Filed 5/30/13 Nelson v. Southern Cal. Gas CA2/8
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
ERIC L. NELSON et al., B238845
Plaintiffs and Appellants, (Los Angeles County
Super. Ct. No. BC451310)
v.
SOUTHERN CALIFORNIA GAS
COMPANY,
Defendant and Respondent.
APPEAL from an order of the Superior Court of Los Angeles County. Zaven V.
Sinanian, Judge. Affirmed in part, reversed in part.
Marlin & Saltzman, Louis M. Marlin, Kristen Marquis Fritz; Fitzgerald Lundberg
& Romig, Ken M. Fitzgerald and Barbrae Lundberg for Plaintiffs and Appellants.
Paul Hastings, Paul Grossman, Paul W. Cane, Jr., Leslie L. Abbott, Eric Stevens;
Young, Zinn & Bate, Linda Van Winkle Deacon and Harry A. Zinn for Defendant and
Respondent.
______________________________________
Plaintiffs Eric Nelson, Juan Mejoredo, and Robert Dowling sought certification of
a class action against Southern California Gas Company (the Gas Company). The
plaintiffs alleged the company failed to provide meal and rest breaks in accordance with
California law, and committed overtime wage violations. The trial court denied
certification on the grounds that the plaintiffs failed to establish common questions would
predominate in the action or that class treatment would be the superior means of
resolving the litigation. We affirm the trial court order on class certification but reverse
the order to the extent it purported to deny plaintiffs’ representative claim under the
Labor Code Private Attorney Generals Act of 2004 (Lab. Code, § 2698 et seq.; PAGA).
FACTUAL AND PROCEDURAL BACKGROUND
Named plaintiffs Nelson, Mejoredo, and Dowling worked as “field operations”
employees for the Gas Company. Field operations employees work in the “field,” away
from a Gas Company facility, driving in company vehicles in assigned geographic areas
or at specific sites. In their class action lawsuit, plaintiffs alleged the Gas Company
violated California wage and hour laws by failing to relieve class members of all duties
during their meal and rest periods, and by exerting control over class members during
their meal and rest periods, such that they were denied the meal and rest breaks required
by law. Plaintiffs also alleged the Gas Company required class members to perform
work “off the clock,” such as donning and doffing coveralls, and booting up or shutting
down computers. Based on these factual allegations, plaintiffs asserted seven causes of
action in the operative second amended complaint: (1) failure to provide required meal
and rest breaks in violation of Industrial Welfare Commission (IWC) Wage Order No. 4
(Wage Order No. 4), and Labor Code sections 200, 226.7, and 512;1 (2) failure to
compensate for all hours worked (Wage Order No. 4; Lab. Code, §§ 200, 226, 226.7,
500, 510, 1194, 1197, 1198); (3) failure to pay overtime compensation (Lab. Code,
1 All further statutory references are to the Labor Code unless otherwise noted.
On our own motion, we have augmented the appellate record with the second
amended complaint.
2
§ 1194); (4) failure to compensate for all hours worked (Wage Order No. 4; Lab. Code,
§§ 200, 226, 226.7, 500, 510, 1194, 1197, 1198); (5) failure to furnish accurate wage
statements (Lab. Code, § 226); (6) failure to pay compensation upon discharge (Lab.
Code, §§ 201-203); and (7) violations of Business and Professions Code section 17200 et
seq. (UCL). Plaintiffs also asserted a claim for remedies under PAGA.
The Gas Company filed a motion for an order declaring the suit inappropriate for
class treatment and denying representative status for the PAGA claim. Plaintiffs
subsequently filed a motion for class certification. Plaintiffs sought certification of a
class defined as: “All individuals who are currently employed, or formerly have been
employed, as non-exempt Field Operations employees for Southern California Gas
Company during the Class Period. Excluded from the Class are Meter Readers and
current and former employees who work only at a base location (as opposed to in the
field) including, but not limited to, Field Planners.” Plaintiffs also sought certification of
two subclasses, one composed of class members whose employment required them to
wear employer-supplied coveralls and other protective gear, and one composed of class
members whose employment had been terminated.
Motion for Certification
In the certification motion, plaintiffs argued the Gas Company had formal policies
that were applied to all field operations employees, and these policies established the Gas
Company was not providing lawful meal and rest breaks and required “off-the-clock”
work. They offered documentary and testimonial evidence in support of the motion,
which we summarize below.
Written Policies
Plaintiffs provided copies of the Gas Company’s written policies, including an
Employee Conduct and Responsibilities manual with an effective date of September
2006. On company vehicles, the manual provided that company vehicles are “operated
only in the performance of Company business by authorized employees who are 18 years
of age or over.” In a section on work assignments, the manual indicated field employees
are required to “retrieve and route their orders on or after the start of their shift. . . . [¶]
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. . . Employees are expected to be in their assigned work area unless otherwise approved
by a supervisor. Travel between work areas is by the most reasonably direct, and
efficient route.”
The manual included a section on work schedules, coffee breaks, and lunch
periods. The section provided that field employees are entitled to take two 10-minute
breaks and, when working more than six hours in a given day, the employee is required to
take a meal period before the end of the fifth hour of work.2 This section also stated:
“Field employees may carry coffee, tea, milk etc., and take a rest period as work permits.
Coffee and other beverages are not prepared on the job. . . . [¶] . . . Field employees are
to avoid coincidental meetings of more than two persons or more than one crew.
Prearranged meetings are prohibited.”
In a section of the manual titled “Conduct,” the document indicated company
coveralls and uniforms “are worn only in the performance of Company work or
Company-approved activities. Two-piece uniforms may be worn to and from work.”
The manual indicated employees are prohibited from consuming alcoholic beverages
during working hours, “whether on or off of Company premises.”
Plaintiffs also offered subsequently revised manuals containing similar provisions
to those identified above. A copy of the manual with a February 2011 revision date
indicated coveralls and two-piece uniforms could be worn to and from work, and stated
employees were allowed to take uniforms or coveralls home if required to report to work
with a uniform or coveralls. Plaintiffs’ evidence also included copies of a provision from
the collective bargaining agreement stating certain employees would be provided
coveralls, and employees would not take the coveralls home at night except in specified
circumstances.
Plaintiffs attached a separate “gas standard” for crew operations which set forth
rest period criteria. The standard allowed for crew operations employees to take rest
2 This section also included guidelines for meal periods when an employee works
more than 10 hours in a shift.
4
periods or coffee breaks, with the “Lead Construction Technician’s approval, when the
entire time away from the job does not exceed 15 minutes nor more frequent than one
morning and one evening break and: [¶] . . . May be taken en route to the first job or to
the base following the last job, if the travel time exceeds 1-1/2 hours or, [¶] . . . They
drive by or stop near a restaurant or store en route to their next job by a direct route,
provided parking space is available nearby and the stops are of short duration or, [¶] . . .
When working within a reasonable walking distance of a restaurant or store. One or two
crew members at a time may leave the job to obtain coffee or soft drinks. The crew truck
is not left unattended nor used for transportation in these cases or, [¶] . . . A ‘coffee
truck’ stops at or nearby the job location.” The policy further indicated an employee was
permitted to carry a beverage and take a short coffee break as the work permitted, but
noted, “It is not intended, however, that coffee or other hot or cold drinks be prepared on
the job.”
Declarations of Named Plaintiffs and Arturo Frias
The named plaintiffs declared Gas Company policy required them to be available
at all times during their shifts to respond to emergencies, including during meal and rest
breaks. Plaintiffs further declared Gas Company policy required that if field operations
employees are contacted, including during a meal or rest break, the employee is required
to acknowledge the contact to determine whether it is an emergency. Plaintiffs
additionally declared Gas Company policy required field operations employees to be in
their assigned work area unless they had supervisor approval to be out of the area; they
were required to always be “in route” during their work shifts; they were required to
drive a company vehicle but were not allowed to use the vehicle during meal and rest
periods; they could only take rest breaks as “work permits”; and they were prohibited
from having prearranged or coincidental meetings of more than two persons or more than
one crew of workers. Nelson declared he was disciplined in 2004 for being “out of
route” and using a Gas Company truck for transportation during a lunch break. Plaintiffs
declared Gas Company policy prohibited field operations employees from consuming
alcoholic beverages during working hours, and two of the named plaintiffs also declared
5
that under Gas Company policy they were not allowed to prepare coffee or other
beverages on the job site. According to plaintiffs, they were prohibited from taking their
coveralls home, but were also required to wear them only when working. They
additionally declared they were required to perform work-related duties before and after
their scheduled shifts, and they were not paid for the time.
