SHE SHE STRAWDER v. PACIFIC SUNWEAR STORE CORP (2010)

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

INTRODUCTION

She She Strawder, on behalf of herself and all others similarly situated, appeals from the trial court's order denying class certification.   Plaintiffs sought to certify a class of current and former employees of Pacific Sunwear Store Corporation (PacSun), a national retailer with retail stores throughout California, to recover premium pay for missed meal and rest periods, overtime pay, and damages for non-compliant wage statements.

We affirm the order denying class certification.   The trial court did not commit legal error or abuse its discretion in determining that plaintiffs did not meet their burden of proof to establish the class certification requirement that common issues of law and fact would predominate.   We therefore do not choose sides or speculate on the outcome of the meal and rest period issues now pending before the Supreme Court,¹ nor do we address the adequacy of Strawder as a class representative.

BACKGROUND

PacSun is a national retail outlet with stores in California.   Strawder was an assistant manager and worked for eight months at PacSun's Westminster, California store.   She was an hourly, nonexempt employee.   Strawder seeks to represent the putative class.

The class action complaint alleges the following causes of action:  (1) violation of Labor Code sections 510 and 1198 ² (unpaid overtime);  violations of sections 201 and 202 (wages not paid upon termination);  violations of section 226, subdivision (a) (non-compliant wage statements);  violation of section 226.7 (missed rest periods);  violation of sections 512 and 226.7 (missed meal periods);  and violation of Business and Professions Code section 17200 et seq.

Two years after the initial complaint was filed, and before the class certification motion was decided, plaintiffs attempted to amend the complaint to add remedies under sections 2699 et seq., referred to as the Private Attorneys General Act or PAGA. The trial court denied that request.

CLASS CERTIFICATION MOTION

1. Overview Of Class And Subclasses ³

The complaint proposed a class of employees who held nonexempt positions and earned bonuses but were not paid overtime.   The certification motion proposed four subclasses.

a. Meal Period Subclass

The meal period subclass is based upon the failure to relieve hourly, nonexempt employees of all work duties for a 30-minute meal period, and the failure to pay one hour of wages for each missed meal period.

Section 226.7 ⁴ states that no employer shall require an employee to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission.   The Industrial Welfare Commission (IWC) is empowered to formulate regulations known as wage orders governing employment in California.  (Tidewater Marine Western, Inc. v. Bradshaw (1996) 14 Cal.4th 557, 561.)   IWC wage order No. 4-2001, codified at California Code of Regulations, title 8, section 11040, subdivision 11(A), governs an employer's obligation to provide meal periods to nonexempt employees.⁵  An employer may not employ a person for a work period of more than 5 hours without a meal period of 30 minutes, except when a work period of not more than 6 hours will complete the work day, the meal period may be waived.  (Cal.Code Regs., tit. 8, § 11040, subd.   11(A);  see § 226.7, subd. (a).)  Employers who do not comply “shall pay” the employee one hour of pay at the employees' regular rate of compensation for each workday that the meal period is not provided.   (Cal.Code Regs., tit. 8, § 11040, subd.   11(B);  see § 226.7, subd. (b).)

Section 512 sets forth an employer's obligation to provide meal periods.⁶ (§ 512, subd. (a).)  The statute also contains a waiver provision.   (Ibid.)

b. Rest Period Subclass

The rest period subclass is based upon the failure to give rest periods to all hourly, nonexempt employees, and the failure to pay one hour of wages for each missed rest period.   Wage Order No. 4-2001 states that every employer must permit employees to take authorized rest periods at the rate of 10 minutes (net) per four hours.⁷  (Cal.Code Regs., tit. 8, § 11040, subd.   12(A).)   Employers who do not comply with rest period rules “shall pay” the employee one hour of pay at the employee's regular rate of compensation for each workday that the rest period is not provided.  (Cal.Code Regs., tit. 8, § 11040, subd.   12(B).)

c. Wage Statement Subclass

The wage statement subclass includes hourly, nonexempt employees who received a wage statement that did not have a separate line indicating the sum of the regular and overtime hours worked during the pay period.

Section 226 sets forth nine requirements of a written wage statement.⁸  The wage statement must include, among other things, the “total hours” worked by the employee and all applicable hourly rates during the pay period and corresponding number of hours worked at each hourly rate. (§ 226, subd. (a)(2), (9).)

d. Overtime Subclass

The overtime subclass is the same as alleged in the complaint - hourly, nonexempt employees who earned bonuses during the same pay periods in which overtime hours were worked, and the bonuses were not calculated into their regular rate of compensation.

