1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 DECATUER CARTER, Case No. 18-cv-06313-DMR
8 Plaintiff, ORDER ON MOTIONS FOR 9 v. SUMMARY JUDGMENT
10 JAI-PUT ENTERPRISE INC., et al., Re: Dkt. Nos. 46, 47 11 Defendants.
12 Plaintiff Decatuer Carter brings employment-related claims against Defendants Jai-Put 13 Enterprise Inc. dba Junk King (“Junk King”) and Krishna Vepa, alleging violations of the Federal 14 Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq., the California Labor Code, the California 15 Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code § 17200 et seq., and California common 16 law. [Docket No. 1 (“Compl.”).] Carter and Defendants both filed motions for summary judgment. 17 [Docket Nos. 47 (“Pltf. Mot.”); 48 (“Def. Opp.”), 50 (“Pltf. Reply”), 46 (“Def. Mot.”), 49 (“Pltf. 18 Opp.”), 51 (“Def. Reply”).] The court has determined that this matter may be determined on the 19 papers pursuant to Local Rule 7-1(b). 20 For the reasons stated below, Carter’s motion is granted in part and denied in part. 21 Defendants’ motion is denied.1 22 I. BACKGROUND 23 A. Junk King’s Operations 24 Junk King is as a franchise of Junk King Franchise Systems. [Docket No. 49-2, Declaration 25 of Jocelyn Burton (“Burton Decl.”), Ex. 2, Deposition of Krishna Vepa (“Vepa Depo.”) at 30:9-10.] 26 The company operates exclusively in Northern California. [Docket No. 46-3, Declaration of 27 1 Krishna Vepa (“First Vepa Decl.”) ¶ 2]. Vepa is the president and CEO of Junk King. Id. The 2 company employs drivers and navigators to drive Junk King-branded trucks around the Bay Area 3 to pick up clients’ personal property and dispose of it at dumps or recycling facilities. Id. Typically, 4 Junk King assigns a single driver to each route, but sometimes also assigns a navigator when the 5 work is difficult. Id. The daily schedules for drivers and navigators “var[y] depending on the 6 specific job and locations, traffic conditions, dump wait times, and other factors.” Id. ¶ 3. 7 Employees clock in every morning through Junk King’s online web application, JunkWare. Id. ¶ 8. 8 The driver and navigator teams receive their pickup schedule through JunkWare. Id. ¶ 9. 9 According to Vepa, employees manage their own time based on the “honor code.” First 10 Vepa Decl. ¶ 8. Employees “go out on their routes for the day, unsupervised, and in control of their 11 lunch and break times.” Id. ¶ 9. Vepa claims that both drivers and navigators have “a lot [of] control 12 over their time and schedule.” Id. 13 B. Junk King’s Meal and Rest Break Policies 14 Vepa represents that “the nature of the work prevents employees from being relieved of all 15 duty for their 30-minute lunch break as required under California law.” First Vepa Decl. ¶ 3. As a 16 result, Junk King provides its drivers and navigators with an “on-duty meal period” option for their 17 lunch break, which is reflected in Junk King’s On Duty Meal Period Agreement:2 18 Jai=Put Enterprise Inc. (“the Company”) & _______________ (“Employee”) Agree that the nature of the Employee’s work as Junk Haul- 19 away worker at Jai-Put Enterprise Inc on the truck, as driver or Navigator 20 usually prevents Employee from getting relieved in taking a 30 minute uninterrupted meal-break. 21 The Employee agrees as an alternate, to an on-duty meal break whenever 22 the employee activity during the work day prevents them from to have an uninterrupted meal-break during work day. In this case the employee will 23 be compensated for such meal break periods at the rate of one hour of pay 24 at the employee’s regular rate. 25 Employee understands that if a 30-minute uninterrupted meal period is provided, it will not be an on-duty meal break, and employee will not be 26 compensated at all times. 27 Employee understand an on-duty meal break maybe revoked at any time, 1 by providing company with a notice of revocation 2 First Vepa Decl., Ex. A. Carter signed the On Duty Meal Period Agreement on November 29, 2016. 3 Id. Vepa represents that the agreement is voluntary. First Vepa Decl. ¶ 4. 4 Junk King also provides a Policy on Best Practices handout that explains company policy 5 regarding, among other things, meal and rest breaks:3 6 Meal Breaks, & Rest policy 7 a. JKCC has flex-time policy for lunch breaks. Remember, you have 8 agreed to on-time meal breaks. 1-hour break is allowed, inclusive of drive time when work duration exceeds 5 hours, of which at least 9 30-minute seated meal break is suggested. It is expected that your choice of a stop for eating be located along work route. toilet breaks 10 are not included in these calculations, but passed on past experience 11 reasonable (eg 10 to 15 min enroute) are OK. Finally, lunch is expected to be taken during regular hours and not end of the shift- 12 that is not lunch 13 b. Clock i/o for Lunch generally not later than 5 hrs from start for 1 hr. Grace time of 45 min is allowed in case being stick due to the job. 14 Inform management by text or call 15 c. All employees especially drivers are encouraged to take a break 16 during daily truck operations. When possible ensure that you take a break and stretch, to keep alert on the job. Two more 15-minute 17 refresher breaks are encouraged. Being alert and avoiding accidents is highly encouraged 18 First Vepa Decl., Ex. B. 19 C. Junk King’s Telephone Plan 20 Junk King implemented a telephone purchase plan for employees in January 2017. First 21 Vepa Decl. ¶ 12. Relevant portions of Junk King’s Telephone Policy are excerpted below: 22 It is the responsibility of all employees who are required to have a cell phone 23 for their job duties to ensure compliance with this policy. . . . Cell phones 24 are required by employees in some positions in the company in order to maintain contact with customers, vendors, supervisors, and other 25 employees. In general, this includes, Sales, Marketing, and Drivers. 26 … 27 The phone referred to in this document is an iPhone 7, purchased in name 1 of Krishna Vepa, President Junk King Contra Costa, from Verizon 2 Wireless. The phones are purchased by Krishna Vepa on behalf of Junk King Contra Costa for subsequent use by company employees. 3 … 4 All those employees who voluntarily participate in this telephone scheme, 5 will consent to payroll deduction towards repayment of company funded equipment purchase, and co-shared data, voice plan charges by Verizon 6 during non-business hours, for personal use. 7 . . . 8 Following charges will be deducted towards the usage of the phone 9 a. Equipment charges to be paid by employee in 24 monthly installments 10 as determined by Verizon fee statement 11 b. 5GB of free data will be included with each phone. It is expected that this will cover usage during work hour, and off work personal use. All 12 users will be enabled with data metering to keep track of usage. 13 Additional use will be charged to user at prevailing Verizon excess charge rate. Employee is encouraged to monitor usage at all times. 14 c. Monthly line access fee[.] The phone is being provided as a co-shared 15 service, and in principal will be paid in equal amounts by both (employer and employee). The amount will be determined by charges 16 levied by Verizon. 