Meal & Rest Break Penalties are Wages

After thorough arguments from both sides of the debate, the California Supreme Court issued its decision in Murphy v. Kenneth Cole Productions today. Many wage and hour practitioners were waiting patiently for the decision because it dealt with two key issues:

  1. Whether the “one additional hour of pay” provided for in Labor Code section 226.7 constitutes a wage or premium pay subject to a three-year statute of limitations (Code Civ. Proc., § 338) or a penalty subject to a one-year statute of limitations (Code Civ. Proc., § 340); and
  2. Whether a trial court, conducting a de novo trial, can consider additional wage claims not presented in the administrative proceeding before the state Labor Commissioner.

The California Supreme Court concluded that “the remedy provided in Labor Code section 226.7 constitutes a wage or premium pay and is governed by a three-year statute of limitations and that the trial court properly considered the additional, but related, wage claims during the de novo trial.”

The court’s decision serves as a reminder that employers should maintain accurate records of employee breaks. Additionally, employers have one more reason to not appeal adverse Labor Commissioner decisions.

The Law Office of Phillip J. Griego
95 South Market Street, Suite 520
San Jose, CA 95113
Tel. 408-293-6341
 
Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
 

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