Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 274 P.3d 1160
Background and Court History: Plaintiffs Anthony Kirby and Rick Leech, Jr., sued defendant Immoos Fire Protection, Inc. (IFP) and multiple Doe defendants for violating various labor laws as well as the unfair competition law (UCL). One of the claims alleged the failure to provide rest breaks as required by California Labor Code section 226.7. The remedy for violation of section 222.7 is “one additional hour of pay … for each work day that the … rest period is not provided.” Plaintiffs ultimately dismissed the claim with prejudice after settling with the Doe defendants. IFP subsequently moved to recover attorney’s fees from plaintiffs under section 218.5.The trial court awarded fees and concluded that section 218.5 authorizes an award of fees for alleged rest period violations, the Court of Appeal affirmed stating that an award of fees was proper under section 218.5 because plaintiffs were seeking payment of “additional wages” for missed rest periods. Supreme Court granted review to consider when, if ever, a party who prevails on a section 226.7 action for an alleged failure to provide rest breaks may be awarded attorney’s fees.
Pertinent Issues addressed: The relevant issues addressed by the Supreme Court are as follows:
a. “Additional hour of pay” for violation of section 226.7 is not “minimum wage” under Section 1194. Hence, no attorney fees can be recovered under Section 1194 for violations under Section 226.7.
Plaintiff argued that, the “additional hour of pay” for missed meal or rest periods is tantamount to a statutorily prescribed minimum wage. Further, pointing to the term “legal” in section 1194’s reference to “legal minimum wage” and “legal overtime compensation,” plaintiffs argued that use of the modifier is evidence that the Legislature intended a broader meaning.
The Supreme Court rejected both the arguments of the Plaintiff for the following reasons:
- In construing a statute, the words should be given their plain and commonsense meaning. The term “minimum wage” under Section 1194 ordinarily refers to the statutory or administrative floor below which an employee’s compensation may not fall; and the term “overtime compensation” ordinarily refers to the statutory and administrative obligation to pay employees one-and-one-half times their regular rate of pay for work in excess of eight hours a day or 40 hours a week (and double the regular rate for work in excess of 12 hours a day or in excess of eight hours on any seventh day of a workweek). Plaintiffs failed to identify any sound reason to interpret section 1194’s reference to “the legal minimum wage or the legal overtime compensation” in a manner that departs from the foregoing usual meanings.
- “As a textual matter, if plaintiffs were correct that a “legal minimum wage” refers broadly to any statutory or administrative compensation requirement or to any compensation requirement based on minimum labor standards, then section 1194’s reference to “legal overtime compensation” would be mere surplusage. For, under plaintiffs’ reading, overtime compensation would already be encompassed by the term “legal minimum wage.” (Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 274 P.3d 1160.)
- The history of Section 1194 supports the commonsense reading of its term.
- Construing the scope of section 1194 in light of other related statutes (Section 1193.6) the Court found no evidence to suggest that the term “minimum wage” in section 1193.6 was intended to have a narrower scope than the term “legal minimum wage” in section 1194.
The Court concluded stating that, “section 1194 does not authorize an award of attorney’s fees to employees who prevail on a section 226.7 action for the nonprovision of statutorily mandated rest periods. Neither the plain text, the history of section 1194, nor the language of related statutes provides any reason to depart from the ordinary meaning of section 1194’s words.”
b. An action for violations under Section 226.7 does not constitute an “action brought for the nonpayment of wages”. Hence, no attorney fees can be recovered under Section 218.5.
IFB argued that since the remedy sought by plaintiffs is a wage, the action was an “action brought for nonpayment of wages” within the meaning of section 218.5. IFB relied on Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1102, 56 Cal.Rptr.3d 880, 155 P.3d 284 (Murphy) where the Supreme Court held that, “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” constitute “wage” for purposes of determining what statute of limitation applies to section 226.7 claims.
However, the Supreme Court disagreeing with IFB stated that “section 226.7 does not give employers a lawful choice between providing either meal and rest breaks or an additional hour of pay. An employer’s failure to provide an additional hour of pay does not form part of a section 226.7 violation, and an employer’s provision of an additional hour of pay does not excuse a section 226.7 violation. The failure to provide required meal and rest breaks is what triggers a violation of section 226.7. Accordingly, a section 226.7 claim is not an action brought for nonpayment of wages; it is an action brought for non-provision of meal or rest breaks.” (Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 274 P.3d 1160.)
The Supreme Court further clarified the principle laid in Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1102, 56 Cal.Rptr.3d 880, 155 P.3d 284 (Murphy) stating that, “We said that the “additional hour of pay” remedy in section 226.7 is a “ ‘liability created by statute’ ” and that the liability is properly characterized as a wage, not a penalty. To say that a section 226.7 remedy is a wage, however, is not to say that the legal violation triggering the remedy is nonpayment of wages. As explained above, the legal violation is nonprovision of meal or rest breaks, and the object that follows the phrase “action brought for” in section 218.5 is the alleged legal violation, not the desired remedy.” (Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal.4th 1244, 274 P.3d 1160.)
Accordingly, the Supreme Court granted review, superseding the opinion of the Court of Appeal.
- Employers should note that, “an employer’s provision of an additional hour of pay does not excuse a violation of the meal and rest break statute”. Hence, employers cannot substitute a meal or rest break violation by paying its employees an additional hour of pay. The failure to provide required meal and rest breaks is what triggers a violation of section 226.7 and not the failure make the payment of additional hour of pay.
- Plaintiff’s counsel may still seek attorney’s fees under section 2699(g)(1) for meal and break violations bolted with Private Attorney General Act claims.