17 First Vepa Decl., Ex. E. Carter signed the Telephone Policy on January 23, 2017. Id. He testified 18 that employees were required to purchase a cell phone through the plan as a condition of 19 employment. [Burton Decl., Ex. 2, Deposition of Decatuer Carter (“Carter Depo.”) at 75:9-18.] He 20 stated that Vepa told employees that if they did not sign the Telephone Policy, they would lose their 21 job. Carter Depo. at 79:4-25. Payment for a phone was deducted from his wages. Carter Depo. at 22 71:13-18. When he was terminated by Junk King, he kept the cell phone. Carter Depo. at 122:17- 23 18. Vepa testified that he paid Carter the amount that had been deducted from his wages to purchase 24 the cell phone, while Carter stated that he has still not been reimbursed. Carter Depo. at 122:19- 25 123:1. 26 D. Carter’s Employment 27 Carter worked for Junk King as a navigator from November 30, 2016 to August 14, 2017. 1 Carter’s time there. Carter Depo. at 45:10-15. Carter and the other employees were assigned routes 2 and trucks every morning through the JunkWare app. Carter Depo. at 37:19-38:2, 39:6-40:3; Vepa 3 Decl. ¶ 8. As a navigator, Carter was always paired with a driver. Carter Depo. at 40:10-13. The 4 team completed jobs as they were listed in the app, and Carter was responsible for calling customers 5 to give them estimated arrival times. Carter Depo. at 36:17-24, 40:23-41:14. Once the team 6 completed a job, Carter would log the type and amount of items removed in the app, and report how 7 the items were discarded (e.g., “recycled”). Carter Depo at 41:15-42:4. The team sometimes did 8 not know what or how much they would be picking up, and they would have to make unscheduled 9 drop-offs at a dump or recycling center. Carter Depo. at 42:5-16. Occasionally, the trucks had 10 maintenance issues that would further delay the route. Carter Depo. at 42:17-24. 11 According to Carter, he did not discuss meal and rest breaks with Vepa when he started 12 working for Junk King. Carter Depo. at 45:18-24. He claimed that he did not receive an employee 13 manual at that time. Carter Depo. at 53:12-14. Carter acknowledged that he did receive and sign a 14 copy of the On Duty Meal Period Agreement. Carter Depo. at 46:18-47:21. He represented that he 15 understood the agreement meant that he would be paid for an hour of work if he did not receive an 16 off-duty lunch break, and that he would not be paid if he was able to take an uninterrupted 30-minute 17 break. Carter Depo. at 49:14-51:5. However, he testified that he did not understand that he could 18 revoke the agreement at any time. Carter Depo. at 51:18-20. 19 Carter asserted that he did not take any rest breaks during the day, except when a client asked 20 him to take a break. Carter Depo. at 61:25-62:4, 62:10-15. He also did not take any meal breaks 21 during the day and would eat after he clocked out for the evening. Carter Depo. at 65:17-23. He 22 testified that Vepa told employees, “If you’re not working, you’re not making me money, so if 23 you’re not doing your job, you’re not doing anything.” Carter Depo. at 62:6-9. While he was on 24 route during the day, Vepa would “call[] every . . . 20 to 30 minutes, asking and seeing where we 25 were.” Carter Depo. at 61:15-21, 63:22-25. Carter stated that he stopped taking meal and rest breaks 26 because of these constant calls and because he was pressured to work through his meal breaks. 27 Carter Depo. at 65:12-66:3, 67:13-14. Carter also testified that he frequently worked more than 1 time records would not reflect his overtime even though he was required to keep working. Carter 2 Depo. at 95:1-6, 106:20-107:5, 147:15-20, 147:22-148:8. 3 Carter stated that he first discussed meal breaks with Vepa around January 2017. Carter 4 Depo. at 57:12-58:12. He told Vepa, “[E]very man needs a meal break, and every person needs a 5 break,” particularly given the physical demands of the job. Carter Depo. at 57:18-21. According to 6 Carter, Vepa just replied, “Why are you asking me?” Carter Depo. at 58:10-13. Carter testified that 7 after that conversation, he began receiving less desirable routes. Carter Depo. at 58:23-59:5. Carter 8 also made other complaints about his workplace conditions, including Junk King’s practice of hiring 9 day laborers and various safety conditions on the job, such as being exposed to needles, mold, and 10 other health hazards. Carter Depo. at 112:7-113:12, 114:8-117:10, 117:15-118:17. 11 Carter was fired on August 14, 2017. First Vepa Decl. ¶ 13. According to Vepa, Carter had 12 received several warnings for routinely showing up late to work. Id. ¶ 13. Vepa testified that 13 sometimes Carter would finish working but not clock out until much later. Id. ¶ 8. Vepa also raised 14 an issue regarding the rate that Carter’s team had charged a customer, and Carter was 15 “unresponsive” to Vepa’s concerns. Id. ¶ 13. Vepa testified that he gave Carter a check for his final 16 wages. Id. ¶ 13. Carter asserts that he was terminated in retaliation for complaining about the 17 conditions of his employment. Carter testified that he has never been paid for his last two weeks of 18 work. Carter Depo. at 160:8-23. 19 Carter brings claims for (1) failure to provide meal and rest breaks as required by Labor 20 Code §§ 226.7, 512; (2) failure to pay overtime in violation of the FLSA; (3) failure to pay overtime 21 as required by Labor Code § 510; (4) failure to timely pay wages in violation of Labor Code § 204; 22 (5) failure to furnish complete and accurate itemized wage statements as required by Labor Code § 23 226(a); (6) violations of Labor Code §§ 201, 202, and 203 for failing to timely pay wages upon 24 termination; (7) unlawful deductions from his wages in violation of Labor Code § 221; (8) failure 25 to reimburse for business expenses as required by Labor Code § 2802; (9) retaliation in violation of 26 Labor Code § 98.6; (10) retaliation in violation of Labor Code § 6310; (11) wrongful discharge in 27 violation of public policy; and (12) violations of the UCL. 1 II. LEGAL STANDARD FOR SUMMARY JUDGMENT 2 A court shall grant summary judgment “if . . . there is no genuine dispute as to any material 3 fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The burden 4 of establishing the absence of a genuine issue of material fact lies with the moving party, see Celotex 5 Corp. v. Catrett, 477 U.S. 317, 322-23 (1986), and the court must view the evidence in the light 6 most favorable to the non-movant. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) 7 (citation omitted). A genuine factual issue exists if, taking into account the burdens of production 8 and proof that would be required at trial, sufficient evidence favors the non-movant such that a 9 reasonable jury could return a verdict in that party’s favor. Id. at 248. The court may not weigh the 10 evidence, assess the credibility of witnesses, or resolve issues of fact. See id. at 249. 11 To defeat summary judgment once the moving part has met its burden, the nonmoving party 12 may not simply rely on the pleadings, but must produce significant probative evidence, by affidavit 13 or as otherwise provided by Federal Rule of Civil Procedure 56, supporting the claim that a genuine 14 issue of material fact exists. TW Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d 626, 15 630 (9th Cir. 1987). In other words, there must exist more than “a scintilla of evidence” to support 16 the non-moving party’s claims, Anderson, 477 U.S. at 252; conclusory assertions will not suffice. 