Wage & Hour Counsel : Wage & Hour Lawyer & Attorney : Littler Mendelson Law Firm : Employment Law, Labor Relations

Factual and Procedural Background

The plaintiff, Rogelio Hernandez, an hourly, nonexempt restaurant employee, brought a class action against the Chipotle fast food restaurant chain, charging that the company denied him meal and rest periods. Chipotle subsequently brought a motion to deny class certification, relying on written policies that require managers to provide all employees with meal and rest breaks. Chipotle also introduced evidence that it pays employees for the time they take breaks even though they are relieved of all duties and are free to leave the restaurant. Lastly, Chipotle submitted declarations from a number of employees who attested that they had received all meal and rest breaks, but occasionally had forgotten to record them.

Hernandez brought his own motion for class certification, offering declarations from a number of employees attesting that managers had denied or interrupted their breaks, to varying degrees. Hernandez also relied on a report submitted by his expert suggesting that missed breaks were widespread.

The trial court denied class certification, holding that although Hernandez had established the factors of numerosity, ascertainability of the class, typicality of Hernandez’s claims and adequacy of representation, he had failed to demonstrate that common issues predominated over individual issues; consequently, class treatment was not superior to individual actions. In reaching this conclusion, the trial court recognized the vacuum created by the California Supreme Court’s decision to review Brinker Restaurant Corporation v. Superior Court¹(pdf), but nonetheless concluded that the court was likely to decide that California employers are only required to provide employees with the ability to take breaks, not to ensure that breaks are actually taken. This appeal followed.

Court of Appeal Adopts ‘Provide’ Standard, Affirms Denial of Class Certification

Rather than shy away from the trial court’s embrace of the ‘provide’ standard, the court of appeal expressly affirmed the trial court’s analysis of the meal/rest period issue. It launched its own evaluation of the relevant statutes and regulations, concluding, as the trial court had, that “[i]t is an employer’s obligation to ensure that its employees are free from its control for thirty minutes, not to ensure that the employees do any particular thing during that time.”

In reaching this conclusion, the court limited the holding previously reached by another appellate court in Cicairos v. Summit Logistics, Inc. (pdf), 133 Cal. App. 4th 949 (2005), which some have argued had suggested that the “ensure” standard was the appropriate test. The court noted that the Division of Labor Standards Enforcement withdrew the opinion letter on which the Cicairos court based its analysis. Additionally, in Cicairos, the employer had established a system by which its driver employees were pressured to make a certain number of trips per today, a practice which effectively deprived drivers of the ability to take breaks. Hernandez could not point to any such practice implemented by Chipotle. “Thus,” the court concluded, “although the Supreme Court has yet to decide the issue, we hold that the trial court used the correct legal analysis with respect to meal breaks.”

Perhaps more importantly, the appellate court affirmed the trial court’s ability to address the legal issue, even in the vacuum created by the California Supreme Court’s review of Brinker. It noted that the California Supreme Court has not foreclosed trial courts from examining a legal issue at the class certification stage. Nor did another recent appellate decision, Jaimez v. Daiohs USA, Inc. (pdf), 181 Cal. App. 4th 1286 (2010), alter the trial court’s analysis. In Jaimez, the court determined that the defendant’s employment practices presented predominant common factual issues as to the plaintiff’s meal and rest break claims. In Hernandez, however, individual issues predominated. The court noted that some employees declared they always missed meal breaks, while others declared that they received meal breaks but not rest breaks. Still others declared that they were not denied meal breaks, while others simply declared their breaks were simply delayed. Hernandez himself had testified at deposition that he almost always was provided with breaks at one location where he worked, while managers at another location regularly denied him breaks.

Lastly, the court also seized upon the inherent unreliability of the punch data offered by Hernandez. Because Chipotle paid its employees for meal and rest breaks, there was no incentive for employees to accurately record their break time.

