Filed 6/24/21 Velis v. AT&T Services CA2/4
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
WILLIAM VELIS, B303011
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. 19STCV10231)
v.
AT&T SERVICES, INC.,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of
Los Angeles County, Carolyn B. Kuhl, Judge. Affirmed.
Diversity Law Group, Larry W. Lee; Hyun Legal, Dennis S.
Hyun; Polaris Law Group, William L. Marder; Law Offices of
Choi & Associates, Edward W. Choi for Plaintiff and Appellant.
Paul Hastings, Raymond W. Bertrand, James P. DeHaan
for Defendant and Respondent.
Appellant William Velis filed a complaint alleging that his
employer, respondent AT&T Services, Inc., violated Labor Code
section 226, subdivision (a)(9)1 (section 226(a)(9)) by failing to
identify all applicable hourly rates for overtime wages on its wage
statements. Velis sought to represent a class of AT&T’s past and
present employees who were paid overtime wages. He also
sought penalties for the violation under the Labor Code Private
Attorneys General Act of 2004 (PAGA) (§ 2698 et. seq.).
AT&T demurred to Velis’s second amended complaint
(SAC), arguing that its wage statements complied with section
226(a)(9) as a matter of law. The trial court agreed and
sustained the demurrer without leave to amend.
Velis now argues that he properly pled a violation of section
226(a)(9) by alleging that AT&T disaggregated overtime wages
into “overtime base” and “overtime premium” components and
listed different numbers of hours worked at each component rate.
We disagree and affirm. Section 226(a)(9) requires employers to
provide accurate itemized wage statements showing “all
applicable hourly rates in effect during the pay period and the
corresponding number of hours worked at each hourly rate by the
employee.” Disaggregating overtime rates and hours does not
violate this statutory mandate.
BACKGROUND
I. Second Amended Complaint
In the factually sparse SAC, Velis alleged that he was a
non-exempt employee of AT&T, a corporation that does business
in California. In the first cause of action, for violation of section
226, subdivision (a), Velis alleged that the wage statements
1Allfurther statutory references are to the Labor Code
unless otherwise indicated.
2
AT&T provided to employees who earned overtime wages did not
“identify all applicable hourly rates for overtime wages whenever
overtime wages were paid. Specifically, whenever overtime
wages were paid, the overtime rates were identified as the
regular or ‘base’ rate of pay and separate line item [sic] showing
various premium rates of pay. Moreover, the applicable hours for
each overtime line item identified different hours. For example,
Plaintiff’s January 25, 2019 wage statement contained an
overtime base line item with a pay rate of $28.7875 per hour at
11.75 hours, while the ‘overtime prem 0.5’ line item showed a pay
rate of $14.3938 per hour at 3.75 hours. This causes significant
confusion as it is unclear as to what rate of overtime pay Plaintiff
is being paid and how many actual overtime hours for which
Plaintiff is actually being paid.”
Velis sought to represent a class of past and present non-
exempt AT&T employees “who were paid overtime [and] were
issued similarly confusing and inaccurate wage statements” any
time from March 26, 2018 through the present. He also
incorporated his section 226, subdivision (a) allegations into a
derivative second cause of action for violation of PAGA. Velis
sought PAGA penalties on behalf of all “Aggrieved Employees
from March 25, 2018, through the present, for Defendants’
violations of Labor Code § 226, arising from Defendants’ failure
to provide accurate, itemized wage statements in violation of
Labor Code § 226.”2
II. Demurrer
AT&T demurred to the SAC for failure to allege facts
sufficient to state a cause of action. (See Code Civ. Proc., §
2Velis
used the plural “Defendants” because he included 50
Doe defendants in the SAC.
3
430.10, subd. (e).) It contended that the first cause of action for
violation of section 226, subdivision (a) failed as a matter of law,
and that the derivative PAGA cause of action therefore failed as
well.