Section 510 sets forth the right to overtime compensation. (§ 510.) ⁹  The statute does not describe calculating bonuses into the regular rate of compensation.   A DLSE opinion letter states:  “Bonus payments, with certain exceptions[,] are included in the calculation of overtime.   Bonuses based on incentive must be calculated into the employee's wages to determine the ‘regular rate of pay[.’]”  (Cal. Dept. of Industrial Relations, DLSE Chief Counsel H. Thomas Cadell, Jr., opn. letter No.1991.03.06, Calculation of Regular Rate of Pay (Mar. 6, 1991) p. 1, fn. omitted http:// www.dir.ca.gov/dlse/opinions/1991-03-06.pdf (as of July 21, 2010).)   Discretionary bonuses, however, are excluded from the calculation of the regular rate of pay.  (Id. at p. 1, fn. 1;  see also DLSE Enforcement Policies and Interpretations Manual (2002) § 35.7.) ¹⁰

In order to have these subclasses certified, plaintiffs had to prove the existence of a sufficiently numerous, ascertainable class, with a well-defined community of interest, and demonstrate that class certification would provide substantial benefits to litigants and the courts.  (In re Tobacco II Cases (2009) 46 Cal.4th 298, 313.)

2. The Evidence

a. Meal Period Policies And Practices

Both parties submitted PacSun's policies and procedures regarding meal periods.   PacSun requires nonexempt employees to punch in and out for all shifts and meal periods using PacSun's “SOLAR” point-of-sale system.   The “store punch reports” automatically calculate the duration of the daily shift and meal period.   PacSun store managers review these reports on a daily basis to confirm that employees are taking the required meal periods.   District managers conduct a weekly review, and ultimately managers investigate the circumstances of a missed meal period.   If the investigation reveals that an employee was not provided a meal period, managers inform the payroll department.   Payroll issues a meal premium for each missed meal period.   Strawder received one meal premium payment.

Strawder stated in her declaration that she had not been paid for all her missed or late meal periods.  “Throughout my employment with Defendant, there were days in which I worked more than five hours without a 30-minute meal period, and I did not receive any additional pay for most of those days.”   Strawder testified that on a number of occasions during her eight-months of employment she skipped or took late meal periods.

Strawder was aware of PacSun's meal period policy and was never told to skip her meal period.   She testified that her store manager never denied her a meal period.   Strawder offered no explanation as to why she missed her meal periods or took late meal periods.

Plaintiffs also presented a statistical sampling of PacSun's time records to show missed meal periods.   Robert Lewis Fountain, Ph.D., analyzed PacSun's time records and meal premium payments pursuant to a stipulated meal/rest break sample and prepared a report.   Despite its title, the meal/rest break sample report only addresses missed meal periods.   The sample report concludes:  (1) 30 percent of the daily shifts worked more than 5 hours before a meal period;  (2) 85.1 percent of the daily shifts of 10 hours or more received fewer than 2 meal periods;  and (3) 4.8 percent of the daily shifts of more than 5 hours had a meal period of less than 30 minutes.   Fountain's report was characterized by plaintiffs in the trial court as evidence of widespread meal period violations without the appropriate premium payments for missed meal periods.

Fountain's conclusions were based upon certain assumptions.   His data analysis necessarily did not take into consideration employees who had taken a meal period but forgot to punch out using PacSun's timekeeping system.   Fountain also did not exclude those employees who waived their meal period.   Finally, in his analysis of “shortened” meal periods, Fountain did not take into consideration an employee who clocked in early, and therefore a 29:59 meal period constituted a “missed” meal period.

b. Rest Period Policy And Practices

PacSun has policies and procedures regarding rest periods.   Strawder knew that it was the company's policy to give rest periods to its employees.

Strawder stated that she did not take rest periods.  “Throughout my employment with Defendant, there were also days in which I worked more than four hours without a ten-minute rest period, and I did not receive any additional pay for missed rest periods.”   She does not recall the specific time or date when she failed to take a rest period.   She estimates that at least three days a week she did not receive rest periods, but she was never told she had to skip her rest period.

PacSun's timekeeping system does not record rest periods.   Plaintiffs presented testimony from PacSun's corporate representative on the rest period policy, mischaracterizing the testimony as a “corporate policy” of not compensating employees for missed rest periods.

c. Wage Statements Separately List Regular And Overtime Hours

PacSun's wage statements for nonexempt employees in California are identically formatted.   The wage statements list regular hours and the rate of pay, and overtime hours and the rate of pay.   The wage statements do not have a separate line indicating the sum of the regular and overtime hours.   Strawder stated “[d]uring [the] pay periods in which I received overtime wages, I was required to perform arithmetic calculations to determine the total sum of my hours worked during that pay period.”

d. PacSun's Sales Incentive Bonus Was Discretionary

PacSun offers its employees several different types of bonuses and incentives.   One of the offered bonuses is the sales incentive bonus awarded at the discretion of the district and regional managers.¹¹

Strawder received one sales incentive bonus.   The sales incentive bonus has the following disclaimer:  “The granting of any award, including the amount, shall be at the sole discretion of Pacific Sunwear.   An incentive award may be withheld due to issues of performance or management discretion.   Pacific Sunwear reserves the right to modify or cancel this program in whole or in part at its discretion at any time.”   Strawder acknowledged that she read and understood these terms.

