Late last week, the California Supreme Court ruled in Ferra v. Loews Hollywood Hotel, LLC that employers must pay meal and rest break premiums to nonexempt employees at the regular rate of pay. The regular rate of pay, used to calculate the overtime rate of pay, includes all nondiscretionary compensation. This decision marks an important change in the law that impacts employers’ pay practices. Employers should immediately review all forms of nondiscretionary compensation paid to nonexempt employees, such as commissions or bonuses, to ensure proper calculation of the regular rate for meal and rest period premium payments.
See the attached Alert for more information, and contact an attorney in our Employment Group with any questions.