Donahue v. AMN: Meal Periods & the Rebuttable Presumption

[Alex Medina] (0:01 - 6:38)
All right, we're going to go ahead and get started. I just want to thank everybody for joining our webinar today in conjunction with the Roseville Chamber of Commerce, the law firm that I am the co-founder of, Medina McKelvey LLP. We are putting on a webinar to discuss a critical and groundbreaking California Supreme Court case that really changes the landscape of what it means to have hourly employees in the state of California.

My law firm, Medina McKelvey LLP, we're headquartered in Roseville, and we have offices up and down the state of California, and we're a full-service employment law firm, and we specialize in representing California businesses, California employers, and in particular, in cases involving lawsuits brought by employees on things like new unrest break violations, overtime, pay, expense reimbursement, and those sorts of things.

So in my line of work, we call that wage and hour law, dealing with wages, pay, and hours, time. Might sound silly, might sound trivial, things like new unrest breaks and overtime, but these types of cases are actually the fastest growing type of lawsuit in the state of California. They have been for some time.

The deck essentially is stacked against employers in the state of California, so we are looking at something like a 500 percent increase year over year on these types of cases, and they're typically not covered by insurance. This was all bad news, however you looked at it, even before COVID. COVID made things worse, and the California Supreme Court has made it worse even still.

So this webinar that we are putting on for the Roseville Chamber of Commerce is actually, we've been doing a series of webinars with multiple trade groups along with all of our clients since the court case came down on February 25. So we've got it streamlined. We're going to go quickly.

What I would ask is if you have questions, you can put those into the chat feature and we'll address them at the end. Otherwise, I, along with my colleague, who's one of our wage and hour attorneys, Ravi David, who's going to be running the PowerPoint, we're going to kind of fly through these, and I will go through questions at the end. So why don't we go to the next slide, Ravi?

So the overview of what we're going to be talking about today is number one, the biggest threat to your business in the COVID-19 world. Obviously, the California Supreme Court's latest meal break case, which I just mentioned, and then we're going to talk about some compliance tools and solutions to help protect California businesses. Next slide, please.

That's a question. Lawyers love rhetorical questions. If the biggest threat from COVID-19 isn't the virus, what is it?

I alluded to it earlier. It's a wage and hour class action lawsuit. So let's go to the next slide, please.

Okay. So I gave a little preview of wage and hour cases, meal breaks, rest breaks, overtime, timekeeping practices, bonuses, those sorts of things. There's about 10 types of wage and hour practices that are getting California employers sued, and most of these lawsuits start with an employee who is disgruntled, feels that he or she wasn't treated fairly at work, maybe was discriminated against, maybe was harassed.

Pick your reason. They'll go to a lawyer, share kind of a horror story about how they were treated. The lawyer will listen compassionately, say something like, I'm really sorry that happened to you.

Hey, were you getting your meal breaks? Did you take your rest periods? How much overtime did you work?

Did you get any bonuses? Can I see a copy of your pay stubs? Those are the types of questions that then kind of lead to a wage and hour lawsuit.

So there's some three trends that we've been noticing. Again, we represent employers all up and down the state of California. We've handled 500 to 600 wage and hour class actions collectively with the lawyers in our firm.

And one of the things that we've noticed is, well, obviously, not obviously, but even before COVID, the wage and hour lawsuits were already on the rise. These are class action cases. And what that means is they're brought on behalf of all of a company or organizations, hourly employees, covering a period of four years.

One employee can sue on behalf of all of the company's employees, non-exempt hourly employees, covering a period of four years. Massive penalties that stack on top of penalties, and you have to pay the other side's attorneys. Those cases were already kind of skyrocketing before COVID.

Wage and hour cases, this is number two, they impact all California employers, regardless of industry. My client list has manufacturing, insurance, other law firms. We've got folks in aerospace, healthcare, you name it.

The plaintiff's bar that file these lawsuits is no respecter of industry. And number three, given COVID, and given the California Supreme Court case that I'm going to mention, these wage and hour cases are now even harder to defend and even more costly to sell. Next slide.

So this is just a snapshot of what I was just talking about with these cases kind of on the rise. These numbers are actually a little bit outdated even now, because in 2021, the curve goes up even more steeply. And at the very beginning of the pandemic in 2020, and for much of 2020, the courts were closed.