Plaintiffs’ evidence included the declaration of a union representative, Arturo
Frias. Frias declared, based on his personal knowledge and disciplinary records he had
seen, that he was aware Gas Company employees had been disciplined for being out of
route, using company vehicles during their meal and rest periods, having coincidental or
prearranged meetings during meal or rest periods, consuming alcoholic beverages during
meal or rest periods, taking coveralls home, and for not responding to calls from
supervisors or dispatch during a shift.
Deposition Testimony of Gas Company Supervisors
Plaintiffs offered excerpts from the depositions of 13 Gas Company supervisors.
The supervisors all testified that one of their responsibilities was to enforce company
policies, or to review the company’s policies with the employees they supervised to
ensure compliance. Several supervisors testified that the employees they supervised used
company vehicles equipped with a communication device or radio that allowed
employees to be contacted. Several confirmed that the company trucks were equipped
with a horn that could be remotely honked if the radio was not answered. There was also
testimony that employees used mobile data terminals, a form of laptop computer.
In the included excerpts, the supervisors testified that employees had to be
reachable at all times while “on duty,” or available to be contacted by some method in
case of an emergency. One supervisor testified if there was an emergency during work
hours, one of two types of field employees would respond, but there was no particular
time frame because “all emergencies are different.” Another testified if an employee
received a contact during a meal break, the employee would respond if it was an
emergency and, once the area is made safe, the employee would start the lunch or break.
6
Others testified if it was not possible to restart the meal period, the employee would
receive an extra hour of pay.
Regarding the policy that employees stay “in route,” 10 of the supervisors testified
this meant going from one job to the next, and not going somewhere that was not on the
way, or not deviating from the most direct route to the job site, or taking the “most
efficient” route. One supervisor testified that employees were told to stay “en route,” but
not that there was “a certain mileage you can go before we call you out of route.” Five
supervisors testified they were aware an employee could be disciplined for not staying in
route.
Deposition Testimony of Gas Company Person Most Knowledgeable Witness
Plaintiffs further supported their motion with excerpts from the deposition of a
person most knowledgeable (PMK) witness for the Gas Company, Frank Ayala. Ayala
testified that employees were supposed to take a meal break in the “general proximity of
where their last order is or their next order.” Ayala indicated there was no written policy
defining in or out of route, or any set distance or mileage determining what is “in route,”
but the company relied on the employee’s “good judgment,” and “coaching” from
supervisors, who also used their judgment to determine “reasonable proximity.” Ayala
testified employees were allowed to conduct personal business on meal and rest breaks.
He said when there was an emergency call, employees were required to respond “as
quickly as they can safely respond when they are given the work.” He testified
employees with various job titles were to be available at all times to respond to
emergencies during their shifts. Although the company tried to avoid interrupting an
employee’s meal or rest breaks, “if it is an emergency and they are the closest person,” an
employee taking a meal or rest break might be interrupted by an emergency call, and
could be subject to disciplinary action for failing to respond.
Gas Company Opposition
The Gas Company contended class treatment was inappropriate because some of
the plaintiffs’ theories were legally untenable, and their claims would require
individualized proof.
7
Putative Class Member Declarations
To support the motion seeking an order declaring the action inappropriate for class
treatment, and in opposition to plaintiffs’ certification motion, the Gas Company
submitted declarations from 58 field operations employees. Some declarations were
short preprinted forms, with spaces for the employees to mark responses by hand. The
form declarations addressed how frequently the employee wore coveralls, whether she or
he was permitted to take the coveralls home, and whether he or she was required to
change into coveralls at the base before clocking in for a shift, or required to change out
of coveralls at the base after clocking out for the day. Most declarants indicated they
were permitted to take their coveralls home. Some, but not all, indicated they were
required to change into coveralls at the base before they were clocked in for the day.
Most reported they were not required to change out of coveralls at the base after clocking
out for the day.
The form also addressed meal periods, allowing the declarants to indicate how
frequently they were able to take a “duty-free 30-minute meal period within 5 hours of
starting work,” and whether or how often they were allowed to leave the job site for a
meal period. With respect to occasions when the employee took a meal period at the job
site, the declarations asked employees to assess the percentage of time that was the
employee’s free choice, because a member of management said the employee had to
remain at the site, because of an emergency, or for another reason. There was a range of
responses. One declarant reported only being able to take a duty-free meal period 45
percent of the days he worked. Some declarants indicated they were able to leave the job
site for a meal on only 5 percent of the days they worked. However, others reported
being able to take duty-free meal periods 100 percent of the days they worked, and they
were able to leave the job site 100 percent of the time.
The Gas Company’s declarations also included longer prose-style declarations
addressing meal and rest periods. These declarations contained text indicating the Gas
Company had never pressured the employee to skip meal or rest periods, and the
employee was allowed to place active orders on hold to take a meal period. The
8
declarations included language indicating how often the employee had the opportunity to
take an “off-duty meal period of at least 30 minutes,” whether the employee always
decided when and where to take meal and rest periods, and whether the employee
understood the Gas Company expected the employee to accurately record meal period
start and stop times. Some declarants recounted receiving premium pay on occasions
when they were unable to start a meal period within 5 hours of starting work. One
individualized paragraph described how the employee usually spent his or her meal and
rest periods, most included the sentence: “I am allowed to leave my work vehicle
unattended during meal and rest periods as long as I lock it.” Some employees stated
they brought lunch from home and sat in the truck or in a park to take the meal break.
Others described buying a meal and taking a meal break outside of the truck, or taking a
“reasonable detour” between orders to take a break. Several declared they usually took
rest breaks at fast food restaurants or stores.
Some of the longer declarations also described a process by which the employee
could keep track of an interrupted meal period so as to be paid for the time. Several
included a paragraph indicating that when the declarant received a message during a meal
period to respond to an emergency call, he or she interrupted the meal, recorded the
interruption, and responded to the emergency. Numerous declarants also stated if the
interruption was not for a particular type of emergency (an “A-1 leak order”), they could
ignore the message and respond after the meal break, or tell the dispatcher they were on
lunch and they would not be disturbed.3 Some included a paragraph stating they would
send a message to the dispatcher notifying him or her that they were starting a meal
period so they would not be contacted during that time. A few declarants noted they did
not always carry a communications device with them when they were on meal or rest
breaks.
3 Some declarants indicated they were rarely interrupted during their meal breaks.
Others were silent on how often they were interrupted.
9
The declarations further discussed the policy regarding Gas Company uniforms;
most indicated they were allowed to take their uniforms home and had the option to
change in and out of uniform at home. Many declarants in these longer declarations
indicated no Gas Company management had ever told them they needed to change into or
out of a uniform or coveralls at the base before or after their shift. With respect to
coveralls, many declared they did not always wear coveralls and changed into and out of
them on paid working time.
Gas Company Supervisor Declarations
The Gas Company additionally provided declarations from 12 supervisors who
worked at different bases, all of whom plaintiffs had deposed. These declarations
suggested supervisors at different bases had different expectations about what
communication devices employees were required to carry, if any.
Many of these supervisors declared they had rarely or never called employees on
their cell phones or paged employees during meal or rest breaks to have the employee
respond to an emergency. Eleven of the twelve declared that when they called
employees, they always asked if they were available, and, if the employee was on a meal
or rest break, they told the employee they could return the contact after the break was
finished. All declared they had never disciplined an employee for failing to respond to a
call or a page.4 Some supervisors declared that if they (personally, or through dispatch)
contacted an employee about an emergency, they made known whether it was an
emergency that required an immediate response or one that could be handled after a break
or ongoing order.
The supervisors further explained the customary practices at their bases regarding
the definition of “in route,” the personal use of company vehicles during meal and rest
breaks, the prohibition on preparing coffee, and the prohibition on meetings of two or
more employees. Some supervisors interpreted “in route” as allowing employees to use a
4 The declarations did not discuss how frequently employees failed to respond to
calls or pages, if at all.
