Released on = June 21, 2007, 7:07 am

Press Release Author = Lala C. Ballatan

Industry = Law

Press Release Summary = The Supreme Court of the State of California, U.S.A. issued
a new ruling, which would increase the cost employers have to face if they fail to
grant their non-exempt employees with regular rest and meal breaks. These benefits
are rightfully provided for employees according to a state statute. According to the
Labor Code of California, Section 226.7, when an employer fails to grant non-exempt
employees with rest breaks or meal periods they rightfully deserve, the employee can
be entitled to a one hour of pay for every break period missed.

Press Release Body = The Supreme Court of the State of California, U.S.A. issued a
new ruling, which would increase the cost employers have to face if they fail to
grant their non-exempt employees with regular rest and meal breaks. These benefits
are rightfully provided for employees according to a state statute. According to the
Labor Code of California, Section 226.7, when an employer fails to grant non-exempt
employees with rest breaks or meal periods they rightfully deserve, the employee can
be entitled to a one hour of pay for every break period missed.

Los Angeles, California, June 18, 2007 - The new ruling has evoked several debates
and arguments during the past years. The main issue is whether the "one hour of pay"
is considered as a penalty for the employer or a wage payment for hours worked. The
former would be subject to a statute of limitations for one year while the latter is
subject for a statute of limitations of 3 years, respectively.

This issue was resolved when the Supreme Court of California gave its decision on
the case "Murphy vs. Kenneth Cole Productions" last April 16, 2007. The decision was
that the "one hour of pay" is wage payment that is subject to a retroactive payment
of three years. This decision thereby expands the liability of employers regarding
violations of the statutes providing for employee's right to meal breaks and rest
periods.

The decision given by the Supreme Court was determined based on the Section 226.7
legislation history. According to its legislative agenda, it intends to give premium
compensation for employees for their time worked during breaks and not as punishment
for the employer. The Court also announced that if the Legislature had intended for
the Section 226.7 to become a penalty, they would have labeled it as so.

The Court contends that their decision was the interpretation of the statute's
content suggesting, in plain terms, that the additional "hour of pay" is indeed a
wage.

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