Citing the January 25, 2019 wage statement Velis
referenced in the SAC, and concurrently requesting judicial
notice thereof,3 AT&T asserted that the wage statement listed all
applicable hourly rates and the hours Velis worked at those
rates. Specifically, it contended the January 25, 2019 wage
statement showed that Velis worked a total of 35.75 hours: 24.00
“Regular” hours, at a rate of $28.7875 per hour; 11.75 “Overtime
Base” hours, at a rate of $28.7875 per hour; and 3.75 “Overtime
Prem 0.5” hours, at a rate of $14.3938 per hour. AT&T argued
that the Ninth Circuit has interpreted section 226(a)(9) to permit
this type of “splitting overtime into its component parts” of a base
rate of pay and an overtime premium that is 0.5 times the base
rate. (See Hernandez v. BCI Coca-Cola Bottling Co. (9th Cir.
2014) 554 Fed. Appx. 661 (Hernandez).) It further contended
that the Department of Labor Standards Enforcement (DLSE), a
state agency authorized to enforce California’s labor laws
3In its ruling on the demurrer, the trial court acknowledged
that it could consider the January 25, 2019 wage statement as a
“material document[ ] referred to in the allegations of the
complaint.” (City of Port Hueneme v. Oxnard Harbor District
(2007) 146 Cal.App.4th 511, 513.) The court also noted that Velis
included the January 25, 2019 wage statement in his opposition
and did not object to the request for judicial notice. The court
nevertheless concluded it was “not necessary” to consider the
January 25, 2019 wage statement because “the demurrer can be
sustained based on the allegations in the SAC, which include a
detailed description of the January [25,] 2019 wage statement.”
4
(Gattuso v. Harte-Hanks Shoppers, Inc. (2007) 42 Cal.4th 554,
563), also endorsed the disaggregation of overtime wages by
issuing an exemplar wage statement displaying the overtime
wage rate as one-half of the regular wage rate.
III. Opposition and Reply
Velis filed a written opposition to the demurrer. He
contended the wage statements inaccurately listed “both the
hours and rates for overtime,” such that his “overtime rates and
hours cannot be ascertained from the information on the four
corners of Plaintiff’s wage statements.” Regarding the January
25, 2019 wage statement in particular, the contents of which he
did not dispute, he contended, “it is not clear whether Plaintiff
worked 11.75 hours of overtime, or 3.75 hours of overtime, a
combination of those hours, or some other hours.” Velis
distinguished Hernandez, supra, 554 Fed. Appx. 661 on the basis
that the wage statement at issue there listed the same number of
hours worked at each component portion of the disaggregated
overtime wage. He urged the court to instead follow McKenzie v.
Federal Express Corp. (C.D. Cal. 2011) 765 F. Supp. 2d 1222
(McKenzie), which he contended was “directly on-point” and held
that “listing the overtime rate of ½ of the regular rate violates
Labor Code § 226(a)(9) as a matter of law.”
Velis did not address AT&T’s argument that the DLSE had
approved the practice of “splitting overtime into its component
parts” through its exemplar wage statement. He also did not
seek leave to amend or suggest any possible amendments to the
SAC. Instead, he suggested that if the court was “inclined” to
sustain the demurrer, it “should hold its ruling in abeyance” and
“should permit Plaintiff to conduct discovery to confirm what the
actual overtime hours and rates are and how employees are being
5
paid. . . . Plaintiff must be permitted to conduct discovery to
determine whether Defendant is paying its employees correctly.”
Velis did not cite any authority in support of this suggestion.
In its written reply, AT&T reiterated its previous
arguments in support of the demurrer and urged the court to
follow Hernandez, supra, 554 Fed. Appx. 661. Additionally, it
disputed Velis’s assertion that McKenzie, supra, 765 F.Supp.2d
1222 was “directly on-point.” AT&T contended that McKenzie
was distinguishable because the wage statements in that case,
unlike those at issue here, did not include a line item for total
hours worked. AT&T also highlighted Velis’s failure to address
its contention that the DLSE had approved “split[ting] the
worker’s overtime rate into a half-time premium earned on top of
a base rate.”
IV. Tentative Ruling
The court issued a written tentative sustaining the
demurrer with leave to amend. In the tentative, the court
concluded that Velis failed to plead a violation of section
226(a)(9). It explained: “Taking Plaintiff’s allegations to be true,
Defendant’s wage statements adequately show ‘all applicable
hourly rates in effect during the pay period and the
corresponding number of hours worked at each hourly rate by the
employee.’ It is clear that the amount of overtime hours worked
is 3.75, because that is the amount of hours for which an
overtime premium was paid. The fact that 11.75 hours were paid
at a base rate, while only 3.75 of those hours were paid at the
premium rate does not, without more, lead to any confusion as to
either the total amount of overtime hours or the proper hourly
rates.”
