The practice of rounding meal periods is prohibited in California and is no longer necessary with the ease and accuracy of available timekeeping systems that can track hours worked to a fraction of a minute.
The California Supreme Court issued a decision prohibiting employers from rounding employee time punches for meal breaks. Employers who are rounding time must immediately stop this practice – even if it results in rounding to the employee’s benefit – or risk a costly wage and hour suit.
In Donohue v. AMN Services, the court stated, “The meal period provisions are designed to prevent even minor infringements on meal period requirements, and rounding is incompatible with that objective.” This is true even if the practice of rounding results in employees being fully compensated or even overcompensated over a period of time. California employers that round employees’ meal breaks should adjust their timekeeping systems as soon as possible to minimize the risk of liability.
California’s Meal Breaks Law
California requires employers to provide nonexempt employees a meal break of at least 30 minutes if they work more than five hours in a day and a second meal break of at least 30 minutes if they work more than 10 hours in a day. The meal breaks must begin no later than the end of the employee’s fifth and tenth hours of work, respectively. Unless the employee is relieved of all duty, the meal breaks are considered as “on duty” and must be counted as time worked. Employers that fail to provide employees with a meal break in accordance with California law must pay one extra hour of pay at the employee’s regular rate of pay for each shift in which the meal break is not provided.
Facts of the Case
AMN Services, a healthcare services and staffing company, used an electronic timekeeping system to track its employees’ work time. Employees used computers to punch in and out of the system, including at the beginning of the day, at the beginning of lunch, at the end of lunch, and at the end of the day. Employees also could ask to manually adjust any inaccurate time punches – for example, if they forgot to clock out for lunch or if they worked when they were clocked out. AMN’s timekeeping system rounded employees’ time punches to the nearest 10-minute increment. For example, if an employee clocked out for lunch at 11:02 a.m. and clocked in after lunch at 11:25 a.m., it would have recorded the time punches as 11:00 a.m. and 11:30 a.m. Although the actual meal break was 23 minutes, it would have recorded the meal break as 30 minutes. AMN’s practice of rounding meal break times evened out over time and actually resulted in the plaintiffs being overpaid by 85 work hours.
The Court’s Ruling
The precision of the time requirements in California’s meal breaks law – “not less than 30 minutes” and “five hours per day” or “ten hours per day” – is “at odds with the imprecise calculations that rounding involves,” the court observed. The court further noted that California’s meal breaks law requires employers to provide employees an additional hour of pay regardless of whether their meal break was shortened or they had no meal break at all. The court held that “[a] premium pay scheme that discourages employers from infringing on meal periods by even a few minutes cannot be reconciled with a policy that counts those minutes as negligible rounding errors.” Finally, the court also held that time records showing noncompliant meal breaks raise a rebuttable presumption of meal break violations at summary judgment.
The Takeaway
Employers should immediately check whether their timekeeping systems are rounding nonexempt employees’ punches. If it is, modify the settings to prevent the system from rounding meal break punches. While not addressed in the court’s decision, employers should consider ending all rounding of employee punches if the timekeeping system is capable of precisely tracking employee punches.
This article is informational and does not constitute legal or financial advice. Consult with an employment lawyer or accountant for additional clarification on how these changes impact your company.