17 See Thornhill Publ’g Co. v. GTE Corp., 594 F.2d 730, 738 (9th Cir. 1979). Similarly, “[w]hen 18 opposing parties tell two different stories, one of which is blatantly contradicted by the record, so 19 that no reasonable jury could believe it, a court should not adopt that version of the facts” when 20 ruling on the motion. Scott v. Harris, 550 U.S. 372, 380 (2007). 21 Where, as here, the parties have filed cross-motions for summary judgment, “[e]ach motion 22 must be considered on its own merits.” Fair Hous. Council of Riverside Cty., Inc. v. Riverside Two, 23 249 F.3d 1132, 1136 (9th Cir. 2001). “In fulfilling its duty to review each cross-motion separately, 24 the court must review the evidence submitted in support of each cross-motion.” Id. 25 III. DISCUSSION 26 A. Missed Meal and Rest Breaks 27 Defendants move for summary judgment on Carter’s claims for missed meal and rest breaks. 1 1. Meal Period Agreement 2 The parties do not dispute that Carter signed Junk King’s On Duty Meal Period Agreement 3 or that he was paid his usual hourly rate for his on-duty meal periods. Carter moves for summary 4 judgment on his meal break claim on the basis that the On Duty Meal Period Agreement violates 5 California law. Defendants also move for summary judgment on Carter’s meal break claim, 6 although their argument on this claim is unclear. They seem to argue that Carter was properly 7 compensated under a lawful on-duty meal period agreement and that therefore there is no liability 8 even if he never took off-duty meal breaks. To the extent that Defendants’ argument is instead that 9 Carter was properly provided off-duty meal breaks notwithstanding the On Duty Meal Period 10 Agreement, that argument is addressed in the next section. 11 In general, California law requires employers to provide non-exempt employees with one 12 30-minute meal break after no more than five hours of work, and a second meal break after no more 13 than ten hours of work. Cal. Labor Code § 512; see also IWC Wage Order No. 9-2001, section 14 11(A).4 An employer satisfies this requirement “if it relieves its employees of all duty, relinquishes 15 control over their activities and permits them a reasonable opportunity to take an uninterrupted 30- 16 minute break, and does not impede or discourage them from doing so.” Brinker Rest. Corp. v. 17 Superior Court, 53 Cal. 4th 1004, 1040, 273 P.3d 513, 536–37 (2012). However, meal periods 18 where the employee remains “on duty” are permitted where (1) the “nature of the work prevents an 19 employee from being relieved of all duty”; (2) the parties agree in writing to have on-duty, paid 20 meal periods; and (3) the agreement states that the employee may, in writing, revoke the agreement 21 at any time. Cal. Code Regs. tit. 8, § 11040, subd. 11(A); IWC Wage Order. No 9-2001, section 22 11(C). 23 It is the employer’s burden to “establish[] the facts that would justify an on-duty meal 24 period.” Abdullah v. U.S. Sec. Assocs., Inc., 731 F.3d 952, 959 (9th Cir. 2013) (citation omitted). 25 The Department of Labor Standards Enforcement (“DLSE”) laid out five non-exhaustive factors to 26 consider when deciding whether the “nature of the work” exception applies to a particular job: 27 (1) [T]he type of work, (2) the availability of other employees to provide 1 relief to an employee during a meal period, (3) the potential consequences 2 to the employer if the employee is relieved of all duty, (4) the ability of the employer to anticipate and mitigate these consequences such as by 3 scheduling the work in a manner that would allow the employee to take an off-duty meal period, and (5) whether the work product or process will be 4 destroyed or damaged by relieving the employee of all duty. 5 DLSE Opinion Letter 2009.06.09 at 7. For example, DLSE concluded that employees who transport 6 hazardous materials are covered by the “nature of the work” exception because federal regulations 7 require them to attend to their vehicles at all times. Abdullah, 731 F.3d at 959-60 (citing DLSE 8 Opinion Letter 2009.06.09 at 8). 9 Carter argues that Defendants have not met their burden to show that the “nature of the work” 10 exception applies to Carter’s position. In response, Defendants present testimony from Vepa about 11 the kind of job contingencies that render off-duty meal periods impractical. [Docket No. 48-1, 12 Declaration of Krishna Vepa (“Second Vepa Decl.”).] For example, the time to complete a given 13 route varies depending on the location and size of the jobs on the route, traffic conditions on a 14 particular day, traffic and delay at dump yards, and driver and truck availability. Second Vepa Decl. 15 ¶ 3. According to Vepa, it is impossible to schedule another employee to drive out to a particular 16 job site and relieve the driver and/or navigator of their duties in order to take a meal break. Id. ¶ 6. 17 While Carter is correct that it is ultimately the employer’s burden to establish that the nature of the 18 work prevents off-duty meal periods, the issue cannot be decided on summary judgment because 19 there is a genuine issue of material fact as to whether it was possible for Carter to take off-duty 20 meal periods within the first five hours of work. The court cannot weigh the parties’ conflicting 21 evidence on this issue at this stage of litigation. 22 Accordingly, Carter’s motion is denied as to his meal break claim. Defendants’ motion is 23 denied to the extent that it relies on a ruling as to the validity of the On Duty Meal Break Agreement. 24 2. Rest Breaks 25 Defendants move for summary judgment on Carter’s rest break claim, arguing that drivers 26 and navigators were properly provided the opportunity for rest breaks during the day and that an 27 employer is not obligated to ensure that rest breaks are actually taken. They further argue that Carter 1 has offered no corroborating evidence for his testimony that he was not provided rest breaks.5 Carter 2 responds that he has raised a genuine issue of fact as to whether he was permitted to take rest breaks. 3 California law requires that employers permit all employees to take a rest period of ten 4 minutes for each four hours of work. IWC Wage Order 9-2001, section 12(A). Employers must 5 “authorize and permit all employees to take rest breaks, which insofar as practicable shall be in the 6 middle of each work period.” Cal. Code Regs., tit. 8 § 11090. While employers are required to make 7 meal and rest breaks available, they do not have to ensure that employees actually take breaks. 8 Cleveland v. Groceryworks.com, LLC, 200 F. Supp. 3d 924, 953 (N.D. Cal. 2016). To survive 9 summary judgment on a meal or rest break claim, “[a]n employee must show that the employer 10 actually prevented the employee from taking breaks; mere proof of knowledge that the employee 11 was forgoing breaks is insufficient.” Reece v. Unitrin Auto & Home Ins. Co., Case No. 11-cv- 12 03960-EJD, 2013 WL 245452, at *5 (N.D. Cal. Jan. 22, 2013). 