In Heyen v. Safeway, the California Court of Appeal put the nail in the coffin of the federal approach to analyzing wage and hour issues in California. Because of Heyen, California employers and employees need to focus on hours worked in exempt and nonexempt services to correctly classify employees. Only if the employee spends more than 50% of his or her time performing nonexempt work can he or she be classified as nonexempt.
In Heyen, Safeway argued that California should follow the federal wage and hour approach and categorize as exempt an employee who spends much of her time simultaneously performing exempt and nonexempt work. The trial court rejected Safeway’s approach, and found that because Safeway had failed to prove that Heyen spent more than 50% of her time performing nonexempt work, she was nonexempt and entitled to overtime pay. The Heyen court affirmed the trial court’s holding. The court explained that California categorizes employees using a quantitative analysis of how many hours the employee spends doing nonexempt work rather than using the federal qualitative analysis of the “primary function” of the employee’s work.
Heyen, who was an assistant manager for Safeway, claimed that she spent most of her time performing nonexempt work. She had a number of witnesses who testified that Safeway’s managers and assistant managers were forced to do nonexempt work, such as checking and bookkeeping to ensure that their nonexempt employees did not work too many hours. Her witnesses said that Safeway imposed a strict limit on how much overtime a store could have on a monthly basis, and violating that standard could result in discipline up to termination. Overlaying the overtime policy was Safeway’s “checkout success” policy requiring a new line to be opened if three customers were in a checkout line. Since there were often insufficient numbers of employees available when a three-person line formed, managers often had to check and bag, stock the shelves, collect shopping carts from the parking lot, finish and correct bookkeeping, and perform other nonexempt work to ensure customer satisfaction without the store incurring too much overtime. These two policies, Heyen argued, forced her to work 14 to 15 hours a day, on occasion six days a week, to ensure she completed her tasks.
Safeway’s witnesses presented conflicting facts. Bookkeepers testified that they did the work that Heyen claimed she had to do, and so there was no need for Heyen to perform bookkeeping. Employees testified that they had not observed Heyen doing a lot of checking or stocking shelves and that she was at her desk most of the time. Some of them testified that they rarely saw her walk the store or “face” the aisles (pulling items to the front of the shelf). An employee testified that Heyen generally left work around 6:00 p.m. Employees complained about Heyen’s scheduling, claiming that she did not schedule employees for the times when deliveries were made and employees were needed.
The jury issued an advisory verdict in Heyen’s favor. After an extensive review of the contradictory evidence, the Heyen trial judge agreed with the jury and found that Safeway had not carried its burden of proving that Heyen spent more than half of her time performing exempt tasks. The trial court entered judgment in Heyen’s favor and awarded her overtime pay.
On appeal, Safeway argued that the trial court erred by not using the federal approach of categorizing as exempt those hours when Heyen was simultaneously performing exempt and nonexempt work. The Heyen court began with a detailed review of the California Supreme Court’s decision in Ramirez v. Yosemite Water Co. (1999) 20 Cal.4th 785. The court noted that Ramirez found a difference between the federal and California approaches to the classification issue in a case involving an outside salesman. Ramirez described the federal approach as focusing on the employee’s “primary function” and not the percentage of time the employee spends at exempt and nonexempt tasks. California, by contrast, focuses on the amount of time an employee spends on nonexempt tasks. The Heyen court quoted Ramirez’s statement that this difference evidenced California’s intent to provide (at least in some cases) “greater protection for employees.”
The Heyen court approved of the trial court’s focus on hours worked (the quantitative approach) rather than agreeing with Safeway’s qualitative argument. The court affirmed the trial court’s holding that Safeway had failed to establish that more than half of Heyen’s time was spent on exempt work.