3. The Trial Court's Order Denying Class Certification

As noted, in order to certify the subclasses, plaintiffs had to meet the class action procedural requirements.  (In re Tobacco II Cases, supra, 46 Cal.4th at p. 313.)   Plaintiffs bore the burden of showing, among other things, common questions of law and fact predominated.  (Sav-On Drug Stores, Inc. v. Superior Court (2004) 34 Cal.4th 319, 326 (Sav-On Drug ).)   The trial court concluded that plaintiffs failed to meet their burden, and underlying that conclusion was plaintiffs' insufficient evidentiary showing of commonality.   Our summary of the court's 22-page order focuses on that issue.

a. Meal Period Subclass Lacks Commonality

The trial court concluded that common questions of law and fact did not predominate and did not certify the meal period subclass.   PacSun had a well-established meal period policy that it communicated to its employees and managers through employment handbooks, training sessions, and counseling sessions.   PacSun also had a timekeeping system and procedures to ensure payment of meal premiums.   Given this well-communicated policy to take meal periods, and a timekeeping system to ensure compliance, the trial court concluded that why employees missed meal periods would require an individualized inquiry.

Moreover, the evidence was not sufficient to establish a uniform practice of missed meal periods.   The trial court found Fountain's sample report and methodology flawed because it did not exclude de minimis meal break violations (arising from early punch in or out), did not consider waivers, and did not exclude employees who had inadvertently failed to punch in or out on the timekeeping system but actually took a meal period.   Thus, given the flawed methodology in the report, the trial court did not consider Strawder's declaration sufficient to certify a class.   As the trial court noted, “[t]his does not stand as evidence of any classwide violations, nor any practice that discouraged PacSun employees from taking meal periods.” ¹²

b. Rest Period Subclass Lacks Commonality

The trial court concluded that plaintiffs did not meet their burden that common issues would predominate and did not certify the rest period subclass.   Strawder submitted her declaration and testified that she did not receive rest periods, but there was no evidence of an employer policy or practice that denied employees rest periods.   Since there is no “ ‘paper trail’ or other evidence to track rest breaks missed or taken,” the trial court concluded that these claims required a highly individualized inquiry into who missed rest periods and why they did so.

c. Wage Statement Subclass Lacks Commonality

The trial court concluded that common issues did not predominate and did not certify the wage statement subclass.   The trial court construed section 226, subdivision (e), concluding that any wage statement violation required an employee to suffer an injury as a result of an incomplete wage statement.   According to the trial court, individual assessments of injury from the incomplete statement rendered class treatment “unworkable.”   In a footnote, the trial court criticized as “flawed,” plaintiffs' interpretation of the statute.

d. Strawder Did Not Have Standing To Bring The Overtime Claim

Based upon the evidence, the trial court concluded that Strawder received one discretionary bonus.   Thus, she did not have standing to seek relief on behalf of a subclass whose overtime claim was based upon the failure to include non-discretionary bonuses in the calculation of their regular rate of pay.   The trial court had no other evidence from which it could determine whether class treatment was appropriate for those putative class members who received non-discretionary bonuses and whose overtime had been miscalculated.

Plaintiffs timely appealed the order denying class certification.   Although not referenced in the notice of appeal, Strawder also challenges the trial court's earlier order denying leave to amend.   We do not have jurisdiction to review the trial court's order denying leave to amend.¹³

DISCUSSION

1. General Class Action Principles And Standard Of Review

Code of Civil Procedure section 382 authorizes class actions “when the question is one of a common or general interest, of many persons, or when the parties are numerous, and it is impracticable to bring them all before the court․”  Class certification requires, among other things, a well-defined community of interest.  (Fireside Bank v. Superior Court (2007) 40 Cal.4th 1069, 1089;  Sav-On Drug, supra, 34 Cal.4th at pp. 326-327 citing Lockheed Martin Corp. v. Superior Court (2003) 29 Cal.4th 1096, 1104, and Washington Mutual Bank v. Superior Court (2001) 24 Cal.4th 906, 913.)   A “well-defined community of interest” embodies three factors, including common questions of law and fact, claims or defenses typical of the class, and class representatives who can adequately represent the class.  (Sav-On Drug, supra, at p. 326.)

The decision to certify a class rests with the sound discretion of the trial court.  “Because trial courts are ideally situated to evaluate the efficiencies and practicalities of permitting group action, they are afforded great discretion in granting or denying certification.”  (Linder v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435.)   Despite this grant of discretion, appellate review of an order denying class certification differs from ordinary appellate review.   We consider only the reasons stated by the trial court and must ignore any unexpressed reason that might support the ruling.  (Id. at pp. 435-436;  Bufil v. Dollar Financial Group, Inc. (2008) 162 Cal.App.4th 1193, 1204-1205.)   But any valid pertinent reason is sufficient to uphold an order denying class certification.  (Sav-On Drug, supra, 34 Cal.4th at pp. 326-327 citing Linder v. Thrifty Oil Co., supra, at pp. 435-436.)

The trial court's findings on commonality are reviewed for an abuse of discretion.   When the decision turns on disputed facts or inferences to be drawn from the facts, this court cannot substitute its decision for that of the trial court.  (Sav-On Drug, supra, 34 Cal.4th at p. 328.)   If supported by substantial evidence, a trial court's ruling will not be disturbed unless improper criteria were used or erroneous legal assumptions were made.  (Id. at p. 327;  Ticconi v. Blue Shield of California Life & Health Ins. Co. (2008) 160 Cal.App.4th 528, 538.)