13 In this case, Carter testified that his job required him to be out of the office all day, where 14 Vepa was not physically with him. Carter Depo. at 60:12-14, 60:19-61:12. He stated that Vepa 15 would call him every 20 to 30 minutes to make sure the team was still working. Carter Depo. at 16 61:13-21, 63:22-25. Carter testified that Vepa would say things like “[i]f you’re not working, you’re 17 not making me money,” and that if he asked to take a break, Vepa said no. Carter Depo. at 62:5-9, 18 99:20-100:5. Carter claimed that he stopped taking breaks because he did not want to lose his job. 19 Carter Depo. at 62:16-24, 65:15-16. He stated that he only took breaks if the customer said he 20 should. Carter Depo. at 62:10-15. In opposition, Defendants assert that the employee manual 21 explicitly allows for two 15-minute rest breaks. See First Vepa Decl., Ex. B. Vepa testifies that 22 “[t]here can be a lot of down time during the day for drivers and navigators to take their meal and 23 rest breaks but employees have to be flexible in carrying out their duties.” Second Vepa Decl. ¶ 4. 24 Defendants also submitted a declaration from Chris Beltre, a Junk King driver who was paired with 25 Carter on numerous routes. [Docket No. 46-2, Declaration of Chris Beltre (“Beltre Decl.”) ¶ 2.] 26
27 5 As noted above, it is unclear whether Defendants intended these arguments to apply to Carter’s 1 Beltre states that he never witnessed “incessant phone calls” from Vepa to Carter, and that he himself 2 never experienced such calls. Id. ¶ 7. According to Beltre, he spoke to Vepa about 2-3 times per 3 day, not every 20-30 minutes. Id. Beltre testifies that drivers and navigators have “many 4 opportunities throughout the day to take a meal break or rest break” and that he is unaware of any 5 other employees who claim those breaks are prohibited. Id. ¶ 6. He states that he has “never felt 6 pressured to forego my lunch break or rest breaks.” Id. 7 Courts have generally found that meal and rest break claims do not survive summary 8 judgment if the plaintiff merely alleges a subjective belief that he or she cannot take breaks. See, 9 e.g., Frausto v. Bank of Am., Nat’l Ass’n, No. 18-cv-01983-LB, 2019 WL 5626640, at *8 (N.D. Cal. 10 Oct. 31, 2019) (“[A]n employee’s subjective belief that his employer wanted him to skip breaks 11 does not satisfy the legal standard.”); Cleveland, 200 F. Supp. 3d at 946 (“[C]ourts have not hesitated 12 to grant summary judgment where plaintiffs have skipped breaks of their own accord due to pressure 13 they feel to complete their job in a given amount of time, absent evidence that their employer took 14 action to prevent or impede employees from taking their meal or rest breaks.”); Roberts v. Trimac 15 Transportation Servs. (W.), Inc., Case No. 12-cv-05302 HRL, 2013 WL 4647223, at *4 (N.D. Cal. 16 Aug. 28, 2013) (granting summary judgment on plaintiff employee’s meal break claims where the 17 plaintiff only had a “subjective belief[]” that he could not take breaks due to the “time pressures of 18 the job”). By contrast, an employer may be liable for “pressuring employees to perform their duties 19 in ways that omit breaks.” Brinker, 53 Cal. 4th at 1040. Courts have denied summary judgment 20 where there was some evidence that an employer actively interfered with an employee’s ability to 21 take breaks. For example, in Frausto, the court found a genuine issue of material fact where the 22 plaintiff presented evidence that her employer told her to not take breaks. 2019 WL 5626640 at *8. 23 In Aguirre v. Genesis Logistics, 2016 WL 6818351 (C.D. Cal. June 7, 2016), the court denied 24 summary judgment on a rest break claim in the truck driving industry. There, the plaintiffs presented 25 evidence that they were “regularly pressured” to forego breaks because their employer 26 “maintain[ed] strict driving schedules which require[d] timely deliveries” and pressured its 27 employees to complete the schedules on time. Id. at *3. 1 take rest breaks. He specifically asserts that Vepa refused to let him take breaks when he asked for 2 them. Carter Depo. at 99:20-100:5. He also testified that Vepa continuously pressured him to stay 3 on task and move from job to job as quickly as possible. Carter Depo. at 62:5-9, 99:20-100:5. While 4 Defendants claim that the employees have a “lot of down time during the day” during which they 5 can take rest breaks, Second Vepa Decl. ¶ 4, the court cannot weigh conflicting evidence at summary 6 judgment. Anderson, 477 U.S. at 249. Beltre’s declaration, which directly contradicts Carter’s 7 testimony, only serves as further evidence that there is a genuine dispute of material fact as to 8 whether Carter was prohibited from taking rest breaks.6 9 Accordingly, the court finds that there is a genuine dispute of material fact as to whether 10 Defendants prevented Carter from taking rest breaks in violation of California law. Defendants’ 11 motion for summary judgment on Carter’s rest break claim is denied. 12 B. Failure to Pay Overtime 13 “Any work in excess of eight hours in one workday and any work in excess of 40 hours in 14 any one workweek and the first eight hours worked on the seventh day of work in any one workweek 15 shall be compensated at the rate of no less than one and one-half times the regular rate of pay for an 16 employee.” Cal. Lab. Code § 510; see also IWC Wage Order 9-2001, section 3(A). Carter’s 17 overtime claim raises two separate issues: (1) whether Defendants failed to pay Carter for the time 18 he allegedly worked after he clocked out for the evening, and (2) whether Defendants improperly 19 paid Carter his usual hourly rate for on-duty meal breaks rather than the time-and-a-half overtime 20 wage. Defendants move for summary judgment on the first issue, while Carter cross-moves for 21 summary judgment on the second. 22 1. Defendants’ Motion 23 Carter testifies that he frequently worked more than eight hours a day. Carter Depo. at 95:1- 24 2, 96:18-22. However, he was told to clock out so that his time records would not reflect his 25
26 6 Defendants’ contention that Carter’s testimony is “self-serving” does not help their case. “[S]elf- 27 serving affidavits are cognizable to establish a genuine issue of material fact so long as they state facts based on personal knowledge and are not too conclusory.” Rodriguez v. Airborne Express, 1 overtime even though he was required to keep working. Carter Depo. at 95:1-6, 106:20-107:5, 2 147:15-20, 147:22-148:8. Although not completely clear, Defendants’ motion for summary 3 judgment on Carter’s overtime claim appears to be based on the same argument as his rest break 4 claim: namely, that Carter did not provide sufficient evidence that he was not paid for time he 5 worked after he clocked out. 6 Defendants’ arguments fail for the same reasons addressed with respect to Carter’s rest break 7 claim. Carter has presented admissible evidence through his testimony that he worked in excess of 8 eight hours per day on some occasions and was not paid for those hours. This evidence is sufficient 9 to raise a genuine dispute of material fact suitable for resolution at trial. 