So there has been a huge backlog of wage and hour class action cases. So we don't even yet have current numbers. And these numbers are only based on state courts, meaning certain counties in California that report and classify their cases as wage and hour class actions.

So this again, is incomplete information, but hopefully it kind of shows you graphically, the trend of where we're going and how it's going to continue to rise. And so remember, just a few minutes ago, I mentioned that the plaintiff's lawyers that are filing these cases are looking for ways to get a wage and hour class action. It's not exciting, it's not sexy to advertise on TV or on radio or on a shopping cart or somewhere else or on the internet to say, did you get your meal breaks?

That doesn't get people excited. People don't think that those are multimillion dollar cases, even though they are. Most people are more concerned with the way that they've been treated.

And they feel that they've been treated unfairly. The plaintiff's lawyers who file these class actions, all they want is a warm body. They want an employee who is willing to talk to them so they can ask them the types of questions that will then allow them to get the information to find even one meal break violation to file a wage and hour class action.

This has been going on for 20 years. COVID has made it even worse. Now the plaintiff's lawyers who file these types of lawsuits are using COVID as a way to get people to call or reach out over the internet and say, yes, I was treated unfairly at work because of COVID.

[Rabi David] (6:39 - 6:47)
I was discriminated against. They wouldn't let me wear a mask or they forced me to wear a mask or whatever they did with the mask. I'm upset.

I want you to help me out.

[Alex Medina] (6:47 - 36:17)
The lawyers who then are soliciting people to call in for COVID related reasons, they don't care about COVID. They care about meal breaks, rest breaks, overtime, wage and hour cases. So what's the takeaway?

Biggest threat, wage and hour class action lawsuit, compliance with California employment and labor laws has heightened significance as a result of COVID-19. We'll talk about a little bit of the solutions a little bit later, but there's three points here. One is prepare.

Spot check and audit your company's wage and hour compliance so that you are prepared. Number two, put together a compliance plan. And number three, consider some other compliance solutions to help protect you from a lawsuit.

Next slide, please. So the case that I mentioned when we first started came down on February 25, 2021. It's called Donahue versus AMN Services LLC.

The way that the law works in the state of California, a little civics lesson for those of you who might not remember, obviously we have the legislature that passes the laws. We've got the governor's office, the executive branch that enforces them. Then we have the Supreme Court that interprets the law.

When the Supreme Court interprets the law, it's essentially saying what the law is and what it always has been, meaning that a California Supreme Court decision that comes out and interprets the labor code as this Donahue case did, it applies retroactively. So any existing lawsuit that's filed against the business, the Donahue principles are going to apply obviously to any future lawsuits as well. There are three things that I'm going to mention and we'll go dive into the details a little bit.

The first, this is a groundbreaking meal break case. I cannot understate the importance of the Donahue case. Things that worked in California employment law, advice that we gave our clients for years that was valid four weeks ago is no longer valid because of Donahue.

That's how important this case is. The two big points that we're going to talk about today is rounding of meal periods is now illegal. And number three, it's something called a rebuttable presumption that meal period violations will be presumed to be the fault of the employer.

Let's go to the next slide and we'll dive in a little bit more. Again, February 25, 2021, Donahue came down. The two main holdings or takeaways or rulings from the court, number one, employers cannot engage in the practice of rounding time punches in the meal period context.

And number two, a company's time records that show any noncompliant meal periods raise a rebuttable presumption that meal period violations took place. We'll unpack that a bit. Let's go to the next slide, please.

All right. So let's talk about meal period rounding. What does that mean?

Most companies in the state of California, if they don't already have this, they should, to comply with California law, have a timekeeping system. Whether you outsource it to a third party payroll and timekeeping provider, whether you do it in house, you are required in California to keep track of every minute worked. If you have paper time cards, that's a very risky business because you're essentially asking employees to keep track of their own time.

The best practice is to have a system, whether it's on a computer or a punch system or whatever, that tracks punches from the second an employee starts working to the second they stop working to take a meal period, the second they come back in from their lunch break, and the second they leave home. You are required in California to track all employee time, period, no buts, end of story. That was the case even before the Donahue system, Donahue case came down.