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company vehicle to drive “a few minutes” or “a few blocks” out of “the most direct route
between two orders,” or to take a “reasonable detour,” or to take a “a reasonable
detour . . . as long as they are heading in the same direction as their next order.” Several
of the supervisors indicated employees could take their breaks anywhere they wanted
“within the break timeframe.” Two indicated their employees were allowed to drive
company vehicles “farther out of the most direct route . . . during breaks if that is how
they choose to spend their time.”
All of the supervisors declared employees “routinely” used company vehicles
between work orders to drive to locations such as restaurants, convenience stores, or
“other locations,” to take their meal or rest breaks. All declared they had never
disciplined an employee for using a company vehicle to drive to a location in their
assigned geographic area to take a meal or rest period.
Most, but not all, of the supervisors declared there was no prohibition on coffee
preparation at their bases during meal or rest periods.5 All noted that the issue had never
come up because employees “prefer to stop at a local coffee shop or bring beverages
from home,” or in some cases took coffee provided at the base. All of the supervisors
acknowledged the company’s prohibition on prearranged or coincidental meetings.
All but one of the supervisors declared the requirement that company attire only
be worn when performing work did not apply to employees during meal and rest breaks,
and employees were allowed to wear uniforms or coveralls during those times. All but
one further declared employees were free to wear their coveralls and uniforms to and
from work. All but one of the supervisors declared that employees often returned to the
base to shower and change out of their work clothes while on the clock, assuming they
were able to finish in the field before the scheduled end of their shifts. In addition, they
all declared that employees were not required to boot up computers before the start of a
5 One noted there was no prohibition on preparing coffee so long as employees did
not use a “blow torch or other device to heat their beverage.”
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shift; all but one further declared employees were not required to omit the time it takes to
shut down the computer from their time sheets.
The Gas Company’s evidence also included an excerpt from the PMK deposition,
in which Ayala testified: “I am not aware of specific restrictions [on what employees can
do during their meal and rest break times] other than they are not supposed to be traveling
long distance on a route. They are supposed to take an uninterrupted meal break in the
general proximity of where their either last order is or their next order. [¶] . . . [¶] . . .
They get a certain number of orders in a certain geographic area. And they are expected
to stay in that geographic area and take their meals within a reasonable proximity of those
orders.” The Gas Company also included excerpts from several supervisor depositions,
in which the supervisors testified they were unaware of the collective bargaining
provision prohibiting employees from taking coveralls home.
Trial Court Ruling
The trial court denied the motion for class certification. Although it concluded
plaintiffs had established the proposed class was ascertainable and sufficiently numerous,
and that the named plaintiffs would be adequate representatives, the court determined
common questions would not predominate in the litigation of the class claims. The court
found the evidence demonstrated the Gas Company’s policy was for field employees to
receive messages, even during breaks. However, the court explained there was no set
time in which employees were required to respond, and some employees did not respond
during their meal breaks. The court therefore concluded “whether a class member
actually responded to a message during their meal break is a question that cannot be
determined on a classwide basis because of variations in practice.” The court dismissed
plaintiffs’ arguments regarding the prohibition on alcohol consumption and preparation
of hot beverages as irrelevant.
As to the “in route” restriction, the court concluded the Gas Company policy
involved no specific geographic limitation and each supervisor was able to determine
what was reasonable. As a result, the court concluded “[w]hether the requirement that
the class members stay ‘en route’ amounts to such a restriction that Defendant remains in
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control of their meal breaks, cannot be determined for the entire class and would require
individualized analysis. In other words, there are differences in how the rule is applied
by supervisors that would create individualized questions for putative class members.”
The court determined plaintiffs did not provide evidence that a rule against
conducting personal business during meal breaks was uniformly applied to the class.
Similarly, the court concluded the plaintiffs had not established a rule prohibiting
meetings of more than two persons or more than one crew was applied to the class
because the plaintiffs provided only their own declarations as evidence. The court
concluded these three issues—whether class members’ meal breaks were interrupted by
messages to which they responded or did not respond to; the application of a rule against
personal business; and the application of the rule against class members meeting—
presented numerous individualized inquires.
On the off-the-clock work claim, the court concluded there was no evidence any
rule prohibiting putative class members from taking coveralls home was applied
uniformly to the class. Likewise, the court determined plaintiffs provided no evidence
the time employees spent booting up or turning off computers was required to be
performed off the clock.
The court found individual questions were likely to arise in the litigation rather
than common ones, thus class treatment would not be superior or substantially beneficial
to the litigants or the court. The court further held plaintiffs could not bring their PAGA
claim as a representative action because individual issues would predominate and a
representative action would not be manageable. The court sustained several evidentiary
objections to the Frias declaration, and also concluded plaintiffs’ cocounsel Ken M.
Fitzgerald was not qualified to act as class counsel.6
Plaintiffs’ appeal timely followed.
6 The court noted Fitzgerald might be able to overcome the deficiencies the court
identified, “if he can show that he is prepared to prosecute the case in association with
Louis P. Marlin, who is qualified to act as class counsel.”
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DISCUSSION
I. Legal Principles of Class Certification
As both sides acknowledge, the California Supreme Court recently considered
issues surrounding the certification of class action claims for meal and rest break
violations in Brinker Restaurant Corporation v. Superior Court (2012) 53 Cal.4th 1004
(Brinker). The court summarized the general requirements for certification of a class:
“The party advocating class treatment must demonstrate the existence of an ascertainable
and sufficiently numerous class, a well-defined community of interest, and substantial
benefits from certification that render proceeding as a class superior to the alternatives.
(Code Civ. Proc., § 382; [citations].) ‘In turn, the “community of interest requirement
embodies three factors: (1) predominant common questions of law or fact; (2) class
representatives with claims or defenses typical of the class; and (3) class representatives
who can adequately represent the class.” ’ [Citation.]” (Id. at p. 1021.)
As in Brinker, the disputed issue in this case is whether individual or common
questions would predominate in any classwide litigation. The Brinker court explained
“[t]he ‘ultimate question’ the element of predominance presents is whether ‘the issues
which may be jointly tried, when compared with those requiring separate adjudication,
are so numerous or substantial that the maintenance of a class action would be
advantageous to the judicial process and to the litigants.’ [Citations.] The answer hinges
on ‘whether the theory of recovery advanced by the proponents of certification is, as an
analytical matter, likely to prove amenable to class treatment.’ [Citation.] A court must
examine the allegations of the complaint and supporting declarations [citation] and
consider whether the legal and factual issues they present are such that their resolution in
a single class proceeding would be both desirable and feasible. ‘As a general rule if the
defendant’s liability can be determined by facts common to all members of the class, a
class will be certified even if the members must individually prove their damages.’
[Citations.]” (Brinker, supra, 53 Cal.4th at pp. 1021-1022, fn. omitted.)
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The Brinker court further explained the task of the reviewing court: “On review of
a class certification order, an appellate court’s inquiry is narrowly circumscribed. ‘The
decision to certify a class rests squarely within the discretion of the trial court, and we
afford that decision great deference on appeal, reversing only for a manifest abuse of
discretion: “Because trial courts are ideally situated to evaluate the efficiencies and
practicalities of permitting group action, they are afforded great discretion in granting or
denying certification.” [Citation.] A certification order generally will not be disturbed
unless (1) it is unsupported by substantial evidence, (2) it rests on improper criteria, or
(3) it rests on erroneous legal assumptions. [Citations.]’ [Citations.] Predominance is a
factual question; accordingly, the trial court’s finding that common issues predominate
generally is reviewed for substantial evidence. [Citation.] We must ‘[p]resum[e] in favor
of the certification order . . . the existence of every fact the trial court could reasonably
deduce from the record. . . .’ ” (Brinker, supra, 53 Cal.4th at p. 1022, citing Sav-On
Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 328-329 (Sav-On).)
II. The Trial Court Did Not Abuse Its Discretion in Denying Certification
Plaintiffs contend the trial court erred in concluding individual questions would
predominate in the litigation. Specifically, plaintiffs argue the evidence showed specific
Gas Company policies were applicable to all putative class members. Based on those
policies, plaintiffs assert the Gas Company failed to provide class members with legally
compliant meal and rest breaks, and caused employees to work off the clock. We
separately consider the meal/rest break claim and the off-the-clock claim.7
7 The trial court did not separately address plaintiffs’ rest break claim. On appeal,
plaintiffs do not separately address the trial court’s error, if any, in denying certification
of a rest-period class. Thus, without deciding that any meal break analysis was wholly
applicable to the rest break claims, we consider the claims together.
