Opinion · California Supreme Court
Donohue v. AMN Services, LLC
11 Cal. 5th 58
- Type
- Opinion
- Court
- California Supreme Court
- Jurisdiction
- California
- Date
- 2021-02-25
- Topic
- employee-benefits-and-executive-compensation
“[T]he presumption goes to 16 the question of liability and applies at the summary judgment stage, not just at the class 17 certification stage.” | “If time records show missed, short, or delayed meal 24 periods with no indication of proper compensation, then a rebuttable presumption [of meal period 25 violations] arises.” | “Employers can rebut the presumption by presenting 24 evidence that employees . . . had in fact been provided compliant meal periods during 25 which they chose to work.” | explaining the unrecorded meal break presumption | discussing CAL. LAB. CODE § 512(a)
Citator
- Cited by
- 31 opinions
IN THE SUPREME COURT OF
CALIFORNIA
KENNEDY DONOHUE,
Plaintiff and Appellant,
v.
AMN SERVICES, LLC,
Defendant and Respondent.
S253677
Fourth Appellate District, Division One
D071865
San Diego County Superior Court
37-2014-00012605-CU-OE-CTL
February 25, 2021
Justice Liu authored the opinion of the Court, in which Chief
Justice Cantil-Sakauye and Justices Corrigan, Cuéllar,
Kruger, Groban and Hoffstadt* concurred.
*
Associate Justice of the Court of Appeal, Second Appellate
District, Division Two, assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
DONOHUE v. AMN SERVICES, LLC
S253677
Opinion of the Court by Liu, J.
Under California law, employers must generally provide
employees with one 30-minute meal period that begins no later
than the end of the fifth hour of work and another 30-minute
meal period that begins no later than the end of the tenth hour
of work. (Lab. Code, § 512, subd. (a); Industrial Welfare
Commission (IWC) wage order No. 4-2001, § 11(A) (Wage Order
No. 4).) If an employer does not provide an employee with a
compliant meal period, then “the employer shall pay the
employee one additional hour of pay at the employee’s regular
rate of compensation for each workday that the meal . . . period
is not provided.” (Lab. Code, § 226.7, subd. (c); Wage Order
No. 4, § 11(B).)
In this case, we decide two questions of law relating to
meal periods. First, we hold that employers cannot engage in
the practice of rounding time punches — that is, adjusting the
hours that an employee has actually worked to the nearest
preset time increment — in the meal period context. The meal
period provisions are designed to prevent even minor
infringements on meal period requirements, and rounding is
incompatible with that objective. Second, we hold that time
records showing noncompliant meal periods raise a rebuttable
presumption of meal period violations, including at the
summary judgment stage.
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
In light of our holdings, we reverse the Court of Appeal’s
judgment and remand the matter to permit either party to bring
a new summary adjudication motion as to the meal period claim.
(See TRB Investments, Inc. v. Fireman’s Fund Ins. Co. (2006) 40 Cal.4th 19, 23
, 31–32 (TRB Investments).) The remand offers
the parties the opportunity to present evidence and arguments
bearing on the question of liability in light of our analysis here.
I.
Defendant AMN Services, LLC (AMN) is a healthcare
services and staffing company that recruits nurses for
temporary contract assignments. Between September 2012 and
February 2014, plaintiff Kennedy Donohue worked as a nurse
recruiter at AMN’s San Diego offices. In that role, Donohue did
not have predetermined shifts but was expected to work eight
hours per day. Per AMN’s company policy, nurse recruiters
were provided with 30-minute meal periods beginning no later
than the end of the fifth hour of work. AMN’s policy and
trainings emphasized that the meal period was an
“uninterrupted 30 minute” break, during which employees were
“relieved of all job duties,” were “free to leave the office site,” and
“control[led] the time.” The policy also specified that
supervisors should not “impede or discourage team members
from taking their break.”
Until April 2015, AMN used an electronic timekeeping
system called Team Time to track its employees’ compensable
time. Employees used their work desktop computers to punch
in and out of Team Time, including at the beginning of the day,
at the beginning of lunch, at the end of lunch, and at the end of
the day. Employees could also ask to manually adjust any
inaccurate time punches — for example, if they forgot to clock
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
out for lunch or if they worked when they were clocked out. For
purposes of calculating work time and compensation, Team
Time rounded the time punches to the nearest 10-minute
increment. For example, if an employee clocked out for lunch at
11:02 a.m. and clocked in after lunch at 11:25 a.m., Team Time
would have recorded the time punches as 11:00 a.m. and 11:30
a.m. Although the actual meal period was 23 minutes, Team
Time would have recorded the meal period as 30 minutes.
Similarly, if an employee clocked in for work at 6:59 a.m. and
clocked out for lunch at 12:04 p.m., Team Time would have
rounded the time punches to 7:00 a.m. and 12:00 p.m. In that
case, the actual meal period started after five hours and five
minutes of work, but Team Time would have recorded the meal
period as starting after exactly five hours of work.
AMN also used Team Time to manage potentially
noncompliant meal periods. Before September 2012, whenever
Team Time records showed a missed meal period, a meal period
shorter than 30 minutes, or a meal period taken after five hours
of work, AMN assumed there had been a meal period violation
and paid the employee a premium wage. In September 2012,
AMN added a feature to Team Time to comply with the meal
period requirements articulated in Brinker Restaurant Corp. v.
Superior Court (2012) 53 Cal.4th 1004
(Brinker): When an
employee recorded a missed, short, or delayed meal period, a
dropdown menu would appear on Team Time. The dropdown
menu prompted the employee to choose one of three options: (1)
“I was provided an opportunity to take a 30 min break before the
end of my 5th hour of work but chose not to”; (2) “I was provided
an opportunity to take a 30 min break before the end of my 5th
hour of work but chose to take a shorter/later break”; (3) “I was
not provided an opportunity to take a 30 min break before the
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
end of my 5th hour of work.” The employee was required to
choose an option before submitting his or her timesheet at the
end of the pay period. If the employee chose the first or second
option, then AMN assumed the employee was provided with a
compliant meal period but voluntarily chose not to take one, and
the employee did not receive premium pay for a meal period
violation. If the employee chose the third option, then AMN
assumed there had been a meal period violation and paid the
employee a premium wage. In addition, at the end of each
biweekly pay period, employees were required to sign a
certification statement: “By submitting this timesheet, I am
certifying that I have reviewed the time entries I made and
confirm they are true and accurate. I am also confirming that
. . . I was provided the opportunity to take all meal breaks to
which I was entitled, or, if not, I have reported on this timesheet
that I was not provided the opportunity to take all such meal
breaks . . . .”
