Employer prevails in rare class action trial over California meal break rules

In a rare win for a California employer under recently tightened labor standards, a San Bernardino County jury largely sided with Northwest Pallet Services LLC, rejecting most wage claims and awarding only minimal damages in a two-month employment class action trial.

The case is believed to be one of the first to challenge -- and overcome -- the strict "rebuttable presumption" standard set forth in the California Supreme Court's 2021 decision in Donohue v. AMN Services. The ruling holds that time records showing noncompliant meal breaks trigger a legal presumption that a violation occurred, placing the burden on employers to prove otherwise. Donohue v. AMN Services, LLC, 11 Cal. 5th 58, 275 Cal. Rptr. 3d 422, 481 P.3d 661 (Cal. Feb. 25, 2021)

The standard has made it significantly more difficult for employers to prevail at trial in meal and rest break litigation.

"This was a high-stakes, complex matter involving evolving California legal standards that are generally very difficult for employers to overcome at trial," said lead defense attorney Abad Lopez of Dykema Gossett PLLC. "We were proud to take this case all the way through trial, and even happier to deliver this result for Northwest Pallet."

The class action originated from a May 2019 complaint in Kern County Superior Court by former employees Jermaine Grandberry and Noah Clines, who alleged Northwest Pallet denied overtime pay and rest periods, required employees to work through meal breaks without proper compensation, and failed to maintain accurate wage records. Grandberry v. Northwest Pallet Services LLC, BCV-19-101284 (Kern Co. Super. Ct., filed May 9, 2019),

That case was later coordinated in San Bernardino County with a second class action. While class certification was denied in Carroll, the Grandberry claims advanced to trial. Carroll v. Northwest Pallet Services LLC, CIV-DS-1932541 (San Bndo Co. Super. Ct., filed Oct. 25, 2019)

The original lawsuit alleged the company "engaged in a pattern and practice of wage abuse against their hourly-paid or non-exempt employees," including failing to pay overtime for hours worked beyond eight per day or 40 per week, omitting total hours from wage statements, and failing to reimburse business-related expenses.

Plaintiffs alleged they were "required to work during meal periods and failed to compensate" with premium pay.

The certified class eventually included as many as 1,900 former hourly or non-exempt employees who worked for Northwest Pallet in California during the four years preceding the lawsuit.

Edwin Aiwazian of Lawyers for Justice PC in Glendale represented the plaintiffs. He was not available for comment.

Northwest Pallet's defense team included Lopez, Ryan Arger, Charlotte Carne, James Golden, and Christine Mardikian of Dykema.

The original complaint sought unpaid wages, meal and rest break premiums, overtime compensation, and statutory penalties of up to $4,000 per employee.