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A. Meal/Rest Breaks
1. Relevant Legal Background
We first briefly consider the underlying legal principles applicable to plaintiffs’
claims. Under Wage Order No. 4, “No employer shall employ any person for a
work period of more than five (5) hours without a meal period of not less than 30
minutes . . . . Unless the employee is relieved of all duty during a 30 minute meal period,
the meal period shall be considered an ‘on duty’ meal period and counted as time
worked.” (Cal. Code Regs., tit. 8, § 11040, subd. 11(A).) “An employer also has a duty
to authorize and permit rest breaks; the number of breaks depends on the length of the
shift. (Cal. Code Regs, tit. 8, § 11040, subd. 12; Brinker, supra, 53 Cal.4th at pp. 1028-
1031.)” (Bradley v. Networkers International, LLC (2012) 211 Cal.App.4th 1129, 1149
(Bradley).)
Plaintiffs’ legal theory hinges on whether the field operations employees were
“relieved of all duties,” and whether Gas Company restrictions on employee conduct
converted meal periods into “hours worked.”8 Plaintiffs rely on cases such as Madera
Police Officers Association v. City of Madera (1984) 36 Cal.3d 403 (Madera), in which
the California Supreme Court concluded the “substantial limitations” placed on the
plaintiff police officers during their noncompensated meal periods “converted that time
into hours worked.” (Id. at p. 409.) The court adopted a two-step analysis that
considered “whether the restrictions on off-duty time are primarily directed toward the
fulfillment of the employer’s requirements and policies,” and “whether the employee’s
off-duty time is so substantially restricted that they are unable to engage in private
pursuits.” (Ibid.) Madera did not involve state wage and overtime laws. But courts have
8 California law requires employers to pay employees for all hours worked, and the
IWC wage orders largely define “hours worked” as “the time during which an employee
is subject to the control of an employer, and includes all the time the employee is suffered
or permitted to work, whether or not required to do so.” (See Cal. Code Regs., tit. 8,
§ 11040, subd. 2(K); Morillion v. Royal Packing Company (2000) 22 Cal.4th 575, 581
(Morillion) [all 15 wage orders contain same definition of hours worked, with exception
of two which include additional language].)
16
since applied a similar analysis to workers in other industries governed by state Labor
Code provisions and wage orders, largely in “on-call” contexts other than meal periods.
Thus, for example, in Morillion, our high court concluded time agricultural
workers were required to spend on the employer’s shuttle bus taking them to the fields
was compensable. (Morillion, supra, 22 Cal.4th at p. 595.) During this travel time, the
plaintiff workers were “foreclosed from numerous activities in which they might
otherwise engage if they were permitted to travel to the fields by their own
transportation,” such as running errands requiring the use of a car or stopping for
breakfast. (Id. at p. 586.) The employer thus prohibited the workers from “effectively
using their travel time for their own purposes.” (Ibid.) The court explained in part, the
“level of the employer’s control over its employees, rather than the mere fact that the
employer requires the employees’ activity, is determinative . . . . [¶] . . . [¶] . . . by
requiring employees to take certain transportation to a work site, employers thereby
subject those employees to its control by determining when, where, and how they are to
travel. Under the definition of ‘hours worked,’ that travel time is compensable.” (Id. at
pp. 587-588, citations omitted; see also Seymore v. Metson Marine, Inc. (2011) 194
Cal.App.4th 361, 373-376 (Seymore) [workers on oil spill recovery vessels; standby time
during two-week work periods]; Ghazaryan v. Diva Limousine, Ltd. (2008) 169
Cal.App.4th 1524, 1535 (Ghazaryan) [describing multifactor test set forth by Ninth
Circuit in Berry v. County of Sonoma (9th Cir. 1994) 30 F.3d 1174, and adopted in
Department of Labor Standards Enforcement (DLSE) opinion letter of Dec. 28, 1998].)
Similarly, in Bono Enterprises, Inc. v. Bradshaw (1995) 32 Cal.App.4th 968
(Bono), disapproved on other grounds in Tidewater Marine Western, Inc. v. Bradshaw
(1996) 14 Cal.4th 557, 574, the court concluded a DLSE decision requiring an employer
to pay employees for meal periods if the employees are required to remain at the
worksite, was consistent with the IWC wage order definition of “hours worked” and the
requirement of a duty-free meal period. (Bono, at pp. 974-975.) The court explained:
“When an employer directs, commands or restrains an employee from leaving the work
place during his or her lunch hour and thus prevents the employee from using the time
17
effectively for his or her own purposes, that employee remains subject to the employer’s
control. According to [the definition of hours worked], that employee must be paid.”
(Id. at p. 975; see Morillion, supra, 22 Cal.4th at p. 583.)
A 1992 DLSE opinion letter specifically addresses the issue of whether an
employee who is required to wear a pager during a meal period is entitled to
compensation for that meal period.9 The DLSE opinion letter noted the analysis of
Madera “is not so responsive to situations involving such use during scheduled meal
periods because of the specific requirement that meal periods be ‘duty free.’” (DLSE
Opn. Ltr. No. 1992.01.28, pp. 2-3.) The DLSE then articulated the following policy:
“If the employee is simply required to wear a pager or respond to an in-house
pager during the meal period there is no presumption that the employee is under the
direction or control of the employer so long as no other condition is put upon the
employee’s conduct during the meal period. If, on the other hand, the employer requires
the employee to not only wear the pager or listen for the in-house paging system, but also
to remain within a certain distance of a telephone or otherwise limits the employee’s
activities, such control would require that all of the meal period time be compensated. [¶]
So long as the employee who is simply required to wear the pager is not called upon
during the meal period to respond, there is no requirement that the meal period be paid
for. On the other hand, if the employee responds, as required, to a pager call during the
meal period, the whole of the meal period must be compensated.” (DLSE Opn. Letter
No. 1992.01.28, p. 3.)
And, more recently, in Brinker, the court explained the fundamental employer
obligation associated with a meal break is “to relieve the employee of all duty and
relinquish any employer control over the employee and how he or she spends the time.”
(Brinker, supra, 53 Cal.4th at pp. 1038-1039.) The court further summarized the
9 DLSE opinion letters are not controlling upon the courts but “ ‘ “ ‘ “constitute a
body of experience and informed judgment to which courts and litigants may properly
resort for guidance.” ’ ” ’ ” (Brinker, supra, 53 Cal.4th at p. 1029, fn. 11, citations
omitted.)
18
employer’s duty with respect to meal breaks as satisfied if the employer “relieves its
employees of all duty, relinquishes control over their activities and permits them a
reasonable opportunity to take an uninterrupted 30-minute break, and does not impede or
discourage them from doing so.” (Id. at p. 1039.)
2. Analysis
Plaintiffs contend their meal/rest break claim is based on the theory that field
operations employees were never relieved of all duties during breaks, even if they never
were called upon to perform any work-related duties. Plaintiffs argue that Gas Company
policy required field operations employees to be available to respond to emergency
contacts during their meal and rest breaks. They further contend the Gas Company
uniformly applied other restrictions to putative class members on break periods, such that
the breaks were transformed into “on-duty” periods.
The Gas Company argues there is no evidence of a uniform companywide policy
regarding putative class members’ conduct except that they must respond to certain rare
emergency calls, and that policy alone is an insufficient basis of liability. It contends that
to the extent there were other conditions placed on some employees, these were not
companywide policies, thus class treatment is inappropriate because individual questions
would predominate in any determination of what those limitations were, or how
restrictive they were. To the extent there were other companywide policies, the Gas
Company contends plaintiffs’ theories based on these restrictions cannot support liability.
