July 24, 2008

Appellate Court Clarifies Meal and Rest Period Issues in Significant Case Decision

On Tuesday, the California Court of Appeal for the Fourth District issued its eagerly awaited opinion in the matter of Brinker Restaurant Corporation v. Superior Court (Case No. D049331, July 22, 2008). This case addressed the administration of meal breaks, rest breaks, and off-the-clock work and considered whether violations are amenable to class certification.

In a published decision sure to bring relief to California employers, the court concluded that class certification was inappropriate and provided much needed guidance on issues such as whether an employer must ensure meal periods have been taken and whether a meal period must be provided every five hours. The decision is a substantial victory for employers and may greatly reduce the number of class actions based on meal period, rest period and off the clock claims.

Relying on recent federal case law and distinguishing unclear California authority in similar meal and rest period cases, the court made the following key rulings:

• Employers need only provide, not ensure, rest periods are taken.
• Where it is not practicable to do so, rest periods need not occur in the middle of each 4-hour work period.
• Employers cannot “impede, discourage, or dissuade” employees from taking meal periods, but need not force employees to take meal breaks, and need not “ensure” the meal breaks are taken. Like rest breaks, an employer need only provide an employee with the opportunity to take a meal period.
• Employers are not required to provide a meal period for each five hours an employee works (the “rolling five hour” requirement). Instead, Labor Code section 512 only requires an employer to provide a meal period if an employee’s shift is more than five hours in a day. The court thus endorsed Brinker’s policy of “early lunching” – that is, having Brinker’s servers and waitstaff take meal periods shortly after the start of their shifts, then working a full shift without a meal break. (Meal periods may still be waived if the work period does not exceed six hours.)
• Employers cannot “coerce, require, or compel” employees to work off the clock, but are only liable for an employee’s decision to work off the clock if the employer “knew or should have known” the employee was doing so.

Based on these holdings, the court concluded that class certification was inappropriate in meal and rest break cases where an employer’s policy permits employees to take breaks, holding that:

We further conclude that because the rest and meal breaks need only be "made available" and not "ensured," individual issues predominate and, based upon the evidence presented to the trial court, they are not amenable to class treatment. Finally, we conclude the off-the-clock claims are also not amenable to class treatment as individual issues predominate on the issue of whether Brinker forced employees to work off the clock, whether Brinker changed time records, and whether Brinker knew or should have known employees were working off the clock.

Although it is likely to be immediately appealed to the California Supreme Court, this decision is a breakthrough for California employers. If upheld, the rules established by this decision will relieve employers of the burden of policing their employees’ meal and rest breaks, and will allow employers and employees the freedom to work together to provide employee meal and rest breaks in ways that make sense for the workplace.

The case was brought on behalf of servers and other hourly employees of Brinker’s 137 California restaurants. The proposed class was estimated to consist of more than 59,000 employees.

Practice Pointer: While the full impact of this decision remains to be seen, employers may wish to revisit their meal period policies and reassess the circumstances under which they are currently paying the one-hour of meal period pay. However, employers are advised not to make policy changes in response to the decision until it is final and we know whether the California Supreme Court will review the decision. If the Supreme Court grants review, employers may not rely on the decision of the court of appeal. In the meantime, employers should continue to enforce policies providing for meal and rest periods.