This fact, plus various logical flaws in the analysis conducted by Hernandez’s statistical expert, persuaded the court that individual issues predominated over common ones, thereby warranting a denial of class certification. As the court itself noted, “the evidence before the trial court suggested that in order to prove Chipotle violated break laws, Hernandez would have to present an analysis restaurant-by-restaurant, and perhaps supervisor-by-supervisor. Given the variances in the declarations, Hernandez did not demonstrate a common practice or policy.”

Court Certifies Opinion for Publication

The court injected further energy into the meal/rest period debate on October 28, 2010, when it issued an order certifying its opinion for publication. Consequently, it is currently citable and available as precedent.

This decision could have significant ramifications on meal period and rest break practices in California and employers are encouraged to speak to their employment counsel to discuss these issues in detail.

This entry was written by Ryan Eskin.

Photo credit: skodonnell

¹ On October 22, 2008, the California Supreme Court granted review of Brinker to address the proper interpretation of California statutes and regulations governing an employer's duty to provide meal and rest breaks to hourly workers.

The Eleventh Circuit affirmed the district court’s conclusion that certification of each claim was improper under Rule 23(b)(3) because individualized factual inquiries into whether each employee worked without compensation and, if so, for how long, would swamp any issues that were common to the proposed class. The court analyzed the gap period, break period and quantum meruit claims separately, but in each instance reached the same conclusion: that individualized inquiries would predominate with respect to each claim. Notable points made by the Eleventh Circuit in the discussion of each claim include the following:

Breach of Contract Claim (Gap Period)
• The time records the plaintiffs proposed to rely on did not provide common proof of any uncompensated work during gap periods, particularly in light of employee testimony about various non-work related activities that took place during gap periods and various personal reasons that employees listed for coming in early and staying late;
• Even if a contract to pay for such gap time existed (an issue the parties disputed that was not ruled on), an individualized defense existed as to whether an employee knew of FedEx’s policy prohibiting off-the-clock work and yet deliberately chose to engage in such work in breach of contract;
• Even if, as the plaintiffs asserted, the FLSA was incorporated into the alleged contract, an individualized inquiry would still be necessary to determine whether each employee voluntarily arrived early or stayed late, and whether the employee engaged in any work during that time (under 29 C.F.R. § 785.48(a) early or late clock punching may be disregarded if it was voluntary and no work was performed); and
• Even if, as the plaintiffs alleged, there was a policy requiring or encouraging employees to arrive early or stay late, it would not predominate individualized issues, as the record showed that many employees arrived early or stayed late voluntarily and purely for personal reasons.

Breach of Contract Claim (Break Period)
• The time records that the plaintiffs proposed to rely on might not be sufficient to prove that an employee actually worked during a break, which would then require individualized inquiries;
• Even if work occurred, there is no way to tell from those time records how long an employee worked during a break; and
• Even if a contract to pay for such break time existed (an issue the parties disputed that was not ruled on), an individualized defense existed as to whether an employee who worked during the break violated the terms of the contract.

Quantum Meruit Claim
• A quantum meruit claim is highly individualized and would require an inquiry into whether each employee expected compensation for non-work related tasks or for activities performed while the employee was supposed to be on break.

The Eleventh Circuit also affirmed the district court’s refusal to certify a class under Rule 23(b)(1)(A). The appellate court agreed that certification under this Rule is improper where, as here, the plaintiffs request compensatory damages in addition to injunctive relief. In fact, the court noted that the primary remedy sought by the plaintiffs was unquestionably monetary relief.

The Eleventh Circuit characterized Babineau as “round two” of the plaintiffs’ litigation against FedEx, because the same district court previously denied certification of a nationwide class of FedEx employees who asserted substantially similar claims in the matter of Clausnitzer, et al. v. Federal Express Corp., 248 F.R.D. 647 (S.D. Fla. 2008). The Eleventh Circuit referred to Babineau as an attempt by the plaintiffs to cure the defects that the district court identified in Clausnitzer, by limiting the scope of the class to Florida employees, adding the quantum meruit claim and altering the breach of contract claim. Nonetheless, as discussed above, the plaintiffs’ “round two” attempt at class certification has now been rejected as well.

This blog entry was authored by Aaron Reed.