REDDIE WINS KEY CLASS ACTION APPEAL
Tuesday, March 01, 2016
McCormick Barstow partner Scott M. Reddie, a certified appellate specialist and part of the firm’s appellate litigation practice group, has successfully represented a residential care facility sued in a class action suit over alleged wage and hour violations. In an appeal before the Fifth District Court of Appeal, which sits in Fresno, the plaintiff argued that the trial court should have certified her class and permitted the class action to go forward. In Palacio v. Jan & Gail’s Care Homes, Inc., the Court of Appeal ruled in a published opinion that the refusal to certify the class was entirely proper.
The dispute in the suit is over meal periods at the home, a 24-hour care facility for developmentally disabled individuals. The home’s employees, numbering between 45 and 48, worked various shifts ranging between four and ten hours. Under state regulations for 24-hour care facilities, the employees may be required to work on-duty meal periods. This means eating meals with the clients without charge and being paid for the lunch periods. Employees are required to sign an agreement waiving their right to uninterrupted meal periods. Plaintiff signed such an agreement but later attempted to revoke it, which she contended she had the right to do. She later was terminated and filed suit alleging the facility failed to provide her with uninterrupted meal periods in violation of California law. She filed the suit as a class action, identifying the class as 102 present and former employees. If successful the class action would have obtained relief for all 102 members who did not opt out of the class.
The trial court refused to certify the class, ending it as a class action. On appeal the plaintiff challenged the ruling as legally in error. On behalf of the care facility, Reddie urged the court to affirm the trial court ruling.
The Court of Appeal agreed with Reddie’s arguments, holding that common questions of law or fact did not predominate the various class members’ claims. In a published opinion, the court found the governing regulation was clear and provided no support for the plaintiff’s position that generally applicable wage regulations apply to 24-hour care facilities. Under those rules, the employee may at any time revoke an agreement to work on-duty meal periods. Instead the court agreed that such facilities are subject to a special rule that allows the facility to require on-duty meals if meals are eaten with the clients without penalty and the employee is in sole charge of the residents. The previously undecided issue turned upon a resolution of competing wage regulations relating to meal periods. The ruling is important to all such facilities and other employers who are subject to similar meal-period regulations.
In an unpublished part of the opinion, the court also agreed with Reddie’s argument that the plaintiff did not establish her own claim was “typical” of those of the class. Most of the potential class members had settled and released claims against the facility, and they fell into at least three different statuses—full-time, part-time, and overnight, with shifts ranging from four to ten hours. Injuries would have to be determined case-by-case, as rules differ depending on whether the employee works more than five hours in a shift. Plaintiff was simply atypical of the bulk of the class she wanted to represent.
The decision resolves an important question of regulatory interpretation applicable to residential care facilities, which employ thousands of California workers.