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Maza v. Waterford Operations, LLC

Court of Appeals of Oregon

November 14, 2019

Renee MAZA, Jodi Real, and Steve Price, individually and on behalf of all similarly situated, Plaintiffs-Appellants,
v.
WATERFORD OPERATIONS, LLC and Coos Bay Rehabilitation, LLC, domestic limited liability company, Defendants-Respondents. 300 Or.App. 471

          Argued and submitted December 10, 2018

          Jackson County Circuit Court 14CV03147; Timothy C. Gerking, Judge.

          Lisa T. Hunt argued the cause for appellants. Also on the briefs were Law Offce of Lisa T. Hunt, LLC; David A. Schuck and Schuck Law LLC.

          William E. Gaar argued the cause for respondents. Also on the brief were Jillian Pollock and Buckley Law, P.C.

          Noah T. Barish and McKanna Bishop Joffe, LLP, fled the brief amicus curiae for Oregon AFL-CIO.

          Ellen F. Rosenblum, Attorney General, Benjamin Gutman, Solicitor General, and Sharia Mayfeld, Assistant Attorney General, fled the brief amicus curiae for Bureau of Labor and Industries.

          Thomas W. Sondag, Paul M. Ostroff, Peter D. Hawkes, and Lane Powell PC fled the brief amicus curiae for Health Care Association and Oregon Business & Industry.

          Before Armstrong, Presiding Judge, and Tookey, Judge, and Shorr, Judge.

          [300 Or.App. 472] Case Summary: In this putative class-action claim arising under ORS 653.055, plaintiffs sought wages and penalty wages for meal periods that were shorter than 30 minutes, contending that the 30-minute meal period required by OAR 839-020-0050, an administrative rule of the Bureau of Labor and Industries, is mandatory and that, if it is not taken, the employer must pay wages for the full 30-minute meal period. Employer contended that, under the administrative rule, an employer need only make available a 30-minute meal period, but is not required to monitor whether employees take the full 30-minute meal period or pay wages for the meal period if the employee voluntarily chooses not to take the full 30 minutes. The trial court agreed with employer's interpretation and, based on that interpretation declined to certify the class under ORCP 32 A, because a claim would be factually dependent on the reason the employee did not take the full 30-minute meal period. But, pursuant to ORS 19.225, the trial court allowed plaintiffs' interlocutory appeal seeking an interpretation of OAR 839-020-0050. Held: The minimum meal period prescribed by OAR 839-020-0050 is mandatory and, in the absence of a waiver of the meal period as provided in OAR 839-020-0050(8), an employer who is not exempt must require a 30-minute meal period without work duties and pay wages to an employee who is not relieved of duties during the entirety of the required minimum 30-minute meal period. The court's conclusion requires the trial court to reconsider its rulings regarding the certification of a class under ORCP 32 A.

          [300 Or.App. 473] TOOKEY, J.

         This putative class-action wage claim arises under ORS 653.055, providing for the liability of an employer "who pays an employee less than the wages to which the employee is entitled," and OAR 839-020-0050, an administrative rule of the Commissioner of the Bureau of Labor and Industries (BOLI), describing when employees must be paid for otherwise unpaid meal periods. Plaintiffs sought to certify a class of plaintiffs who they alleged had not been paid wages for meal periods under OAR 839-020-0050. The trial court declined to certify the class under ORCP 32 A. But, pursuant to ORS 19.225, the trial court has allowed plaintiffs' interlocutory appeal seeking an interpretation of OAR 839-020-0050. We provide that interpretation, vacate the trial court's rulings under ORCP 32 A, and remand the case for further proceedings.