10 2. Carter’s Motion 11 Work in excess of eight hours per day must be “compensated at the rate of no less than one 12 and one-half times the regular rate of pay for an employee.” Cal. Labor Code § 510(a). Carter 13 moves for summary judgment on his overtime claim insofar as that claim is based on his on-duty 14 meal breaks. Carter was typically scheduled to work for nine hours a day. See Vepa Depo. at 56:21- 15 58-6; First Vepa Decl., Ex. D. The parties do not dispute that Defendants paid Carter his standard 16 hourly rate for his first nine hours of work. See Vepa Depo. at 56:21-58:6; see also First Vepa Decl., 17 Ex. D (Carter’s time records show that he was only paid overtime once he worked more than nine 18 hours). Carter argues that he should have been compensated for the ninth hour of work at an 19 overtime rate, pursuant to Labor Code § 510(a). Defendants appear to argue that Carter’s on-duty 20 lunch hour does not count toward “hours worked” for the purposes of overtime calculations, and so 21 the overtime rate would not start until after Carter worked nine hours (the standard eight hours plus 22 the one hour on-duty meal period). In support of their contention, Defendants cite Labor Code 23 section 226.7, which provides: “If an employer fails to provide an employee a meal or rest or 24 recovery period in accordance with a state law . . . , the employer shall pay the employee one 25 additional hour of pay at the employee’s regular rate of compensation for each workday that the 26 meal or rest or recovery period is not provided.” Cal. Labor Code § 226.7; see also IWC Order 9- 27 2001, section 11(D). 1 employee’s regular rate of compensation even if the missed meal break means that an employee 2 works a total of nine hours in one day (eight hours plus one hour paid meal period). Defendants’ 3 argument is untenable. Labor Code section 510(a) makes clear that “[a]ny work in excess of eight 4 hours in one workday . . . shall be compensated at the rate of no less than one and one-half times the 5 regular rate of pay for an employee.” Lab. Code § 510(a) (emphasis added); see also IWC Order 9- 6 2001, section 3(A)(1)(a) (stating that an employer must pay “[o]ne and one-half (1 ½) times the 7 employee’s regular rate of pay for all hours worked in excess of eight (8) hours . . . .” (emphasis 8 added)). Defendants point to no authorities that allow employers to schedule employees for nine 9 hours of work, with no meal break and no overtime rate, at the mere cost of an extra hour of the 10 employees’ normal rate. 11 The existence of a valid on-duty meal period does not alter this analysis. If Defendants’ on- 12 duty meal period is valid, then Carter cannot recover a premium wage under section 226.7 for his 13 on-duty meal breaks. See Naranjo v. Spectrum Sec. Servs., Inc., 40 Cal. App. 5th 444, 459 (2019), as 14 modified on denial of reh’g (Oct. 10, 2019) (“[E]mployees who sign on-duty meal agreements that 15 include a right-to-revoke clause are entitled to be paid their regular wages for every on-duty meal 16 period, but they are not entitled to one-hour of premium pay.”). However, nothing in section 226.7 17 restricts the pay rate that applies after eight hours of work. The applicable Wage Order specifically 18 provides that an on-duty meal period is “counted as time worked.” IWC 9-2001, section 11(C). In 19 turn, the overtime provision requires that an employer pay “[o]ne and one-half (1 ½) times the 20 employee’s regular rate of pay for all hours worked in excess of eight (8) hours . . . .” IWC Order 21 9-2001, section 3(A)(1)(a) (emphasis added). Therefore, even if a finder of fact determines that 22 Defendants have a valid on-duty meal period agreement, such an agreement only restricts the ability 23 of employees to recover a meal period premium under section 226.7; it does not alter the hours 24 worked for the purposes of overtime calculations. 25 Defendants also cite to a paragraph on the DLSE’s website that reads: 26 If an employer fails to provide an employee a meal period in accordance with an applicable IWC Order, the employer must pay one additional hour 27 of pay at the employee’s regular rate of pay for each workday that the meal additional hour is not counted as hours worked for purposes of 1 overtime calculations. 2 See Dep’t of Indus. Relations, Meal Periods, https://www.dir.ca.gov/dlse/FAQ_MealPeriods.htm 3 (rev. 7/11/2012) (emphasis added). Defendants seem to construe the bolded language to mean that 4 an employer may freely deny meal breaks for the price of a ninth hour of work at an employee’s 5 standard pay rate. However, the plain meaning of the bolded language is that the additional hour of 6 pay provided by section 226.7 is not an additional hour worked for overtime purposes. For example, 7 an employee who works eight hours without a meal break would be entitled to an additional hour of 8 pay under section 226.7, for a total of nine hours of pay. The nine hours of pay, however, does not 9 translate into nine hours of work such that the employee is owed for one hour of overtime. 10 To summarize, it is undisputed that Carter was paid his standard wage for the first nine hours 11 he worked. For the reasons stated above, Carter is entitled to overtime pay for any hours he worked 12 in excess of eight hours per day, including his paid meal breaks. Thus, Carter’s motion for summary 13 judgment on his overtime claim is granted. Because the parties did not explain how many days 14 Carter was not properly compensated for his on-duty meal breaks, the court will not decide at this 15 time what damages Carter should receive on this claim. 16 C. PAGA Claims 17 The Private Attorney General’s Act (“PAGA”), Cal. Labor Code § 2699 et seq., permits 18 employees to recover civil penalties for violations of enumerated Labor Code provisions. Carter 19 moves for summary judgment on his PAGA claims, which are premised on violations of Labor Code 20 sections 201 (failure to timely pay final wages upon discharge), 204 (failure to timely pay 21 semimonthly wages), and 226(a) (failure to provide accurate wage statements). Although Carter is 22 not explicit on this point, his argument appears to be that Defendants unlawfully failed to pay him 23 an overtime rate for his on-duty meal breaks and therefore the payment of those wages is untimely 24 and improperly omitted from his wage statements.7 25 26
27 7 The court does not construe these arguments to apply to the hours Carter allegedly worked after 1 1. Failure to Pay Wages Upon Termination 2 Labor Code section 201 provides that “[i]f an employer discharges an employee, the wages 3 earned and unpaid at the time of discharge are due and payable immediately.” Cal. Labor Code § 4 201(a). Willful violations of section 201 subject an employer to waiting time penalties under section 5 203. Unpaid overtime wages can serve as the basis for a violation of section 201. See Frausto, 6 2018 WL 3659251, at *6-7. 7 The parties agree that Carter was not paid at an overtime rate when his on-duty meal periods 8 resulted in a workday of more than eight hours. The court granted summary judgment on that issue 9 above, explaining that Carter was entitled to overtime for any time he worked in excess of eight 10 hours, including for his on-duty meal breaks. It follows that Defendants’ failure to pay him owed 11 overtime wages upon termination is a violation of section 201. 