IR #2006-02
Friday, January 13, 2006

Dean Fryer
Renée Bacchini
(415) 703-5050

Meal and Rest Period Regulations Postponed – Penalty Provision Defined by Court

San Francisco -- The California Department of Industrial Relations (DIR) has announced that the Division of Labor Standards Enforcement (DLSE) will not file regulations governing meal and rest periods with the Office of Administrative Law by today's deadline. It will instead issue a new package of proposed meal and rest period regulations at a later date, beginning a completely new rulemaking process.

John Rea, acting director of the DIR, noted that the most critical component of the regulations, governing the classification of payments made to employees for an employer's failure to provide meal and rest periods, has been independently reviewed by the First District Court of Appeal, which found that the "payment" is indeed a penalty and not a wage. "That decision is in full agreement with our position," Rea said. "When viewed in combination with a precedent decision recently issued by the Labor Commissioner, the need for a regulation clarifying that the 'payment' is a penalty and not a wage is significantly reduced at this time," he added. It should be noted that other appellate court decisions have referred to the payment as a penalty as well.

"In reviewing the hundreds of comments we received, it has become apparent that we might further fine tune these regulations to better serve the working men and women of California and provide better guidance for their employers," said Rea. "Regulations remain necessary in order to provide enforcement officials with clarity relating to very distinct changes in the law."

"It is imperative, therefore, that we proceed on a fresh track," Rea said. "We look forward to working with all parties on our new regulatory package."