2. The Trial Court Did Not Commit Legal Error By Considering The Merits

Strawder contends the trial court employed improper criteria and legal assumptions by ruling on the ultimate question in the case and determining that the complaint was meritless.   Class certification is procedural and does not involve the legal or factual merits of the action.  (Sav-On Drug, supra, 34 Cal.4th at p. 326;  see also Linder v. Thrifty Oil Co., supra, 23 Cal.4th at pp. 439-440.)   Issues affecting the merits of a case may be considered when they are “enmeshed with class action requirements” such as commonality, typicality, and adequacy of representation.  (Linder, supra, at p. 443.)   “[T]he trial court must evaluate whether the theory of recovery advanced by the plaintiff is likely to prove amenable to class treatment․”  (Ghazaryan v. Diva Limousine, Ltd. (2008) 169 Cal.App.4th 1524, 1531.)   But this is not a merits determination.   A party need not establish a likelihood of success on the merits to obtain class certification, nor should the trial court at a class certification hearing make a determination of the merits or validity of the claim.  (See Fireside Bank v. Superior Court, supra, 40 Cal.4th at pp. 1091-1092.)   The trial court adhered to these principles and did not reach the merits of this lawsuit.

The trial court's order denying certification of the meal and rest period subclasses is not a merits-based conclusion that PacSun's policies complied with the law.   Rather, the trial court acknowledged the unsettled law, and then addressed the insufficient evidence to establish commonality.

As a threshold matter, the trial court had to interpret the Labor Code in order to determine whether the wage statement class claim was amenable to class treatment.  (See Lebrilla v. Farmers Group, Inc. (2004) 119 Cal.App.4th 1070, 1077.)   While the trial court disagreed with plaintiffs' interpretation of the statute, its decision to deny certification rests on the lack of common proof of injury, not on the merits.

The trial court's decision to deny certification of the overtime subclass also was not merits-based;  Strawder lacked standing to pursue the claim on behalf of the class.   The trial court expressed no opinion on the viability or the success of the overtime claim.

There is no similarity with the trial court's order and Medrazo v. Honda of North Hollywood (2008) 166 Cal.App.4th 89, 95, 97, where the trial court adopted a statutory interpretation that ended the case.   Here, the trial court's statutory interpretation of section 226, subdivision (e) of the Labor Code was necessary to determine commonality, a procedural requirement necessary to certify the wage statement subclass.   The trial court's reference in a footnote to plaintiffs' “flawed” interpretation of section 226, subdivision (a), addressing itemized wage statements, does not overshadow the procedural analysis for the wage statement subclass.   As shall be discussed, the trial court considered evidence bearing on the procedural requirements.   Strawder's challenge to the order denying class certification is more appropriately characterized as a challenge to the trial court's evaluation of that evidence, not legal error.

3. Common Issues Of Law And Fact Do Not Predominate

Commonality depends on whether the defendant's liability can be determined by issues common to all class members.  (Sav-On Drug, supra, 34 Cal.4th at p. 327.)  “ ‘[T]o determine whether common questions of fact predominate the trial court must examine the issues framed by the pleadings and the law applicable to the causes of action alleged.’  “ (Ali v. U.S.A. Cab Ltd. (2009) 176 Cal.App.4th 1333, 1347, quoting Hicks v. Kaufman & Broad Home Corp. (2001) 89 Cal.App.4th 908, 916, fns. omitted.)   California courts consider “pattern and practice evidence, statistical evidence, sampling evidence, expert testimony, and other indicators of a defendant's centralized practices in order to evaluate whether common behavior towards similarly situated plaintiffs makes class certification appropriate.”  (Sav-On Drug, supra, at p. 333, fn. omitted.)   This focus is on whether the defendant had an institutional practice that affected all of the potential class members.  (Jaimez v. Daiohs USA, Inc., supra, 181 Cal.App.4th at p. 1299.)

a. No Uniform Practice To Deny Meal Periods

For the meal period subclass, the predominant legal and factual issues are whether PacSun had a uniform practice of (1) failing to provide meal periods to its employees, and (2) failing to pay its employees for missed meal periods.   The evidence did not establish a uniform practice on either issue.

Strawder stated in her declaration that she missed meal periods, and she further testified based upon PacSun's timekeeping records that she missed meal periods or took late meal periods for which she did not receive additional pay.   Strawder offered no practical explanation for her missed meal periods -no company policy or practice prevented her from taking meal periods.   Given Strawder's focus on her experience, and PacSun's policy of providing meal periods, of training employees to ensure they take meal periods, and of its timekeeping system to ensure compliance, the trial court reasonably could conclude the requisite predominance was missing because there was insufficient evidence that others had missed meal periods.