12 The court accordingly grants summary judgment on Carter’s section 201 claim. However, 13 Carter did not brief his entitlement to waiting time penalties under the willfulness standard of section 14 203 or present evidence as to the total amount of overtime he accrued due to his on-duty meal 15 periods. Therefore, the court does not reach the amount of damages or penalties owed as a result of 16 Defendants’ violation of section 201. 17 2. Failure to Timely Pay Wages 18 Except under certain circumstances not at issue here, Labor Code section 204 requires 19 employers to timely pay wages twice per month. Cal. Labor Code § 204(a). Carter appears to argue 20 that as a result of Defendants’ failure to pay him overtime, he was not timely paid all wages he was 21 owed on a semimonthly basis. This argument fails. Section 204 “simply regulates the timing of 22 wage payments and does not provide for the payment of any particular type of wages or create any 23 substantive right to wages.” Frausto, 2018 WL 3659251, at *10. In other words, a violation of 24 section 204 cannot be premised solely on the claim that an employer underpaid wages. See Johnson 25 v. Hewlett-Packard Co., 809 F. Supp. 2d 1114, 1136 (N.D. Cal. 2011), aff’d, 546 F. App’x 613 (9th 26 Cir. 2013) (“Section 204 requires the payment of wages in a timely manner; it does not provide a 27 right to wages.”); Fuentes v. Maxim Healthcare Servs., Inc., 2018 WL 6137619, at *6 (C.D. Cal. 1 wages.”); De La Torre v. Am. Red Cross, 2013 WL 5573101, at *5 (C.D. Cal. Oct. 9, 2013) (“Labor 2 Code Section 204(a) deals solely with the timing of wages and not with whether the correct wages 3 were paid.”). Carter argues only that Defendants underpaid his wages; he does not claim that he 4 was not paid regular and timely paychecks. Underpayment of wages is insufficient to establish a 5 violation of section 204. 6 Therefore, Carter’s motion for summary judgment on his claim under section 204 is denied. 7 3. Failure to Provide Accurate Wage Statements 8 Labor Code section 226(a) requires employers to furnish accurate wage statements that 9 include, among other things, the gross and net wages earned and all applicable hourly rates in effect 10 during the pay period. Cal. Labor Code § 226(a). Both statutory and civil penalties are available 11 for a violation of section 226(a). An employee may obtain judgment on civil penalties under PAGA 12 merely by showing a violation of section 226(a), while an employee seeking statutory damages must 13 show that they “suffer[ed] injury as a result of a knowing and intentional” violation. Cal. Labor 14 Code § 226(e)(1); see Mays v. Wal-Mart Stores, Inc., 2018 WL 6264992, at *7 (C.D. Cal. Nov. 1, 15 2018); Magadia v. Wal-Mart Assocs., Inc., 319 F. Supp. 3d 1180, 1187 (N.D. Cal. 2018). 16 Carter argues that his wage statements do not accurately reflect his wages or hourly rates 17 because they do not reflect the overtime wages and rate he was entitled to receive for his on-duty 18 meal periods. Defendants argue only that they were not required to pay Carter an overtime rate for 19 those hours; there is no dispute that Carter’s wage statements did not reflect the overtime he accrued 20 as a result of his on-duty meal periods.8 Failure to pay earned overtime supports a derivative claim 21 for inaccurate wage statements because the rates and amounts owed are not reflected in the 22 statements. See Daugherty v. SolarCity Corp., Case No. 16-cv-05155 WHA, 2017 WL 386253, at 23 *8 (N.D. Cal. Jan. 26, 2017) (“[The plaintiff’s] overtime claim sufficiently establishes that [the 24 defendant] failed to provide accurate and complete information about [the plaintiff’s] wages, in 25 violation of Section 226 . . . .”); Contreras v. Performance Food Grp., Inc., Case No. 14-cv-3380 26 PJH, 2014 WL 6481365, at *4 (N.D. Cal. Nov. 18, 2014) (finding that wage statements must 27 1 accurately reflect all wages earned, not merely report the wages that employees are actually paid). 2 Here, Carter is entitled to overtime for each hour he worked in excess of eight hours. It is 3 undisputed that his wage statements did not reflect an overtime rate for his on-duty meal periods 4 when he worked in excess of eight hours. Accordingly, Carter is entitled to summary judgment on 5 Defendants’ failure to provide accurate wage statements as required by section 226(a). Carter did 6 not brief his entitlement to statutory damages or calculate the civil penalties owed due to the 7 violations, and so the court does not reach the question of damages at this time. 8 D. UCL 9 Defendants argue that they are entitled to summary judgment on Carter’s UCL claim because 10 it is premised on his wage and hour claims. Since his wage and hour claims fail, they contend, his 11 UCL claim fails as well. The court disagrees. For the reasons stated above, Defendants’ motion for 12 summary judgment on Carter’s wage and hour claims is denied and therefore those claims may serve 13 as the basis for a UCL claim. Defendants offer no other reason to rule on Carter’s UCL claim at 14 this time. 15 Accordingly, the court denies summary judgment on Carter’s UCL claim. 16 E. Retaliation and Wrongful Termination 17 Carter alleges that he was retaliated against and wrongfully terminated for engaging in 18 protected activity by complaining about his workplace conditions. Defendants move for summary 19 judgment on these claims on the basis that Carter has failed to present evidence that Defendants 20 retaliated against him or terminated him based on protected activity. 21 According to Carter, he made multiple complaints about his workplace conditions. He first 22 approached Vepa with his concerns about missed meal breaks around January 2017. Carter Depo. 23 at 57:12-58:1-13. Vepa reportedly responded, “Why are you asking me this?” Carter Depo. at 24 58:13-15. Carter testified that, after that conversation, he began getting less desirable routes. Carter 25 Depo. at 58:22-59:5. Carter stated that he also made complaints regarding Junk King’s practice of 26 hiring day laborers. Carter Depo. at 112:7-113:12. Finally, Carter complained about various safety 27 conditions on the job, such as being exposed to needles, mold, and other health hazards, and not 1 Defendants argue that Carter’s testimony is insufficient to establish retaliation or wrongful 2 termination. They point out that Carter received two pay raises (in March and May 2017) during 3 his time at Junk King. Def. Mot. at 21. They also assert that Carter “worked the same routes that 4 other employees of Junk King worked.” Id. Beltre testifies that when he drove with Carter, he “did 5 not see any material difference in the routes we were assigned versus the other routes.” Id. ¶ 7. 6 As with several of Defendants’ other arguments, this issue raises genuine disputes of 7 material fact, including whether Carter ever complained about the listed issues; whether he was 8 assigned less desirable routes because of his complaints; and whether he was terminated because of 9 his complaints. These factual disputes are not appropriate for resolution at summary judgment, and 10 so Defendants’ motion must be denied as to Carter’s retaliation and wrongful termination claims. 