out of ten;

• Had him work from 8:30 or 9:00 a.m. to after 6:00 p.m., with no overtime, of course;

• Had the poor guy working without rest brakes, and sometimes with nobody to cover for him so he could go to the rest room;

• Failed to include the statutorily required pay stub information about hours worked, amounts paid, etc.;  and

• As icing on the cake, saw fit to appeal an adverse Labor Commissioner’s decision, whereupon the plaintiff got the Hastings Law School Civil Justice Clinic   to take on his case, and things got much, much worse.