The issue before the trial court, and before us, is class certification only. “ ‘The
certification question is “essentially a procedural one that does not ask whether an action
is legally or factually meritorious.” ’ [Citations.]” (Brinker, supra, 53 Cal.4th at
p. 1023.) Whether plaintiffs’ theories of liability are ultimately valid or invalid, in
considering the predominance element, the trial court’s task was to determine “ ‘whether
the theory of recovery advanced by the proponents of certification is, as an analytical
19
matter, likely to prove amenable to class treatment.’ [Citation.]”10 (Id. at p. 1021.) And,
Brinker instructs that “[c]laims alleging that a uniform policy consistently applied to a
group of employees is in violation of the wage and hour laws are of the sort routinely,
and properly, found suitable for class treatment.” (Id. at p. 1033, italics added.)
In this case, then, the question was whether plaintiffs presented substantial
evidence of a systematic company policy or policies that allegedly rendered break periods
compensable as hours worked. (See Brinker, supra, 53 Cal.4th at p. 1051 [class
treatment inappropriate where plaintiff did not present substantial evidence of systematic
company policy to require off-the-clock work].) Plaintiffs allege the failure to relieve of
duties is demonstrated by several of the Gas Company’s companywide policies that are
applicable to all putative class members. But the trial court concluded the evidence did
not demonstrate these policies were in fact uniformly applied to all putative class
members, thus requiring individualized questions as to the degree of restraint the
company imposed on individual members during their meal and rest breaks.
We are mindful of the standard of review: “[I]n the absence of other error, a trial
court ruling supported by substantial evidence generally will not be disturbed ‘unless
(1) improper criteria were used [citation]; or (2) erroneous legal assumptions were made
[Citation.]’ [citation]. Under this standard, an order based upon improper criteria or
incorrect assumptions calls for reversal ‘ “even though there may be substantial evidence
to support the court’s order.” ’ [Citations.] Accordingly, we must examine the trial
10 In Brinker, the court reiterated that in general, a court should not decide the merits
of a plaintiff’s legal theory in the context of a class certification decision. While parties
may jointly consent to have a court decide the merits of underlying substantive legal
issues (Brinker, supra, 53 Cal.4th at p. 1026; Linder v. Thrifty Oil Co. (2000) 23 Cal.4th
429, 443 (Linder)), here plaintiffs did not request or consent to a decision on the merits of
its legal theories. Further, the trial court’s analysis was by and large focused only on the
certification question and avoided the merits of plaintiffs’ claims. Thus, the Gas
Company’s extended briefing regarding the validity of plaintiffs’ legal theories is
irrelevant to the issues presented in this appeal and we need not consider those
arguments.
20
court’s reasons for denying class certification. ‘Any valid pertinent reason stated will be
sufficient to uphold the order.’ [Citation.]” (Linder, supra, 23 Cal.4th at pp. 435-436.)
We turn first to one of the plaintiffs’ critical allegations, that the Gas Company
policies prevented putative class members from engaging in personal business during
their breaks. Substantial evidence supported the trial court determination that plaintiffs
did not establish the existence of a uniform, consistently applied policy, restricting
employees from conducting personal activities during their meal and rest breaks.
Initially, we note there was no evidence that Gas Company had any policy,
whether formal or informal, explicitly prohibiting employees from conducting personal
business during meal breaks. Indeed, plaintiffs’ evidence included deposition testimony
from a Gas Company PMK witness who testified that field operations employees are
allowed to conduct personal business during their breaks. Even the named plaintiffs did
not declare they were explicitly prohibited from conducting personal business during
breaks. However, plaintiffs alleged a written policy prohibiting the personal use of
company vehicles and the requirement that employees stay “in route” severely limited
putative class members’ ability to engage in any personal activities. Yet, despite the
written policy prohibiting the personal use of company vehicles, there was substantial
evidence before the trial court indicating this was not a uniform prohibition consistently
applied across the company disallowing personal use of vehicles during breaks. Gas
Company evidence included declarations from multiple supervisors indicating employees
under their supervision were allowed to drive company vehicles to fast food restaurants,
convenience stores, or “other locations,” to take their meal or rest breaks. Several
declared their supervisees were allowed to take their breaks anywhere they wanted,
limited only by the amount of time they had for the break. The Gas Company further
provided evidence indicating putative class members were free to go anywhere they
wished on foot, after parking and locking the company vehicle.
The trial court could reasonably conclude plaintiffs did not present evidence
establishing the prohibition against personal use of company vehicles was a uniform
policy consistently applied to putative class members, particularly as it related to an
21
alleged restriction on conducting personal business during breaks, such that it would
be amenable to a common method of proof. (Sav-On, supra, 34 Cal.4th at p. 328
[“ ‘[W]here a certification order turns on inferences to be drawn from the facts,
“ ‘the reviewing court has no authority to substitute its decision for that of the trial
court.’ ” ’ ”].)
Similarly, there was evidence establishing a companywide policy of requiring
employees to stay “in route,” but there was also evidence indicating there was no uniform
definition of the term, and variations among supervisors as to their interpretation of the
requirement. While some supervisors declared employees were given leeway during
breaks so long as they were heading in the same direction as their next order, others
considered it acceptable for employees to drive a few minutes or a few blocks out of the
route during a break; some indicated they told employees they could drive even farther
afield if that is how they wished to spend their break time.
This issue is: was there a uniformly applied companywide policy that would
allow for a common method of proof? Was there substantial evidence to support the trial
court’s finding that plaintiffs did not make a factual showing that the policies they alleged
could be established by common evidence? Given that plaintiffs’ theory of liability
depends on the level of restriction and control exercised over putative class members
during their meal breaks, substantial evidence supported the trial court’s determination
that individual questions would predominate on the issue of whether the prohibition on
personal use of company vehicles applied during meal breaks, and the “in route”
requirement, constituted a level of control that turned the breaks into compensable time.
Plaintiffs alleged other Gas Company policies demonstrated it exerted control over
putative class members during their meal breaks, and that these were also companywide
policies. However, we need not consider each policy individually. Plaintiffs’ theory of
liability is that the Gas Company did not provide putative class members duty-free
meal/rest periods because it did not relinquish control over them. The legal authorities
upon which plaintiffs rely indicate the central issues are the level of control, and whether
22
employees may use the break time for their own purposes. (See, e.g., Morillion, supra,
22 Cal.4th at pp. 583, 586-587; Bono, supra, 32 Cal.App.4th at p. 975.)
For example, in Seymore, and Gomez v. Lincare, Inc. (2009) 173 Cal.App.4th 508,
523, courts attempting to determine whether on-call time was compensable considered
factors such as excessive geographical restrictions on employee’s movements, the
frequency of calls while the employees were on call, “ ‘ “whether a fixed time limit for
response was unduly restrictive,” ’ ” and “ ‘ “whether the employee had actually engaged
in personal activities during call-in time.” ’ ” (Seymore, supra, 194 Cal.App.4th at p.
374; Gomez, at p. 523.) Assuming without deciding that the reasoning of these cases
would be persuasive in a case involving meal or rest breaks rather than “standby” or “on
call” time, the cases explain that the extent to which plaintiffs are able to use the
challenged time for personal activities is a critical factor. (Seymore, at p. 374; Gomez, at
pp. 523-524.)
Here, there was substantial evidence the Gas Company did not have a
companywide policy consistently applied to putative class members relating to the
personal use of company vehicles, or uniform geographic restrictions, that directly or
indirectly limited field operations employees’ ability to use their break time for personal
activities. (Brinker, supra, 53 Cal.4th at pp. 1033, 1051; Sav-On, supra, 34 Cal.4th at
p. 338; Arenas v. El Torito Restaurants, Inc. (2010) 183 Cal.App.4th 723, 733.) Given
the centrality of this allegation to plaintiffs’ theory of liability, the trial court could
reasonably conclude individual questions would predominate in any litigation of their
claims, even if there was also evidence of some companywide policies governing
employee availability for emergencies or restraints on employee conduct during breaks.
Two cases reaching different results on certification illustrate the point. In
Ghazaryan, supra, 169 Cal.App.4th 1524, a limousine driver sought certification of a
class action on behalf of similarly situated drivers. The action alleged the employer
violated wage and hour laws by failing to compensate drivers for on-call time between
assignments. The Court of Appeal concluded that on the community of interest factor,
the trial court erred in denying certification because it incorrectly focused on the
23
difficulty of evaluating the validity of the employer’s compensation policy in light of
variations in how drivers spent their on-call time, rather than on the reasonableness of the
employer’s policies as applied to its drivers as a whole. (Id. at pp. 1527-1528, 1534.)