11 F. Corporate Officer Liability 12 Defendants move for summary judgment on Carter’s wage and hour claims against Vepa, 13 arguing that individual corporate agents are not liable for California wage and hour violations. Def. 14 Mot. at 24 (citing Martinez v. Combs, 49 Cal. 4th 35 (2010) and Reynolds v. Bement, 36 Cal. 4th 15 1075 (2005)). Defendants’ argument is not convincing. While it is true that Reynolds held (and 16 Martinez affirmed) that “the IWC’s definition of ‘employer’ does not impose liability on individual 17 corporate agents acting within the scope of their agency,” Martinez, 49 Cal. 4th at 66, Defendants 18 do not explain how that maxim applies in this case. In particular, they fail to support their conclusory 19 assertion that Vepa is merely an agent rather than an employer. To employ means “(a) to exercise 20 control over the wages, hours or working conditions, or (b) to suffer or permit to work, or (c) to 21 engage, thereby creating a common law employment relationship.” Martinez, 49 Cal. 4th at 64 22 (emphasis in original). Neither party explains whether any of these definitions apply to Vepa. See, 23 e.g., Maravilla v. Rosas Bros. Constr., Inc., 401 F. Supp. 3d 886, 903 (N.D. Cal. 2019) (holding that 24 the individual owners and operators of a construction firm were liable for violations of the Labor 25 Code). Further, Defendants do not address the impact of Labor Code § 558.1 on their argument, 26 which “extends liability to an owner, director, officer, or managing agent of the employer who 27 violates, or causes to be violated,” certain sections of the Labor Code, including some at issue in 1 *5 (N.D. Cal. Apr. 6, 2020) (quoting Cal. Lab. Code § 558.1(a), (b)) (internal quotation marks 2 omitted). 3 For the above reasons, Defendants’ motion is denied as to the wage and hour claims against 4 Vepa. 5 G. FLSA 6 Defendants move for summary judgment on Carter’s FLSA claim for failure to pay overtime. 7 Under FLSA, an employer must pay overtime to “any of his employees who in any workweek is 8 engaged in commerce or in the production of goods for commerce, or is employed in an enterprise 9 engaged in commerce or in the production of goods for commerce.” 29 U.S.C. § 207(a)(1). FLSA 10 defines “commerce” as “trade, commerce, transportation, transmission, or communication among 11 the several States or between any State and any place outside thereof.” 29 U.S.C. § 203(b). 12 Defendants argue that FLSA does not apply in this case because Carter was not engaged in interstate 13 commerce within the meaning of FLSA, nor is Junk King an enterprise that is engaged in commerce. 14 Carter asserts that his job involved handling products that came from outside California and that 15 therefore his overtime claims are covered by FLSA. Defendants do not dispute that Junk King’s 16 workers sometimes move products from other states or foreign countries. 17 In order to prevail on a FLSA overtime claim, an employee must establish that the employer 18 is liable under either an “enterprise coverage” or “individual coverage” theory. Yan v. Gen. Pot, 19 Inc., 78 F. Supp. 3d 997, 1002 (N.D. Cal. 2015). “Individual coverage” under FLSA applies when 20 an employee is “(1) engaged in commerce or (2) engaged in the production of goods for commerce.” 21 Id. at 1003 (citing 29 U.S.C. § 207(a)). “Enterprise coverage” applies when an enterprise (a) “has 22 employees engaged in commerce or in the production of goods for commerce, or that has employees 23 handling, selling, or otherwise working on goods or materials that have been moved in or produced 24 for commerce by any person” and (b) has an “annual gross volume of sales made or business done” 25 of $500,000 or more. 29 U.S.C. § 203(s)(1)(A); see Yan, 78 F. Supp. 3d at 1003. Defendants do 26 not dispute that Junk King’s gross volume of sales meets the statutory requirement; therefore, only 27 the first requirement for enterprise coverage is at issue here. 1 1. Individual Coverage 2 The definition for individual coverage requires that the employee is “engaged in commerce 3 or in the production of goods for commerce.” 29 U.S.C. § 207(a)(1). Individual coverage under 4 FLSA is “not so broad as to include working on goods or materials that have been moved in 5 commerce by any person.” Id. In Yan, the plaintiff employee was a cook who prepared food for 6 customers in a local restaurant. 78 F. Supp. 3d at 1003. The court noted that the plaintiff may have 7 handled food that was moved interstate before arriving at the restaurant. Id. However, the record 8 reflected that the restaurant prepared food for the purpose of serving it in the restaurant and that the 9 food did not later return to interstate commerce. Id. The court held that individual coverage did not 10 apply because merely using goods that have been moved in commerce is not sufficient to find 11 individual coverage. Id. 12 In this case, it is undisputed that Junk King operates exclusively in the Bay Area and that its 13 trucks and drivers never cross state lines. Carter did not perform any out-of-state services. He 14 picked up products from California customers and disposed of them in California dumps or 15 recycling facilities. The only connection Carter alleges between his work and interstate commerce 16 is that he occasionally hauled items, such as IKEA furniture, that originated outside of California. 17 Carter Depo. at 90:24-91:13. As in Yan, where the court found a cook did not engage in commerce 18 merely by using food that had been moved interstate, Carter does not engage in commerce by 19 hauling some products that may have, at some point, crossed state lines. See 78 F. Supp. 3d at 1003. 20 Accordingly, the individual coverage theory does not apply in this case. 21 2. Enterprise Coverage 22 Under an enterprise theory, an employee does not have to show that he or other employees 23 personally engaged in commerce or in the production of goods for commerce; he can also establish 24 FLSA liability by showing that the enterprise’s employees “handl[e], sell[], or otherwise work[] on 25 goods or materials that have been moved in or produced for commerce by any person.” 29 U.S.C. 26 § 203(s)(1)(A). Defendants assert that Junk King is not an enterprise covered by FLSA because it 27 exclusively services the Bay Area; its workers remove trash from local homes and businesses and 1 state lines. Def. Mot. at 17; Def. Reply at 3-4. Carter argues that FLSA applies because he 2 occasionally hauled items that originated from outside of California. Pltf. Opp. at 13. 3 Neither party provides relevant authority on enterprise coverage under FLSA. Defendants 4 rely primarily on McLeod v. Threlkeld, 319 U.S. 491 (1943) and Wirtz v. Modern Trashmoval, Inc., 5 323 F.2d 451 (4th Cir. 1963), but those cases analyzed the original version of FLSA, which did not 6 include a basis for enterprise coverage.9 The more recent cases Defendants cite address individual 7 rather than enterprise coverage and are therefore also inapposite. See Yan, 78 F. Supp. 3d at 1003 8 (finding that the enterprise coverage theory did not apply because the defendant business’s gross 9 sale volume did not meet FLSA’s monetary standard); Russell v. Cont’l Rest., Inc., 430 F. Supp. 2d 10 521, 524 (D. Md. 2006) (same). Carter’s authority is also unpersuasive. He relies on cases analyzing 11 employees who work in “any . . . occupation directly essential to the production” of interstate goods 12 under 29 U.S.C. § 203(j). Those cases focus on, for example, workers that provide waste removal 13 services for businesses that produce interstate goods. See Brennan v. Carrasco, 540 F.2d 454 (9th 14 Cir. 1976); see also Mitchell v. Dooley Bros., Inc., 286 F.2d 40 (1st Cir. 1960); Nunn’s Battery & 15 Elec. Co. v. Wirtz, 335 F.2d 599 (5th Cir. 1964). By contrast, Carter’s FLSA claim is not premised 16 on whether Junk King provided services that were essential for another business’s production of 17 interstate goods, and so the reasoning of those cases does not apply here. 18 The parties failed to present relevant arguments and authority and the court has no obligation 19 to decipher what those arguments and authorities might be. It therefore declines to render judgment 20 on Carter’s FLSA claim at this time. Defendants’ motion is denied as to this claim without prejudice 21 to raising the issue again in pre-trial proceedings. 