6
The court further concluded that “[l]isting the overtime
premium at 0.5 times—rather than 1.5 times—the regular rate of
pay does not constitute a violation of the Labor Code.” It
observed that Velis “could simply add $28.7875 to $14.3938 in
order to determine that his overtime rate was $43.18.” The court
noted that “the DLSE itself follows this practice in its own
sample wage statement,” the exemplar wage statement for piece-
rate workers AT&T cited in the demurrer. The court also found
AT&T’s primary cited authority, Hernandez, supra, 554 Fed.
Appx. 661, analogous because “the plaintiff’s wage statements
separated overtime base hours from overtime premium hours,
paying the former at a normal rate, and paying the latter at a
rate of 0.5.” The court found Velis’s primary cited authority,
McKenzie, supra, 765 F. Supp. 2d 1222, “inapposite” because
Hernandez “held that the animating factor behind the McKenzie
decision was the fact that the wage statements ‘did not provide a
line item for total hours worked,’ and the SAC here did not allege
that such a line item was absent.” It also rejected McKenzie as
“simply not persuasive, as it offers an interpretation of Labor
Code section 226 that does not accord with that of either the
DLSE or the Ninth Circuit Court of Appeals” in Hernandez.
The court tentatively rejected Velis’s request for discovery.
It tentatively allowed leave to amend, however, to the extent that
Velis’s opposition suggested other possible violations of section
226, subdivision (a).
V. Hearing and Supplemental Briefing
At the hearing on the demurrer, AT&T submitted on the
tentative. Velis argued that the demurrer should be overruled
because “nothing on the four corners of the pay stub” clearly
demonstrated the number of overtime hours he worked. He
7
again distinguished the Hernandez wage statements on the
ground that they listed the same number of hours on the
disaggregated overtime base and overtime premium lines. Velis
also argued that the DLSE had not approved the practice of
disaggregating of overtime for hourly workers like himself. He
contended the exemplar wage statement on which AT&T relied
was applicable only to piece-rate workers, and that the DLSE had
issued an exemplar wage statement for hourly workers that
“requires hourly pay stubs to list 1.5 the base rate of pay” for
overtime. Velis additionally clarified that he had no intent to
amend the SAC to assert further claims.
In response to Velis’s belated argument about the DLSE
exemplar wage statements, AT&T contended that the law
“merely requires that the pay stubs show the rates and hours
worked,” and “there’s no single uniform way that a pay stub has
to reflect this information.” AT&T also contended that any
concern over the different number of hours on the “overtime base”
and “overtime prem” lines “should be addressed through Labor
Code section 226, subsection b,” which “gives the employee the
right . . . to request his or her payroll records so that they can
look behind the pay stub to see if they were, in fact paid . . .
correctly or if there’s any questions.”4 Velis responded that the
latter contention proved the wage statements failed to show the
information required by section 226.
4Section 226, subdivision (b) provides in relevant part that
“[a]n employer that is required by this code or any regulation
adopted pursuant to this code to keep the information required by
subdivision (a) shall afford current and former employees the
right to inspect or receive a copy of records pertaining to their
employment, upon reasonable request to the employer.”
8
At the conclusion of the hearing, the court gave the parties
leave to file supplemental briefs further addressing the DLSE
exemplar wage statements. In Velis’s supplemental brief, he
argued that the DLSE exemplar wage statement for hourly
workers was controlling. He bolstered this argument by pointing
to language on the DLSE website describing the exemplar for
hourly workers as “required by Labor Code section 226(a).” He
argued that the language mandated employers of hourly wage
workers to emulate the exemplar wage statement for hourly wage
workers, which listed the overtime pay rate as 1.5 times the
regular rate rather than the disaggregated 0.5 premium shown in
the piece-rate exemplar. Velis requested that the court take
judicial notice of both DLSE exemplar wage statements, as well
as text from the DLSE website.