Strawder contends, however, there was sufficient evidence of widespread meal period violations, and the trial court abused its discretion by discounting Fountain's statistical analysis of skipped meal periods.   Strawder argues Fountain's report is substantial evidence to establish common factual issues (PacSun had a uniform practice of denying meal periods) and legal issues (PacSun violated the Labor Code mandating meal periods and premium pay for skipped meal periods).   The trial court gave little weight to Fountain's report, finding fault with Fountain's methodology.   On the common legal issues, for example, the trial court noted that Fountain's statistical sampling included those employees who waived their meal period, which is permissible under the Labor Code. The trial court also observed that the data in Fountain's report did not explain why employees did not take their meal periods.   The trial court apparently did not consider that Fountain's promise of a future survey to address why employees missed meal periods was sufficient to certify the class.   We defer to the trial court's ruling because it is in a better position to decide these concerns.  (Sav-On Drug, supra, 34 Cal.4th at p. 331.)

Strawder directs us to a recently published Ninth Circuit case, Dukes v. Wal-Mart Stores, Inc. (9th Cir.2010) 603 F.3d 571 (en banc ), petition for certiorari filed August 25, 2010 (No. 10-277), to support the argument that the trial court's consideration of Fountain's report was legal error because it was merits-based.   Wal-Mart contended that the plaintiffs' expert did not meet the federal standards to provide expert testimony.  (Id. at p. 600.)   The district court rejected that challenge, concluding that its role for purposes of class certification was to make factual determinations regarding evidence as it relates to common questions of law or fact, not to decide which parties' evidence is most persuasive.  (Id. at p. 602.)   The Ninth Circuit concluded the district court did not abuse its discretion in considering the expert's testimony.  (Id. at p. 603.)   Here, the trial court considered Fountain's testimony but found fault with his methodology for purposes of determining whether common issues of law and fact predominated.   We cannot say the trial court abused its discretion in giving little weight to the report and concluding that the statistical analysis did not show a uniform corporate policy to deny meal periods common to all subclass members.

Relying on Jaimez v. Daiohs USA, Inc., supra, 181 Cal.App.4th at pages 1291 to 1292, Strawder next contends that even without Fountain's report, for class certification purposes it is enough to show Strawder missed meal periods.   Jaimez showed more.   In that case, Jaimez asserted, among other things, that the employer had a practice of denying meal and rest periods.  (Id. at p. 1292.)   Common legal and factual issues predominated because the employer required sales representatives to sign a manifest indicating they took a meal period and deducted the meal period regardless of whether the sales representative actually took a meal period.  (Id. at p. 1304;  see also Ghazaryan v. Diva Limousine, Ltd., supra, 169 Cal.App.4th at p. 1536 [employer policy of dictating on-call time activities raised common legal question to be resolved in class wage and hour claim.] )   Here, the evidence is unique to Strawder;  she missed her meal periods and offers no corporate practice that prevented her from taking her meal periods.   The statistical evidence presented by Fountain offered no insight into any uniform practice from which it could infer Strawder's situation was not unique.   We cannot say that the trial court abused its discretion.

Since the evidentiary showing is insufficient to establish a uniform practice or policy to deny meal periods or widespread violations, as noted, we do not address or discuss the meal period issue and the interpretation of section 226.7 that is now pending in the Supreme Court.  (See fn. 1, ante.)   We are not bound by the federal district court cases PacSun cites in its favor that employers need only “provide” meal breaks, which they did.  (Brown v. Federal Express Corp. (C.D.Cal.2008) 249 F.R.D. 580, 585-586;  White v. Starbucks Corp. (N.D.Cal.2007) 497 F.Supp.2d 1080, 1088-1089.)   Nor do we think Cicairos v. Summit Logistics, Inc., supra, 133 Cal.App.4th at pages 962 to 963, cited by Strawder, resolves this issue, especially since the evidence in that case affirmatively showed the employer's policy and practice failed to provide meal periods.   Along with our colleagues in Division One, we do not try to predict the outcome of these cases at this stage in the proceedings, nor do we stay this case pending the outcome in the Supreme Court.  (See Jaimez v. Daiohs USA, Inc., supra, 181 Cal.App.4th at p. 1303.)   Our resolution of this issue solely focuses on the trial court's conclusion that plaintiffs failed to present sufficient evidence to show common questions of law and fact predominate to support class certification of the meal period subclass.

b. No Uniform Practice To Deny Rest Periods

PacSun has a rest period policy.   The common factual and legal issues are whether PacSun had a uniform practice of (1) failing to provide rest periods, and (2) failing to pay its employees for missed rest periods.   The evidence did not establish a uniform practice of failing to provide rest periods or a corporate policy to deny rest period premiums.

Strawder stated that she did not receive 10-minute rest periods, and she did not receive additional pay for missed rest periods.   She does not state that PacSun had a practice of preventing her from taking breaks or that she was told she could not take one.   While Fountain's declaration states that a survey sampling could determine missed rest periods, plaintiffs offered this in theory and presented no survey evidence to show commonality.

We disagree with Strawder that her declaration combined with PacSun's corporate representative's testimony addressing the lack of rest period premium payments is sufficient evidence to establish that common issues predominate.   The corporate representative's testimony did not establish such a uniform policy.   Thus, Strawder's situation appears unique on this evidentiary record.   The question of why Strawder did not take rest periods depends upon a variety of circumstances at her store, chief among them is scheduling and staffing concerns, which is not subject to common proof.

