to provide proper wages for employees who work excessive working hours california much later passed a provision to provide employees of premium wages when they don't receive a meal break at issue in this case is whether california is a requirement to pay for a meal break one whether it actually applied to this particular case is one of the issues but assuming that it did apply in this particular case does that give california authority to waive the important protections provided by the fair labor standards act the fair labor standards act contains a saving clause that permits state laws that  provide more protection to the employees but it does not give employers the right to waive compensation that would be due to the employees simply in the goal of corporate efficiency a big employer was providing educational benefits to the employees and the court said that those at the value of those educational benefits needed to be included in the regular rate of pay on which overtime is computed well what we're talking about here concerns the lunch hour right is the employees were scheduled for eight hour work days and they used electronic time he keep keeping system that was on their computer and they would just basically click a button and say i'm on the clock and they would click a button to say they were  off the clock either at the end of the day or on their break and that system was in for years beginning in two thousand and eleven there was a backend change to the processing of that where medtronic came up with the new company policy was that any time the employee did not click the button within five hours they would automatically receive one hour's pay without any inquiry into why they didn't take a break or whether they voluntarily chose not to take the break or piece so we can't have any disputed facts so everything has to be read is that and i read your complaint and do you create a disputed fact when you say the other side contends x y and z when it's  you to the language in your complaint where you're saying that the opponent you're that the defendant is contending certain issues but that doesn't create a an issue does it when you when you put words in the other side lunch hour to be considered part of the regular pay that could be a count you want that you want them to be part of the regular credits that can be counted towards overtime is that that's the main issue yesterday all right so you can tell us why we should consider the payments to be part of the regular rate of pay when it looks like to paul's within an exemption exemption number five of the f l s say that's the main issue we're here for i believe yesterday the key to that understanding is that the fair labor standards act does not permit states to waive compensation that is due and i'll explain that so it's undisputed that if had this policy and was operating in texas where there is no meal break law we would have a claim we receive the extra hour we get extra compensation under the f l s a it's you know five dollars a week or something like that so if this employer an employee had been working in texas it's undisputed by all the parties that he'd be entitled to the additional compensation and could come into court with a claim so the issue is can california pass a law that waves a right to compensation that you would have in every other state in the union just because california wants to say it's something else now i think out of the savings clause you can't get that but well ok explain to me in if if there's no break so they work nine hours  in texas then they then they get an hour overtime right is that how that works if the texas doesn't have a daily overtime provision so it would get a little bit but if the employer had a daily overtime provision a voluntary one like medtronic had here to say we're going to pay overtime after eight hours in a day than the employee would get one hour of overtime for that day now the f l s eight in the texas situation wouldn't kick in until he worked forty hours in the week but just to make the things simple will say on friday he worked nine hours one of those hours would be paid at an overtime rate he'd also receive it will say he's making ten dollars an hour to so maybe the math is slightly easier he also receive the ten dollars premium for the missed meal the issue is under that situation where it's clearly a voluntary meal break program implemented by a private employer working in texas that ten dollars must be put into the regular rate of pay if you add up all the compensation divide by the number of hours worked which in this case would be forty one and that gives a higher regular rate of pay and that requires additional compensation my point in the beginning is that all these mess and a nation's there are there for a deliberate purpose and it's not just to make people studying math in high school the reason is that employers can always comply with the f l essays maximum hours there's a minimum wage thing in that's not relevant here so the f l s say they can always comply with the f l s say if they don't work their employees over forty hours in a week so what congress did in doing this is two things they say well we're going to give me premiums but we're also going to make it so darned difficult for employers who work there at their employees over forty hours that what they need to do is go hire more people don't have one person working eighty hours have two people working forty don't have one person working sixty have two people working thirty the wisdom of that law we can't debate here that's what congress passed in congress said well we're also not going to allow states to have a race to the bottom where one state can pass a some provision over here that waves the f l s say and then all the employers move to that state and in fact here it's exceedingly rare because it's in it's in the record that medtronic moved to texas and now they medtronic is coming back into this court and saying that california is supposedly employer friendly laws would require less pay than somebody working in texas that is not the law that the standard in which is this court had just identified is extremely critical for the reason pointed out in the brief is that it creates this additional problem that it's a mathematical certainty that if it falls under if employers take the credit and they say medtronic is it is a you know wonderful employer and they would never seek to do that but it would be malpractise for an attorney who's faced with a class action in any other law suit to say they're suing us for overtime and meal breaks and we are we are not going to certain a defense of offset any employer on the planet would say if we if that if that meal breaks and a five exception we're going to take that credit every single time and that's going to reduce the amount of overtime that other employees do you want to reserve any time for yes your hon there's nothing remotely regular about a payment that is triggered only by a departure from a statutory working requirement a statutory scheduling requirement regular rate of pay has is is something that encompasses lots of types of compensation but it does not encompass extra compensation that is paid because of some deviation or departure from a daily standard so could i ask you what your thoughts are in response to your colleague's argument here that if you interpret california law and in the way that you're proposing that it would result in less pay than if the person were in texas where meals were not required to be becomes that becomes usually with