AMN relied on the rounded time punches generated by
Team Time to determine whether a meal period was short or
delayed. Consider the example above, where a 23-minute lunch
starting at 11:02 a.m. and ending at 11:25 a.m. was recorded on
Team Time as a 30-minute lunch starting at 11:00 a.m. and
ending at 11:30 a.m. Before September 2012, AMN would not
have paid a premium wage for this lunch because it would have
appeared as a full 30-minute meal period in the Team Time
records. Similarly, after September 2012, the dropdown menu
would not have been triggered for this lunch because it would
have appeared as a compliant meal period on Team Time. In
other words, Team Time would not have prompted the employee
taking the lunch to indicate whether there had been a meal
period violation.
4
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
In April 2014, Donohue filed a class action lawsuit against
AMN. Donohue alleged various wage and hour violations,
including the meal period claim at issue here. In October 2015,
the trial court certified a class of all nonexempt California nurse
recruiters who were employed by AMN between April 23, 2010
and April 26, 2015 with respect to the meal period claim. April
26, 2015 marks the end of the class period because on that date
AMN switched to a timekeeping system that does not round
time entries.
In November 2016, Donohue filed a motion for summary
adjudication. As to the meal period claim, Donohue argued that
AMN denied its employees compliant meal periods, improperly
rounded time records for meal periods using Team Time, and
failed to pay premium wages for noncompliant meal periods. To
support the motion, Donohue submitted her testimony that
AMN had an office culture that discouraged employees from
taking full and timely lunches. Donohue also provided a
declaration from an expert witness, a statistics professor.
According to the expert, the use of Team Time resulted in the
denial of premium wages for 40,110 short lunches and 6,651
delayed lunches during the class period, which totaled
$802,077.08. The expert calculated the number of noncompliant
lunches for which no premium wages were paid by comparing
the rounded time records for meal periods to the actual time
records. For example, the expert would have counted a 23-
minute lunch starting at 11:02 a.m. and ending at 11:25 a.m.,
recorded on Team Time as a 30-minute lunch starting at 11:00
a.m. and ending at 11:30 a.m., as an uncompensated short
lunch.
AMN filed a cross-motion for summary judgment or, in the
alternative, summary adjudication. As to the meal period claim,
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
AMN contended that it did not have a uniform policy or practice
of denying employees compliant meal periods. It also argued
that Donohue did not plead in the operative complaint that
AMN’s rounding policy resulted in meal period violations. AMN
submitted the declarations of 40 class members in support of its
motion. Thirty of the nurse recruiters stated that they “always”
or “usually” took lunches that were at least 30 minutes long.
Other recruiters said that they only “sometimes” took 30-minute
lunches but that it was their choice to forgo a full lunch on the
other days. No declarant stated that a supervisor had tried to
discourage him or her from taking a full or timely meal period.
AMN also submitted a declaration from its expert witness,
a labor economist and statistician. The expert explained that
because AMN’s rounding policy sometimes rounded meal period
times up and sometimes down, AMN sometimes paid employees
for a few extra minutes they did not work and sometimes did not
pay them for a few minutes that they did work. Unlike
Donohue’s expert, AMN’s expert did not account for meal period
premium wages that would have been paid based on actual meal
period times. According to the expert, AMN’s practice of
rounding meal period times evened out over time and actually
resulted in the overcompensation of the class by 85 work hours.
The expert also stated that based on the nurse recruiters’ actual
time punches, the average length of a meal period during the
class period was 45.6 minutes.
The trial court granted AMN’s motion for summary
judgment and denied Donohue’s motion for summary
adjudication, including on the meal period claim. The court
concluded there was insufficient evidence that AMN had a policy
or practice of denying employees compliant meal periods.
According to the court, AMN’s meal period policy complied with
6
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
California law, and its practice of rounding the time punches for
meal periods was proper. The court said that even if no case has
ever applied rounding to meal periods, “the rationale behind
allowing rounding for work time would be the same for meal
break time.” According to the court, AMN’s rounding policy
fairly compensated employees over time, and there was
insufficient evidence that supervisors at AMN prevented
employees from taking compliant meal periods.
The Court of Appeal affirmed and generally agreed with
the trial court’s reasoning as to the meal period claim. The court
decided that it was proper for AMN to round time punches for
meal periods. (Donohue v. AMN Services, LLC (2018) 29 Cal.App.5th 1068
, 1086–1092 (Donohue).) According to the
court, the plain text of Labor Code section 512 and Wage Order
No. 4, which govern meal periods, does not prohibit rounding.
(Donohue, at p. 1087.) The court explained that rounding “ ‘is a
practical method for calculating worktime and can be a neutral
calculation tool for providing full payment to employees’ ” and
that no case law suggests rounding does not apply to meal
periods. (Id. at p. 1090.) The court rejected Donohue’s
argument that rounding meal period time punches “ ‘would
quickly eviscerate employee[s’] statutory right to full 30 minute
meal periods.’ ” (Ibid.)
The court also concluded that AMN’s rounding policy was
neutral on its face and as applied, as required by California law.
(Donohue, supra,
29 Cal.App.5th at pp. 1083–1086.) The court
agreed with AMN that the rounding policy fully compensated
employees over time and actually resulted in the
overcompensation of the class as a whole. (Id. at p. 1084.) The
court rejected Donohue’s argument that the rounding policy did
not properly pay employees premium wages for meal period
7
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
violations. (Id. at p. 1090.) According to the court, “the
neutrality of a rounding policy does not depend on the frequency
of penalties.” (Ibid.)
In addition, the court rejected Donohue’s argument that
time records showing missing, short, or delayed meal periods
give rise to a rebuttable presumption of meal period violations.
(Donohue, supra,
29 Cal.App.5th at pp. 1087–1088.) In the
court’s view, this rebuttable presumption applies only at the
class certification stage, not at the summary judgment stage.
(Ibid.) Finally, the court considered Donohue’s testimony that
AMN’s office culture discouraged employees from taking full and
timely lunches. (Id. at p. 1091.) The court noted that Donohue
never indicated a meal period violation on Team Time and
always certified that her timesheet was accurate. (Ibid.) Thus,
the court concluded, her testimony was insufficient to raise a
triable issue of material fact as to the meal period claim.
We granted review to address two questions of law
relating to the meal period claim: whether an employer may
properly round time punches for meal periods, and whether time
records showing noncompliant meal periods raise a rebuttable
presumption of meal period violations.
II.
We first examine whether the practice of rounding time
punches, which was developed for the purpose of calculating
wages, can be properly applied to the meal period context. To
be clear, the question is not whether AMN’s rounding policy
resulted in the proper compensation of employees for all time
worked. Donohue does not dispute that the rounding policy
overcompensated the class by 85 work hours, as AMN’s expert
concluded, when considering only compensation for time
8
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
worked. Instead, the issue is whether AMN’s rounding policy
resulted in the proper payment of premium wages for meal
period violations. AMN’s claim that it overpaid the class based
on time worked does not address this issue.