Jaimez v. Daiohs USA, Inc., supra, 181 Cal.App.4th at page 1304, is inapposite.   Common issues predominated to certify the rest period class because the employer imposed a schedule for making deliveries that made it difficult for sales representatives to take rest periods and the employer never compensated for these missed rest periods.   There is no evidence to suggest that PacSun had a practice of denying, discouraging, or deliberately scheduling out rest periods.   Based on this evidence, the trial court reasonably could conclude that Strawder's experience was the exception, not the rule.

c. No Common Injury Arising From Wage Statement

For the wage statement subclass, Strawder contends common issues of law and fact predominate because a non-compliant wage statement violates the statute.   To recover damages, the Labor Code requires “suffering injury as a result of a knowing and intentional failure” to comply with the statute.¹⁴ (§ 226, subd. (e).)  Strawder contends any factual inquiry into “injury” is satisfied on a class-wide basis when, as here, the wage statement purportedly does not comply with the statute.   We do not agree;  the current state of the law requires a minimal showing of injury.

Neither party relies on California case law construing the wage statement penalty provision of the Labor Code. (§ 226, subd. (e).)  Strawder cites Kisliuk v. ADT Sec. Services, Inc. (C.D.Cal.2008) 263 F.R.D. 544, 548-549, arguing “injury” under the statute is satisfied when the right to receive an itemized wage statement is impaired.   PacSun cites Elliot v. Spherion Pacific Work, LLC (C.D.Cal.2008) 572 F.Supp.2d 1169, 1181, arguing that “suffering injury,” under the statute requires a showing of some type of injury from the violation (as opposed to the injury arising from the “right” to an itemized wage statement).  Jaimez v. Daiohs USA Inc., supra, 181 Cal.App.4th at page 1306, cites Elliot not Kisliuk, stating “there must be some injury in order to recover damages, a very modest showing will suffice.”   From its perspective, the Jaimez court described the minimal nature of the injury as the lawsuit to recover wages from the inaccurate statement, and the difficulty and expense of attempting to reconstruct time and pay records to determine the amount owed.  (Ibid.)

Strawder relies on Cicairos v. Summit Logistics, Inc., supra, 133 Cal.App.4th at pages 960-961, to show sufficiency of the evidence, but Cicairos actually undercuts her position.   In that case, the wage statements did not contain accurate information of the total hours worked, requiring the drivers to reconstruct time and pay records.  (Id. at p. 960.)   There is no evidence presented here that PacSun's statements did not accurately reflect employees' regular and overtime hours, or that Strawder's arithmetic calculations required her to determine whether she received the pay she was entitled to at the appropriate rate.

Under the plain meaning of section 226, subdivision (e), to certify a class, plaintiffs must show that the injury they suffered from a non-compliant wage statement is subject to common proof.   While this threshold is low, the trial court did not abuse its discretion by concluding that Strawder's own personal “arithmetic calculations” to add together the regular and overtime hours she worked did not meet plaintiffs' burden to show a common injury from a non-compliant wage statement.

4. Strawder Lacks Standing To Pursue The Overtime Claim

Strawder contends the only proper procedural inquiry to certify the overtime subclass is whether the bonus is discretionary or non-discretionary, which is a common question suitable for class treatment.   This position overlooks Strawder's evidence.   The only evidence in the record is that Strawder received a discretionary bonus, which is of no concern to the overtime subclass.   Based upon this evidence, Strawder lacked standing to represent the overtime subclass seeking unpaid overtime pay for failure to calculate non-discretionary bonuses into their regular rate of pay.  (Simons v. Horowitz (1984) 151 Cal.App.3d 834, 845.)

DISPOSITION

The order denying the certification motion is affirmed.   We dismiss the appeal from the motion for leave to file a first amended complaint.   PacSun is to recover costs on appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

We concur:

FOOTNOTES

FN1. The California Supreme Court has granted review in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25, review granted October 22, 2008, S166350, and Brinkley v. Public Storage, Inc. (2008) 167 Cal.App.4th 1278, review granted January 14, 2009, S168806.   These cases held that California law does not require an employer to ensure that employees take meal or rest periods.   Rather, an employer need only provide the meal and rest periods.  Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, 962, a case Strawder relies on, held that the employer has an obligation to ensure the employees are relieved of their duties during a meal period..  FN1. The California Supreme Court has granted review in Brinker Restaurant Corp. v. Superior Court (2008) 165 Cal.App.4th 25, review granted October 22, 2008, S166350, and Brinkley v. Public Storage, Inc. (2008) 167 Cal.App.4th 1278, review granted January 14, 2009, S168806.   These cases held that California law does not require an employer to ensure that employees take meal or rest periods.   Rather, an employer need only provide the meal and rest periods.  Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, 962, a case Strawder relies on, held that the employer has an obligation to ensure the employees are relieved of their duties during a meal period.

FN2. Unless stated, all further statutory references are to the Labor Code..  FN2. Unless stated, all further statutory references are to the Labor Code.