What some companies do is they have systems that will round time. And what that basically means is that if somebody, for instance, let's say they get to work at 8.55 for a nine o'clock shift, they will have a system that will round up to nine o'clock. So they'll punch in at 8.55, it'll round to nine. And then if they punch out five minutes early at the end of the day, it'll round it back to three o'clock. So it essentially evens out over time. Rounding per se is not unlawful in California.

It's just not a good idea. Because if there's the potential that an employee was shorted for his or her time, then there is the possibility for claims for unpaid wages and all sorts of penalties. Most businesses don't really do that anymore.

But there are still some industries and some companies that have time keeping systems where they will round the lunch break. As a quick reminder, in California, every non-exempt hourly employee must take a 30 minute lunch break that's off duty and uninterrupted before the end of the fifth hour of work. It has to be a complete 30 minutes.

If it's 29 minutes, it's a violation. And so if any company has a rounding system, we can talk about rounding at the beginning and end of the shift on another time, call me, reach out to me, whatever. But put that aside.

The rounding now is in the lunch period context. If somebody takes a 29 minute lunch or 26 minute lunch and it rounds up to 30 minutes, that is now per se unlawful. It's like walking off a cliff.

It's just a bad idea. If your business is rounding meal periods, stop doing it. Next slide, please.

So that one is fairly straightforward. It's a practice that has now been deemed unlawful. It wasn't a good idea to begin with.

Businesses in California should not do it any longer. The second point is really where I'm going to spend a little bit more time unpacking this. And again, I can answer any questions at the end.

But it's what I refer to as the rebuttable presumption. I'm going to read a short quotation from the California Supreme Court. And the key quotation is this.

Time records showing non-compliant meal periods raise a rebuttable presumption of meal period violation, including at the summary judgment stage. What does that mean? Let's go to the next slide.

Okay. A rebuttable presumption is a fancy $50 legal term, meaning an assumed, something that's assumed, and you have to meet a heavy burden to rebut the presumption. So every employer in California is required to keep written time records for every employee, including for their meal periods.

As I mentioned before, every California non-exempt hourly employee must take a 30-minute uninterrupted off-duty lunch break before the end of the fifth hour. If they go late, if they go five hours and one minute, and you look at their time records, and they went into the sixth hour by one minute, if they took that 29-minute lunch break that I talked about, or they didn't take it at all, up until the Donahue case, there were arguments that we as defense lawyers could make that that was the employee's choice, that there were other reasons for it. We had really good policies, and we had a handbook, and maybe there's a way to kind of reduce the liability or have a complete defense to some of the claims.

What the Donahue Supreme Court is saying now, we are raising the bar. We are saying that if the time records show one of those violations that I mentioned, it's an assumption of fault. The employer is on the hook.

It puts the employers on the defense, and it is very, very difficult to overcome that presumption. Next slide, please. So let's kind of walk through it kind of graphically.

So let's go with the first one, please. So we've got a plaintiff. We've got somebody who claims through their lawyer that they had a noncompliant lunch break, a 29-minute lunch break.

Next one. Or short meal period, or late meal period, or missed meal period. What does that mean?

Let's go to the next one. The employer must prove compliance. Essentially, they must prove that it was the plaintiff's or the employee's fault, not the employer's fault.

Next one. If it's proven, there's no liability. If it's not proven, the liability is assumed against the employer.

Next slide. Here's the thing. I've been doing this for a long time.

The lawyers at my firm have been doing this a long time. One of the things that we hear when we take on a case, we're screening a case, almost without question, my clients will say, or a potential client will say, our time records are great. We don't have people missing lunch.

They go all the time. We tell them it's important. We have a handbook.

Sometimes we even have training. They got to go to lunch. We know they go to lunch.

But we say in my line of work, the devil is in the data. So then we will get the time data and we will audit it. And this is what I'm telling you, 500 to 600 of these cases, it is common for the records to show late, short, or missed meal periods 10 to 60% of the time.

That was even before the Donahue case. And now that 10 to 60%, if a lawsuit is filed, employers have to have specific evidence to prove that that number of violations was the choice or the fault of the employee, not the employer. 10 to 60% for an average size business in California can work out to hundreds of thousands of meal period violations over the four-year period that these cases cover.

