Seyfarth Synopsis: Last week, a Washington healthcare company was ordered to pay 33,000 workers $98.3 million in damages in a class action related to its meal break and timeclock rounding practices. The vast majority of the awarded damages pertain to missed meal breaks, but the award included an offset of about $1 million to account for the fact that some employees signed meal break waivers. This case is a potent reminder of the importance of training managers on meal break requirements, scheduling and providing meal breaks in compliance with Washington law, and clearly documenting employee meal break waivers.
Background
In September 2021, a class action lawsuit was filed against the healthcare company claiming that the company systematically failed to provide employees with a second 30-minute meal break when employees worked shifts longer than ten hours (Washington law requires employers to provide non-exempt employees with a 30-minute unpaid meal break for every five hours worked).
Plaintiffs also claimed that the healthcare company’s payroll policy of rounding time worked to the nearest 15-minute increment generally deprived workers of wages due, though plaintiffs conceded that, in some instances, the rounding practice resulted in workers being paid more than they were due.
In January 2024, King County Superior Court Judge Averil Rothrock granted partial summary judgment in the plaintiffs’ favor on both claims. Accordingly, the issue remaining for trial was damages: plaintiffs asked the jury to award them approximately $9.3 million in damages related to the rounding system and $90.3 million for missed second 30-minute meal breaks.
On April 18, 2024, the jury awarded plaintiffs $98.3 million in damages. Although the jury verdict form reportedly indicated that the jury initially awarded the workers their full request of $99.6 million in damages, the jury ultimately reduced that amount by about $1.3 million, finding that the company had shown some employees had signed written meal break waivers.
Takeaways
- Meal break waivers – Under Washington law, employees can waive meal breaks. If an employee chooses to waive their meal break(s), the waiver should be clearly documented.
- Manager meal break training – Managers should be trained on meal and rest break requirements so that they are empowered to ensure compliance.
- Rounding policy review – Although limited payroll rounding is allowed under Washington law, restrictions apply. Rounding policy and other related policies (such as punctuality and timekeeping policies) should be reviewed holistically for compliance.
Certainly a verdict so sizeable puts a spotlight on Washington employers’ wage and hour compliance. Meal break and rounding practices, however, present compliance challenges in other states and under the FLSA, as well. And the size of this Washington verdict will certainly attract plaintiffs’ lawyers’ attention to those challenges nationally.