n May 23, 2022, the Supreme Court of California held that premium pay for missed meal and rest periods constitutes “wages” under California labor law and that employers may be held liable for the failure to properly report and timely pay out such wages.
The unanimous California high court in Naranjo v. Spectrum Security Services, Inc. found that such premium pay must be reported on statutorily required wage statements under California Labor Code section 226. The court further held that such unpaid premium pay must be paid within statutory deadlines when an employee leaves a job and that employers may face potential liability for waiting time penalties under California Labor Code section 203.
The case involved a class action filed by security guards alleging that Spectrum Security Services had violated California labor law by failing to report the premium pay for missed meal breaks on employees’ wage statements and failed to timely provide the pay upon employees’ discharge or resignation. A California appellate court had held that missed-break premium pay was not “wages” because it serves as a legal remedy, not compensation for work, and that employers cannot be penalized for the failure to timely pay or report.
The state’s high court reversed, reasoning that while the extra pay is designed to compensate for what is an unlawful deprivation of a guaranteed break, it is also compensation for work an employee performed during that break period. Therefore, the pay constitutes...
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