Sarah Block
Thu, 08/26/2021
Pursuant to a recent decision by the California Supreme Court, employers in California are now required to include the value of an employee’s commissions, bonuses, and other non-discretionary pay in the meal and rest break premiums to which employees are legally entitled when the employer fails to provide them with a meal and/or rest break.
Specifically, in Ferra v. Loews Hollywood Hotel, LLC, Case No. S259172, a hotel bartender earning an hourly wage as well as quarterly nondiscretionary incentive payments sued her employer in a class action challenging its policy and practice of paying the premium required by the California Labor Code for a missed meal or rest break according to the employee’s base hourly wage. Siding with the bartender, the California Supreme Court unanimously held that the required meal or rest break premium must be paid not at the employee’s base rate, but instead at a regular rate that includes commissions, bonuses, and other non-discretionary payments. This is similar to the way that employers are required to calculate the regular rate of pay for purposes of calculating an employee’s overtime rate. Significantly, the Court explicitly held that the decision applies to employers retroactively, noting that even if the employer were correct that the decision will expose employers to “millions” in liability, “it is not clear why [the court] should favor the interest of employers in avoiding ‘millions’ in liability over the interest of employees in obtaining the ‘millions’ owed to them under the law.”
When an employee works during an otherwise unpaid meal break, they must be compensated for their work time. If you believe you have not been paid for all of the work that you perform or have questions about your right to a duty free meal break, please contact us through the form available at https://www.mselaborlaw.com/contact.
