By Jim Butler of the Global Hospitality Group®
Author of www.HotelLawBlog.com
April 25, 2012

Hotel Lawyer with some insights on the recent California Supreme Court Case, Brinker v. Superior Court

Last week, the California Supreme Court gave employers a "break" by resolving issues in a case that has been pending since 2008 -- issues that have cost California employers more than a billion dollars in settling and defending class action lawsuits.

At issue in Brinker Restaurant Corporation v. Superior Court was whether California employers must ensure that their employees actually take their meal and rest periods or merely make them available. To the collective relief of California employers, the court found that an employer must only provide meal and rest periods to its employees, leaving the employees free to use the period for whatever purpose they desire. The employer is not obligated to ensure no work is performed during the period.
My partner, labor and employment lawyer Travis Gemoets, offers some practical pointers to employers based on the Brinker decision, in his article below.

While it is always great to share positive news with our friends in the hospitality industry, the Brinker decision also reminds us of the critical need for clear, sound employee policies, and the importance of providing regular, ongoing education to supervisors who implement those policies.

JMBM's Global Hospitality Group® includes labor and employment lawyers with deep experience in the hospitality industry, providing clients with practical advice and planning, as well as aggressive advocacy. If you would like to discuss how our industry-specific prevention and preparedness strategies can help you avoid or minimize costly employment claims, or how the Brinker decision impacts your hotel operation, please contact me or my partner, Travis Gemoets.

by

Travis Gemoets | Hotel Lawyer, JMBM Global Hospitality Group®

For over a decade, class action litigation over missed meal and rest periods, off-the-clock work, and failure to pay wages have plagued California employers and resulted in over a billion dollars paid in verdicts and settlements. In last week's Brinker Restaurant Corporation v. Superior Court, the California Supreme Court resolved a significant issue, finding that an employer must only provide meal periods to its employees, leaving the employees free to use the period for whatever purpose they desire, but that an employer need not ensure no work is done. This ruling allows California employers--finally--to breathe a huge sigh of relief.

Meal periods

The Court makes clear the following: "When someone is ... employed ... for five hours, an employer is put to a choice: it must (1) afford an off duty meal period; (2) consent to a mutually agreed-upon waiver if one hour or less will end the shift; or (3) obtain written agreement to an on duty meal period if circumstances permit. Failure to do one of these will render the employer liable for premium pay." Brinker, p. 35.

The Court continues: "[a]n employer's duty with respect to meal breaks ... is an obligation to provide a meal period to its employees. The employer satisfies this obligation if it relieves its employees of all duty, relinquishes control over their activities and permits them a reasonable opportunity to take an uninterrupted 30-minute break, and does not impede or discourage them from doing so." Brinker, Slip Opinion, p. 36 (emphasis added).

The Court further acknowledged that what will suffice may vary from industry to industry, but held, "the employer is not obligated to police meal breaks and ensure no work thereafter is performed. Bona fide relief from duty and the relinquishing of control satisfies the employer's obligations, and work by a relieved employee during a meal break does not thereby place the employer in violation of its obligations and create liability for premium pay." Brinker, p. 36-7 (emphasis added).

On the related question concerning when meal periods must be provided, the Court concluded a first meal break must fall no later than five hours into an employee's shift, but an employer need not schedule meal breaks at five hour intervals throughout the shift: "We conclude that Wage Order No. 5 imposes no meal timing requirements beyond those in section 512. Under the wage order, as under the statute, an employer's obligation is to provide a first meal period after no more than five hours of work and a second meal period after no more than 10 hours of work." Brinker, p. 50. The Court also noted that employees who work between 5 and 6 hours in a shift can waive their meal period, and employees who work between 10 and 12 hours can waive their second meal period.

Rest periods

On the question of rest periods, the Court confirmed that the wage orders entitle employees to 10 minutes of paid rest for shifts from three and one-half to six hours in length, and to another 10 minutes paid rest for shifts from six hours to 10 hours in length. The Court clarified that rest periods need not be timed to fall specifically before or after any meal period.

Class certification viability after Brinker

With respect to rest period claims, the Court concluded that plaintiffs had identified a theory of recovery suitable for class treatment, namely, that Brinker's policy did not comply with the law.

As for meal period claims, the Supreme Court remanded to the trial court for reconsideration of class certification in light of its clarification of the substantive law governing meal period claims.

Finally, with respect to a third issue--for claims that Brinker required off-the-clock work--the court affirmed vacation of class certification, finding that individualized issues predominate in such claims.

Some practical pointers

Although the employer before the Brinker court was subject to Wage Order 5, the Court's ruling will apply to industries covered by other Wage Orders. Accordingly, unless otherwise mandated by a collective bargaining agreement or employment contract, employers who automatically pay employees an hour's pay whenever they fail to clock out for a full 30-minute meal period can safely cease this practice once a clear written policy, compliant with Brinker, is implemented, along with policies allowing an employee denied a meal period under the Brinker standard to receive an extra hour's pay.

Employers who allow a meal period on "rolling five hour" periods can discontinue such practice, provided their meal period policy is Brinker-compliant. Employers whose meal and/or rest period policies fail to account for the Brinker formulations should immediately revise their policies accordingly with the assistance of experienced employment counsel.

Finally, for those employers who are currently facing a lawsuit with a certified class of employees, consideration should be made to determine if a motion for decertification, in light of Brinker, is warranted.

For a copy of the case, click below:

Brinker Restaurant Corporation v. Superior Court. No. S166350

This is Jim Butler, author of www.HotelLawBlog.com and hotel lawyer, signing off. We've done more than $60 billion of hotel transactions and have developed innovative solutions to help investors be successful in bidding for hotel acquisitions, and helping investors and lenders to unlock value from troubled hotel transactions. Who's your hotel lawyer?
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Travis Gemoets is a partner in JMBM's Employment and Labor Department and a member of JMBM's Global Hospitality Group®. His clients include hotel owners, investors, and managers across the globe as well as hospitals, restaurants, professional offices, and manufacturing plants, to name a few. An experienced trial lawyer, he represents management in all facets of labor and employment law, including claims of discrimination, harassment, wrongful termination, wage/hour class actions, union/management contract negotiations and disputes, trade secrets, unfair competition, and workplace violence. Travis advises employers nationwide on these areas as well as on disability and religious accommodation, protected absences, personnel policies and handbooks, employee discipline and discharge, and labor relations. Contact Travis at [email protected] or 310.785.5387.
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Our Perspective. We represent hotel lenders, owners and investors. We have helped our clients find business and legal solutions for more than $60 billion of hotel transactions, involving more than 1,300 properties all over the world. For more information, please contact Jim Butler at [email protected] or +1 (310) 201-3526.

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JMBM’s Global Hospitality Group®
The hotel lawyers in the Global Hospitality Group® of Jeffer Mangels Butler & Mitchell (JMBM) comprise the premier hospitality practice in a full-service law firm and are the authors of the Hotel Law Blog. We represent hotel owners, developers, investors and lenders and have helped our clients find business and legal solutions for more than $60 billion of hotel transactions, involving more than 1,300 properties worldwide. For more information about the Global Hospitality Group®, go to www.HotelLawBlog.com. For more information about full range of legal services provided by JMBM, go to www.JMBM.com.