The court noted the record revealed the employer dictated to a large extent how the
drivers used their time, in part through a handbook distributed to all drivers which set
forth various policies governing drivers’ conduct and activities during the on-call periods.
The limitations described in the handbook applied “across the board” to all drivers who
had on-call time. (Id. at p. 1536.) Although the employer offered evidence suggesting
some drivers used their on-call time for their own purposes, the court concluded this
evidence did not change the fundamental legal question presented by the suit. The court
explained: “Although individual testimony may be relevant to determine whether these
policies unduly restrict the ability of drivers as a whole to utilize their on-call time for
personal purposes, the legal question to be resolved is not an individual one. To the
contrary, the common legal question remains the overall impact of [the employer’s]
policies on its drivers, not whether any one driver, through the incidental convenience of
having a home or gym nearby to spend his or her gap time, successfully finds a way to
utilize that time for his or her own purposes.” (Ibid.)
In Soderstedt v. CBIZ Southern California, LLC (2011) 197 Cal.App.4th 133
(Soderstedt), the court reached a different result. The plaintiffs were accountants seeking
certification of a class to prosecute wage and hour claims resulting largely from
misclassification. The plaintiffs argued their claims were subject to common proof
because the classification question could be resolved by evaluating the employer’s
policies and procedures. (Id. at p. 152.) The court rejected this argument, explaining that
even where an alleged misclassification involves application of a uniform policy,
individualized inquiry may be necessary “because the policy may properly classify some
employees as exempt but not others.” (Id. at p. 153.) Although the employer
“maintained uniform internal policies,” the “evidence showed that the manner in which
those policies and standards were implemented as to each [putative class member] varied
depending on multiple factors.” (Id. at p. 154.) The court thus concluded substantial
24
evidence supported the trial court’s determination that common issues did not
predominate. (Ibid.)
We find this case to be more similar to Soderstedt than Ghazarayan. Although
plaintiffs allege uniform policies may be used to prove their claim that putative class
members were denied duty-free meal/rest periods, there was substantial evidence that
several of these policies were not in fact uniform or consistently applied. In Ghazarayan,
the record established, with apparently undisputed evidence, that the employer dictated
how putative class members were to use their standby time. Here, the Gas Company
disputes the uniformity and consistency of application of the critical policies plaintiffs
rely upon to support their claims. Individualized evidence would be required to resolve
simply the existence of these alleged uniform policies, and the extent to which they were
in fact applied.
Two cases decided after Brinker likewise provide an instructive contrast. In
Morgan v. Wet Seal, Inc. (2012) 210 Cal.App.4th 1341 (Wet Seal), the appellate court
affirmed a trial court order denying class certification. The plaintiffs were sales
employees at the defendant’s clothing stores. They alleged they were required to wear
defendant’s merchandise, but were not reimbursed for the merchandise they purchased to
wear, and that they were not reimbursed for mileage for their work-related travel. (Id. at
p. 1350.) Plaintiffs’ legal theory was that the defendant’s unlawful practices were
reflected in written company policies which applied to all members of the putative class.
(Id. at p. 1346.) The trial court denied certification, concluding individual questions
would predominate as the defendant’s company policies did not provide a common
method of classwide proof on central liability questions. (Id. at p. 1353.)
The Court of Appeal agreed. Although the plaintiffs purported to base their claims
on the defendant’s company policies, the written policies did not on their face support the
plaintiffs’ claims. The dress code policy did not require employees to wear defendant’s
merchandise, and the plaintiffs’ other evidence—consisting mainly of declarations from
putative class members—did not demonstrate any common dress code practices. (Wet
Seal, supra, 210 Cal.App.4th at pp. 1356-1357.) Similarly, the defendant’s written travel
25
reimbursement policy did not support plaintiffs’ allegations, and plaintiffs themselves
categorized the policy in practice as “hit or miss.” (Id. at p. 1357.) Thus, the Court of
Appeal concluded the plaintiffs did not produce substantial evidence of a companywide
policy which could be used to establish classwide liability. The written policies alone did
not constitute substantial evidence that defendant engaged in unlawful practices, and the
plaintiffs’ other evidence reinforced the conclusion that liability would have to be
decided on an individualized basis. (Id. at pp. 1362, 1364, 1368.) The employer disputed
that any unlawful policies existed, and the plaintiffs failed to establish there was any
classwide method of proof for resolving that liability question. (Id. at pp. 1362-1363.)
In contrast, in Bradley, supra, 211 Cal.App.4th 1129, the appellate court applied
Brinker and reversed a trial court order denying certification to a class of allegedly
misclassified employees who were also denied meal and rest breaks. The court noted
there was undisputed evidence showing the defendant had “consistent companywide
policies applicable to all employees regarding work scheduling, payments, and work
requirement.” (Bradley, at p. 1147.) Irrespective of the merits of the misclassification
claim, the court explained “[t]he critical fact is that the evidence likely to be relied upon
by the parties would be largely uniform throughout the class.” (Ibid.) With respect to the
meal and rest break claims, the court noted the defendant did not present any evidence
showing it had a formal or informal policy of permitting legally required breaks, that any
worker believed he or she was entitled to take legally required breaks, that some or all
workers took the breaks, or evidence that its “meal or break policies (or the failure to
institute such policies) were different with respect to each worker.” (Id. at p. 1150.)
The court thus concluded, “plaintiffs’ theory of recovery is based on [the
defendant’s] (uniform) lack of a rest and meal break policy and its (uniform) failure to
authorize employees to take statutorily required rest and meal breaks. The lack of a
meal/rest break policy and the uniform failure to authorize such breaks are matters of
common proof. Although an employer could potentially defend these claims by arguing
that it did have an informal or unwritten meal or rest break policy, this defense is also a
matter of common proof.” (Bradley, supra, 211 Cal.App.4th at p. 1150.) The defendant
26
argued the issue of which employees missed breaks, how many breaks were missed, and
the reasons employees missed breaks was highly individualized. The court
acknowledged this was true, but concluded that, under Brinker, “when an employer has
not authorized and not provided legally required meal and/or rest breaks, the employer
has violated the law and the fact that an employee may have actually taken a break or was
able to eat food during the workday does not show that individual issues will predominate
in the litigation.” (Bradley, at p. 1151.)
Here, as in Wet Seal, plaintiffs have alleged they can prove their claims using
evidence of companywide policies, but the Gas Company disputes the uniformity of
those policies, and plaintiffs have not established the dispute may be resolved with
common proof rather than individualized showings. And, in contrast to Bradley, there is
no undisputed evidence showing consistent companywide policies that uniformly
restricted putative class members’ use of company vehicles for personal use or their
movement during breaks.
We find no trial court abuse of discretion with respect to the meal/rest break claim.
B. Off-the-clock Claims: Donning/Doffing Uniforms and Computer Use
Substantial evidence also supported the trial court finding that individual questions
would predominate in litigation of plaintiffs’ off-the-clock work claims. Plaintiffs
alleged Gas Company policies required putative class members to be dressed in a
uniform or coveralls at the start of their shift, but they were prohibited from taking their
work attire home, and were limited to wearing work attire only in the performance of
work, thus they were forced to spend uncompensated time before their shifts getting
dressed in work attire. However, plaintiffs offered no evidence of a companywide policy
prohibiting employees from getting dressed in work clothing on the clock at the
beginning of their shifts.11 Further, although plaintiffs offered evidence that a collective
11 The one citation to the record plaintiffs offer on appeal to support this point refers
only to the declaration of Frias, in which he declared he was aware of Gas Company
employees being disciplined for not being in a uniform or coveralls at the start of a shift.
Aside from the evidentiary issues surrounding this declaration, even if admitted, the
27
bargaining agreement provision indicated workers were not to take coveralls home with
them in most cases, the Gas Company offered evidence indicating it had waived that
provision, and it was not widely known within the company. In addition, the Gas
Company offered evidence that in practice employees were allowed to take coveralls and
uniforms home with them, and did so. Indeed, the only evidence plaintiffs offered on this
claim were their own declarations, the collective bargaining agreement provision, and
Frias’s declaration. No substantial evidence pointed to a uniform, consistently applied
companywide policy requiring employees to don and doff uniforms during
uncompensated time, or prohibiting class members from wearing work attire to and from
their base.
