One of the questions that we get continually California workers is" Is it legal if the company automatically deducts my meal period under California wage law. Or: Is automatic meal deduction legal under California wage and hour law?
In this article we explain why automatic meal break deductions are illegal under California law.
Why is automatic meal deduction illegal in California?
If the company automatically deducts meal breaks from your timekeeping/ payroll, you are probably owed a lot of money in unpaid wages.
This is based on the landmark California Supreme Court case - Brinker vs. Superior Court. I represented the workers in the Brinker case, so I know a lot about the case.
Automatic meal deduction (also called auto meal deduct or automatic meal break deduction) is illegal in California. The company is in violation of California Wage Order Section 7(A)(3) because the company doesn’t accurately record the time that you take your meal breaks.
Automatic meal deduction California wage law - don’t some people say that automatically deducting lunch breaks is legal in California?
If you go on Google and look at articles on California wage law automatic meal break deduction you will find articles that suggest, or come right out and claim that automatic meal deduction (also called auto meal deduct) is perfectly legal in California. And there are articles that say that automatic meal deduction is legal under the FLSA (federal law).
I am here to tell you that these web pages are not only wrong, but they are very wrong about California wage law. Under California wage law, automatic meal deduction is not only illegal, but you can recover a lot of money in unpaid wages if your employer (or former employer/ company) automatically deducts your meal periods / lunch breaks.
In this article I not only explain why auto meal deduct is illegal under California law, I give you case citations and actual case studies explaining these principals. I show you why you may be owed a lot of money in unpaid wages.
Getting your settlement check in a Class Action wage case - makes it all worthwhile!!!
What is automatic meal deduction?
Automatic meal deduction is a payroll/ timekeeping procedure where the company automatically deducts time from your time records from you each day for a meal break/ lunch break. It is usually 30 minutes a day or a shift. But I have also seen a few companies that automatically deduct an hour’s pay each day.
Instead of workers actually punching out for their meal break or lunch break, the payroll system/ timekeeping system automatically deducts the ½ hour each day. Thus, the name “automatic meal deduction.”
Why is Bill Turley asked to testify concerning wage law legislation at the California State Senate and the California Assembly?
Because Bill is known as a No B.S. straight-shooter lawyer
Believe it or not, Bill is known for being a no B.S. straight-up lawyer. Besides being known as one of the leading experts on this area of the law in California, one of the reasons why Bill is asked to testify at legislature hearings is because he is known for being straight-forward and blunt. He is known for being no B.S., with no lawyer-talk, no double-talk.
Employers have a duty to record meal breaks in California
Under California law, employers have a duty to record meal breaks. The California Wage Orders require employer to record when you clock out for a meal break and when you clock back in when your lunch break is finished. For example, the California Wage Orders state:
(A) Every employer shall keep accurate information with respect to each employee including the following:
(3) Time records showing when the employee begins and ends each work period. Meal periods, split shift intervals and total daily hours worked shall also be recorded. Meal periods during which operations cease and authorized rest periods need not be recorded.
California Wage Order 7(A)(3), California Wage Order 1(A)(3); California Wage Order 9(A)(3), etc.
There are similar provisions in the other California Wage Orders.
The rebuttable presumption under the Brinker California Supreme Court case(this is very powerful to workers)
Since employers have a duty to record their employees' meal periods, “[i]f an employer's records show no meal period for a given shift over five hours, a rebuttable presumption arises that the employee was not relieved of duty and no meal period was provided.” Brinker vs. Superior Court, 53 Cal.4th 1004, 1053 (2012) (conc. opn. of Werdegar, J.); see Cal. Code Regs., tit. 8, § 11050, subd. 7(A)(3); ABM Industries Overtime Cases, 19 Cal. App. 5th 277, 311, 227 (2017).
Under such circumstances, a court may award damages, even if they are only approximate and based on statistical sampling. Bell v. Farmers Ins. Exchange, 115 Cal.App. 715, 746–751 (2008); ABM Industries Overtime Cases, 19 Cal. App. 5th 277, 311, 227 (2017).
What is a rebuttable presumption?
Under the law. A “rebuttable presumption” is an assumption of fact that the law will make unless the company/ employer proves otherwise.
Thus, the court is going to presume that you didn’t get a meal break, unless the company/ employer can prove that you a meal break/ lunch break.
How is the rebuttable presumption applied to automatic lunch period deduction cases under California wage law?
