Imagine an employee who makes $15.00 per hour (and receives no other compensation) as a cashier. And imagine the employee works Monday through Friday from 8:00 a.m. to 4:30 p.m. This employee should begin a 30-minute meal period by 1:00 p.m.
Three days a week, due to a heavy work schedule, our employee was unable to begin a meal period until 1:05 p.m. (in other words, five minutes after the end of the five-hour mark in their shift). The employer did not pay the employee a one-hour premium for the late meal period.
Now imagine the employee is terminated the following month, never having been paid the meal period premium. If this employee brings a claim, the failure to pay the single meal period, on its own, is significantly risky for the employer: over $4,000 when you combine the unpaid wages, wage statement violation penalties, Private Attorneys General Act ("PAGA") penalties and waiting time penalties, plus the employee is entitled to pre-judgment interest and their attorneys' fees if they prevail in a wage claim.
Now imagine there are 44 other employees just like this employee. If this employee brings a claim as a PAGA/class action lawsuit on behalf of all 44 employees for unpaid meal break premiums and penalties for meal break violations, along with derivative claims (ignoring for this example the likely common bedfellow claims like rest break claims, minimum wage and unpaid overtime) each of the 44 employees potentially could recover the following:
- Meal period premium pay: 3 premiums/week x $15.00 per hour x 50 workweeks/year x 4 years (statute of limitations) = $9,000
- Wage statement penalty: $50/pay period x 26 pay periods/year x 1 year (the statute of limitations) = $1,300
- Waiting time penalties: $15 per hour x 8 hours per day x 30 days = $3,600
- Multiple PAGA penalties: $350/pay period x 26 pay periods/year x 1 year (statute of limitations) = $9,100
This equates to $23,000 in meal break premiums and penalites per employee, which multiplied by 44 employees equals $1.012 million.
On top of this, the class would be entitled to prejudgment interest at 7%, and reimbursement for attorneys' fees and costs incurred to bring the claim (often in the mid-6-figures). The Company also would be required to pay its own attorneys' fees.