AMN, for its part, does not argue that any meal periods
rounded to 30 minutes are per se lawful. Rather, it argues that
the undisputed evidence shows that no meal period violations
occurred for which premium wages were not paid. AMN asserts
that this evidence, regardless of its use of rounding, supports
judgment on the meal period claim. But because AMN asserted
that rounding applies to meal periods as an affirmative defense
and because the trial court certified a meal period class on the
basis of this question, the issue of rounding is properly before
us.
The issue arises solely under state law because the federal
Fair Labor Standards Act of 1938 (29 U.S.C. § 201
et seq.) does not require employers to provide meal periods to employees. (Mitchell v. JCG Industries, Inc. (7th Cir. 2014)745 F.3d 837, 840
.) In California, “wage and hour claims are today governed by two complementary and occasionally overlapping sources of authority: the provisions of the Labor Code, enacted by the Legislature, and a series of 18 wage orders, adopted by the IWC.” (Brinker, supra,53 Cal.4th at p. 1026
.) “The IWC is the state agency empowered to promulgate wage orders, which are legislative regulations specifying minimum requirements with respect to wages, hours, and working conditions.” (Augustus v. ABM Security Services, Inc. (2016)2 Cal.5th 257, 262, fn. 5
(ABM Security).)
“The IWC’s wage orders are to be accorded the same
dignity as statutes. They are ‘presumptively valid’ legislative
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
regulations of the employment relationship [citation],
regulations that must be given ‘independent effect’ separate and
apart from any statutory enactments [citation].” (Brinker,
supra, 53 Cal.4th at p. 1027
.) “When construing the Labor Code and wage orders, we adopt the construction that best gives effect to the purpose of the Legislature and the IWC. [Citations.] Time and again, we have characterized that purpose as the protection of employees—particularly given the extent of legislative concern about working conditions, wages, and hours when the Legislature enacted key portions of the Labor Code. [Citations.] In furtherance of that purpose, we liberally construe the Labor Code and wage orders to favor the protection of employees.” (ABM Security, supra,2 Cal.5th at p. 262
.)
Wage Order No. 4, which applies to professional, clerical,
mechanical, and similar occupations, applies to the certified
class of AMN nurse recruiters here. (Wage Order No. 4, § 2(O).)
This wage order and the relevant statute provide: “No employer
shall employ any person for a work period of more than five (5)
hours without a meal period of not less than 30 minutes . . . .
Unless the employee is relieved of all duty during a 30 minute
meal period, the meal period shall be considered an ‘on duty’
meal period and counted as time worked.” (Wage Order No. 4,
§ 11(A); accord, Lab. Code, § 512, subd. (a) [“An employer shall
not employ an employee for a work period of more than five
hours per day without providing the employee with a meal
period of not less than 30 minutes . . . . An employer shall not
employ an employee for a work period of more than 10 hours per
day without providing the employee with a second meal period
of not less than 30 minutes . . . .”].)
This means that employers must generally provide “a first
meal period [of at least 30 minutes] no later than the end of an
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
employee’s fifth hour of work, and a second meal period [of at
least 30 minutes] no later than the end of an employee’s 10th
hour of work.” (Brinker, supra, 53 Cal.4th at p. 1041
.) In
Brinker, we clarified that an “employer satisfies this obligation
if it relieves its employees of all duty, relinquishes control over
their activities and permits them a reasonable opportunity to
take an uninterrupted 30-minute break, and does not impede or
discourage them from doing so. . . . [¶] . . . [T]he employer is not
obligated to police meal breaks and ensure no work thereafter is
performed.” (Id. at p. 1040.) There is no meal period violation
if an employee voluntarily chooses to work during a meal period
after the employer has relieved the employee of all duty. (Id. at
pp. 1040–1041.) The voluntariness of an employee’s choice
matters because “an employer may not undermine a formal
policy of providing meal breaks by pressuring employees to
perform their duties in ways that omit breaks.” (Id. at p. 1040.)
If an employer does not provide an employee with a
compliant meal period, then the employer must provide the
employee with premium pay for the violation. Specifically, the
relevant wage order and statute provide: “If an employer fails
to provide an employee a meal period in accordance with the
applicable provisions of this order, the employer shall pay the
employee one (1) hour of pay at the employee’s regular rate of
compensation for each workday that the meal period is not
provided.” (Wage Order No. 4, § 11(B); accord, Lab. Code,
§ 226.7, subd. (c) [“If an employer fails to provide an employee a
meal . . . period in accordance with a state law, including, but
not limited to, an applicable statute or applicable regulation,
standard, or order of the Industrial Welfare Commission . . . the
employer shall pay the employee one additional hour of pay at
the employee’s regular rate of compensation for each workday
11
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
that the meal . . . period is not provided.”].) Under this
provision, even a minor infringement of the meal period triggers
the premium pay obligation. In addition to providing premium
pay, the employer must compensate the employee for any time
worked during the meal period if “it ‘knew or reasonably should
have known that the worker was working through the
authorized meal period.’ ” (Brinker, supra, 53 Cal.4th at p. 1040, fn. 19
.) To avoid liability, an employer must provide its
employees with full and timely meal periods whenever those
meal periods are required.
The practice of rounding time punches for meal periods is
inconsistent with the purpose of the Labor Code provisions and
the IWC wage order. The text of Labor Code section 512 and
Wage Order No. 4 sets precise time requirements for meal
periods. Each meal period must be “not less than 30 minutes,”
and no employee shall work “more than five hours per day” or
“more than 10 hours per day” without being provided with a
meal period. (Lab. Code, § 512, subd. (a); accord, Wage Order
No. 4, § 11(A) [“No employer shall employ any person for a work
period of more than five (5) hours without a meal period of not
less than 30 minutes . . . .”]; see Brinker, supra,
53 Cal.4th at p. 1041
.) These provisions speak directly to the calculation of
time for meal period purposes.
The precision of the time requirements set out in Labor
Code section 512 and Wage Order No. 4 — “not less than 30
minutes” and “five hours per day” or “ten hours per day” — is at
odds with the imprecise calculations that rounding involves.
The regulatory scheme that encompasses the meal period
provisions is concerned with small amounts of time. (Troester v.
Starbucks Corp. (2018) 5 Cal.5th 829, 844
(Troester).) For
example, we have “requir[ed] strict adherence to” the Labor
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
Code’s requirement that employees receive two daily 10-minute
rest periods and “scrupulously guarded against encroachments
on” these periods. (Ibid.) The same vigilance is warranted here.
