(2013) 215 Cal.App.4th 36
Court of Appeal, Second Appellate District, Division Two · Decided March 6, 2013
01. Facts
Downtown LA Motors (DTLA) paid its automotive technicians on a “flag hour” piece-rate basis: Mercedes-Benz assigned a set number of flag hours to each repair task, and a technician earned that number of flag hours for completing the task regardless of how long it actually took (215 Cal.App.4th at p. 41). Technicians accrued flag hours only while working on a repair order, so on-the-clock time spent waiting for repair work or performing other employer-directed nonrepair tasks generated no separate pay (id. at p. 41). A class of technicians sued, contending they were entitled to separate compensation for that nonproductive time (id. at p. 41).
02. Procedural posture
The trial court awarded the technicians separate hourly compensation for nonproductive time plus section 203 penalties, and the Court of Appeal affirmed (215 Cal.App.4th at p. 41).
03. Issue
Whether employees paid on a piece-rate basis must be separately compensated, at least at minimum wage, for on-the-clock time during which they are not performing piece-rate work (waiting time and other employer-directed nonrepair tasks).
Holding
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 at p. 41).
05. Reasoning
Applying Armenta’s no-averaging rule, the court reasoned that the wage order requires payment of at least minimum wage for each hour worked, and time spent waiting or performing nonrepair tasks under the employer’s control is compensable hours worked. Because DTLA’s flag-hour system paid technicians nothing for that time, the employer could not use the piece-rate earnings to cover it; separate compensation, and section 203 penalties for the resulting unpaid wages, were properly awarded.
Practice Pointer
Gonzalez is the piece-rate companion to Armenta: where workers are paid only for “productive” piece-rate tasks, identify the on-the-clock nonproductive time (waiting, cleaning, meetings, travel between tasks) and demand separate hourly pay for it. The decision (with Bluford) drove the Legislature to codify separate pay for nonproductive and rest time, so confirm the current Labor Code requirements for present-day piece-rate claims.
06. Open questions
Gonzalez addressed nonproductive work time; the related question of separate pay for rest periods of piece-rate workers was decided in Bluford v. Safeway, and both lines were later codified, leaving present-day disputes to the statutory framework that followed.
Cite this entry
Gonzalez v. Downtown LA Motors, LP (2013) 215 Cal.App.4th 36.
“class members were entitled to separate hourly compensation for time spent waiting for repair work or performing other nonrepair tasks directed by the employer during their workshifts.” — 215 Cal.App.4th at p. 41
Source: California Official Reports – [insert durable courts.ca.gov / Official Reports link at verification].