|
|
|
|
|
        |
|
|
 |
II. JUDICIAL UPDATES The state supreme court has decided to weigh in on two issues that are of interest to all employers. Following a handful of decisions by the intermediate appellate courts that have reached different conclusions, the California Supreme Court will decide whether the remedy for a missed meal or rest break – “one additional hour of pay” – constitutes a penalty or wages. The issue is important. If the pay is a “penalty,” then an employee’s time to file a claim for this penalty is subject to a one-year statute of limitations. If the pay constitutes “wages,” then an employee has at least three years, and possibly up to four years, to file a claim to recover such payments. In the latter situation, an employee may also be entitled to recover waiting-time penalties, interest and attorneys’ fees. The Supreme Court will also address the question of how an employer must indemnify an employee for business-related expenses. Specifically, the high court will review Gattuso v. Harte-Hanks Shoppers, Inc., a decision in which the Court of Appeal held that an employer may comply with Labor Code section 2802 (requiring indemnification of employees for expenses they necessarily incur in the discharge of their duties) by paying increased wages or commissions instead of reimbursing them for actual expenses. In the Gattuso case, the employer indemnified employees for automobile expenses by paying higher salaries and commission rates that were designed to cover those expenses. The Court of Appeal held that this method of reimbursement is valid as long as it in fact reimburses employees for their expenses incurred. The Labor Commissioner’s position has been that section 2802 requires either the reimbursement of actual costs or the payment of a reasonable rate, such as the IRS mileage rate.
If you would like to discuss these or any
other employment law matters, please do not hesitate to contact any member
of Klinedinst's Employment Law
Department.
|
|
|
|
|
 |