Given the relatively short length of a 30-minute meal period, the
potential incursion that might result from rounding is
significant. (See Kaanaana v. Barrett Business Services, Inc.
(2018) 29 Cal.App.5th 778, 801
(Kaanaana) [“ ‘On a 30-minute
break, time is scarce’ ” and “ ‘[w]hen time is scarce, minutes
count.’ ”], review granted Feb. 27, 2019, S253458.)
Consider, for example, an employee who is provided with
a 21-minute lunch from 12:04 p.m. to 12:25 p.m. Under AMN’s
timekeeping system, which rounded time punches to the nearest
10-minute increment, the lunch would have been recorded as a
30-minute lunch from 12:00 p.m. to 12:30 p.m. In that scenario,
an employee would have lost nine of the 30 minutes — or almost
a third of the time — to which he or she was entitled, and Team
Time would not have flagged the lunch as a meal period
violation. Small rounding errors can amount to a significant
infringement on an employee’s right to a 30-minute meal period.
The premium pay structure under Labor Code section
226.7 and Wage Order No. 4 confirms that rounding is
inappropriate in the meal period context. In general, premium
pay serves the dual purposes of compensating employees for
their injuries and incentivizing employers to comply with labor
standards. (Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1110
(Murphy).) In the meal period context, an
employee receives the full amount of premium pay — one
additional hour of pay at the employee’s regular rate of
compensation for each workday that the meal period is not
provided — regardless of the extent of the violation. (Lab. Code,
§ 226.7, subd. (c); Wage Order No. 4, § 11(B).) In other words,
13
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
whether an employer provides a shortened meal period or no
meal period at all, the employee receives one additional hour of
pay.
The premise of this approach is that even relatively minor
infringements on meal periods can cause substantial burdens to
the employee. Forcing employees to work through their meal
periods not only causes economic burdens in the form of extra
work but also noneconomic burdens on the employees’ health,
safety, and well-being. (Murphy, supra, 40 Cal.4th at p. 1113
.)
Employees denied compliant meal periods “face greater risk of
work-related accidents and increased stress” and lose valuable
time “free from employer control that is often needed to be able
to accomplish important personal tasks.” (Ibid.) Shortening or
delaying a meal period by even a few minutes may exacerbate
risks associated with stress or fatigue, especially for workers
who are on their feet most of the day or who perform manual
labor or repetitive tasks. Further, within a 30-minute
timeframe, a few minutes can make a significant difference
when it comes to eating an unhurried meal, scheduling a
doctor’s appointment, giving instructions to a babysitter,
refreshing oneself with a cup of coffee, or simply resting before
going back to work.
By requiring premium pay for any violation, no matter
how minor, the structure makes clear that employers must
provide compliant meal periods whenever such a period is
triggered. This corroborates the conclusion that rounding is
improper here. A premium pay scheme that discourages
employers from infringing on meal periods by even a few
minutes cannot be reconciled with a policy that counts those
minutes as negligible rounding errors.
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
Legislative history supports this understanding. “Meal
and rest periods have long been viewed as part of the remedial
worker protection framework. . . . Concerned with the health
and welfare of employees, the IWC issued wage orders
mandating the provision of meal and rest periods in 1916 and
1932, respectively. . . . The wage orders required meal and rest
periods after specified hours of work. The only remedy available
to employees, however, was injunctive relief aimed at
preventing future abuse. In 2000, due to a lack of employer
compliance, the IWC added a pay remedy to the wage orders,
providing that employers who fail to provide a meal or rest
period ‘shall pay the employee one (1) hour of pay at the
employee’s regular rate of compensation for each work day’ that
the period is not provided.” (Murphy, supra,
40 Cal.4th at pp. 1105–1106, citations omitted.) Around the same time, the Legislature “wrote into statute various guarantees that previously had been left to the IWC, including meal break guarantees.” (Brinker, supra,
53 Cal.4th at pp. 1037–1038.)
The legislative history indicates that the meal period
provisions are not “aimed at protecting or providing employees’
wages. Instead, [they are] primarily concerned with ensuring
the health and welfare of employees by requiring that employers
provide meal . . . periods as mandated by the IWC.” (Kirby v.
Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 1255
.) As
Donohue argues, the health and safety concerns underlying
these provisions distinguish the meal period context from the
wage calculation context, in which the practice of rounding time
punches was developed. For purposes of calculating wages,
counting slightly fewer minutes one day can be made up by
counting a few more minutes another day. But the same is not
true for meal periods. Under the applicable statute and wage
15
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
order, a shorter or delayed meal period one day cannot be offset
by a longer or earlier meal period another day. The premium
pay scheme reflects the Legislature’s and the IWC’s
determination that infringements on meal period requirements
threaten employees’ health and safety whenever they occur
(Murphy, supra, 40 Cal.4th at p. 1113
;Kaanaana, supra,
29 Cal.App.5th at p. 801
, rev.gr.), and the scheme was enacted to
address inadequate employer compliance (Murphy, at pp. 1105–
1106). Rounding policies are at odds with the requirement that
employers pay the full premium wage for meal period violations.
When the actual times that an employee must work during a
day reveal a meal period violation, the violation cannot be
papered over by rounding.
This understanding also comports with the remedial
purpose of the Labor Code and wage orders. “Because the laws
authorizing the regulation of wages, hours, and working
conditions are remedial in nature, courts construe these
provisions liberally, with an eye to promoting the worker
protections they were intended to provide.” (Prachasaisoradej
v. Ralphs Grocery Co., Inc. (2007) 42 Cal.4th 217, 227
.) As we
have explained, rounding is incompatible with promoting strict
adherence to the safeguards for workers’ health, safety, and
well-being that meal periods are intended to provide.
The Court of Appeal here relied on See’s Candy Shops, Inc.
v. Superior Court (2012) 210 Cal.App.4th 889
(See’s Candy I). See’s Candy I concluded that employers may use rounded time punches to calculate regular and overtime wages if the rounding policy is neutral on its face and as applied. (Id. at p. 907.) That court consulted a federal regulation under the Fair Labor Standards Act of 1938 that addresses rounding practices. (29 C.F.R. § 785.48
(b) (2020).) The regulation, first promulgated in
16
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
1961, states: “It has been found that in some industries,
particularly where time clocks are used, there has been the
practice for many years of recording the employees’ starting
time and stopping time to the nearest 5 minutes, or to the
nearest one-tenth or quarter of an hour. Presumably, this
arrangement averages out so that the employees are fully
compensated for all the time they actually work. For
enforcement purposes this practice of computing working time
will be accepted, provided that it is used in such a manner that
it will not result, over a period of time, in failure to compensate
the employees properly for all the time they have actually
worked.” (Ibid.)