FN3. We summarize each subclass and explain the legal principles underlying the claims not to discuss the merits but to provide a legal background to the analysis of the procedural requirements for class certification..  FN3. We summarize each subclass and explain the legal principles underlying the claims not to discuss the merits but to provide a legal background to the analysis of the procedural requirements for class certification.

FN4. Section 226.7 states:  “(a) No employer shall require any employee to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission. [¶] (b) If an employer fails to provide an employee a meal period or rest period in accordance with an applicable order of the Industrial Welfare Commission, the employer shall pay the employee one additional hour of pay at the employee's regular rate of compensation for each work day that the meal or rest period is not provided.”.  FN4. Section 226.7 states:  “(a) No employer shall require any employee to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission. [¶] (b) If an employer fails to provide an employee a meal period or rest period in accordance with an applicable order of the Industrial Welfare Commission, the employer shall pay the employee one additional hour of pay at the employee's regular rate of compensation for each work day that the meal or rest period is not provided.”

FN5. Wage Order No. 4-2001 states:  “No employer shall employ any person for a work period of more than five (5) hours without a meal period of not less than 30 minutes, except that when a work period of not more than six (6) hours will complete the day's work the meal period may be waived by mutual consent of the employer and the employee.   Unless the employee is relieved of all duty during a 30 minute meal period, the meal period shall be considered an ‘on duty’ meal period and counted as time worked․”  (Cal.Code Regs., tit. 8, § 11040, subd.   11(A).).  FN5. Wage Order No. 4-2001 states:  “No employer shall employ any person for a work period of more than five (5) hours without a meal period of not less than 30 minutes, except that when a work period of not more than six (6) hours will complete the day's work the meal period may be waived by mutual consent of the employer and the employee.   Unless the employee is relieved of all duty during a 30 minute meal period, the meal period shall be considered an ‘on duty’ meal period and counted as time worked․”  (Cal.Code Regs., tit. 8, § 11040, subd.   11(A).)

FN6. Section 512, subdivision (a) states:  “An employer may not employ an employee for a work period of more than five hours per day without providing the employee with a meal period of not less than 30 minutes, except that if the total work period per day of the employee is no more than six hours, the meal period may be waived by mutual consent of both the employer and employee.   An employer may not employ an employee for a work period of more than 10 hours per day without providing the employee with a second meal period of not less than 30 minutes, except that if the total hours worked is no more than 12 hours, the second meal period may be waived by mutual consent of the employer and the employee only if the first meal period was not waived.” (§ 512, subd. (a).).  FN6. Section 512, subdivision (a) states:  “An employer may not employ an employee for a work period of more than five hours per day without providing the employee with a meal period of not less than 30 minutes, except that if the total work period per day of the employee is no more than six hours, the meal period may be waived by mutual consent of both the employer and employee.   An employer may not employ an employee for a work period of more than 10 hours per day without providing the employee with a second meal period of not less than 30 minutes, except that if the total hours worked is no more than 12 hours, the second meal period may be waived by mutual consent of the employer and the employee only if the first meal period was not waived.” (§ 512, subd. (a).)

FN7. Wage Order No. 4-2001 states:  “Every employer shall authorize and permit all employees to take rest periods, which insofar as practicable shall be in the middle of each work period.   The authorized rest period time shall be based on the total hours worked daily at the rate of ten (10) minutes net rest time per four (4) hours or major fraction thereof.   However, a rest period need not be authorized for employees whose total daily work time is less than three and one-half (31/212) hours.   Authorized rest period time shall be counted as hours worked for which there shall be no deduction from wages.”  (Cal.Code Regs., tit. 8, § 11040, subd.   12(A).).  FN7. Wage Order No. 4-2001 states:  “Every employer shall authorize and permit all employees to take rest periods, which insofar as practicable shall be in the middle of each work period.   The authorized rest period time shall be based on the total hours worked daily at the rate of ten (10) minutes net rest time per four (4) hours or major fraction thereof.   However, a rest period need not be authorized for employees whose total daily work time is less than three and one-half (31/212) hours.   Authorized rest period time shall be counted as hours worked for which there shall be no deduction from wages.”  (Cal.Code Regs., tit. 8, § 11040, subd.   12(A).)

FN8. Section 226 states in pertinent part:  “(a) Every employer shall, semimonthly or at the time of each payment of wages, furnish each of his or her employees, either as a detachable part of the check, draft, or voucher paying the employee's wages, or separately when wages are paid by personal check or cash, an accurate itemized statement in writing showing (1) gross wages earned, (2) total hours worked by the employee, except for any employee whose compensation is solely based on a salary and who is exempt from payment of overtime under subdivision (a) of Section 515 or any applicable order of the Industrial Welfare Commission, (3) the number of piece-rate units earned and any applicable piece rate if the employee is paid on a piece-rate basis, (4) all deductions, provided that all deductions made on written orders of the employee may be aggregated and shown as one item, (5) net wages earned, (6) the inclusive dates of the period for which the employee is paid, (7) the name of the employee and his or her social security number ․, (8) the name and address of the legal entity that is the employer, and (9) all applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee․”.  FN8. Section 226 states in pertinent part:  “(a) Every employer shall, semimonthly or at the time of each payment of wages, furnish each of his or her employees, either as a detachable part of the check, draft, or voucher paying the employee's wages, or separately when wages are paid by personal check or cash, an accurate itemized statement in writing showing (1) gross wages earned, (2) total hours worked by the employee, except for any employee whose compensation is solely based on a salary and who is exempt from payment of overtime under subdivision (a) of Section 515 or any applicable order of the Industrial Welfare Commission, (3) the number of piece-rate units earned and any applicable piece rate if the employee is paid on a piece-rate basis, (4) all deductions, provided that all deductions made on written orders of the employee may be aggregated and shown as one item, (5) net wages earned, (6) the inclusive dates of the period for which the employee is paid, (7) the name of the employee and his or her social security number ․, (8) the name and address of the legal entity that is the employer, and (9) all applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee․”

