As previously reported in Spotlight, last month the California Supreme Court refused to review the appeal court ruling in Gonzalez v. Downtown LA Motors. In that case, the appellate court ruled that the minimum hourly wage must be paid for each and every hour worked, no matter how the employee is normally compensated. As a result, employers can no longer show that the required minimum wage has been paid by averaging the total compensation over the total number of hours worked in the pay period as permitted by the Fair Labor Standards Act (FLSA) and other states.
Continuing the trend established by Downtown LA Motors, the California Court of Appeal in Bluford v. Safeway Stores, Inc. held that an employer must separately compensate piece-rate workers at the minimum or contracted hourly wage for the two 10-minute rest breaks per day that must be authorized and permitted by their employers under California law. Prior to this decision, such rest breaks had always been permitted to be included as part of piece-rate and commission plans.
Safeway has petitioned the California Supreme Court to review the Bluford decision. As we did in the Downtown LA Motors case, Western Growers, California Farm Bureau Federation and Ventura County Agricultural Association have each written letters urging the Court to review this important case.
This case is important for all employers who pay by the piece rate, daily rate, or inside sales commission. Traditionally, employers using such pay structures could rely on communications with employees that rest periods were included in these rates. If Bluford is not reviewed by the California Supreme Court and becomes binding law, wage statements reflecting alternate pay structures may be required to include a separate line item to note that rest periods are being paid. In any event, it is important that employees be given a clear understanding of how they are being compensated and that they are in fact being paid for their on-duty breaks.
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