Federal courts had interpreted the regulation to permit
rounding policies as long as they “on average, favor[] neither
overpayment nor underpayment” and do not “ ‘consistently
result[] in a failure to pay employees for time worked.’ ” (Alonzo
v. Maximus, Inc. (C.D.Cal. 2011) 832 F.Supp.2d 1122, 1126
.) Conversely, rounding policies violate the regulation if they “systematically undercompensate employees” (id. at pp. 1126– 1127), such as when the rounding policy “encompasses only rounding down” (Eyles v. Uline, Inc. (N.D.Tex., Sept. 4, 2009, No. 4:08-CV-577-A)2009 WL 2868447
, p. *4).
The See’s Candy I court observed that the Division of
Labor Standards Enforcement (DLSE), the agency that enforces
California’s labor laws, had adopted the federal regulation in its
manual. (See’s Candy I, supra, 210 Cal.App.4th at p. 902
; seeibid.
[DLSE Manual is not binding but may be considered for its
persuasive value].) The court then concluded it was appropriate
to adopt the federal regulatory standard: “Assuming a
rounding-over-time policy is neutral, both facially and as
applied, the practice is proper under California law because its
17
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
net effect is to permit employers to efficiently calculate hours
worked without imposing any burden on employees.” (See’s
Candy I, supra, 210 Cal.App.4th at p. 903
.) The court observed
that employers across the country have long used rounding and
it would be unreasonable to prevent California employers from
doing the same. (Ibid.) The court held that an employer is
entitled to use a rounding policy if it “is fair and neutral on its
face and ‘it is used in such a manner that it will not result, over
a period of time, in failure to compensate the employees properly
for all the time they have actually worked.’ ” (Id. at p. 907.)
The See’s Candy I court believed this rounding standard is
consistent with Labor Code section 204, subdivision (a), which
provides: “All wages . . . earned by any person in any
employment are due and payable twice during each calendar
month, on days designated in advance by the employer as the
regular paydays.” According to the court, the focus of section
204 is on the timing of wage payments, not the way those wages
are calculated. (See’s Candy I, supra, 210 Cal.App.4th at
pp. 904–905.) In addition, the court observed that the phrase
“all wages” does not necessarily refer to an amount calculated
on the basis of unrounded time punches. (Id. at p. 905
[“Fundamentally, the question whether all wages have been
paid is different from the issue of how an employer calculates
the number of hours worked and thus what wages are owed.
Section 204 does not address the measurement issue.”].) Thus,
the court concluded, the phrase “all wages” in section 204 does
not bar the practice of rounding time punches.
Further, See’s Candy I held that rounding is consistent
with Labor Code section 510, subdivision (a), which provides:
“Any work in excess of eight hours in one workday and any work
in excess of 40 hours in any one workweek . . . shall be
18
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
compensated at the rate of no less than one and one-half times
the regular rate of pay for an employee.” The court said the
provision “sets the multiplier for the rate at which ‘[a]ny’
overtime work must be paid” and “has nothing to do with
rounding or calculating time.” (See’s Candy I, supra, 210 Cal.App.4th at p. 905
.) The court also rejected the argument
that rounding can never be neutral because California law
requires the compensation rate to increase after eight hours of
work a day. (Id. at pp. 905–906.) Ultimately, the court said,
whether California’s overtime rules render a rounding policy
unfair is a factual, not legal, issue. (Id. at p. 906.)
Since See’s Candy I was decided, state and federal courts
have applied its standard to determine whether various
rounding policies are valid under California law. (See, e.g.,
David v. Queen of Valley Medical Center (2020) 51 Cal.App.5th 653
, 664; AHMC Healthcare, Inc. v. Superior Court (2018)24 Cal.App.5th 1014
, 1027–1028; Utne v. Home Depot U.S.A., Inc. (2017) (N.D.Cal. Dec. 4, 2017, No. 16-cv-01854-RS)2017 WL 5991863
, pp. *2–*3.) This court has never decided the validity
of the rounding standard articulated in See’s Candy I, and we
are not asked to do so here.
But even assuming the validity of See’s Candy I, a
rounding policy in the meal period context does not comport with
its neutrality standard. As noted, failing to provide employees
with full and timely meal periods burdens their health, safety,
and well-being by aggravating risks associated with stress or
fatigue. By deeming delayed or shortened meal breaks as
“timely” and “complete” when they are not, a rounding policy
erodes the health and safety protections that the meal period
requirements are intended to achieve. (See Murphy, supra, 40 Cal.4th at p. 1113
.) Moreover, in articulating its standard, See’s
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
Candy I reasoned that the rounding policy “ ‘averages out’ ” and
“employees are fully compensated ‘over a period of time.’ ” (See’s
Candy I, supra, 210 Cal.App.4th at p. 901
.) In the meal period
context, however, there is an asymmetry between the treatment
of rounded-up minutes (i.e., time not worked that is
compensated with regular pay) and the treatment of rounded-
down minutes (i.e., time worked that may trigger premium pay).
As noted, under AMN’s policy, a 21-minute lunch from
12:04 p.m. to 12:25 p.m. would be recorded as a 30-minute lunch
from 12:00 p.m. to 12:30 p.m. Meanwhile, a 38-minute lunch
from 11:55 a.m. to 12:33 p.m. would be recorded as a 30-minute
lunch from 12:00 p.m. to 12:30 p.m. This means that the
rounding policy, while never triggering premium pay for
compliant meal periods, does not always trigger premium pay
for noncompliant meal periods. The same concern applies to the
timing of meal periods; the policy never triggers premium pay
for early or on-time meal periods, but it does not always trigger
premium pay for meal periods that are improperly delayed.
AMN argues that its rounding policy was neutral over
time because it sometimes paid employees for a few extra
minutes that they did not work and sometimes did not pay them
for a few minutes that they did work. AMN asserts that the
policy slightly overcompensated the class as a whole. But this
argument does not properly account for the underpayment of
premium pay. It is true that in the 38-minute lunch example
above, the rounding policy would count the extra eight minutes
of lunch as work time and would trigger regular pay for those
eight minutes. But in the 21-minute lunch example, the
rounding policy does not trigger the “one additional hour of
[regular] pay” (Lab. Code, § 226.7, subd. (c); Wage Order No. 4,
§ 11(B)) that the employee is owed. In this respect, the rounding
20
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
policy is not neutral. It never provides employees with premium
pay when such pay is not owed, but it does not always trigger
premium pay when such pay is owed.
We recognize that rounding was developed as a means of
“efficiently calculat[ing] hours worked” and wages owed to
employees (See’s Candy I, supra, 210 Cal.App.4th at p. 903
) and is useful “in some industries, particularly where time clocks are used” (29 C.F.R. § 785.48
(b) (2020)). But technological advances may help employers to track time more precisely, and “employers are in a better position than employees to devise alternatives.” (Troester, supra,5 Cal.5th at p. 848
.) In this case,
AMN was already using an electronic timekeeping system,
Team Time, that recorded employees’ unrounded time punches.