Similarly, no substantial evidence pointed to a uniformly applied, companywide
policy requiring employees to boot up or shut down their mobile computers while they
were off the clock. Plaintiffs offered no evidence of any policy relating to the booting up
or shutting down of computers, and no evidence that any employees were required by
company policy or practice to engage in these activities in off-the-clock time. Even the
named plaintiffs’ own declarations stated only that they were required to engage in work
activities before and after their shifts, without providing any specifics. To the extent the
named plaintiffs were required to perform off-the-clock work, their evidence indicates
only that their claims arose from the individual actions of particular supervisors. As
such, the trial court could reasonably conclude based on the evidence that individual
questions would predominate in any litigation of these claims. (Bradley, supra, 211
Cal.App.4th at p. 1156.)
statement did not provide substantial evidence of a uniformly applied companywide
policy prohibiting employees from donning uniforms or coveralls during paid time. The
same is true of Frias’s other statements regarding the other challenged policies in this
case. Frias’s declaration at best provided only anecdotal evidence of discipline rather
than evidence of uniformly applied companywide policies. In light of our conclusions
above, we need not consider plaintiffs’ argument that the trial court erred in sustaining
objections to portions of the Frias declaration.
28
The trial court did not abuse its discretion in denying certification of a class based
on the off-the-clock claims. (Brinker, supra, 53 Cal.4th at pp. 1051-1052.)
III. Superiority and Adequacy of Class Counsel
Plaintiffs also challenge the trial court’s determination that a class action would
not be a superior method of resolving this case. The court’s decision was based on its
conclusion that individual questions would predominate in the litigation, and the claims
brought on behalf of the class would be “difficult if not impossible to manage.” We have
affirmed the trial court’s conclusion as a proper exercise of its discretion. We similarly
find substantial evidence established class treatment was not superior in this action
because individual questions would predominate, requiring numerous “mini-trials.”
(Soderstedt, supra, 197 Cal.App.4th at p. 157; Ali v. U.S.A. Cab Ltd. (2009) 176
Cal.App.4th 1333, 1353.) In light of our conclusions affirming the denial of certification
of the class claims, we need not consider plaintiffs’ argument that the trial court erred in
finding cocounsel Fitzgerald inadequate as class counsel. (Ali, at p. 1353.)
IV. The Trial Court Erred in Denying the PAGA Claim
Plaintiffs argue the trial court erred in denying their representative PAGA claim.
Plaintiffs assert the trial court improperly applied class action requirements to the claim,
and alternatively adopt their arguments regarding the trial court’s conclusions on
predominance. We agree that the trial court abused its discretion in applying class action
requirements to the PAGA claim.
Arias v. Superior Court (2009) 46 Cal.4th 969, 984 (Arias), is the controlling
decision. Under PAGA, “an ‘aggrieved employee’ may bring a civil action personally
and on behalf of other current or former employees to recover civil penalties for Labor
Code violations. (Lab. Code, § 2699, subd. (a).)”12 (Arias, at p. 980.) In Arias, the
12 Labor Code section 2699, subdivision (a) provides: “Notwithstanding any other
provision of law, any provision of this code that provides for a civil penalty to be
assessed and collected by the Labor and Workforce Development Agency or any of its
departments, divisions, commissions, boards, agencies, or employees, for a violation of
this code, may, as an alternative, be recovered through a civil action brought by an
29
plaintiff sought civil penalties under PAGA, and asserted UCL claims (Bus. & Prof.
Code, § 17200 et seq.), for himself and other employees for alleged Labor Code
violations. (Id. at pp. 976, 981.) The trial court granted the defendants’ motion to strike
the representative causes of action on the ground that the plaintiff failed to comply with
pleading requirements for class actions. The Court of Appeal held the representative
claims under the UCL were subject to class action requirements, but the PAGA claims
were not. (Ibid.)
In the California Supreme Court, the defendants challenged the appellate court
ruling on the PAGA claims, while the plaintiff challenged the court’s ruling as to the
representative UCL claims. Our high court affirmed the appellate court ruling. On the
UCL claims, the court concluded Proposition 64 allowed private plaintiffs to bring
representative actions under the UCL only if they comply with class action requirements
set forth in Code of Civil Procedure section 382.13 (Arias, supra, 46 Cal.4th at pp. 977-
978, 980.)
However, our Supreme Court rejected the defendants’ argument that the plaintiff
was also required to satisfy class action requirements when seeking civil penalties on a
representative basis under PAGA. The court considered and dismissed arguments that
not requiring compliance with class action requirements would lead to “absurd results,”
aggrieved employee on behalf of himself or herself and other current or former
employees pursuant to the procedures specified in Section 2699.3.” Labor Code section
2699, subdivision (c) defines “aggrieved employee” as “any person who was employed
by the alleged violator and against whom one or more of the alleged violations was
committed.”
13 Code of Civil Procedure section 382 provides: “If the consent of any one who
should have been joined as plaintiff cannot be obtained, he may be made a defendant, the
reason thereof being stated in the complaint; and when the question is one of a common
or general interest, of many persons, or when the parties are numerous, and it is
impracticable to bring them all before the court, one or more may sue or defend for the
benefit of all.”
30
would conflict with the legislative intent of the act, or would violate the due process
rights of defendant employers and nonparty aggrieved employees. (Arias, supra, 46
Cal.4th at pp. 982-985.) The court concluded the plaintiff was not required to satisfy
Code of Civil Procedure section 382 requirements to pursue civil penalties on a
representative basis under PAGA.
While the Gas Company acknowledges the holding of Arias, it contends the trial
court could still deny plaintiffs’ PAGA claim on the ground that the litigation would be
unmanageable. However, the court’s finding of unmanageability was based entirely on
the conclusion that plaintiffs had not satisfied the community interest prong for class
action certification, specifically by failing to establish common questions would
predominate in the litigation. Since, under Arias, a plaintiff need not even plead a
representative PAGA claim in accordance with class action requirements, it seems
anomalous to require that the plaintiff establish the community of interest class action
requirement with respect to a PAGA claim, in the context of a class certification
procedure. Indeed, the Gas Company has offered no authority suggesting such a
procedure is authorized or appropriate. The authorities the Gas Company cites all pre-
date Arias, they all concern representative claims under the UCL (prior to Proposition
64), and they do not support the company’s position.
For example, in Bronco Wine Co. v. Frank A. Logoluso Farms (1989) 214
Cal.App.3d 699 (Bronco Wine), the plaintiff, a grape grower, sued a winery operator, on
a breach of contract theory. The plaintiff also sought restitution, on behalf of itself and
other grape growers under contract with the defendant, as compensation for unfair
business practices, such as wrongfully rejecting grapes, applying quality standards
unreasonably in order to pay less for grapes than a previously agreed upon price, and
threatening to sue growers who complained. (Id. at p. 715.) The trial court awarded
restitution to several nonparty grape growers. The Court of Appeal concluded this was
error because nonparty growers were not given notice of the proceedings or an
opportunity to be heard before judgment. (Id. at pp. 718-719.) The procedure the trial
court used to grant awards to certain nonparties raised “serious fundamental due process
31
considerations.” (Id. at p. 717.) The court noted that the determination of whether the
challenged business practice was unfair was complex, and the potential amount of
restitution per grower was significant and not determined by an automatic calculation.
(Id. at p. 720.) The growers also had an alternative administrative remedy. (Id. at pp.
720-721.) Although the court issued restitution awards to 27 nonparty grape growers,
contracts of only 20 nonparty grape growers were introduced into evidence. (Id. at pp.
716, 718.) Disputes arose because the defendant asserted 12 of the growers had already
released their claims. (Id. at p. 718.) Under those circumstances, the court concluded the
trial court abused its discretion in denying the defendant’s pretrial motion to strike claims
asserted on behalf of nonparty growers or require that a class action procedure be
utilized. (Id. at pp. 715, 721.)
