California employment case index

Stoneledge paid furniture sales associates on commission with a guaranteed $12.01 hourly draw that was deducted from later commissions. The Court of Appeal reversed summary judgment for the employer, holding that Wage Order No. 7 requires separate compensation for rest periods and applies equally to commissioned employees, piece-rate employees, or any other system that does not pay for rest breaks. The draws were not compensation at all – at best, interest-free loans.

Piece-rate employees are entitled to separate hourly compensation for time spent waiting for repair work or performing other nonrepair tasks directed by the employer during their work shifts; piece-rate earnings cannot be averaged across that nonproductive time to satisfy the minimum-wage obligation (215 Cal.App.4th…

Section 203(b) contains a single, three-year limitations period governing all actions for section 203 penalties, regardless of whether the penalty claim is accompanied by a claim for unpaid final wages; and the penalties may be recovered even though the underlying wages were eventually paid.

Citigroup let employees take part of their annual compensation as discounted restricted stock vesting only after two years; an employee who resigned early forfeited both the shares and the pay used to buy them. The California Supreme Court affirmed summary judgment for the company, holding that no earned wages remained unpaid on resignation. The decision agrees that restricted stock is a wage – so it turns on when incentive compensation is earned, not on characterization – and expressly refuses to extend Suastez's pro rata vacation-vesting rule to voluntary incentive programs.

Harte-Hanks paid outside sales representatives higher salaries and commission rates than inside representatives and treated the difference as reimbursement for their automobile expenses. The California Supreme Court held the practice permissible in principle, but only where the employer establishes a means to identify which portion of overall compensation is intended as reimbursement and that portion fully covers expenses actually and necessarily incurred. Section 2804 bars any agreement that waives full reimbursement – a holding that unravelled the trial court's denial of class certification.

“Discharge” under sections 201 and 203 includes not only firing but also releasing an employee upon completion of the particular job assignment or time duration for which he or she was hired; final wages are then immediately due, and a willful failure to pay triggers waiting-time penalties.

California does not permit wage averaging: the minimum-wage standard applies to each hour worked, and an employer must pay at least the minimum wage for every compensable hour; it cannot use higher pay for some hours to offset unpaid or sub-minimum hours.