Recent Employment Law Cases
Naranjo v. Spectrum Security Services, Inc.
On May 23, 2022, the California Supreme Court issued an employee-friendly ruling from the Second District in Naranjo v. Spectrum Security Services, Inc. The California Supreme Court held that unpaid premium wages for meal and rest period violations now entitle employees to wage statement penalties and waiting time penalties. These same violations can also trigger civil penalties under the Private Attorneys General Act (PAGA).
Naranjo brought a class action for Labor Code violations against Spectrum, including for failing to provide meal periods and rest breaks, wage statement violations and rest break premiums.
If an employer fails to comply with the meal period and rest break rules, they must pay one hour of “premium” pay.
The case was appealed to the California Supreme Court. In a ruling adverse to employers, the California Supreme Court overturned the Second District and held that: (1) employers are liable for wage statement violations for failing to list premium pay on wage statements; and (2) employers are liable for waiting time penalties for failing to timely pay premium pay upon separation.
The Supreme Court reasoned that premium pay, even though designed to compensate for the deprivation of the right to breaks, also compensates employees for the work they performed during the break period. The court explained “the premium pay due for the deprivation [of meal periods and rest breaks] is certainly designed to compensate employees for hardships the Legislature concluded employees should not be made to suffer. But when those hardships include rendering work, the pay owed can equally be viewed as wages.” The court reiterated that premium pay is “a wage to compensate employees for the work” they performed during a meal or rest period and analogized the missed-break premium pay to other forms of enhanced payment for working under conditions of hardship, such as overtime.
Troester v. Starbucks Corp.
The Supreme Court of California ruled that a Starbucks Corp. employee was entitled to full compensation for all hours worked. In the suit, Troester alleged that Starbucks Corp. required him to clock out before completing tasks which were mandated by the company. Those included a store closure procedure to transmit sales, profit and loss and inventory data to Starbucks headquarters.
Epic Systems v. Lewis
U.S. Supreme Court Holds That Class-Action Waivers in Employment Arbitration Agreements Are Enforceable Under Federal Law.