In the aftermath of the California Supreme Courtâ€™s landmark decision inÂ Brinker Restaurant Corp. v. Superior Court(2012) 53 Cal.4th 1004 (Brinker), employers and non-exempt employees are still hashing out the implications of the clarified meal and rest period requirements.Â Â In April, Bryan Schwartz Law discussed the implications of that case on this blog, which can be found here:Â California Supreme Court’s Long-Awaited Brinker Decision.
Last week, inÂ Bradley v. Networkers International, LLCÂ (December 12, 2012)Â Â —Cal. Rptr.3d —, 2012 WL 6182473, the California Court of Appeal in San Diego addressed a common problemÂ in meal and rest period cases: where an employer has no compliant meal and rest period policies that are distributed to employees. This case makes clear that a lack of a meal or rest period policy can provide sufficient commonality for class certification, which is a significant victory for plaintiffs.
While theÂ BrinkerÂ case was pending, a number of cases appealed to the Supreme Court were granted review and held, pending the decision inÂ Brinker.Â Â Among the cases relegated to judicial limbo wasÂ Bradley v. Networkers International, Inc.Â (Feb. 5, 2009, D052365). InÂ Bradley, three plaintiffs filed a class action complaint against Networkers International, LLC, alleging violations of Californiaâ€™s wage and hour laws including nonpayment of overtime and failure to provide rest breaks and meal periods. The plaintiffs moved to certify the class, which requires that they â€śdemonstrate the existence of an ascertainable and sufficiently numerous class, a well-defined community of interest, and substantial benefits from certification that render proceeding as a class superior to the alternatives.â€ťÂ Brinker, 53 Cal.4th at 1021. The court determined that the plaintiffs did not demonstrate that common factual and legal questions would predominate over the individual issues and denied class certification. The plaintiffs appealed, but the decision was upheld by the California Court of Appeal.Â
Plaintiffs appealed to the California Supreme Court, which granted petition for review but held the case for over three years untilÂ BrinkerÂ was resolved. After issuing their decision inÂ Brinker, the California Supreme Court remandedÂ Bradleyto the California Court of Appeal, Fourth Appellate District, with directions to vacate its decision on class certification and reconsider the case in light of theÂ BrinkerÂ decision.
Before getting to the recent decision from the Fourth Appellate District, a little background is useful. A common fight between employers and employees arises when an employer classifies its employees as â€śindependent contractors,â€ť as opposed to employees. True independent contractors have control over the terms and conditions of their employment and are not subject to California wage and hour protections including overtime and meal and rest periods. Employees, on the other hand, remain under their employerâ€™s control during their working hours and are protected by Californiaâ€™s wage and hour laws. The employee versus independent contractor issue has been a battleground for years in the employment law arena and California courts have developed numerous criteria to assess whether an individual is truly an independent contractor or an employee.
In the recentÂ BradleyÂ case, the three plaintiffs alleged that they were misclassified as independent contractors, and should instead have been treated as employees. All three of the plaintiffs worked for Networkers. Each of the plaintiffs was required to sign an â€śindependent contractor agreement,â€ť which stated that each was an independent contractor rather than an employee. As such, plaintiffs did not receive overtime pay or meal or rest periods. However, contrary to the terms of the agreement, the plaintiffs alleged that they were treated as employees and were subject to the same employment policies.
Networkers argued that plaintiffsâ€™ motion to certify the class should be denied because the case did not involve common questions of fact or law, and therefore, resolution of the case would require mini-trials for each plaintiff. Although the court agreed with Networkers on the first go-around, after theÂ BrinkerÂ decision, the court agreed with plaintiffs on all but one cause of action.Â
The Court of Appealâ€™s Decision on Remand
Because Networkers applied consistent companywide policies applicable to all employees regarding scheduling, payments, and work requirements, those policies could be analyzed on a class-wide basis. The court would not need to assess them with respect to each potential class member. In analyzing whether class certification was appropriate the court noted that, â€ś[t]he critical fact is that the evidence likely to be relied upon by the parties would be largely uniform throughout the class.â€ť The court held that the factual and legal issues related to the independent contractor issue would be the same among the plaintiff class members, and therefore appropriate for class treatment.