Based on Justice Werdegar's concurrence in Brinker, “If an employer's records show no meal period for a given shift over five hours, a rebuttable presumption arises that the employee was not relieved of duty and no meal period was provided.” Brinker vs. Superior Court, 53 Cal.4th 1004, 1053 (2012); Safeway, Inc. v. Superior Court 238 Cal.App.4th 1138, 1159-1160 (2015); Lubin v. The Wackenhut Corp., 5 Cal. App. 5th 926, 951 (2016).
Hold on a second, won’t the company just say that there are “individualized issues” because some employees (or even most or all employees) waived their right to a meal period, to there can’t be a class action lawsuit?
Yep, this is exactly what you can expect the company to say. But, not so fast.
Justice Werdegar placed special emphasis on a presumption based on record-keeping obligations. Brinker vs. Superior Court, 53 Cal.4th 1004, 1052-1054 (2012)(conc. opn. of Werdegar, J.).
Justice Werdegar stated that when the applicable IWC wage order obliges the employer to record meal breaks, “[i]f [those] records show no meal period for a given shift over five hours, a rebuttable presumption arises that the employee was not relieved of duty and no meal period was provided. … An employer's assertion that it did relieve the employee of duty, but the employee waived the opportunity to have a work-free break, is not an element that a plaintiff must disprove as part of the plaintiff's case-in-chief. Rather, … the assertion is an affirmative defense, and thus the burden is on the employer, as the party asserting waiver, to plead and prove it. [Citations.]” Brinker vs. Superior Court, 53 Cal.4th 1004, 1053 (2012) (conc. opn. of Werdegar, J.); Safeway, Inc. v. Superior Court, 238 Cal. App. 4th 1138, 1159-1160 (2015).
Workers that have had their meal periods automatically deducted can be identified through the company’s timekeeping and payroll records
As noted by the court in ABM:
For instance, the subclass of ABM Workers who “suffered an automatic deduction of a half-hour although the employee actually worked through the deducted meal period” can be identified through ABM's timekeeping and payroll records showing numerous instances where a meal deduction was made for a shift without any corresponding time entry indicating that a meal period was taken. ABM Industries Overtime Cases, 19 Cal. App. 5th 277, 306 (2017).
The tough luck chuck rule: When the company breaks the law, the company can’t argue that the company's breaking the law should benefit the company
Where the employer has failed to keep records required by statute, the consequences for such failure should fall on the employer, not the employee. In such a situation, imprecise evidence by the employee can provide a sufficient basis for damages. ABM Industries Overtime Cases, 19 Cal. App. 5th 277, 311 (2017).
Under such circumstances, a court may award damages, even if they are only approximate and based on statistical sampling. Bell v. Farmers Ins. Exchange, 115 Cal.App. 715, 746–751 (2008). In other words, the company can't profit from breaking the law.
There’s a lot of money for workers in automatic meal deduction cases
We have had dozens of automatic meal period deduction cases. We have recovered tens of millions of dollars for workers in these auto meal deduct class action cases. In all different kinds of industries.
Automatic meal deduction Case studies
In these case studies we will not provide the names of the workers and/or clients that brought the cases and the companies that practiced the auto meal deduction in order to protect the innocent and the guilty. You get the idea.
Case study: Factory - locations in Northern California and Southern California - with an automatic meal period deduction practice
In this case, the company has factory locations in NorCal and SoCal. The worker that brought the wage class action case is a forklift operator. Among other California Labor Code violations and California Wage Order violations, the company had an automatic meal period deduction practice.
Factories in California fall under California Wage Order 1.
Wage Order 1 states that meal periods shall be recorded. 8 Cal. Code. Regs., § 11010, subd. 7(A)(3). The failure to record meal periods creates a "rebuttable presumption . . . that the employee was not relieved of duty and no meal period was provided." Brinker vs. Superior Court, 53 Cal.4th 1004, 1053 (2012); ABM Industries Overtime Cases, 19 Cal. App. 5th 277, 311- 312(2017).
The company’s person most qualified testimony and the company’s payroll and timekeeping data established that the company maintained a policy of automatically deducting 30 minutes of time from shifts lasting at least 6 hours without supporting records. Meaning, with no records showing the employees punched out for meal periods and punched back for meal periods (or any other records that complied with Wage Order No.1 for factories in California).
In the case, the company contended that the 30 Minute Auto-Deduction Class is not "ascertainable" because individual inquiries are required to determine which employees had 30 minutes automatically deducted for meal periods, which did not have a corresponding time entry, and which did not receive the meal period as required.