FN9. The complaint references three additional Labor Code provisions, sections 201, 202, and 1198.   The text of these statutes is not relevant to our resolution of the issues raised on appeal.  Section 201 addresses immediate payment of wages upon discharge or layoff.  Section 202 refers to the immediate payment of wages upon resignation.   And, section 1198 addresses the maximum hours worked..  FN9. The complaint references three additional Labor Code provisions, sections 201, 202, and 1198.   The text of these statutes is not relevant to our resolution of the issues raised on appeal.  Section 201 addresses immediate payment of wages upon discharge or layoff.  Section 202 refers to the immediate payment of wages upon resignation.   And, section 1198 addresses the maximum hours worked.

FN10. The trial court granted judicial notice of the DLSE manual.   Although not binding on a court, the DLSE's construction of a statute, whether embodied in a formal rule or a less formal representation, is entitled to consideration and respect.  (Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1105, fn. 7.) Both parties agree with the DLSE interpretation on the overtime calculation.   We express no opinion on that issue and need not address it to resolve this appeal..  FN10. The trial court granted judicial notice of the DLSE manual.   Although not binding on a court, the DLSE's construction of a statute, whether embodied in a formal rule or a less formal representation, is entitled to consideration and respect.  (Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1105, fn. 7.) Both parties agree with the DLSE interpretation on the overtime calculation.   We express no opinion on that issue and need not address it to resolve this appeal.

FN11. In reply, Strawder presents deposition testimony of PacSun's corporate representative testifying that district managers do not change the dollar amount of the sales incentive bonus.   We do not consider this evidence, as there is no indication in the supplemental exhibits that this testimony was before the trial court when it ruled on the class certification motion..  FN11. In reply, Strawder presents deposition testimony of PacSun's corporate representative testifying that district managers do not change the dollar amount of the sales incentive bonus.   We do not consider this evidence, as there is no indication in the supplemental exhibits that this testimony was before the trial court when it ruled on the class certification motion.

FN12. The trial court also found several other procedural requirements lacking, including ascertainability, typicality, and Strawder's adequacy as a class representative..  FN12. The trial court also found several other procedural requirements lacking, including ascertainability, typicality, and Strawder's adequacy as a class representative.

FN13. An order denying leave to amend is not an appealable order, unless it has the effect of eliminating all issues between the plaintiff and a defendant so that there is nothing left to be tried or determined.   (Code Civ. Proc., § 904.1;  Figueroa v. Northridge Hospital Medical Center (2005) 134 Cal.App.4th 10, 12.)   The order denying leave to amend does not eliminate any issues in this case.   The trial court's ruling also did not have the effect of denying class certification.  (See Bangert v. Narmco Materials, Inc. (1984) 163 Cal.App.3d 207, 209, 211 & fn. 1.) Nor was the denial of leave to amend limited to a refusal to add a new class representative.  (Jaimez v. Daiohs USA, Inc. (2010) 181 Cal.App.4th 1286, 1308-1309.)   Thus, this is a nonappealable order..  FN13. An order denying leave to amend is not an appealable order, unless it has the effect of eliminating all issues between the plaintiff and a defendant so that there is nothing left to be tried or determined.   (Code Civ. Proc., § 904.1;  Figueroa v. Northridge Hospital Medical Center (2005) 134 Cal.App.4th 10, 12.)   The order denying leave to amend does not eliminate any issues in this case.   The trial court's ruling also did not have the effect of denying class certification.  (See Bangert v. Narmco Materials, Inc. (1984) 163 Cal.App.3d 207, 209, 211 & fn. 1.) Nor was the denial of leave to amend limited to a refusal to add a new class representative.  (Jaimez v. Daiohs USA, Inc. (2010) 181 Cal.App.4th 1286, 1308-1309.)   Thus, this is a nonappealable order.

FN14. Section 226, subdivision (e) states:  “An employee suffering injury as a result of a knowing and intentional failure by an employer to comply with subdivision (a) is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not exceeding an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorney's fees.”.  FN14. Section 226, subdivision (e) states:  “An employee suffering injury as a result of a knowing and intentional failure by an employer to comply with subdivision (a) is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not exceeding an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorney's fees.”

CROSKEY, Acting P. J. KITCHING, J.