Employer’s imperfect meal and rest break policies are an insufficient basis to certify a class action

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Last week, the Court of Appeal ordered the publication of its employer-friendly opinion affirming the denial of class certification in an employment wage and hour case. In Cacho v. Eurostar, the two plaintiffs took the position that their former employer maintained meal and rest break policies that violated California law because they did not address an employee’s entitlement to 1) take a first meal break within the first five hours of work, 2) take a second meal break on shifts over 10 hours, or 3) take a third rest break on shifts over 10 hours. They also argued that, since an earlier version of the employee handbook erroneously stated that employees were entitled to a rest break on shifts of at least four hours – instead of on shifts of at least 3.5 hours – class certification of their rest break claim was appropriate. The Court upheld the lower court’s findings that: 1) the employer’s written meal break policies did not evidence a uniform unlawful policy that would be appropriate to decide on a classwide basis, and 2) the employer did not have a uniform practice of denying required rest breaks.

In this case, the trial court considered the testimony of the plaintiffs and witnesses for the employer, as well as statistical evidence of alleged violations presented by the plaintiffs’ expert, and it determined that there was no common proof that the employer did not provide compliant meal breaks (such as proof that the employer had a company-wide policy or practice of denying employees timely meal breaks). The trial court also determined that, even though the employer’s earlier rest break policy conflicted with California law, the plaintiffs had failed to demonstrate that the employer had a uniform practice of denying rest breaks to employees who worked between 3.5 and four hours. Though courts typically may not evaluate evidence of wage and hour violations in a way that prejudges the merits (because the amount of damages is only determined after a class is certified), the Court found that the lower court acted within its discretion in considering the evidence to determine whether class-wide liability for meal and rest break violations could be established by common proof.

The Court’s decision signifies that class certification should not be granted solely on the basis that their policies are either silent as to California wage and hour laws or that they contain an unlawful policy. (Note, however, that the Court’s decision applies only to meal and rest break laws, which do not require employers to publish the laws in an employee handbook. The Court likely would have reached a different conclusion had the law included a publication requirement.) Though the absence of a written policy or the implementation of an unlawful policy can still support class certification in some instances (such as if a plaintiff demonstrated that the employer also had a common practice of denying meal or rest breaks), it is not dispositive in itself.

It is unknown whether or not this decision will be appealed to or heard by the California Supreme Court. Earlier this year, the Ninth Circuit asked the California Supreme Court to decide two questions, which could have had some bearing on this case, and the Supreme Court declined to do so. One question was whether the absence of a formal policy regarding meal and rest breaks violates California law. The second question was whether an employer’s failure to keep records for meal and rest breaks taken by its employees creates a rebuttable presumption that the meal and rest breaks were not provided. If the Supreme Court had reached a conclusion on the first question and found that the absence of a policy violates the law, the outcome of this case may have been different. If the Supreme Court had reached a conclusion on the second question in favor of employees (though it would be unlikely to do so on the rest break question, since rest breaks need not be recorded), Eurostar may have faced a higher burden to prove that it provided rest breaks to its employees.

Although this case provided some welcome relief for the employer in the class action context when the employer did not have an entirely compliant meal/rest break policy, compliant written policies are still an extremely important part of an employer’s defense in such cases and it is important for employers to have compliant and complete written meal/rest break policies in place and enforced.