In response, AT&T disputed Velis’s assertion that the
language on the DLSE website mandated a specific format for
hourly wage statements. It argued that both DLSE exemplar
wage statements “are just that—examples.” For that reason, it
asserted, the disaggregated overtime wage shown on the
exemplar wage statement for piece-rate workers could also be
used on wage statements for hourly workers. AT&T also pointed
out that wage statements found to comply with section 226,
subdivision (a) have included lines for total hours worked even
though the exemplar wage statement for hourly workers “does
not have a line item for ‘total hours worked.’”
VI. Ruling
After receiving and reviewing the supplemental briefs, the
court issued a written ruling sustaining the demurrer without
leave to amend. The ruling largely tracked the court’s tentative
ruling summarized above.
9
As in the tentative, the court concluded that the SAC failed
to state a claim under section 226(a)(9). The court again found it
was “clear that the amount of overtime hours worked is 3.75,
because that is the amount of hours for which an overtime
premium was paid. The fact that 11.75 hours were paid at a base
rate, while only 3.75 of those hours were paid at the premium
rate, does not, without more, lead to any confusion as to either
the total amount of overtime hours or the proper hourly rates.”
The court also again concluded that Hernandez was more
analogous and persuasive than McKenzie.
The court took judicial notice of both DLSE exemplar wage
statements. It concluded that the DLSE’s disaggregation of the
overtime wage rate on the piece-rate exemplar indicated its
approval of disaggregating overtime wages on wage statements
for hourly workers. The court observed that section 226(a)(9)
“makes no distinction between piece-rate workers and hourly-
paid workers,” and the DLSE lacks the power to expand the scope
or requirements of the statute. The court also noted that Velis
“has identified no statutory authority to support the conclusion
that listing a 0.5 premium rate violates section 226(a)(9) for
hourly-paid workers but is permitted with respect to piece-rate
workers.”
Because it concluded that the SAC did not state a claim
under section 226(a)(9), the court also sustained the demurrer as
to the derivative PAGA claim. The court determined that the
SAC could not be amended to state a claim, and rejected Velis’s
request to hold the ruling in abeyance and grant him additional
discovery.
Velis timely appealed.
10
DISCUSSION
Velis contends that he adequately pled a violation of section
226(a)(9), and the trial court erred in concluding that his claim
was foreclosed under Hernandez and the DLSE’s exemplar wage
statement for piece-rate workers. We disagree.
I. Governing Legal Standards
We apply a de novo standard in an appeal following the
sustaining of a demurrer without leave to amend. (Soto v. Motel
6 Operating, L.P. (2016) 4 Cal.App.5th 385, 389 (Soto).) “[W]e
accept the truth of material facts properly pleaded in the
operative complaint, but not contentions, deductions, or
conclusions of fact or law. We may also consider matters subject
to judicial notice.” (Yvanova v. New Century Mortgage Corp.
(2016) 62 Cal.4th 919, 924.) “[I]t is error for a trial court to
sustain a demurrer [if] the plaintiff has stated a cause of action
under any possible legal theory.” (Aubry v. Tri-City Hospital
District (1992) 2 Cal.4th 962, 967.) However, we must affirm the
judgment if any one of the grounds of the demurrer is well taken.
(Ibid.) Even under the de novo standard of review, the appellant
bears the burden of demonstrating error. (Denny v. Arntz (2020)
55 Cal.App.5th 914, 920.)
To determine whether Velis stated a cause of action for
violation of section 226(a)(9), we must determine what section
226(a)(9) requires of employers. “The proper interpretation of a
statute, and its application to undisputed facts, presents a
question of law that is also subject to de novo review.” (Morgan v.
United Retail, Inc. (2010) 186 Cal.App.4th 1136, 1142 (Morgan).)
“The rules governing statutory interpretation are well-settled.
We begin with the fundamental principle that ‘[t]he objective of
statutory construction is to determine the intent of the enacting
11
body so that the law may receive the interpretation that best
effectuates that intent. [Citation.]’ [Citation.]” (Ibid.) We look
first to the words of the statute, giving them their ordinary
meanings. We give effect to every word and clause, avoiding
constructions that render portions meaningless or inoperative.
(Ibid.) If there is no ambiguity in the language, we presume the
plain meaning of the statute governs. (Murphy v. Kenneth Cole
Productions, Inc. (2007) 40 Cal.4th 1094, 1103.)