Next slide, please. So what we did was we kind of looked at this and we said, let's take the average, you know, a decent-sized business in the state of California. What is the cost of a meal break violation post-Donahue?

This is the Donahue dollars. Let's go through these with you. So you have to pay a meal period premium.

And California law requires that any time somebody does not take a compliant meal period, goes late, takes a short one, doesn't take it at all, or works during it, they have to pay one hour of pay as a premium. Based on the minimum wage and kind of an average hourly wage, it's $13 to $20 per meal. Next one.

Then we've got PAGA penalty. PAGA is a separate statute in the state of California that allows one employee to sue and seek penalties on behalf of all of the other employees for a one-year and 65-day period, in addition to class action damages, which cover all employees for a four-year period. Go ahead.

So that's $50 per pay period for a violation. The next one. We'll go through these quickly, please.

Then there's separate wage statement violations and penalties for the same conduct, for the same missed meal period, which is another $250 per pay period. Then we've got defense fees to help rebut the rebuttable presumption, which is about $50 to $100 per meal period. And then you have to pay employers in California, when they are sued, if even one violation is proven, they have to pay the plaintiff's attorney's fees for the entire case.

And that's about $50 to $100 per meal period. What does that work out to? It works out to $413 to $520 per non-compliant meal period.

So in the post Donahue world, if you have a business in California, and you have somebody take a 29-minute lunch break over the course of several years, it's anywhere from $413 to $520 per meal period. Next one, please. So let's look at it over the course of a year.

Let's show the whole slide so I can explain it, please. These are big numbers. If you have just one non-compliant meal period per week, and you have a company that has 200 employees, and you assume a 50 work week year, two weeks of vacation, it's a four to five million dollar problem.

If there are not plans and systems in place to prevent non-compliant meal periods, that's what the Donahue case is saying. You can extrapolate up if your business is bigger, you can extrapolate downward if it's smaller. The point is, you can do the math and figure out anywhere from four to five hundred bucks per meal period per week, times 50 work weeks, times your number of employees, that's your potential exposure in a class action lawsuit.

Next slide. So that's takeaway number two. Meal period compliance is a multi-million dollar issue for every employer in the state of California that has hourly employees.

The solutions, number one, stop rounding. We talked about that previously. We would go so far as to say even if there's the possibility that rounding could be lawful at the start and end of a shift, not including the meal periods, you just shouldn't round.

It's just too risky. And then number two, start protecting your business to limit your liability on meal periods, late, short, and missed meal periods. Next slide.

So one of the things that we have developed, we've actually been in development with this as a law firm even before the Donahue case, given how many of these cases are filed, given how many of our clients have been so frustrated and surprised that they've been hit with these claims, that their former employees are now seeking millions of dollars and that they don't have insurance coverage. Now the Donahue case makes this even more important. It's having a wage and hour compliance plan in place to help protect your business.

So next slide, please. There's five tools that every California employer should have in place. The first one is what's called a wage and hour focused handbook.

You have to have a handbook if you have a business in the state of California. It's the bare minimum. If you don't have a handbook and if it's not current, you're violating the law, you're subject to penalties.

Most businesses in California, particularly small businesses, seem to think that if they get a handbook through a payroll provider, an ADP, or a Paychex and they pay 250 bucks or whatever, they're covered. It says right there they have to take their meal period and they're good. That's not what Donahue says.

In fact, even before Donahue, that was not the best practice. A handbook is typically anywhere from 50 to 100 pages. The things that people are getting sued on is wage and hour things.

It's usually buried on page 45. Employees always say they didn't read it or didn't understand it. It was too long, et cetera, et cetera.

If handbooks were sufficient to prevent wage and hour cases, they wouldn't be on an astronomic, meteoric, atmospheric rise. A handbook is like a seatbelt. If it's not going to prevent the accident, you've got to have it because it'll help save your life, but you need much more than a handbook.

So one of the things that you can do as an employer is have a handbook that puts the wage and hour issues front and center. What we do, my law firm does, is we have a handbook that is essentially a short handbook that covers just the things that people are actually getting sued on and then all the other things that you have to have in the handbook by law, the 50 to 60 pages of civil air patrol leave and all these other leave things that maybe come up once, if ever, over the course of a business's life, those go in a separate appendix.

