Client Alerts
Court of Appeals Holds Okay to Ask Employees to Do Simple Math.
July 2010
The California Court of Appeal upheld the granting of summary adjudication in favor of an employer in a class action lawsuit for violation of various wage and hour laws. Morgan v. United Retail, Inc. (June 23, 2010).
The motion was granted on the claim for violation of Labor Code section 226, which requires that employers provide employees itemized pay stubs showing gross and net wages earned, and total hours worked, among other information. An employee suffering injury as a result of a knowing and intentional failure by an employer to furnish accurate wage statements can recover the greater of actual damages or $50 for the initial pay period in which the violation occurs and $100 per employee for each violation in a subsequent pay period, not to exceed a total penalty of $4,000. The employee is also entitled to recover costs and attorney’s fees. The purpose of the statute is to provide employees with the essential information to verify that they are being properly paid for all hours worked.
The employer is a nationwide apparel store that caters to plus size women and teens. The potential class plaintiff was a nonexempt co-manager, whose pay stubs stated the total number of hours worked and the total number of any overtime hours worked. The plaintiff claimed that the wage statements violated the law by not including a separate line item with the total sum of both the regular and overtime hours. Otherwise, the wage statements complied with the statute in all other respects. When asked in deposition how she was injured by the company’s failure to include an additional line on the total sum of hours worked, the plaintiff replied that "[i]t makes it a little difficult to count how many hours I have been working."
After analyzing state and federal cases, the plain language of the statute and its amendments, and opinion letters issued by the Department of Industrial Relations, Division of Labor Standards Enforcement, the Court concluded that since the wage statements accurately listed the total number of hours worked and the hourly pay rate in effect thus, the employer complied with the statutory requirements. The Court added that the employee "could simply add together the total regular hours figure and the total overtime hours figure shown on the wage statement to arrive at the sum of hours worked."
United Retail was awarded its costs on appeal.
