Monday, April 18, 2011

First District Affirms Rule Limiting Employer Discretion to Define “Workweek” to Avoid Payment of Overtime Compensation: Seymore v. Metson Marine

On April 14, 2011, the First District (Division Three) reversed an order granting an employer summary judgment on employee “seventh day premium pay” overtime claims in Seymore v. Metson Marine, __ Cal.App.4th __ (2011).  According to the Court, such relief was foreclosed by a factual dispute as to whether the employer’s workweek definition was actually an “artifice” designed to evade payment of overtime.

At issue, the employer’s definition of workweek (which ran from Monday through Sunday) conflicted with the actual workweek structure used – which was comprised of a 14-day employment "hitch" that began and ended every two weeks on a Tuesday at noon.  The net result of this pay-structure was that employees would be deprived of one day of “seventh day” double-time compensation required by Labor Code ¶510(a). According to the Court, summary judgment based on these facts was improper, as “an employer may designate a workweek used to calculate compensation that differs from the work schedule of its employees only if there is a bona fide business reason for doing so, which does not include the primary objective of avoiding the obligation to pay overtime.”  Slip Opinion, at 9.  According to the Court, the employer's burden under this standard was clearly not met.  See id., at 8-11 (“the undisputed evidence raises a reasonable inference that Metson designated its workweek in a manner primarily designed to evade its overtime obligations and Metson failed to rebut that inference.”).

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