On July 15, 2021, the California Supreme Court issued its
decision in
Ferra v. Loews Hollywood Hotel, LLC,
in which it held that meal and rest break premiums required under
California Labor Code section 226.7 ( Section 226.7 )
must be paid at non-exempt employees
regular rate
of pay-not merely their base hourly rate. The
decision,
which applies retroactively,
requires that employers promptly adjust their pay practices.
Background
Like the federal Fair Labor Standards Act ( FLSA ),
Labor Code section 510 ( Section 510 ) requires that
employers pay non-exempt employees overtime at their regular
rate[s] of pay. Under a different section of the Labor Code
and the Industrial Welfare Commission s ( IWC ) Wage
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