The system could have kept track of potentially noncompliant
meal periods using those unrounded time punches instead of
rounding the punches to the nearest 10-minute increment. As
Donohue observes, Team Time actually had to take the extra
step of converting the unrounded time punches to rounded ones;
it is not clear what efficiencies were gained from this practice.
AMN eventually switched to a new timekeeping system that
does not round time punches after this lawsuit was filed. As
technology continues to evolve, the practical advantages of
rounding policies may diminish further.
III.
We now consider whether time records showing
noncompliant meal periods raise a rebuttable presumption of
meal period violations at summary judgment. We hold they do.
This rebuttable presumption was first discussed in Justice
Werdegar’s concurrence in Brinker: “Employers covered by
Industrial Welfare Commission (IWC) wage order No. 5-2001
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
(Cal. Code Regs., tit. 8, § 11050) have an obligation both to
relieve their employees for at least one meal period for shifts
over five hours (id., subd. 11(A)) and to record having done so
(id., subd. 7(A)(3) [‘Meal periods . . . shall also be recorded.’]). 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. This
is consistent with the policy underlying the meal period
recording requirement, which was inserted in the IWC’s various
wage orders to permit enforcement. (See, e.g., IWC board for
wage order No. 7-63 meeting mins. (Dec. 14–15, 1966) pp. 4–5
[rejecting proposal to eliminate the meal period recording
requirement because ‘without the recording of all in-and-out
time, including meal periods, the enforcement staff would be
unable to adequately investigate and enforce’ a wage order’s
meal period provisions].) 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.” (Brinker, supra,
53 Cal.4th at pp. 1052–
1053 (conc. opn. of Werdegar, J.).)
Justice Werdegar added: “As the Division of Labor
Standards Enforcement (DLSE) has explained, even under the
less restrictive wage order applicable to agricultural employees,
if ‘a meal period is not taken by the employee, the burden is on
the employer to show that the agricultural employee had been
advised of his or her legal right to take a meal period and has
knowingly and voluntarily decided not to take the meal period.
Again, we emphasize, the burden is on the employer.’ (Dept.
22
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
Industrial Relations, DLSE Opn. Letter No. 2003.08.13 (Aug.
13, 2003) p. 2 [interpreting IWC wage order No. 14 (Cal. Code
Regs., tit. 8, § 11140)].) To place the burden elsewhere would
offer an employer an incentive to avoid its recording duty and a
potential windfall from the failure to record meal periods. Both
the United States Supreme Court and the courts of this state
have rejected such an approach. (See Anderson v. Mt. Clemens
Pottery Co. (1946) 328 U.S. 680
, 686–688 [where an employer is subject to a recordkeeping requirement, the burden shifts to that employer to rebut employee proof of monies owed once a prima facie case has been made]; Ghazaryan v. Diva Limousine, Ltd. (2008)169 Cal.App.4th 1524, 1536, fn. 11
[refusing to allow an employer to use any shortcomings in its records to resist employee wage claims]; Cicairos v. Summit Logistics, Inc. (2005)133 Cal.App.4th 949, 961
[‘ “[W]here the employer has failed to keep records required by statute, the consequences for such failure should fall on the employer, not the employee.” ’].)” (Brinker, supra,53 Cal.4th at p. 1053, fn. 1
(conc. opn. of
Werdegar, J.).)
The term “waiver,” as Justice Werdegar used it, should not
be confused with the “waived” meal period that Labor Code
section 512, subdivision (a), authorizes only under limited
circumstances. We understand an employee’s “waiver” in this
context in the colloquial sense that the employee chose to work
when he or she was not required. We do not suggest that
employees have the unilateral option — without regard for the
waiver requirements in Labor Code section 512,
subdivision (a) — to waive their employer’s obligation to relieve
them from duty and from employer control for a 30-minute meal
period within the required timeframe. (See Brinker, supra,
53
Cal.4th at pp. 1039–1040 & fn. 19.)
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
After Brinker, various Courts of Appeal have cited
approvingly to Justice Werdegar’s analysis of the rebuttable
presumption issue. (See, e.g., Carrington v. Starbucks Corp.
(2018) 30 Cal.App.5th 504, 527
; ABM Industries Overtime Cases (2017)19 Cal.App.5th 277, 311
; Lubin v. Wackenhut Corp. (2016)5 Cal.App.5th 926, 951
; Safeway, Inc. v. Superior Court (2015)238 Cal.App.4th 1138
, 1159–1160; Bradley v. Networkers Internat., LLC (2012)211 Cal.App.4th 1129
, 1144–1145.) We
now adopt her discussion of the rebuttable presumption in full.
As Justice Werdegar explained, an employer’s assertion
that an employee waived a meal period “is not an element that
a plaintiff must disprove as part of the plaintiff’s case-in-chief.”
(Brinker, supra, 53 Cal.4th at p. 1053
(conc. opn. of Werdegar,
J.).) Instead, the assertion is “an affirmative defense,” and “the
burden is on the employer, as the party asserting waiver, to
plead and prove it.” (Ibid.) The “plaintiff’s case-in-chief” and
the “affirmative defense” refer to the merits of the case.
Contrary to AMN’s argument, the presumption goes to the
question of liability and applies at the summary judgment stage,
not just at the class certification stage.
Moreover, AMN is incorrect that the presumption applies
only to records showing missed meal periods; the presumption
applies to records showing short and delayed meal periods as
well. Providing employees with short or delayed meal periods is
just as much a violation of the meal period provisions as failing
to provide employees with a meal period at all.
The rationale underlying the rebuttable presumption
supports these conclusions. The presumption derives from an
employer’s duty to maintain accurate records of meal periods.
(Brinker, supra, 53 Cal.4th at p. 1053
(conc. opn. of Werdegar,
24
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
J.); Wage Order No. 4, § 7(A)(3) [“Every employer shall keep
accurate information with respect to each employee . . . . [¶] . . .
[¶] . . . Meal periods . . . shall also be recorded.”].) It is
important that employers keep accurate records so that
enforcement agencies can “ ‘adequately investigate and enforce’
a wage order’s meal period provisions.” (Brinker, at p. 1053
(conc. opn. of Werdegar, J.).) Because time records are required
to be accurate, it makes sense to apply a rebuttable presumption
of liability when records show noncompliant meal periods. If the
records are accurate, then the records reflect an employer’s true
liability; applying the presumption would not adversely affect
an employer that has complied with meal period requirements
and has maintained accurate records. If the records are
incomplete or inaccurate — for example, the records do not
clearly indicate whether the employee chose to work during
meal periods despite bona fide relief from duty — then the
employer can offer evidence to rebut the presumption. It is
appropriate to place the burden on the employer to plead and
prove, as an affirmative defense, that it genuinely relieved
employees from duty during meal periods. (Ibid.) “To place the
burden elsewhere would offer an employer an incentive to avoid
its recording duty and a potential windfall from the failure to
record meal periods.” (Id. at p. 1053, fn. 1.) “ ‘ “[W]here the
employer has failed to keep records required by statute, the
consequences for such failure should fall on the employer, not
the employee.” ’ ” (Ibid.)