some exceptions part of the regular rate of pay but when it is something that is based on scheduling and it is a statutory requirement as as the us department of labor has has construed the five to include statutory scheduling requirements then you don't compound that premium payment when you're looking at over time i think it's entirely it it's beyond hypothetical to to say that because something is required in state a if someone if an employer agreed to provide the same benefit in state b that there is some kind of problem under the f l i say it what you have in real life i mean we can get we can get back on the other side of the looking glass now and get in real life and when you when you see you in real life it looks like to me this is not the times that this is a repeated issue for me tronic it looks like you're trying to circumvent at least from appearances having to pay these folks the higher rate looks like you do can arguably you know as your here saying well this is appropriate under the can california labor code and then we can hook into exemption number five but that seems to be your that's your approach to wages it doesn't seem like this is a one time thing that's the only thing that gives me some possible i'm not sure if you understand this or trace is brought to lawsuits i understand that and i don't understand it california employers all are compelled and at the time at issue here in two thousand and eleven the prudent ones did something like what metron it did unless they had very eleven many many courts of appeal have held that providing a meal break meant ensuring a bill break and employers were losing this issue and look at last that not hundred percent but pretty consistently until the supreme court in comply with the statute or a way to remedy violation of statute is the second your honor the supreme court california supreme court has been quite clear that you can't just choose to pay and not provide not provide a meal  period it is a statutory premium required by statute to play with a statutory work scheduling requirement which says that on a day of more than five days i'll leave aside there's lots of exceptions with basically on a day of more than five days you have to have a thirty minute period of no work within that first five hours that is a statutory scheduling a carman that comes it is a daily standard where both the schedule and the premium are required by another a political staff to come squarely within the regulation i mean you could say this about any number of other provisions that could be required by one state this one is only required by california and then could be voluntarily provided somewhere else but i think returning something on the head where you when you get on its head when you take a requirement that is unique to california gives employees something they don't get anywhere else nowhere and nowhere else and then say well because it does not get compounded into an overtime rate as well that it's somehow a violation the fair labor standards so they're getting a benefit that the people in taxes aren't getting you know whether it is mean you have this hypothetical about a voluntary rate that's that's the that's all well and good but the reality is that this is something that is required in california it is required only in california and did it goes a little far afield of our facts here but i was curious what metron it was doing prior to april twentieth levin or whenever this new pay system was put in and i don't want to use of your time but in and you know they they paid when they were aware of it and they sometimes had discussions with their employees in deciding whether to pay breaks and some companies i don't think metron it was one of them but there were companies that did not compl in this period and one of the thing as well and particularly but you have to do one of two things i mean if you assert the current law the law as it is under brinker in the what i what i think was a minority of courts but some courts had held before branker that you only had to make the break available well then if somebody didn't record the break you'd better have some form of evidence where someone says is willing going to testify yes i did this because i wanted to complete a sailor i did this for another reason i wanted to leave early whatever it was if you don't have that if you don't want to do that even now it might be prudent to have an automatic payment system tronic doesn't do that anymore they have they have more regular found addressing the same allegations is that you know in fact on the record that there was no sign that this was voluntary and i don't think see how could be voluntary under the under the statutory under the statutory construction now mr mitchell is now asserting that in his pleading he's asserting medtronic physician and humid trying to contrary position had been expressed in the same district court in the prior case first before judge went on then in front of judgments gerald who was in charge of the saw the case when it went to judgment and in this court you know the court was entitled to say that you can't plead your way around undisputed legal the undisputed legal landscape of the time think the only the only other point i would make is i would not when you talk about hypothetical offsets and hypothetical ways that people could take advantage of this requirement have to remember the f l s say is not the only agent is not the only law at issue here if and i'm not sure you know i don't know the how things would would would come out with it with an offset effort  in under the f l us a but i'm positive i know one thing that no one's ever tried people tried to offset voluntary mail periods voluntary meal payments and generally failed as the cases reflect but no one's ever tried to try to get to offset a compulsory premium for the california statutory requirement and i suspect it would not go well in the california enforcement agencies or courts but that's a hypothetical that this court doesn't need to reach and i will be shocked if anyone ever tries to do to do that and what we have here is a clear it relatively clear statute further clarified by an  rule that it has entitle to at least get more deference that says that statutory scheduling requirements that result in statutory premiums are not compounded into the overtime rate they're regarded as overtime they're not exactly overtime they're regarded as overtime and that it's a clear fit thank you thank you that's trying to have your cake and eat it too if you want to get more deference you need to get more deference for the entire regulatory scheme that regulation says premium rates required by statute another regulations is premium rates means an hourly rate paid per hour lump sums don't qualify as premium rates lump sums don't qualify overtime premiums so if you want to get more deference and there's you know we're not arguing that there is a reading of that statute does not say premium payments it premium rates required by statute above daily standard we put it in the pleading and at this state we can plead around adverse law by having the facts in our favor  the you know the quotes in there were from the wrap up in the final thing is that there are important statutory rights of the f l s say in particular mandatory attorneys fees so if this thing is taken out and they win then employees that have these meal premium problems don't have any redress under california law to enforce their important fair labor standards and exclaims thank you thank you very much thank you both