Employment Law Bulletin | March 18, 2021

California Supreme Court Rules Employers Cannot “Round” Meal Break Start and Stop Times

California employers must generally provide non-exempt (overtime eligible) employees with one 30-minute uninterrupted off-duty meal break that begins no later than the end of the fifth hour of work, and another 30-minute meal break that begins no later than the tenth hour of work.  An employer who fails to provide compliant meal breaks is obligated to pay the employee one additional hour of pay for each workday the meal break is not provided (“meal premium pay”).

Federal law is well settled that employers may apply a “rounding” policy to adjust employee time entries to the nearest pre-set time increment so long as the policy is neutral on its face, and, in application, fully compensates employees over time.  Based on this principle, many employers round work start and stop entries to the nearest 5, 10 or 15-minute increment.  California law has followed federal guidance on this issue and similarly permitted rounding of work start and stop times.  However, since meal breaks are not required by federal law, the issue of rounding meal break start and stop times remained undecided in California until last month, when the State’s Supreme Court issued its decision in Donohue v. AMN Services, LLC ruling:

• Employees must record the actual meal break start and stop times.
• Employers cannot “round” meal break start and stop punches to the nearest pre-set time increment.
• Employer time records that show noncompliant meal breaks (no break, breaks less than 30 minutes, or breaks starting after the 5^th or 10^th hour of work) raise a rebuttable presumption that a meal period violation occurred and the employer owes the employee meal premium pay.  The employer must then present evidence to rebut the presumption and show that compliant meal breaks were provided, but the employee voluntarily chose to skip, shorten or take a late break.

In Donohue, the employer’s electronic timekeeping system was set to round all time entries to the nearest 10-minute increment.  The policy was applied consistently and was neutral on its face.  If an employee clocked in at 7:56 a.m., the time was rounded to 8:00 a.m., but if the employee clocked in at 7:49 a.m., the time was rounded to 7:45 a.m.  This type of rounding of work day start and stop times remains lawful under federal and California law, but Donahue applies a different rule in the meal period context.

The Donohue court ruled that rounding is unlawful in the meal break context because it can result in a violation of the meal break requirements.  For example, with a 10-minute rounding rule, the employee who clocks out for lunch at 11:02 a.m. and clocks in after lunch at 11:25 a.m. has received a 23-minute break, but the timekeeping system would record the times as 11:00 a.m. and 11:30 a.m. indicating that a compliant 30-minute meal break was taken, resulting in no meal premium pay.

Ok, now what to do?

• If your employees record their time on time cards or timesheets, make sure they are writing down their actual meal break start and stop times, taking breaks at least 30-minutes long, and they do not work more than five hours (or ten hours) without starting the break.
• If your employees record their time electronically, make sure your timekeeping system does not round meal break start and stop time entries.  If it does, remove the rounding rule from the meal break timekeeping settings.
• Train your managers and supervisors about the meal break rules and how to enforce them.  Make sure they are “providing” employees with the opportunity to take off-duty uninterrupted meal breaks that start on time and are long enough to comply with California’s requirements.
• Audit employee time records each pay period for missed, short, and late meal breaks and follow up with employees to find out whether they were violations or “voluntary” on the part of the employee.  Document all conversations with employees and keep documentation of all time record changes and the reasons they were made.

Implementing, enforcing and ensuring compliance with California’s meal break rules are challenging.  Contact an SMT employment attorney to get some tips and tricks for keeping your business compliant.

Lisa Ann Hilario

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Spaulding McCullough & Tansil LLP
Employment Law Group

Jan Gabrielson Tansil  | Lisa Ann Hilario | Kari Brown