In addition, we reject AMN’s argument that applying the
presumption at the summary judgment stage would eviscerate
the rule that employers need not police meal periods. In
Brinker, we said that an “employer satisfies [meal period]
obligation[s] if it relieves its employees of all duty, relinquishes
25
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
control over their activities and permits them a reasonable
opportunity to take an uninterrupted 30-minute break, and does
not impede or discourage them from doing so. . . . [¶] . . . [T]he
employer is not obligated to police meal breaks and ensure no
work thereafter is performed. Bona fide relief from duty and the
relinquishing of control satisfies the employer’s obligations, and
work by a relieved employee during a meal break does not
thereby place the employer in violation of its obligations and
create liability for premium pay . . . .” (Brinker, supra,
53
Cal.4th at pp. 1040–1041.) In AMN’s view, applying the
presumption at the summary judgment stage means that time
records showing missed, short, or delayed meal periods create
“automatic liability” for employers. According to AMN, this
would leave employers with two options for avoiding liability:
Employers could monitor every meal period and ensure no work
is performed, or employers could eliminate flexible meal period
policies and punish employees for choosing to work during
scheduled meal periods. AMN says both options are
inconsistent with Brinker, which does not require employers to
police meal periods and allows employees to voluntarily work
during meal periods.
AMN misunderstands how the rebuttable presumption
operates at the summary judgment stage. Applying the
presumption does not mean that time records showing missed,
short, or delayed meal periods result in “automatic liability” for
employers. If time records show missed, short, or delayed meal
periods with no indication of proper compensation, then a
rebuttable presumption arises. Employers can rebut the
presumption by presenting evidence that employees were
compensated for noncompliant meal periods or that they had in
fact been provided compliant meal periods during which they
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
chose to work. “Representative testimony, surveys, and
statistical analysis,” along with other types of evidence, “are
available as tools to render manageable determinations of the
extent of liability.” (Brinker, supra, 53 Cal.4th at p. 1054
(conc.
opn. of Werdegar, J.).) Altogether, this evidence presented at
summary judgment may reveal that there are no triable issues
of material fact. The rebuttable presumption does not require
employers to police meal periods. Instead, it requires employers
to give employees a mechanism for recording their meal periods
and to ensure that employees use the mechanism properly.
The court in Silva v. See’s Candy Shops, Inc. (2016) 7 Cal.App.5th 235
, 253–254 (See’s Candy II) concluded that the rebuttable presumption is inapplicable when reviewing a motion for summary judgment as opposed to a motion for class certification. Similarly, the court in Serrano v. Aerotek, Inc. (2018)21 Cal.App.5th 773
“specifically reject[ed] [the plaintiff’s] contention that ‘time records show[ing] late and missed meal periods creat[ed] a presumption of violations,’ ” even though that plaintiff’s time records had shown “that on several days on which she worked more than six hours, she took her meal breaks more than five hours after beginning work or, in a couple of instances, did not take a meal break at all.” (Id. at pp. 781, 778.) We disapprove Silva v. See’s Candy Shops, Inc., supra,7 Cal.App.5th 235
, and Serrano v. Aerotek, Inc., supra,21 Cal.App.5th 773
, to the extent they are inconsistent with this
opinion.
We reiterate the rules set forth in Brinker: An employer
is liable only if it does not provide an employee with the
opportunity to take a compliant meal period. The employer is
not liable if the employee chooses to take a short or delayed meal
period or no meal period at all. The employer is not required to
27
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
police meal periods to make sure no work is performed. Instead,
the employer’s duty is to ensure that it provides the employee
with bona fide relief from duty and that this is accurately
reflected in the employer’s time records. Otherwise, the
employer must pay the employee premium wages for any
noncompliant meal period. (See Brinker, supra,
53 Cal.4th at
pp. 1040–1041.) If time records show noncompliant meal
periods, then a rebuttable presumption of liability arises. This
presumption applies at the summary judgment stage, and the
employer may rebut the presumption with evidence of bona fide
relief from duty or proper compensation. Employers may use a
timekeeping system like Team Time to track meal period
violations as long as the system does not round time punches.
Team Time included a dropdown menu for employees to indicate
whether they were provided a compliant meal period but chose
to work, and the system triggered premium pay for any missed,
short, or delayed meal periods due to the employer’s
noncompliance. Thus, Team Time would have ensured accurate
tracking of meal period violations if it had simply omitted
rounding.
IV.
We now apply our holdings to the facts of this case. We
conclude that AMN improperly used rounded time punches to
track potentially noncompliant meal periods. Before September
2012, when Team Time records showed a missed meal period or
a meal period that was shorter than 30 minutes or taken after
five hours of work, AMN assumed a meal period violation and
paid the employee a premium wage. This system may have
resulted in some overcompensation because AMN gave
employees premium pay regardless of whether they voluntarily
chose to work during an off-duty meal period. But this system
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
did not properly account for meal periods that were short or
delayed based on actual time punches but did not appear as
short or delayed under the rounding policy. AMN would be
liable for premium pay for any instances in which employees did
not voluntarily choose to shorten or delay those meal periods.
After September 2012, when an employee recorded a
missed, short, or delayed meal period, a dropdown menu
appeared on Team Time. The dropdown menu prompted the
employee to choose one of three options: (1) “I was provided an
opportunity to take a 30 min break before the end of my 5th hour
of work but chose not to”; (2) “I was provided an opportunity to
take a 30 min break before the end of my 5th hour of work but
chose to take a shorter/later break”; (3) “I was not provided an
opportunity to take a 30 min break before the end of my 5th hour
of work.” This system also did not properly account for meal
periods that were short or delayed based on unrounded as
opposed to rounded time punches. The dropdown menu did not
appear for such meal periods. If any of those meal periods were
not voluntarily shortened or delayed, then AMN would be liable
for premium pay.
