On February 25, 2021, a unanimous California Supreme Court in Donohue v. AMN Services, LLC created new potential pitfalls for employers who round employee meal break time entries.  Notably, the Court held that: (1) employers may not round meal period punch times, and (2) time records reflecting potentially noncompliant meal periods raise a rebuttable presumption of meal period violations.  In light of this decision, California employers should assess their timekeeping policies and procedures, particularly those related to meal periods, to ensure they comply with the ever-evolving labor and employment law landscape.

California’s Meal Period Requirements

Under California law, employers must provide non-exempt employees with one 30-minute, unpaid meal period that begins no later than the end of the fifth hour of work and another 30-minute meal period that begins no later than the end of the tenth hour of work.  If an employer does not provide an employee with a compliant meal period, then the employee is entitled to one hour’s pay for each break that was denied to them.

Employers May Not Round Meal Period Punch Times

In Donohue, Defendant AMN Services, LLC (“AMN”) utilized an electronic timekeeping system that rounded electronic time punches to the nearest 10-minute increment.  If an employee clocked out for lunch at 11:02 a.m. and clocked in after lunch at 11:25 a.m., the system would have recorded the time punches as 11:00 a.m. and 11:30 a.m.  Thus, although the actual meal period was 23 minutes, the system recorded the meal period as 30 minutes. Similarly, if an employee clocked in for work at 6:59 a.m. and clocked out for lunch at 12:04 p.m., the system rounded the time punches to 7:00 a.m. and 12:00 p.m.  In that case, the actual meal period started after five hours of work, but the system would have recorded the meal period as starting after exactly five hours of work.

The Court rejected AMNs rounding practices, noting that meal period provisions are designed to prevent even minor infringements on meal period requirements, and rounding is incompatible with that objective.  Taking its decision one step further, the Court held that time records showing noncompliant meal periods raise a rebuttable presumption of meal period violations.

Takeaways for Employers

Even after Donohue, noncompliant meal periods do not automatically subject an employer to liability.  Rather, evidence of the noncompliant meal periods raises a rebuttable presumption of meal period violations.  Employers can rebut the presumption by presenting evidence that employees were compensated for noncompliant meal periods or that the employees had, in fact, been provided compliant meal periods during which they chose to work.  The Court noted that employers could use an electronic timekeeping system to track meal period violations as long as the system does not round time punches.  The AMN system, for example, included a dropdown menu for employees to indicate whether they were provided a compliant meal period but chose to work, and the system triggered premium pay for any missed, short, or delayed meal periods due to the employer’s noncompliance.

Most importantly, employers should review their timekeeping and rounding practices to eliminate any rounding for purposes of documenting when and for how long employees take their meal periods.

Matthew Zollman is an attorney with Balestreri Potocki & Holmes. His practice includes litigation and transactional matters for a variety of businesses. He may be reached at mzollman@bph-law.com.