If the statutory language is ambiguous or susceptible to
more than one reasonable interpretation, we may turn to
extrinsic aids to assist in our interpretation. (Murphy v. Kenneth
Cole Productions, Inc., supra, 40 Cal.4th at p. 1103.) Such aids
may include opinion letters and other materials issued by the
DLSE, which, while not binding on the court, are entitled to
consideration and respect. (Troester v. Starbucks Corp. (2018) 5
Cal.5th 829, 841; Morgan, supra, 186 Cal.App.4th at p. 1147.)
We also consider analyses and interpretations of the statute by
other courts. We keep in mind that “‘in light of the remedial
nature of the legislative enactments authorizing the regulation of
wages, hours, and working conditions for the protection and
benefit of employees, the statutory provisions are to be liberally
construed with an eye to promoting such protection.’ [Citation.]”
(Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th
1004, 1026-1027.)
II. Analysis
Section 226(a)(9) requires an employer to “furnish to his or
her employee . . . an accurate itemized wage statement in writing
showing . . . all applicable hourly rates in effect during the pay
period and the corresponding number of hours worked at each
hourly rate by the employee.” (§ 226(a)(9).) Employees generally
12
are entitled to earn an overtime rate of pay “of no less than one
and one-half times the regular rate of pay” for “[a]ny work in
excess of eight hours in one workday and any work in excess of 40
hours in any one workweek and the first eight hours worked on
the seventh day of work in any one workweek.” (§ 510, subd. (a).)
The plain language of section 226(a)(9) requires wage
statements to “show,” or “make evident or apparent,” each hourly
rate and the number of hours the employee worked at each rate,
including overtime hours. (Morgan, supra, 186 Cal.App.4th at p.
1146.)
“The purpose of the wage statement requirement is to
provide transparency as to the calculation of wages.” (Morgan,
supra, 186 Cal.App.4th at p. 1149, citing DLSE Opn. Letter No.
2006.07.06.) ”A complying wage statement accurately reports
most of the information necessary for an employee to verify if he
or she is being properly paid in accordance with the law and that
deductions from wages are proper.” (DLSE Opn. Letter
No. 2006.07.06; see also Soto, supra, 4 Cal.App.5th at p. 393
[“The purpose of requiring greater wage stub information is to
insure that employees are adequately informed of compensation
received and are not shortchanged by their employers.”
(emphases omitted)].)
A wage statement need not perform every single calculation
necessary for the employee’s verification of his or her pay to
comply with section 226, subdivision (a). For instance,
in Morgan, supra, 186 Cal.App.4th at p. 1136, the court held that
a wage statement complied with the section 226, subdivision
(a)(2) requirement to show “total hours worked by the employee”
by listing the total number of regular hours worked and the total
number of overtime hours worked; the wage statement did not
13
also need to include a line adding those two figures. Morgan
emphasized that the employee “could determine the sum of all
hours worked without referring to time records or other
documents,” and held that requiring the employee to “simply add
together the total regular hours figure and the total overtime
figure” did not constitute a violation of section 226, subdivision
(a)(2). (Ibid.)
We find Morgan persuasive.5 The Ninth Circuit did as
well. Hernandez, supra, 554 Fed. Appx. at p. 662 cited Morgan,
supra, 186 Cal.App.4th 1136, for the proposition that “[w]age
statements comply with § 226(a) when a plaintiff employee can
ascertain the required information by performing simple math,
using figures on the face of the wage statement.” It then held
that the wage statement at issue met that standard, because
“Hernandez need only subtract his regular hours from total hours
to determine overtime hours worked during the pay period.
5Our colleagues in the Division One of the Fourth Appellate
District also agreed with Morgan in an opinion filed after this
case was submitted. (See General Atomics v. Superior Court of
San Diego County (2021) ___Cal.App.5th___, ___ , 2021 Cal.App.
LEXIS 452 (General Atomics).) General Atomics held that a wage
statement that displayed an hourly worker’s earnings in two
categories, a regular rate and an overtime rate of 0.5 times the
regular rate, did not violate section 226(a)(9). It emphasized
Morgan’s holding “that a wage statement does not violate section
226 even if it requires the employee to perform simple math to
obtain the required information,” and concluded that the plaintiff
employee could “readily use the information in the wage
statement” — including a line listing total hours worked — “to
arrive at the item [the plaintiff] claims is missing, i.e., the
statutory 1.5x overtime rate.” (General Atomics, supra, 2021
Cal.App. LEXIS at pp. *14-*15.)
