United States: California rejects meal period rounding

Key takeaways

• Employers with timekeeping practices that round the start/end times of meal periods should cease doing so immediately. Employers who currently round the start/end times of shifts (as opposed to meal period punch times) should consult with legal counsel to discuss the pros and cons of such practices, and whether other options should be used to track time more precisely.
• Employers should implement a mechanism to record “why” an employee reported a missed, late, or short meal period. For example, timekeeping systems should be programed to flag non-compliant meal periods and prompt employees to confirm whether they were given the opportunity to take compliant meal periods but chose not to do so for personal reasons, when the employees complete their electronic timesheets

In depth

In Donohue, the California Supreme Court once again weighed in on the employer’s obligation to provide meal periods under California law. Generally speaking, employers must provide employees with the unhindered opportunity to take a 30-minute uninterrupted meal period that begins no later than the end of the fifth hour of work and a second 30-minute meal period that begins no later than the end of the tenth hour of work. If an employer does not provide an employee with the opportunity to take a compliant meal period, the employer must pay the employee one additional hour of pay at the employee’s regular rate of compensation as a “meal period premium” for each workday that the meal period was not provided. The Donohue opinion has two key holdings that further clarify these obligations.

1. Employers cannot round time punches in the meal period context. The Court declined to address whether rounding time punches (i.e., adjusting the hours that an employee has actually worked up or down to the nearest preset time increment) is permissible in other contexts. The Court noted that the California Court of Appeal, and numerous federal courts, have upheld the legality of time rounding policies that are applied in a neutral manner (i.e., that round both up and down) and that do not undercompensate employees over time for all hours actually worked. But the Court held that, in the meal period context, rounding could erode the meal period requirements by deeming a late or short meal period as “timely” and “complete” when it was not. To illustrate, if an employee started his or her shift at 8:00 am, clocked out at 1:02 pm, and clocked back in at 1:28 pm, a rounded time record would reflect a 30-minute meal period that started at the end of the fifth hour of work, when the meal period actually started after the end of the fifth hour of work and was 26 minutes in length, rather than the required 30 minute minimum.

2. The Court held that time records showing non-compliant meal periods raise a rebuttable presumption of meal period violations. In reaching this conclusion, the Court reiterated that employers are not obligated to “police” meal periods or ensure that no work is performed: “The employer is not liable if the employee chooses to take a short or delayed meal period or no meal period at all.” Bona fide relief from duty and the relinquishing of control satisfies the employer’s obligations, and work by a relieved employee during a meal break does not thereby place the employer in violation of its obligations or create liability for an additional hour of premium pay. However, the Court reasoned that because employers have an obligation to maintain accurate records of meal periods, if the employer’s records show a missing meal period, a meal period that starts after the end of the fifth hour of work, or that one that is less than 30 minutes, the records raise a rebuttable presumption that the employer did not provide a compliant meal period. Employers can rebut the presumption by presenting evidence that employees were compensated for noncompliant meal periods or that they had in fact been provided compliant meal periods during which they chose to work.

Separately, the Donohue Court discussed with approval the employer’s use of a “drop down” menu to determine when it should pay meal period premiums. The Court noted that when the timekeeping system in question observed a non-compliant meal period based on the employee’s time punches, the employee was prompted to identify the reason for the potentially non-compliant meal through a drop-down menu that required the employee to select one of three options:

(1) “I was provided an opportunity to take a 30 min break before the end of my 5th hour of work but chose not to”;

(2) “I was provided an opportunity to take a 30 min break before the end of my 5th hour of work but chose to take a shorter/later break”; or

(3) “I was not provided an opportunity to take a 30 min break before the end of the fifth hour of work.”

The employee was required to choose an option before submitting his or her timesheet at the end of the pay period. If the employee chose the first or second option, the employer assumed the employee was provided with a compliant meal period but voluntarily chose not to take one, and the employee did not receive premium pay for a meal period violation. If the employee chose the third option, however, the employer assumed there had been a meal period violation and paid the employee the premium. And at the end of each biweekly pay period, employees were required to sign a certification statement confirming the accuracy of their time sheets and also “confirming that . . . I was provided the opportunity to take all meal breaks to which I was entitled, or, if not, I have reported on this timesheet that I was not provided the opportunity to take all such meal breaks . . . .”

The California Supreme Court noted that employers may use such a system to determine whether meal period penalties are owed for otherwise non-compliant meal period time punches.