California companies with non-exempt employees who are paid hourly plus extra compensation such as commissions and weekend bonuses may retroactively owe them back pay for up to four years, following a state Supreme Court ruling that sided with a hotel employee.
The high court ruled on July 15 in favor of the employee, raising the prospect that employers will need to pay employees retroactively at a higher- than-regular rate for breaks.
The case (Ferra vs. Loews Hollywood Hotel) began with Jessica Ferra, who worked in food and beverage for the Los Angeles-area hotel. She sued her employer for failing to pay her for meal breaks and when she worked special events. The court ruled for the employee.
“The court essentially said Loews should have included the non-discretionary time,” said Lisa Ann Hilario, an employment law specialist with Spaulding McCullough & Tansil of Santa Rosa.
A full-time, non-exempt employee is entitled to two 10-minute breaks in addition to a lunch break. If missed, the company owes an hour for each missed break. In this case, the hotel paid for the “regular rate of pay.” The ruling does not apply to “exempt,” as in salaried, employees.
According to the court’s decision, companies need to factor in the “extra time” through a formula. Plus, the legal decision makes it retroactive from four years back.
“What the court did was made it difficult for employers that could be sued, creating tens of thousands of class-action lawsuits and creating a brand new standard,” said Richard Rosenberg, the attorney representing Loews Hollywood Hotel. “I’m not surprised. The court has been on a tear with pro-employee decisions.”
The legal interpretation boils down to a mandate that dictates “regular rate of pay,” meaning the same as “regular rate of compensation,” which may be payment on commissions, shift differentials and weekend events.
Employment law specialists and recruiters advise companies to audit their time cards to find discrepancies.
“It’s a constant punch in the face to employers,” said Amy Ronakis, a human resources consultant with Santa Rosa-based Personnel Perspectives.
Ronakis, who referred to the retroactive nature of the court decision as “an administrative nightmare,” noted how this case came to a head after years of suspense.
First, the trial court agreed with the hotel two years ago, and the appellate court following suit. But Ferra took her case to the high court and won, with the California Supreme Court departing from earlier court rulings.
“We weren’t surprised (by the outcome). We felt we were right all along,” Ferra attorney Dennis Moss said.
Susan Wood covers law, cannabis, production, biotech, energy, transportation, agriculture as well as banking and finance. For 25 years, Susan has worked for a variety of publications including the North County Times, now a part of the Union Tribune in San Diego County, along with the Tahoe Daily Tribune and Lake Tahoe News. She graduated from Fullerton College. Reach her at 530-545-8662 or susan.wood@busjrnl.com
"pay" - Google News
August 05, 2021 at 05:44AM
https://ift.tt/3fv3J68
California employers face 'administrative nightmare' after high court calls for retroactive pay - North Bay Business Journal
"pay" - Google News
https://ift.tt/301s6zB
Bagikan Berita Ini
0 Response to "California employers face 'administrative nightmare' after high court calls for retroactive pay - North Bay Business Journal"
Post a Comment