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California Court of Appeal Upholds Clearly Defined Waiting Period Before Vacation Begins to Accrue

By Steven Schneider and Hilary Feybush

Building on earlier vacation policy decisions, a California Court of Appeal recently held in Minnick v. Automotive Creations, Inc.  that employers may impose a clearly expressed waiting period before an employee can begin to accrue vacation time.  This means that  employers do not have to provide vacation pay vesting on day one of employment.  While an employer cannot contract around the rule against forfeiture of wages, an employer does not do so by unambiguously providing that employees do not begin to earn vacation pay until a certain period of employment has occurred.  However, once vacation pay under an employer’s policy starts to be vested and earned, it cannot be taken away.

In the Minnick case, the employer’s policy clearly expressed that no vacation time was earned during an employee’s first year of employment.  The plaintiff was a former employee who had only been employed for six months.  He accordingly was not paid any unused vacation in his final paycheck because he had not worked a full year.  His lawyer argued that the employer’s policy violated California law because it required employees who worked less than one year to forfeit vested vacation pay. (more…)

And On The Seventh Day…

By Anthony Amendola and Justine Lazarus

In Mendoza v. Nordstrom, Inc., the California Supreme Court answered some unsettled questions regarding the state’s day of rest statutes.  In short, these provisions of the California Labor Code provide that employees are entitled to at least one day’s rest out of seven.  Specifically, section 551 of the Labor Code states that “[e]very person employed in any occupation of labor is entitled to one day’s rest therefrom in seven.”  Section 552 states that “[n]o employer of labor shall cause his employees to work more than six days in seven.”  Section 556 provides an exception to sections 551 and 552, stating that they “shall not apply to any employer or employee when the total hours of employment do not exceed 30 hours in any week or six hours in any one day thereof.”

At the behest of the federal Ninth Circuit Court of Appeals, the Supreme Court considered three questions, each of which is discussed below.

(1) “Is the day of rest required by sections 551 and 552 calculated by the workweek, or does it apply on a rolling basis to any seven-consecutive-day period?”

Considering the text and history of sections 551 and 552, the Industrial Welfare Commission’s (“IWC”) wage orders, and the statutory scheme of the day of rest provisions, the Supreme Court concluded that employees are entitled to one day of rest each work week (as defined by the employer) rather than one day in seven on a rolling basis.  Thus, the Court acknowledged that an employee could be required to work up to twelve consecutive days without violating sections 551 and 552.  For example, if an employer defines a workweek as Sunday through Saturday, then an employee could be given a day of rest on the Sunday of Week 1, could be required to work 12 consecutive days, and then could be given off the Saturday of Week 2.

(2) “Does the section 556 exemption for workers employed six hours or less per day apply so long as an employee works six hours or less on at least one day of the applicable week, or does it apply only when an employee works no more than six hours on each and every day of the week?”

With respect to this question, the Court held that the exemption set forth in Section 556 applies only to those employees who never exceed six hours of work on any day of the workweek.  If on any one day an employee works more than six hours, a day of rest must be provided during that workweek. (more…)