Employment Case Update: Good Faith Mistakenly Claimed
Overtime Wages and Deductions to Vacation & Sick Time
Barbosa
v. IMPCO Technologies, Inc.,
179 Cal.App.4th 1116 (2009)
This
past year will be remembered most as a year where some very significant
wage and hour cases have been left pending before the California Supreme
Court. Two such cases pending since the fall of 2008 are Brinker Restaurants v. Superior Court
and Brinkley v. Public Storage,
both class action wage and hour cases in which the appellate courts
concluded that California law only requires an employer to make rest and
meal breaks available to employees. Based upon these appellate court
decisions, employers were not required to monitor employee breaks. Once
these decisions were published, the plaintiffs' counsel appealed to the
California Supreme Court citing inconsistency in the courts. While
employers are waiting for a Supreme Court decision in Brinker and Brinkley, the Court of Appeal for the Fourth Appellate
District recently reversed a judgment of non-suit in favor of the
employer at the end of plaintiff's case in Barbosa v. IMPCO Technologies, Inc. That Court held that the
trial court improperly dismissed plaintiff's wrongful termination claim,
finding that there was public policy protecting a mistaken, but good
faith, claim to overtime wages. It remanded the case for a jury
determination as to Mr. Barbosa's good faith and IMPCO's reason for his
termination.
The
facts of the case are largely not in dispute. In June 2007, Mr. Barbosa
was terminated by IMPCO where he worked as a "cell leader"
supervising other carburetor assemblers. Two of the employees he
supervised told him they were missing two hours of overtime. After he
spoke with them, Mr. Barbosa thought he too was missing overtime, and put
in payment requests for himself and the other men. As a result, all three
were paid overtime that they did not, in fact, work.
After
the company completed an internal investigation and presented the facts
to Mr. Barbosa, he apologized and attempted to return the extra pay. The
company refused to accept the money, despite his requests to both payroll
and human resources. Consequently, he was terminated for falsifying time
records.
The
Court of Appeal concluded that a good faith belief in entitlement to
overtime will protect the asking employee, even if he is later found to
be wrong. The significance for employers is evident - employers need to
be wary about terminating employees making claims for overtime, even if
the employee's claims are later found to be erroneous.
DLSE Opinion Letter (November 23, 2009)
In a
move that is surprising and encouraging to California employers, the
Division of Labor Standards Enforcement issued an opinion letter related
to exempt employee salary deductions for partial day absences. The
Opinion concluded that, while it is impermissible for an employer to
deduct partial day absences from the salary of an exempt employee, it is
permissible to deduct from an exempt employee's accrued sick and vacation
time for these same absences. Previously, employers were justifiably
concerned that deductions from an exempt employee's salary for partial
day absences might jeopardize the employee's status as exempt.
This document is intended to provide you with
general information about employment related decisions. The contents of
this document are not intended to provide specific legal advice. If you
have questions about the contents of this update, please contact Ann
Liroff at 415-546-7500 or aliroff@hbblaw.com
or contact your preferred Haight Brown & Bonesteel, LLP attorney.
This communication may be considered advertising in some jurisdictions.
|