14
Similarly, he can add the two component overtime rates to
determine his overall overtime rate.” (Ibid.) The court observed
that the wage statement’s inclusion of a line item showing the
total number of hours worked “allow[ed] Hernandez to do the
math to determine the § 226(a)-required information.” (Ibid.)
The wage statement in Hernandez was described in the
underlying district court case Hernandez affirmed, Hernandez v.
BCI Coca-Cola Bottling Co. (C.D. Cal. Apr. 12, 2012, No. CV 11-
9484 SVW (SSx)) 2012 U.S. Dist. LEXIS 55301 [nonpub. opn.].
The wage statement divided Hernandez’s pay into three separate
lines: an “Hourly Pay” line, showing 40.00 hours worked at a rate
of $21.9300 per hour; an “OT Base 100%” line, showing 0.50
hours worked at a rate of $21.9300 per hour; and an “OT Prem
50%” line, showing 0.50 hours worked at a rate of $10.9650 per
hour. (Hernandez v. BCI Coca-Cola Bottling Co., supra, 2012
U.S. Dist. LEXIS 55301, at p. *3.) At the bottom of the
statement, a line labeled “TOT WKD HRS\WAGES” indicated
that Hernandez worked a total of 40.50 hours and earned a total
of $893.65 during the pay period. (Ibid.)
The federal district court rejected Hernandez’s argument
that the statement violated section 226(a)(9) by disaggregating
the overtime rate into two components, “OT Base 100%” and “OT
Prem 50%,” that must be added together to calculate the
overtime wage. (Hernandez v. BCI Coca-Cola Bottling Co., supra,
2012 U.S. Dist. LEXIS 55301, at pp. *8-*9.) It held that Morgan,
supra, 186 Cal.App.4th 1136 controlled, and that listing the
overtime wage as two component parts was “sufficient to ‘show’—
i.e., ‘to make evident or apparent’—that the employee’s effective
overtime rate is equal to 21.93 + 10.965 = 32.895.” (Id. at p. *9.)
The federal district court also rejected Hernandez’s contention
15
that the wage statement was inaccurate because it “display[ed]
the number of overtime hours worked by an employee twice.” (Id.
at p. *10.) It held that “any potential confusion created by
displaying the number of overtime hours twice is mitigated (if not
eliminated) by the inclusion of the total number of hours worked
on the statement.” (Ibid. at p. *13.) As previously indicated, the
Ninth Circuit affirmed the district court in Hernandez, supra,
554 Fed. Appx. 661.
Velis contends the wage statement in Hernandez—and
therefore the holding in Hernandez—is distinguishable. He
asserts, “Unlike the wage statements in Hernandez wherein the
OT rate was clearly identified on two separate line items
containing the same number of overtime hours, here, the wage
statements provided to employees listed two completely
different number [sic] of overtime hours, 11.75 for Overtime
Base and 3.75 for Overtime Prem 0.5. An employee would not
know which item is for overtime and which is for regular pay.”
AT&T responds that the number of hours worked at the
disaggregated overtime wage rates “was immaterial to
Hernandez’s holding,” and Hernandez “never said paystubs must
also list the same number of base and premium hours.”
AT&T has the better argument. Section 226(a)(9) requires
only that wage statements report “all applicable hourly rates in
effect during the pay period and the corresponding number of
hours worked at each hourly rate by the employee.” The wage
statements in Hernandez and this case meet that standard. Both
disaggregate the overtime wage rate of 1.5 times the regular rate
into component parts: an “overtime base” rate that is the regular
rate, and an “overtime premium” rate that is one-half the regular
rate. As in Hernandez, Velis can see all the applicable rates at
16
which he worked, and “add the two component overtime rates to
determine his overall overtime rate.” (Hernandez, supra, 554
Fed. Appx. at p. 662.) He can also determine the number of
hours for which he earned the full overtime rate by looking at the
number of hours paid at the “overtime premium” rate, and can
use other lines on the wage statement, such as the total number
of hours worked and total compensation, to confirm he was paid
appropriately.