Bronco Wine does not mandate an outcome in this case. Here, there is a California
Supreme Court case explicitly holding that an aggrieved employee need not meet class
action requirements to bring a PAGA claim seeking civil penalties for himself and other
aggrieved employees.14 Arias considered, and rejected, claims that allowing PAGA
claims without mandating class action requirements would create due process problems, a
primary concern of the court in Bronco Wine. Moreover, the court in Bronco Wine was
concerned with the difficulty of making awards of restitution under the UCL. Under
PAGA, a plaintiff may only pursue civil penalties on behalf of himself and other
aggrieved employees. The amount of the penalties are set forth in the statute. (Lab.
Code, § 2699, subd. (f).) Unmanageability due to the difficulty of determining
individualized restitution awards is not present in a PAGA claim, as it may have been in
some representative UCL claims before Proposition 64.
14 Indeed, the Bronco Wine court expressed skepticism that it was “proper to
maintain an individual, representative action for unfair competition outside the confines
of a class action.” (Bronco Wine, supra, 214 Cal.App.3d at p. 720.)
32
The federal district court cases defendant relies upon similarly rejected
representative UCL claims because of the problems inherent in determining restitution
awards when the economic losses suffered by each nonparty varied significantly. (See,
e.g., Marshall v. Standard Insurance Company (2000) 214 F.Supp.2d 1062, 1070, 1072-
1073 [pursuant to motion to dismiss, dismissing representative UCL claim related to
alleged bad faith handling of disability claims; amount of restitution for each nonparty
could not be determined with straightforward calculation and would not be nominal or
identical; allowing representative claim for injunctive relief]; Barnett v. Washington
Mutual Bank (N.D.Cal. Sept. 9, 2004, C 03-00753 CRB) 2004 U.S. Dist. Lexis 18491
[striking representative claim under UCL to the extent it sought restitution because
amount of restitution per party was large and amounts of overtime were not recorded,
making determination of amount of restitution complicated]; Nachum v. Allstate
Insurance Company (C.D.Cal. July 22, 1997, CV 97-4493) 1997 U.S. Dist. Lexis 12670
[dismissing UCL representative claim alleging bad faith in claims handling for
earthquake property damage; court could not award restitutionary relief and provide due
process without litigating individualized bad faith claims]; see also Lazar v. Trans Union
LLC (C.D.Cal. 2000) 195 F.R.D. 665, 673-674 [district court granted motion to strike
representative UCL claim because range of possible damages was wide and plaintiff’s
circumstances were different from those of fellow consumers; court determined
plaintiff’s circumstances were “unusual” thus he was not a reasonable representative].)
Likewise, South Bay Chevrolet v. General Motors Acceptance Corporation (1999)
72 Cal.App.4th 861 (South Bay), also concerned representative claims under the UCL,
prior to the passage of Proposition 64. The plaintiff, an automotive dealership, asserted
an individual claim for unfair business practices, a representative claim on behalf of other
California dealerships, and class action allegations. After unsuccessful summary
judgment motions, the parties stipulated to the dismissal of the plaintiff’s class action
allegations. (Id. at pp. 874-875.) The matter then proceeded to a court trial. At the close
of the plaintiff’s case, the trial court granted a motion for judgment on the representative
claim. The Court of Appeal found the lower court properly concluded the plaintiff did
33
not meet its burden to establish other dealerships were “similarly situated as to their
likelihood of deception,” or that any other dealership was likely to be deceived by the
defendant’s practices. (Id. at p. 894.) Thus, the trial court “properly determined it could
not make any determination that [defendant] was liable statewide.” (Id. at p. 895.) The
appellate court noted the evidentiary record demonstrated there were disparate ways in
which the dealerships understood the defendant’s practices, and based upon this record,
the trial court acted within its discretion in concluding there was an insufficient level of
uniformity to allow representative treatment. (Id. at p. 897.)
Even assuming the South Bay court’s analysis is applicable to a PAGA claim, we
note a critical distinction between South Bay and this case. The trial court in South Bay
dismissed the representative UCL claim only after the plaintiff’s presentation of evidence
at a bench trial revealed the absence of a statewide claim. The plaintiff thus had the
opportunity to prove there were similarly situated dealerships it could properly represent,
and it failed to do so. In this case, there has been no such opportunity, and no analogous
trial court exercise of discretion based on an evidentiary hearing, or other means of
addressing the plaintiff’s ability to prove an element of his or her case, such as a
demurrer or motion for summary adjudication. A conclusion, made in the context of a
class certification motion, that individual questions would predominate in companywide
class litigation, thereby rendering class action treatment inappropriate, is not the same as
a conclusion that the plaintiffs cannot establish there are other “aggrieved persons” they
may properly represent in a PAGA claim. (See, e.g., Rix v. Lockheed Martin
Corporation (S.D.Cal. Jan. 4, 2012, Civ. No. 09cv2063 MMA (NLS)) 2012 U.S. Dist.
Lexis 653 [district court denied class certification because individual inquiries would
predominate over common questions but allowed PAGA representative claim to proceed;
court concluded it was premature to strike claim given the reasonable possibility plaintiff
could ultimately seek to litigate a “manageable PAGA claim”; limiting subsequent
discovery accordingly].)
34
We further find persuasive the following discussion from a recent case, Plaisted v.
Dress Barn, Inc. (C.D.Cal. Sept. 20, 2012, No. 2:12-CV-01679-ODW (SHx)) 2012 U.S.
Dist. Lexis 135599:
“This Court adheres to the majority position allowing representative
PAGA claims to proceed without class certification under [Federal Rule of
Civil Procedure] 23. The Court agrees that representative PAGA actions
fundamentally differ from class actions insofar as PAGA’s ‘plain purpose is
to protect the public interest through a unique private enforcement process,
not to allow a collection of individual plaintiffs to sue the same defendant
in one consolidated action for the sake of convenience and efficiency.’
[Citation.] . . . .
“Dress Barn further contends that even if Plaisted’s PAGA claim
does not automatically fail for want of Rule 23 certification, the PAGA
claim should still be dismissed because the individualized determinations
required under PAGA would make trying such a claim unmanageable. . . .
“. . . Yet, all of the authorities Dress Barn cites in support of its
position required individualized restitution calculations under California’s
Unfair Competition Law, Cal. Bus. & Prof. Code § 17200-17210.
[Citations.] Unlike California’s UCL, PAGA does not provide for
equitable restitutionary or injunctive relief; instead, plaintiffs bringing
representative PAGA actions can recover only statutory penalties in fixed
amounts per violation. See Cal. Lab.Code § 2699(f). And unlike class or
representative actions seeking damages or injunctive relief for injured
employees, the purpose of PAGA ‘is to incentivize private parties to
recover civil penalties for the government that otherwise may not have been
assessed and collected by overburdened state enforcement agencies.’
[Citation.] To hold that a PAGA action could not be maintained because
the individual assessments regarding whether a violation had occurred
would make the claim unmanageable at trial would obliterate this purpose,
as every PAGA action in some way requires some individualized
assessment regarding whether a Labor Code violation has occurred.
Further, the individualized assessment necessary in a PAGA action would
come nowhere close to the individualized and fact-intensive restitution
calculations necessary under the UCL, and is in fact an inherent aspect of a
PAGA claim.” (Fns. omitted.)
(See also Alcantar v. Hobart Service (C.D.Cal. Jan. 14, 2013, No. ED CV 11-1600 PSG
(SPx)) 2013 U.S. Dist. Lexis 5443 [despite denial of class certification, plaintiff allowed
35
to pursue representative PAGA claim; rejecting argument that PAGA claim would
require multiple minitrials]; see also Aleman v. AirTouch Cellular (2012) 209
Cal.App.4th 556, 576, fn. 8 [unpublished federal decisions citable as persuasive
authority.)
The parties have not identified any California cases specifically considering
whether the trial court may deny a representative PAGA claim on the ground that
individual questions would make the litigation unmanageable. But in this case, the trial
court’s finding of unmanageability was based entirely on plaintiffs’ failure to establish
the community of interest prong necessary for class certification. Given the guidance
from Arias, we conclude the trial court abused its discretion in applying class action
certification standards to evaluate the PAGA claim.
DISPOSITION
The trial court order denying certification of class claims is affirmed. The order
denying plaintiffs’ PAGA claim is reversed. The parties shall bear their own costs on
appeal.
BIGELOW, P. J.
We concur:
RUBIN, J.
GRIMES, J.
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