As a quick reminder of just how costly rest and meal break violations can be, on May 8, 2018, a California federal judge awarded $97.28 million to a class of 4,481 home mortgage consultants for Wells Fargo Bank, N.A. (“Wells Fargo”) in Ibarra v. Wells Fargo Bank, N.A., No. CV 17-4344 PA (ASx), 2018 U.S. Dist. LEXIS 78513 (C.D. Cal. May 8, 2018). Divided evenly among the class members, that comes out to roughly $21,710 per person. Though the plaintiffs in this case were granted summary judgment in January, this award came out of a dispute over the method for calculating the damages for rest break violations.
In debating over the regular rate of compensation that should be used when calculating damages in this case, Wells Fargo argued that the regular rate of compensation is solely composed of the workers’ hourly rate, a theory that would have resulted in Wells Fargo owing less than $24.5 million. However, the judge, siding with the workers, decided that the regular rate must include other forms of qualifying compensation such as overtime premiums and incentive pay, almost quadrupling Wells Fargo’s calculation. The bank was also instructed that it must pay court costs for named plaintiff Jacqueline Ibarra.
Wells Fargo began the appeals process with the Ninth Circuit on May 15, 2018, so it is possible that the amount it owes to class members may be reduced.
COUNSEL TO MANAGEMENT:
This extreme award is an example of how drastically expensive it can be to violate rest and meal break laws. What seem to be small, inconsequential inaccuracies can result in detrimental penalties. If you have questions about wage and hour compliance, please contact the experts at The Saqui Law Group.