The court in the case rejected this argument. The court ruled that determining whether individual employees that received auto-deductions actually received meal breaks may be difficult. But the company’s failure to keep records of meal breaks being taken results in a presumption that meal breaks were not given. Brinker vs. Superior Court, 53 Cal.4th 1004, 1053 (2012); ABM Industries Overtime Cases, 19 Cal. App. 5th 277, 311- 312(2017).
The Court found that it would not have to engage in possibly difficult individual inquiries to decipher who was subject to automatically having their meal periods deducted.
Here is a damage model.
Joe worked for the company three years. He earned $16 an hour.
Under California Labor Code Section 226.7 he is owed an hour’s wage for every missed meal period.
$16 x 260 days (one year) = $ 4,160
$4,160 x 3 years = $ 12,480 in 226.7 premium wages
Since the company can’t prove that the workers were taking a legally compliant meal period, they are owed for the ½ hour that was deducted each shift. This is all at the overtime rate of pay.
$ 16 x 1.5 = $24
$ 24 x .5 hours a shift = $12
$ 12 x 260 (one year) = $ 3,120 in unpaid overtime pay
Pay stub violations = $ 4,000
Joe is entitled to waiting time penalties. His daily wage is his regular pay plus his overtime pay. Joe averaged 30 minutes of overtime each day. Remember, Joe is also owed overtime for the 30 minutes that was deducted each day, for a total of one hour a day for overtime.
$ 16 x 8 hours = $ 128
$ 24 x 1 hour overtime per day
$ 128 regular pay
$ 24 overtime pay
$ 16 premium wage
$ 168 daily wages
$168 x 30 days = $ 5,040 waiting time penalties
Total potential unpaid wages/ penalties
$ 12,480 226.7 premium wages
$ 3,120 unpaid overtime pay
$ 4,000 pay stub violations
$ 5,040 waiting time penalties
$ 24,640 total unpaid wages and penalties
In addition, Joe is entitled to PAGA penalties.
Case study: Trucking company automatically deducted ½ hour for meal breaks
In this case, the trucking company drivers would clock in at the beginning of their shift and clock out at the end of their shift. The company told the drivers that they could take a ½ meal period. However, the company did not record the meal periods taken. This is in violation of Wage Order 9 Section 7(A)(2).
This California class action case settled to millions of dollars. The drivers we spoke with were very happy with the result.
Getting a check for your unpaid wages!!
Warehouse automatically deducts ½ hour pay - makes the workers “certify” that they got all of their meal periods and rest breaks at the end of each week
In this case, a company with big warehouses automatically deducts ½ pay each shift for workers work over 5 hours. The warehouse staggers the lunch breaks, so the warehouse has workers working during two shifts a day. At the end of the week, the company requires the workers to sign a document that “certifies” that they received a meal break (and rest breaks) for every shift they worked that week (the company pays weekly).
The company is in violation of California Wage Order 9, Section 7(A)(2), because the company doesn’t record meal periods. In addition, the warehouse workers don’t receive a net 10 minutes at a suitable resting facility because they get a 10 minute rest break and part of the 10 minutes is spent walking to the break room. Here is a very through article on California rest break law.
Salvador earns $17 an hour as a forklift operator. He worked at the company for 10 weeks (50 days).
Here is the damage model.
$ 17 x 50 days = $ 850 in 226.7 premium wages for not receiving meal breaks
$ 17 x 1.5 = $ 25.5 overtime rate
$ 25.5 x .5 x 50 days = $ 637 unpaid overtime pay
$ 950 in pay check stub violations.
Daily pay is as follows (for waiting time penalties):
$136.00 regular pay
$ 25.50 overtime rate
$ 17.00 meal period premium pay
$ 17.00 rest break premium pay
$195.00 daily wage
$195 x 30 days = $5,865 waiting time penalties
Total wages and penalties:
$ 850 226.7 premium wages for not receiving meal breaks
$ 637 unpaid overtime pay
$ 950 pay check stub violations.
$ 5,865 waiting time penalties
$ 8,302 total wages and penalties
The fact that the company makes the workers "certify" or sign a document that they received all of their meal periods and that they were paid for all the hours that they work is not going to get the company off the hook.
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This article isn't legal advice
These discussions and/or examples are not legal advice. All legal situations are different. These testimonials, endorsements, photos and/or discussions do not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter, or your particular case/ situation. Every case is different. There are any number of reasons why class actions are not certified, not won and/or PAGA actions are not successful.
Just because we have gotten great results in so many other unpaid wage cases, doesn't guarantee in particular result in other cases. Including, your wage case. Every case is different.