Changes to Meal and Rest Break Premiums in California

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Changes to Meal and Rest Break Premiums in California

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California labor law requires employers to provide non-exempt employees with certain meal and rest breaks. If an employee is going to miss a break, the company can pay them an hour’s worth of pay as a premium for the time worked. For a long time, employers used an employee’s base hourly rate to calculate the premium amount, though the California Supreme Court recently changed how these calculations should work. If you have questions about paying these premiums to your employees, speak with a Walnut Creek employment lawyer.

“Regular Rate of Pay”

In a recent case, a plaintiff claimed she deserved more than the base hourly rate for break premiums because the employer should have included non-discretionary quarterly bonuses in her “regular rate of pay,” which is what the law requires for a premium calculation. Even though non-discretionary income is included in overtime calculations, employers have long been using the base hourly rate for break premiums.

The California Supreme Court held in favor of the plaintiff, setting a new standard that employers must include non-discretionary income in the calculations for premium payments. This decision also applies retroactively, as well, which means that employees can seek back pay if their premium payments have been less than they deserved.

For example:

  • Your company paid an employee $15.00 per hour for premiums five times per month for the past two years, which equals $1800
  • When you factor in no-discretionary income, the rate should have been $16.50 per hour, which would have equaled $1980
  • The employee can seek the $180 difference in unpaid wages

Employees can go back for four years of unpaid wages if they choose, and employers should know how to handle such wage complaints.

Discuss Any Concerns with a Walnut Creek Employment Attorney

Companies should discuss questions and concerns about this new change in the law with Yudien Law Firm, P.C., right away. Contact us online or call 925.472.0600 for more information and legal guidance.

 

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