Moreover, inÂ Bradley,Â as in many workplaces, the employer did not have a policy actually distributed to employees that provides for meal and rest periods. Networkers argued thatÂ BrinkerÂ was not controlling, in its guidance about meal and rest requirements, because inÂ BrinkerÂ the plaintiffs challenged an express meal and rest break policy whereas inÂ Bradley, the plaintiffs were arguing that the employerâ€™s lack of policy violated the law. The Court rejected this argument, holding: â€śThis is not a material distinction on the record before us. UnderÂ Brinker, and under the facts here, the employer engaged in uniform companywide conduct that allegedly violated state law.â€ťÂ Bradley,Â 2012 WL 6182473 *13.Â The Court noted that plaintiffs had presented evidence on Networkersâ€™ uniform practice and that Networkers acknowledged that it did not have a policy and did not know if employees took meal or rest breaks. In assessing the lack of evidence presented by Networkers and relying onÂ Brinker,Â theÂ BradleyÂ Court held: â€śHere, plaintiffsâ€™ theory of recovery is based on Networkersâ€™ (uniform)Â Â lackÂ of a rest and meal break policy and its (uniform)Â failureÂ to authorize employees to take statutorily required rest and meal breaks. The lack of a meal/rest break policy and the uniform failure to authorize such breaks are matters of common proof.â€ťÂ Bradley,Â 2012 WL 6182473 *13.
TheÂ BradleyÂ decision disposes of a significant hurdle in wage and hour cases by holding that this type of scheme â€“ where no policy is distributed to provide for meal and rest periods- can meet the commonality requirement for class certification. For example, Bryan Schwartz Law is currently representing a group of restaurant workers who were not aware of a meal/rest period policy, and who were not provided with meal or rest periods. In the Bryan Schwartz Law case, there was no policy that provided the workers with coverage to enable them to take their breaks. UnderÂ Bradley, certification is appropriate to test, class-wide, whether the employerâ€™s lack of a well-defined policy or practice of providing meal/rest periods violated the Labor Code.Â
Although several meal and rest period cases have been decided adversely to workers post-Brinker, theÂ BradleyÂ court determined that each of those cases was distinguishable.Â Â In distinguishingÂ Lamps Plus Overtime CasesÂ (2012) 209 Cal.App.4th 35, theÂ BradleyÂ Court of Appeal noted that it was undisputed that theÂ Lamps PlusÂ employerâ€™s written meal and rest period policy was consistent with state law requirements and that the violations differed at each store and with respect to each employee. Similarly, theÂ BradleyÂ court held thatÂ Hernandez v. Chipotle Mexican Grill, Inc.Â (2012) 208 Cal.App.4th 1487 was distinguishable because the only evidence of a company-wide policy or practice was Chipotleâ€™s evidence that it provided meal and rest breaks as required by law. Likewise,Â BradleyÂ distinguishedÂ Tien v. Tenet Healthcare Corp.Â (2012) 209 Cal.App.4th 1077, noting that in that case there was â€śoverwhelmingâ€ť evidence that meal periods were made available and the employerâ€™s liability with respect to each employee depended on issues specific to each employee.Â Brookler v. Radioshack Corp.Â is an undecided case that was remanded afterÂ BrinkerÂ involving wage and hour class certification, which may provide additional clarification on these issues.
The court also rejected Networkersâ€™ argument that because each plaintiff would be owed a different amount of damages, the case should not be certified. Relying, in part, on the concurring opinion inÂ Brinker,Â the court held that even where plaintiffs are required to individually prove damages, individualized damages inquiries do not bar class certification. The court also reversed its prior decision and determined that class certification on the issue of overtime was appropriate because, assuming the plaintiffs were employees, proof of damages could be determined from the common proof of the pay records.
Although the court decided to remand the off-the-clock work issue, it did so because the factual record did not show that there was a uniform policy requiring each employee to work off the clock.
About the Author: Bryan Schwartz is a practicing attorney. If you believe you have been mis-classified as an independent contractor, have meal and rest period claims, or have questions about other wage and hour violations, contact Bryan Schwartz Law (www.BryanSchwartzLaw.com).Â Nothing in the foregoing commentary is intended to provide legal advice in a specific case or to form an attorney-client relationship with any reader. You must have a representation agreement with Bryan Schwartz Law to be a client of this firm or author.