Murphy v. Kenneth Cole Productions, Inc.

Summary

The California Supreme Court held that the additional hour of pay required by Labor Code section 226.7 for missed meal or rest periods is a wage or premium wage, not a penalty, and is therefore subject to a three-year statute of limitations. The court also held that a superior court conducting a de novo trial following a Labor Commissioner proceeding may consider related wage claims that were not presented in the administrative proceeding. The court reversed the contrary judgment of the Court of Appeal.

Holdings

1. The one additional hour of pay required by Labor Code section 226.7 is a premium wage intended primarily to compensate employees, not a penalty. Claims seeking that payment are therefore governed by the three-year statute of limitations in Code of Civil Procedure section 338.
2. A superior court conducting a Labor Code section 98.2 de novo trial has discretion to permit an employee to assert additional wage claims that were not presented to the Labor Commissioner when those claims are legally and factually related to the same underlying wage dispute.

Questions Presented

1. Whether the one additional hour of pay required by California Labor Code section 226.7 for each workday on which an employer fails to provide a required meal or rest period is a wage or premium wage governed by the three-year statute of limitations in Code of Civil Procedure section 338, rather than a penalty governed by the one-year statute of limitations in section 340.
2. Whether a superior court conducting a de novo trial under Labor Code section 98.2 may permit an employee to assert additional wage claims that were not presented to the Labor Commissioner but are legally and factually related to the original wage dispute.

Disposition

reversed