         We provide the following underlying legal, factual, and procedural background: ORS 653.26l(1)(a) authorizes BOLI to adopt rules prescribing minimum conditions of employment, including minimum meal periods, "as may be necessary for the preservation of the health of employees." Pursuant to that authority, BOLI promulgated OAR 839-020-0050, which provides, as relevant:

"(1) The purpose of this rule is to prescribe minimum meal periods and rest periods for the preservation of the health of employees.
"(2)(a) Except as otherwise provided in this rule, every employer shall provide to each employee, for each work period of not less than six or more than eight hours, a meal period of not less than 30 continuous minutes during which the employee is relieved of all duties.
"(b) Except as otherwise provided in this rule, if an employee is not relieved of all duties for 30 continuous minutes during the meal period, the employer must pay the employee for the entire 30-minute meal period."[1]

         As applied to the issue here, the rule requires that, for each work period between six and eight hours in length, an [300 Or.App. 474] employer must provide a minimum unpaid meal period of 30 minutes.[2] If the employer does not relieve the employee of work for an unpaid meal period of 30 continuous minutes, then the employer must pay the employee a penalty wage for the entire 30-minute period.

         It is undisputed that defendants have authorized their hourly employees to take an unpaid 30-minute meal period. An employee handbook advises employees that, "[i]n some states these lunch and meal periods are mandatory and may not be skipped even with your consent." The handbook also explains the availability of a process for hourly employees to report meal-period issues, and employees were required to notify a manager or employer's human resources department if a meal period was not provided or if the employee performed work off the clock.

         The named plaintiffs and the putative class-action plaintiffs in this case are defendants' hourly employees. As alleged by plaintiffs, defendants' records show that, between certain dates, defendants' hourly employees took unpaid meal periods that were shorter than 30 minutes.

         Plaintiffs brought this wage claim under ORS 653.055, seeking certification of a class consisting of defendants' hourly employees, who plaintiffs allege are entitled to wages and penalty wages under OAR 839-020-0050(2)(b) for the shortened meal periods. The trial court initially certified the class under ORCP 32 A. But the court then reconsidered its ruling in response to the parties' arguments. Defendants argued that a class action was inappropriate because the claim of each employee was fact-dependent. See ORCP 32 A(2) (requiring that the class have common questions of law or fact). The view that the claims were fact-dependent derived from defendants' understanding that, under OAR 839-020-0050(2)(a) and (b), if an employer has authorized a 30-minute meal period, no liability for wages or penalty wages will attach for a shortened meal period, unless the employee was forced to return to work early. Thus, defendants contended, each employee's claim depends on the circumstances of the shortened meal period.

          [300 Or.App. 475] Plaintiffs responded that the circumstances of each employee's shortened meal period are not material to the dispute. Plaintiffs' view depends on their understanding that the requirement to pay wages under OAR 839-020-0050(2)(b) attaches if the record shows that a meal period was shortened, regardless of the cause.

         The trial court agreed with defendants' interpretation and decertified the class after concluding that a determination of liability under OAR 839-020-0050(2Xb) would require a fact-specific inquiry regarding the circumstances of each employee's shortened meal period. The court also denied plaintiffs' motion for partial summary judgment on the issue of liability.

         The court subsequently denied plaintiffs' motion to recertify the class, but authorized this interlocutory appeal, pursuant to ORS 19.225, [3] to address the following question:

"Whether an employer can be found strictly liable under OAR 839-020-0050(2) where an employee, regardless of the circumstances, takes less than the entire duty-free 30-minute lunch break to which the employee is otherwise entitled?"

         We have exercised our discretion to allow the interlocutory appeal to address the trial court's question.

         The question presented requires an interpretation of OAR 839-020-0050. In aid of that, the parties reprise their interpretations offered in the trial court. Plaintiffs contend that OAR 839-020-0050(2Xb) is correctly understood to require that, with certain exceptions not relevant here, to [300 Or.App. 476] avoid the requirement to pay meal-period wages, employers must not merely authorize but must actually require that employees take a duty-free meal period for a full 30 minutes; if, for whatever reason, an employee takes a shorter meal period, then, pursuant to OAR 839-020-0050(2)(b), plaintiffs contend that wages must be paid for the entire meal period. That outcome is what defendants and the trial court have characterized as "strict liability."[4]

         In defendants' view, the requirement in OAR 839-020-0050(2)(a) to "provide" a meal period means, simply, that a 30-minute meal period must be made available for use, and that employers have no duty to enforce the use of the full 30-minute break. Further, defendants assert that its written policies set out in the employee handbook satisfy the requirement that it made the requisite meal period available. Under defendants' interpretation, OAR ...


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