July and August 2018 employment law decisions
Employer subject to waiting time penalty for failing to immediately correct an employee’s accrued vacation pay check.
August 1, 2018, First District Court of Appeal, Taryn Nishiki v. Danko Meredith, APC: Ms. Nishiki filed a complaint with the California Labor Commissioner seeking vacation wages, rest period premiums, and waiting time penalties. The Labor Commissioner awarded Ms. Nishiki waiting time penalties in the amount of $4,250. Her former employer appealed the award to court, which affirmed the Labor Commissioner’s award. On appeal, Danko Meredith contended that the waiting time penalties were unwarranted because the unpaid amount of accrued vacation pay resulted from a discrepancy in the numerical amount as compared to the amount spelled out in words in a check that was not “willful.” The court agreed after finding the discrepancy was the result of a clerical error. But the First District also considered the effect of Danko Meredith’s delay in sending a corrected check after being informed by Ms. Nishiki that she could not deposit the original check. The appeals court found that Danko Meredith violated its statutory obligation to pay wages promptly by not immediately correcting the clerical error by either stopping payment on the original check and issuing a new check for the correct amount or by sending an additional check for the amount owed—instead it waited nine days to issue a new check. As a result, Ms. Nishiki was entitled to a waiting time penalty for nine days.
Non-payment of small amounts of compensable time not allowed under California law.
July 26, 2018, Supreme Court of California, Douglas Troester v. Starbucks Corporation: Upon a request by the United States Court of Appeals for the Ninth Circuit, the Supreme Court of California agreed to answer the following question: Does the federal Fair Labor Standards Act’s (FLSA) de minimis doctrine (excuse the payment of wages for small amounts of otherwise compensable time upon a showing that the bits of time are administratively difficult to record) apply to claims for unpaid wages under California Labor Code sections 510, 1194, and 1197? The California Supreme Court first determined whether California’s wage and hour statutes or regulations have adopted the de minimis doctrine found in the FLSA. Its answer was no. Next, the high court decided whether the de minimis principle nevertheless applies to wage and hour claims. It concluded that the relevant wage order and statutes do not permit application of the de minimis rule on the facts given, where the employer required the employee to work “off the clock” several minutes per shift. It did not decide whether there are circumstances where compensable time is so minute or irregular that it is unreasonable to expect the time to be recorded.