California Court of Appeal Clarifies Ruling To Hold That An Employer May Designate Workweek/Workday That Differs From An Employee’s Assigned Schedule If A Legitimate Business Reason Exists

On February 28, 2011, in Seymore v. Metson Marine, Inc., the California Court of Appeal held that an employer cannot “artificially designate the workweek in such a way as to circumvent the statutory requirement to pay overtime rates for the seventh consecutive day worked in each workweek.” In that case, the employees worked 14-day “hitches,” beginning at noon on a Tuesday and ending at noon two weeks later. Metson’s workweek began and ended on Sunday at midnight.

As a result, the 14-day hitch began in the middle of one workweek, consumed the entire second workweek, and ended in the middle of the third workweek. Metson paid the special seventh day premium pay only during the middle workweek. The court held in its original opinion that Metson’s workweek designation could be an improper attempt to circumvent the Labor Code’s overtime requirements. See Seyfarth Shaw’s management alert related to the Court’s opinion here.

On April 14, 2011, the Seymore court issued a new opinion following the employer’s petition for rehearing (click here to read). While the result of the case for Metson did not change, the court now recognizes that an employer may assign employees to work schedules that differ from the company’s designated workweek/workday. But the court maintains its view that employers may not designate workweeks in a manner designed primarily to evade overtime compensation.

The court observed that, on the current record, Metson had not produced a legitimate business reason why its designated workweek/workday (starting at midnight Sunday) differs from the assigned work schedule of the employees at issue (starting at Tuesday noon). The ruling did not foreclose Metson from putting on evidence at trial of a legitimate business reason for its workweek designation. Similarly, the court did not address the fact that typically employers do have legitimate business reasons for designating a workweek/workday on a company-wide or other broad-based method in order to maintain uniform payroll systems.

For more information, please contact the Seyfarth attorney with whom you work or any Labor & Employment attorney on our website.