So that would be a recommendation, would be a handbook that is focused on wage and hour issues. Number two is something that's called an arbitration agreement. There's been some favorable law.

There are not a lot of laws and not a lot of court cases in the last few years that have been friendly to employers, but the law on arbitration agreements is friendly. An arbitration agreement is essentially an agreement between a company and an employee that if there are any disputes that arise that relate out of their employment, instead of going to court, instead of doing a class action in court, it will be handled privately and confidentially in a separate arbitration. If it's done right, that is a way to help prevent wage and hour class actions because anybody who files them and if they have, if whoever in the company has a signed arbitration agreement, the class action can't go forward.

It has to be handled in court. The third thing is a comprehensive wage and hour compliance plan that goes through some of the best practices and essentially fronts the issues, trains and engages the employees so that prevents them from having these violations in the first place and has a response system, which is the next one, which is the enforcement system, if there still are violations. So there's kind of the prevention and education and monitoring and tracking, and then there's the enforcement system.

That's the premium pay that I mentioned. If there is evidence of a violation and if after going through the compliance plan steps that there is proof that it was in fact the employer's fault, then there would be the premium pay. That's just one example of the enforcement system.

And then number five would be monitoring and verification for meal breaks. So it's having a system in place that ensures that employees are taking compliant meal periods and disciplining them if they're not. So those are some of the five tools.

Let's go to the next slide. There's another potential tool, and I have to give the disclaimer that this is a separate company. It's a separate product, and I am the co-owner of this company.

It's called California Compliance Solutions, or CCS. CCS is also a member of the Roseville Chamber of Commerce. So just a really quick story.

Brandon McKelvey, who is the McKelvey of Medina McKelvey and myself, several years ago, even before Donahue came down, we were looking at the epidemic of wage and hour cases being filed. And we were thinking, how can we help California businesses fight the tide of wage and hour cases? It's so expensive if they get hit to go through with a law firm, defend the cases, even if you resolve them early, there has to be a way to help prevent them.

So as part of that five-step compliance plan that I just mentioned, one of those was kind of an enforcement mechanism. We developed an online training and certification program called the CCS Wage and Hour Toolkit. Basically what it does is it trains all of a company's non-exempt hourly employees and their managers on what California law is, what the policies are, but then it goes a step beyond that.

And we don't believe that there's any product like this on the marketplace in California. It tests all employees on wage and hour compliance, and then certifies that they are complying with company policies, and it rigs the system so that they have to get a hundred percent on the wage and hour questions. And then it creates a certification document that goes into each employee's personnel file, so that if a plaintiff's lawyer is kind of sniffing around and trying to get information to file one of these lawsuits, the very first thing they'll see is that the company has been certified in wage and hour compliance, and the particular employee who is maybe trying to sue essentially cannot meet that rebuttable presumption because they have been trained and certified in wage and hour issues. So just very briefly, I'm going to fly through just a couple of screenshots of the training program.

So Ruby, go ahead. So what this does is it provides the wage and hour training for managers, it provides it for employees, there's tests and certifications, there's documentation, and there's regular check-ins, updates, and verification. Every quarter for customers that are on the California Compliance Solutions platform, every three months, they require to do a short check-in that refreshes their training, refreshes their certification, and they also are certifying that they're complying with the law, and there's an enforcement mechanism that will then notify HR if there are any potential violations, that they can be rectified, and that premiums can be paid. And so we believe that if the system is tested, that it would meet the Donahue rebuttable presumption that I mentioned previously.

Next slide, please. So this is just a quick screenshot of what the CCS platform looks like. Everybody gets a training course, they go through it, it takes about 30 to 45 minutes.

I'm not going to spend a lot of time going on this, it's just one of the possible resources that are out there. It doesn't have to be this, but we really do believe that in the post-Donahue world, there has to be something in addition to a handbook, even a wage and hour focused handbook that engages the employees, that allows a company to follow up and enforce any meal period violations to help prevent these lawsuits. So let's go actually to the last slide.

Those are just more screenshots of the training compliance program. So we did this in record time, because I have been presenting this webinar, like I said, to numerous clients up and down the state as well as other trade groups. So for those of you watching live, and for those of you who are going to be watching this later on a reporting, hopefully I gave you part of your lunch or whatever time you were reviewing this back.