The Court of Appeal reached the opposite conclusion as to
the rounding policy before and after September 2012 and ruled
in favor of AMN. We reverse the Court of Appeal’s judgment as
to the meal period claim and remand with directions to remand
the matter to the trial court to permit either party to file a new
summary adjudication motion as to the meal period claim. (See
TRB Investments, supra,
40 Cal.4th at pp. 23, 31–32.) Because
the parties did not have the benefit of this decision when
litigating the defendant’s summary judgment motion and the
plaintiff’s summary adjudication motion, they should now be
afforded another opportunity to present relevant evidence
29
DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
concerning AMN’s compliance with Brinker. As to the meal
periods that are short or delayed based on unrounded time
punches and for which no premium wages were paid, did the
employees voluntarily choose to take short or delayed meal
periods? On remand, the parties will have the opportunity to
present evidence bearing on this question.
We provide some guidance on how the rebuttable
presumption should be applied on remand in light of the usual
summary adjudication standards. According to Donohue’s
expert witness, AMN’s time records showed 40,110 short meal
periods and 6,651 delayed meal periods for which premium
wages were not paid; these meal periods did not show up as
short or delayed in AMN’s timekeeping system because of
rounding. The introduction of these time records by either party
would trigger the rebuttable presumption. If AMN renews its
motion for summary adjudication, it must satisfy the initial
burden of production and make a prima facie showing that “one
or more elements of the cause of action . . . cannot be
established, or that there is a complete defense to the cause of
action.” (Code Civ. Proc., § 437c, subd. (p)(2).) To satisfy this
burden, AMN could try to establish the defense that it genuinely
relieved employees from duty during meal periods. Specifically,
to rebut the presumption of noncompliance arising from the
time records, AMN would need to provide evidence that
employees voluntarily chose to work during off-duty meal
periods that appear in time records to be short or delayed based
on unrounded time punches. If AMN satisfies this burden, then
the burden of production shifts to Donohue “to show that a
triable issue of one or more material facts exists as to the cause
of action or a defense.” (Ibid.) But the ultimate burden of
persuasion remains with the defendant to show that no genuine
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
issue of material fact exists and that it is entitled to judgment
as a matter of law.
Conversely, when a plaintiff moves for summary
adjudication, the plaintiff meets “his or her burden of showing
that there is no defense to a cause of action” if the plaintiff
“prove[s] each element of the cause of action entitling the party
to judgment on the cause of action.” (Code Civ. Proc., § 437c,
subd. (p)(1).) Donohue can satisfy that burden by using time
records to raise a rebuttable presumption of meal period
violations. Once the plaintiff meets that burden, the burden
shifts to the defendant “to show that a triable issue of one or
more material facts exists as to the cause of action or a defense.”
(Ibid.) But the plaintiff bears the ultimate burden of persuasion
to show that no genuine issue of material fact exists and that it
is entitled to judgment as a matter of law. The parties may
present new evidence and arguments to address these issues on
remand.
According to AMN, it has already established that the
time records do not raise a rebuttable presumption of meal
period violations. AMN argues that Donohue never used Team
Time’s dropdown menu to indicate that she was not provided
with a compliant meal period, which suggests that she was
never denied a compliant meal period. But because the
dropdown menu was triggered by rounded time punches, this
evidence does not encompass all meal periods that were short or
delayed based on actual time punches. Thus, AMN cannot rely
on this evidence to prove that there were no meal period
violations.
AMN also contends that the biweekly certifications signed
by Donohue and other class members show that there were no
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
meal period violations. Those certifications stated: “I was
provided the opportunity to take all meal breaks to which I was
entitled, or, if not, I have reported on this timesheet that I was
not provided the opportunity to take all such meal breaks.”
Donohue argues that AMN cannot rely on the certifications to
prove that there were no meal period violations. Because the
Team Time dropdown menu was triggered by rounded time
punches, the system did not flag meal periods that were short or
delayed based on unrounded as opposed to rounded time
punches. As a result, Donohue contends, employees would not
have known about the potentially noncompliant meal periods
that Team Time did not flag unless they kept their own time
records. According to Donohue, Team Time thus led to the
systematic underreporting of noncompliant meal periods and
caused the biweekly certifications to be inaccurate. In addition,
Donohue argues that the significance of the certifications should
be discounted because employees had to sign them to get paid.
We leave these issues for the parties and the trial court to
address on remand. We note that if, as Donohue contends,
employees would not have known about potentially
noncompliant meal periods that Team Time did not flag unless
they kept their own time records, then the certifications would
be inaccurate and cannot be used to prove that there were no
meal period violations. It is the employer’s duty to maintain
accurate time records; the law does not expect or require
employees to keep their own time records to uncover potential
meal period violations. (Wage Order No. 4, § 7(A)(3).)
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DONOHUE v. AMN SERVICES, LLC
Opinion of the Court by Liu, J.
CONCLUSION
We reverse the judgment of the Court of Appeal with
directions to remand to the trial court for further proceedings
consistent with this opinion.
LIU, J.
We Concur:
CANTIL-SAKAUYE, C. J.
CORRIGAN, J.
CUÉLLAR, J.
KRUGER, J.
GROBAN, J.
HOFFSTADT, J.*
*
Associate Justice of the Court of Appeal, Second Appellate
District, Division Two, assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
33
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.
Name of Opinion Donohue v. AMN Services, LLC
__________________________________________________________________________________
Unpublished Opinion
Original Appeal
Original Proceeding
Review Granted XXX 29 Cal.App.5th 1068
Rehearing Granted __________________________________________________________________________________ Opinion No. S253677 Date Filed: February 25, 2021 __________________________________________________________________________________ Court: Superior County: San Diego Judge: Joel M. Pressman __________________________________________________________________________________ Counsel: Sullivan Law Group, William B. Sullivan, Eric K. Yaeckel, Clint S. Engleson; Niddrie Addams Fuller Singh and Rupa G. Singh for Plaintiff and Appellant. Cohelan Khoury & Singer and Michael D. Singer for California Employment Lawyers Association as Amicus Curiae on behalf of Plaintiff and Appellant. H. Scott Leviant and Dennis F. Moss for Moon & Yang, APC, Clients of Moon & Yang, APC, and Moss Bollinger LLP as Amici Curiae on behalf of Plaintiff and Appellant. DLA Piper, Mary C. Dollarhide and Betsey Boutelle for Defendant and Respondent. Jones Day, George S. Howard, Cindi L. Ritchey and Raymond W. Duer for Employers Group and California Employment Law Council as Amici Curiae on behalf of Defendant and Respondent. Counsel who argued in Supreme Court (not intended for publication with opinion): William B. Sullivan Sullivan Law Group, APC 2330 Third Avenue San Diego, CA 92101 (619) 702-6760 Eric K. Yaeckel Sullivan Law Group, APC 2330 Third Avenue San Diego, CA 92101 (619) 702-6760 Mary Dollarhide DLA Piper LLP (US) 4365 Executive Drive, Suite 1100 San Diego, CA 92121 (858) 677-1400