Famous Restaurant Chain Faces California Overtime Lawsuit

Fresno, CAThe famous restaurant chain Hooters is the latest company to face a California overtime lawsuit. Five Hooters restaurants in California are accused of violating a number of labor laws, including failing to pay their employees overtime.


Employees at Hooters restaurants in North Fresno, Sacramento and Bakersfield allege that they were denied rest breaks and meal breaks and were required to cover any shortages if customers left without paying for their meals. According to a 3/16/10 Fox40 News report, servers were also forced to work off the clock and had to pay for their own uniforms.

Approximately three dozen current and former Hooters employees have joined the lawsuit.

Meanwhile, a recent ruling in the case of Rutti v. Lojack may have an impact on employee overtime in California. In this case, Rutti worked for Lojack installing car alarms. One issue addressed was whether or not commute time in a company vehicle is a compensable event. Lojack restricted Rutti's use of the company vehicle - no passengers, no personal errands and no detours between home and job.

Initially, the court ruled that time spent in a company vehicle commuting to and from work was not compensable. However, the Ninth Circuit court reversed its decision, citing a precedent in Morillon v. Royal Packing Co, in which the courts determined that commute time is compensable under certain conditions.

The Ninth Circuit found that because the employees were required to keep their cell phones on and were not allowed to make any addition stops between home and the job site, the employees were under the employer's control during the commute and should be paid under California law. The court did not find that the commute time was compensable under federal law.

This could have implications for overtime hours when employers provide their employees with company vehicles and put restrictions on their commute. Essentially, employers must either pay overtime for time spent commuting, or count it toward a regular eight-hour workday, in which case the employees might see their hours reduced. Alternatively, employers could stop providing company vehicles or lift restrictions on employees when they drive those vehicles.