In a landmark decision issued February 25, 2021 (Donohue v. AMN Services, LLC), the California Supreme Court issued a unanimous decision that significantly affects how employers may satisfy their meal break obligations. First, the Supreme Court held that employers are not permitted to “round” meal break punches. Second, if an employee’s time records indicate a non-compliant (i.e., late, short or missed) meal period, the Court ruled that these records create a rebuttable presumption of a meal period violation, requiring the employer to prove that employees could have taken a compliant meal period, but voluntarily elected not to do so.
- Employers May Not Round Meal Break Punches
Since 2012, the law in California on meal breaks has been well settled. Generally, employers must provide employees with one 30-minute uninterrupted duty-free meal period on any shift lasting over five hours. The meal break must begin no later than the end of the fifth hour of work. If an employer does not provide an employee with a compliant meal period, then the employer must pay the employee a "premium" equal to one hour of pay.
Where the employee works more than 10 hours in a day, a second 30-minute uninterrupted duty-free meal period also must be provided. That second meal break must begin no later than the end of the tenth hour of work.
Notably, the first meal period can be waived if the shift is not more than six hours. The second meal period can be waived if the shift is not more than 12 hours, but only if the first meal period was taken, i.e., both breaks cannot be waived.
In its landmark 2012 Brinker decision, the California Supreme Court clarified that the duty to “provide” a meal break does not mean that employers must police their workers and drag them off the shop floor to take their meal breaks. Rather, the Supreme Court stated that employers are only required to make compliant meal periods available to employees. Thus, if the employee was able to take a timely, 30-minute meal period, but chose not to do so for his or her own convenience or chose to come back early or start the meal break late, then no violation occurs. Conversely, if the employer discouraged or otherwise interfered with an employee’s ability to take a compliant meal period, the one-hour missed meal period premium is owed.
In this new case, AMN’s timekeeping system “rounded” all employee punch times to the nearest 10-minute increment, including meal period punches. For example, under AMN’s timekeeping system, if an employee's time punches reflected a 21-minute meal period from 12:04 p.m. to 12:25 p.m., the meal period was treated as a full 30-minute meal period from 12:00 p.m. to 12:30 p.m. In that scenario, as the Court pointed out, “an employee would have lost 9 of the 30 minutes — or almost a third of the time — to which he or she was entitled.”
While the California Supreme Court begrudgingly recognized that neutral time clock rounding was generally permitted for the start and end of shifts, it held that employers may not round meal break punches. The high court explained that “health and safety concerns” that support meal period requirements “distinguish the meal period context from the wage calculation context, in which the practice of rounding time punches was developed,” and “even relatively minor infringements on meal periods can cause substantial burdens to the employee.”
Thus, the Supreme Court was staking out a clear position that employees must be assured to receive their full 30-minute meal break each time a meal break is required. Timeclock rounding systems that artificially shorten that break will not be permitted. Thus, employers may not legally “round” meal period time punches.
- Time Records Showing Non-Compliant Meal Periods Are Presumed To Be Violations
The Supreme Court also approved the application of a so-called rebuttable presumption in favor of employees where the employer's records do not reflect a compliant meal period. Adopting the concurring opinion of Justice Werdegar in Brinker, the Supreme Court stated that employers bear the burden of proving that no violation occurred any time an employee’s time records show a non-compliant break, i.e., it is less than the full 30 minutes, it started later than the end of the fifth (or tenth) hour or was missed entirely. While the Court explained that employers can rebut that presumption by presenting hard evidence that employees were in fact able to take a compliant meal period if they chose to, employers face a steep challenge in proving that is so where the employer’s time records say otherwise.
The Supreme Court's decision provides several important lessons for employers that require immediate attention:
1. Time Record Audit. Employers who use a rounding system of keeping time (which is still lawful) must assure that the rounding mechanism is adjusted so that it does not round the meal break time entries. For some, this will be a huge technical challenge. If meal period punches are being rounded, this practice should stop immediately.
2. Consider Eliminating Rounding Policy. Although the Court's decision did not concern time clock rounding generally, it was less than enthusiastic about such policies. The Court observed that the main rationale offered up by employers for rounding has been the practical difficulty to precisely record employees' work hours. However, with technological advances that permit electronic timekeeping which can record and calculate work time to the second, the Court questioned whether this rationale still applies. This commentary could foreshadow a future unfavorable ruling from the Supreme Court on time clock rounding policies generally. We have been recommending that employers seriously consider elimination of the policy.
3. The Presumption Requires New Vigilance. Because of the presumption in favor of employees where time records show a non-compliant meal period, employers must be vigilant in monitoring employee meal period punches. If the time records reflect a missed, short or late meal period, the employer should promptly investigate the reasons for the non-compliance and record those efforts in writing. If the investigation reveals that the employee was not able to take a compliant meal period, then the one-hour premium should be paid. Doing so will go a long way toward reducing risk of an expensive and time-consuming class action lawsuit or Private Attorney General Act claim. By the same token, where the investigation reveals that the employee was able to take a compliant meal break, this should be well documented. It is recommended that the employee sign something evidencing their acknowledgment of this fact and agreement with the time record reconciliation. Many timekeeping systems can be programmed to include an affirmative meal period attestation for employees to complete each day. The Court noted that an employer can use such attestation as evidence as part of its effort to meet its burden of proof.
If you have any questions about this important case, please call the author or your firm contact or visit us online at www.brgslaw.com.
Richard S. Rosenberg
Jeffrey P. Fuchsman
Matthew B. Golper
Ballard Rosenberg Golper & Savitt, LLP