If and until it is de-published, we have a live, published Court of Appeal opinion on the wage/penalty issue in Labor Code section 226.7. There was a draft circulating last Spring on the same point, but the case settled, a DLSE “Precedent Opinion” that the courts ignore, and, of course, the vapor regs. On December 2, 2005, the Court of Appeal issued this opinion in Murphy. This Opinion squarely rejects the federal Courts’ interpretations in, e.g., Tomlinson.
We disagree with the district court judge’s interpretation. While the Labor Code allows employers to require overtime work, albeit at a higher rate of compensation, it does not allow employers to deny meal and rest breaks.21 The payments imposed by the wage order and section 226.7 are not compensation for the missed 10 or 30 minute rest or meal break, but are fixed at one additional hour of pay. That payment is not compensation for labor performed, but is an arbitrary amount imposed on the employer in addition to the salary already paid during the time the employee was not eating or not resting.22 It is not overtime pay for an allowed work period, but a penalty for violating the law that prohibits work during those times. [Slip Op. at 25-26]
It’s also worth a read for overtime/exempt and other wage hour issues.
http://www.courtinfo.ca.gov/opinions/documents/A107219.PDF
This case is likely to be petitioned to the California Supreme Court within the next few days. The case presents good issues for Supreme Court review, but the lack of disagreement among appellate courts (especially if you include the Riverside tentative ruling in Orco Block) might cause the Supremes to pass on the issue. As predominantly employee side lawyer, of course, I want to see the case reviewed.