Category Archives: Risk Management

A Case For Risk Management

Robin Noah
Robin Noah

A case for risk management: You may have read about a case where a federal jury recently awarded Taco Bell workers approximately $496,000 in a class action case that alleged meal and rest period violations. Taco Bell ended up in court because of problems with its policy on meal breaks and rest periods.  A clear case of failure to comply with labor law.

For example Meal Periods: Employers must allow employees to take meal periods at the proper time. More than 134,000 employees claimed that Bell failed to properly provide meal breaks before the fifth hour of work as required by California law.   This case demonstrates the challenges California employers face in the ever-persistent litigation over meal and rest periods.

The workers did win on their claim that Taco Bell failed to properly pay them when a meal break was skipped. If an employer fails to provide an employee a meal period, the employer must pay the employee one additional hour of pay at the employee’s regular rate of compensation (Labor Code, sec. 226.7). This is often referred to as “premium pay.”

The Taco Bell workers claimed that the company paid them only 30 minutes of wages when a meal period was skipped, rather than the full hour of required premium pay. The jury agreed.

Of great interest is that Taco Bell faced litigation because its employee handbook policy did not meet California’s strict meal and rest break requirements. Evidence submitted at trial alleged that Taco Bell used a meal period “matrix,” which reflected a policy of providing the meal after five hours of work, instead of before.

Though there are many laws requiring employers to notify employees of certain workplace rights, there are actually no federal or state laws specifically requiring an employer to have an employee handbook. However, for a number of reasons, creating and maintaining an employee handbook is a good idea and a best practice.

Moreover, an employee handbook is a useful tool for providing employees with that information that, by law, must already be delivered in writing (e.g., equal employment opportunity (EEO) statements).

Rather than provide employees with a haphazard pile of mandatory written notices—and then attempt to document that those notices were received—it makes sense to collect them into an organized, easy-to-use handbook or similar document.

Consider managing the risk by making clear what appropriate activity is by enacting a company-wide program that will educate everyone on what is acceptable and unacceptable workplace behavior.

Please see a Labor Law attorney for employee handbook issues.

Author:  Robin Noah, Executive Coaches of Orange County, www.ECofOC.org