The conclusion that disaggregated overtime wages and
hours are permitted by section 226(a)(9) is bolstered by the
DLSE’s use of a disaggregated overtime wage rate in its exemplar
wage statement for piece-rate workers . Section 226(a)(9) does not
establish different wage statement standards for hourly and
piece-rate workers,6 and the DLSE “cannot alter or amend the
statute which it is interpreting, or enlarge or impair its scope.”
(Adamek & Dessert, Inc. v. Agricultural Labor Relations
Board (1986) 178 Cal.App.3d 970, 978.) By using a 0.5 overtime
premium in the exemplar wage statement for piece-rate workers,
the DLSE has indicated its approval of the disaggregation of
overtime pay rates for piece-rate and hourly workers alike. (See
General Atomics, supra, 2021 Cal.App. LEXIS 452, at p. *22.) The
DLSE’s use of the phrase “required by Labor Code section 226(a)”
in describing the exemplar does not convince us otherwise. If, as
6Only one of the nine subdivisions of section 226,
subdivision (a) mentions piece-rate workers. Section 226,
subdivision (a)(3) requires a wage statement to show “the number
of piece-rate units earned and any applicable piece rate if the
employee is paid on a piece-rate basis.” This explicit mention of
piece-rate workers shows that the Legislature knew how to
distinguish between types of workers if it wished to do so in other
subdivisions of the statute.
17
Velis suggests, the phrase means employers must issue wage
statements in exact conformance with the exemplar, then any
employer who included a line showing the total hours worked by
an hourly employee would be in violation of section 226(a)(9),
because that information is not included on the exemplar for
hourly workers. Such a result is absurd, particularly where
courts have found that a line item detailing total hours worked is
important in “allowing [employees] to do the math to determine
the § 226(a)-required information.” (Hernandez, supra, 554 Fed.
Appx. at p. 662.)
Velis contends McKenzie, supra, 765 F. Supp. 2d 1222,
compels the opposite conclusion. We disagree. The wage
statement at issue in McKenzie disaggregated overtime the same
way Velis alleges here—”Reg. Earn.,” “Overtime,” and
“OvrTimePrm.” It did not, however, include any indication of the
total number of hours an employee worked. (See
McKenzie, supra, 765 F.Supp.2d at p. 1226.) Thus, an employee
confronted with lines showing 40.00 hours of “Reg. Earn.,” 9.12
hours of “Overtime,” and 9.12 hours of “OvrTimePrm” on his or
her wage statement would be unable to ascertain whether his or
her pay should be for 49.12 hours or 58.24 hours without
consulting additional documents. (McKenzie, supra, 765 F. Supp.
2d at pp. 1226, 1229.) Here, the parties agree the wage
statement contains a line listing the total hours worked. We
agree with Hernandez, supra, 554 Fed. Appx. at p. 662, that this
line enables Velis “to do the math to determine the § 226(a)-
required information” from the other information on the wage
statement. (See also General Atomics, supra, 2021 Cal.App.
LEXIS 452, at p. *17.)
18
Velis also looks for support in Wright v. Renzenberger
(C.D. Cal. March 8, 2018) 2018 U.S. Dist. LEXIS 234702
[nonpub. opn.] (Wright). We agree with AT&T that Wright is
distinguishable. In Wright, the wage statements “showed the
overtime rate at one-half of the regular rate instead of one and
one-half the regular rate and . . . included overtime hours in the
regular earnings line.” (Wright, supra, 2018 U.S. Dist. LEXIS
234702 at p. *29.) Thus, “unlike Hernandez, the wage statements
[in Wright did] not provide for the full overtime rate in two
component parts which are set side from the regular rate and
which can easily, and sensibly, be added together to show the
correct overtime rate.” (Id. at p. *32.) “Instead, the (partial)
overtime rate on [the] pay stubs must be added to the regular
rate for the employee to calculate the correct overtime rate.”
(Ibid.) That is not the case here, where the overtime wage rate is
disaggregated into two clearly identified component parts that
are entirely separate from the line showing “regular” pay.
DISPOSITION
The judgment is affirmed. AT&T is awarded its costs on
appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
COLLINS, J.
We concur:
MANELLA, P. J. CURREY, J.
19