22 H. Telephone Purchase Agreement 23 Carter alleges that Junk King made unlawful deductions from his wages by requiring him to 24 purchase a cell phone and pay for cell phone usage through the employer purchase plan and failed 25 26 9 Enterprise coverage was added by an amendment to FLSA in 1961. See Donovan v. Scoles, 652 F.2d 16, 18-20 (9th Cir. 1981). McLeod was decided before 1961 and so did not analyze enterprise 27 coverage at all. While Wirtz was decided in 1963, it did not apply the 1961 amendment because the alleged violations at issue in that case arose before that amendment came into effect. 323 F.2d at 1 to reimburse him for those business expenses. Defendants move for summary judgment on the 2 unlawful deductions and failure to reimburse claims. They point out that the Telephone Policy 3 explicitly states that it is voluntary, and that Carter signed a copy of the agreement. In response, 4 Carter testified that he was required to purchase a cell phone through the Junk King plan as a 5 condition of his employment. He also argues that routine business expenses cannot be deducted 6 from employee wages even if the employee consents to the deductions. 7 Under California law, employers must indemnify their employees “for all necessary 8 expenditures or losses incurred by the employee in direct consequence of the discharge of his or her 9 duties . . . .” Cal. Labor Code § 2802(a). To recover under section 2802, an employee must show 10 that “(i) [he] made expenditures or incurred losses; (ii) the expenditures or losses were incurred in 11 direct consequence of the employee’s discharge of his or her duties, or obedience to the directions 12 of the employer; and (iii) the expenditures or losses were reasonable and necessary.” Marr v. Bank 13 of Am., Case No. 09-cv-05978-WHA, 2011 WL 845914, at *1 (N.D. Cal. Mar. 8, 2011), aff’d sub 14 nom. Marr v. Bank of Am., NA, 506 F. App’x 661 (9th Cir. 2013). An employee cannot voluntarily 15 waive his right to indemnification for business expenses, since “[a]n employer may not require its 16 employees to consent to unlawful deductions from their wages.” Aguilar v. Zep Inc., 2014 WL 17 4245988, at *15 (N.D. Cal. Aug. 27, 2014) (quoting Hudgins v. Neiman Marcus Grp., Inc., 34 Cal. 18 App. 4th 1109, 1111-12 (1995)) (internal quotation marks omitted). 19 Defendants summarily assert, without authority, that the purchase of a cell phone and cell 20 phone usage does not qualify as a routine business expense. Def. Reply at 6. Their argument 21 appears to hinge on their claim that purchasing a phone through Junk King’s employer plan was 22 voluntary. Id. They do not respond to the caselaw cited above, which makes clear that employees 23 cannot waive their right to expense reimbursements. See Aguilar, 2014 WL 4245988, at *16 (“Any 24 contract to waive [expense reimbursements] is null and void.” (citing Edwards v. Arthur Andersen 25 LLP, 44 Cal. 4th 937, 951 (2008)). Further, even if Carter’s consent to the Telephone Policy were 26 relevant, it is a disputed fact whether the policy was actually voluntary or whether employees were 27 required to sign it as a condition of employment. Defendants’ argument that Carter was reimbursed 1 terminated, while Carter asserted that he never received payment for the phone. First Vepa Decl. ¶ 2 13; Carter Depo. at 122:19-123:1. The contradicting facts put forward by the parties cannot be 3 resolved at this stage of litigation. 4 In sum, Defendants have not shown that they are entitled to summary judgment on Carter’s 5 claims for unlawful deductions and failure to reimburse. 6 I. Punitive Damages 7 Defendants argue that Carter’s prayer for punitive damages must be struck, insofar as the 8 damages relate to his wage and hour and UCL claims. Def. Mot. at 25. California district courts 9 have held that punitive damages are not available for violations of the California Labor Code. 10 Cleveland v. Groceryworks.com, LLC, 200 F. Supp. 3d 924, 964 (N.D. Cal. 2016) (citing Brewer v. 11 Premier Golf Props., 168 Cal. App. 4th 1243, 1252 (2008)); Cones v. Parexel Int’l Corp., 2017 WL 12 2908789, at *1 (S.D. Cal. July 7, 2017) (“[I]n the context of statutory wage and hour claims under 13 the FLSA and the California Labor Code, punitive damages are not available.”); Jones v. AB 14 Acquisition LLC, 2016 WL 7638188, at *5 (C.D. Cal. Apr. 4, 2016) (“[S]tatutory remedies are 15 generally the exclusive remedy for wage violations.”), aff’d, 703 F. App’x 563 (9th Cir. 2017); 16 Dittmar v. Costco Wholesale Corp., 2015 WL 7106636, at *5 (S.D. Cal. Nov. 13, 2015) (“[P]unitive 17 damages aren’t recoverable for violations of the Labor Code.”). Similarly, it is well-established that 18 punitive damages are not available for a violation of the UCL. Cleveland, 200 F. Supp. 3d at 964; 19 In re Wal-Mart Stores, Inc. Wage & Hour Litig., 505 F. Supp. 2d 609, 620 (N.D. Cal. 2007) (“[I]t 20 is settled law that punitive damages are not available under section 17200.”). 21 Carter does not contest that punitive damages are unavailable for violations of the Labor 22 Code or UCL. He instead argues that punitive damages are available for wrongful termination 23 claims. Pltf. Opp. at 25. Unlike a statutory claim under the Labor Code, wrongful termination in 24 violation of public policy is a tort claim and may include tort relief in the form of punitive damages. 25 See Freund v. Nycomed Amersham, 347 F.3d 752, 760 (9th Cir. 2003). Therefore, while Carter may 26 pursue punitive damages on his wrongful termination claim, Defendants’ motion is granted to the 27 extent that Carter seeks punitive damages for his Labor Code and UCL claims. 1 IV. CONCLUSION 2 For the reasons stated above, the court grants in part Carter’s motion on his overtime claim. 3 || He is entitled to overtime pay for any hours he worked in excess of eight hours per day, including 4 || for on-duty meal periods. Carter’s motion is also granted on his PAGA claims under Labor Code 5 section 201 and 226(a) to the extent that those claims are premised on his overtime claim. The court 6 || does not reach the issue of damages or penalties with respect to those claims. Defendants’ motion 7 is granted to the extent that Carter seeks punitive damages for his Labor Code and UCL claims. The 8 motions are otherwise denied. 9 10 IT IS SO ORDERED. 11 Dated: June 30, 2020
Donna M. Ryu = 13 United States Magistrate Judge
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