California Supreme Court Issues Landmark Decision Holding That Payments Due to Employees for Missed Meal and Rest Breaks Are Wages and Governed by a Three-Year Statute of Limitations


In California, employers must provide their non-exempt employees with meal and rest breaks. When an employee fails to take a meal or rest break, whether that failure is due to the fault of the employer or the employee, California Labor Section 226.7 (b) prescribes the following consequence:

“If an employer fails to provide an employee a meal period or rest period in accordance with an applicable 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 work day that the meal or rest period is not provided.”

Cal. Lab. Code § 226(b) (emphasis added).

Since Section 226.7 was enacted in 2000, a debate has raged between employers and employees, plaintiff attorneys, and defense counsel, and even within the Department of Labor Standards Enforcement over whether the “one hour of additional pay” specified by Section 226.7 amounted to a “wage” or a “penalty.”

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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