I am going to just pause right now, I'm going to look at the chat here and see if there are any questions and answer those. And if you have any follow-up questions that I don't get to today, you can always feel free to reach out to me or any of our wage and hour attorneys. Our website is at the bottom of this slide, it's medinamckelvey.com.

You can find me on there, you can find my colleagues on there. So just one of the questions, kind of a comment, which is, you know, guilty until proven innocent. Yes, 100 percent.

That is what the California Supreme Court is saying. And this is something that I neglected to mention when I was talking about the Donahue case, it is very important. It might sound silly to think why are employers essentially being required to police meal period violations.

I get this all the time from clients, they know, they don't want to go to lunch, they want to go to work, nobody needs 30 minutes, they just want to eat a sandwich and get back to work. I get it. I own two businesses, I have employees, I don't take a 30-minute lunch break every day, maybe I should, but I don't, I'm not required to as an attorney.

But the California Supreme Court throughout the Donahue decision specifically says that the reason that employers are required to police this is that meal periods and rest periods, to a certain extent, are a health and safety concern. This goes back to what I was saying at the very beginning of this webinar, which is that California is very employee-friendly. California is not meant to be political, but the state of California has taken it upon itself to put a system in place to protect the health, safety, and well-being of employees, not only on things like pay and overtime and making sure that everybody's fairly compensated, but the California Supreme Court has said that because meal periods, lunch breaks, are a matter of health and safety for employees, they're going to be treated differently than things like overtime pay or what rate is paid or expense reimbursement. And that is why the California Supreme Court is basically saying, yes, guilty until proven innocent.

If there are violations, you are messing with somebody's health and safety, their mental, emotional, physical well-being, it's going to be proven to be your fault that you did not give them that break that they needed, unless you can have compelling evidence, such as a compliance plan and training and enforcement and responsiveness in place. That's what they are saying. And then another question is, would these sorts of lawsuits be covered by employee liability insurance parts of commercial policies?

So we get this question a lot. The shorthand in the insurance world is EPLI, Employee Practices Liability Insurance. The short answer is no, it's not covered.

There are oftentimes riders that are very specific, that have all this coverage on employment policies and practices. They cover things like wrongful termination and sexual harassment and even COVID-related discrimination. But there's very, almost always, because I've read a lot of these policies, a separate rider or an exclusion that says that wage and hour class and actions are not covered.

You can get certain additional policies, you can get certain additional protection to get very, very minimal coverage. Typically what that means is you pay a very high premium in addition to your EPLI premium, your employment practices premium. And what that will do is it will give you what's called only cost of defense coverage.

And what that means is you usually pay a very high deductible, oftentimes 25, 50, or even $100,000 to get limited coverage where it will only cover a percentage of your defense fees. It won't cover liability. So if let's say you have that $4 million case, that $4 million is on you, it would cover a portion of your defense fees.

And most of the policies that have this cost of defense coverage, they typically will require you to use only a certain select panel of attorneys and law firms. And most of those, and I know this from personal experience, most of those law firms do not specialize in wage and hour class action in PACA cases. And they have a whole separate playbook that plays right into the hands of the plaintiff's lawyers filing these things.

It often means that you have this coverage, you pay a lot of money for this coverage, you think you're covered, you end up spending sometimes two or three times what you would typically spend without insurance coverage in the first place. So it is an epidemic. And that is one of the more frustrating and honestly disheartening and depressing conversations I have, is I'll have somebody, they'll call me, they'll say they've been sued, but they'd say, but I've got insurance coverage.

And I'll say, send me your policy. And I have to break the news to them. You either have no coverage, or you have coverage that's actually going to cost you more money in the long run.

Another question that I have is, it seems really ripe for abuse. Is that is what has been happening? Yes, this is an epidemic.

This is what is happening. There are trade groups that are trying to stop this. But there is so much money involved.

The plaintiff's lawyers who file these cases get 35% of every case, they are getting rich. 10, 20, 30 years ago, the richest lawyers in the state of California were all car accident and personal injury attorneys. Not anymore.

They're all wage and hour lawyers. And most of the assembly are former trial lawyers. So they love this bill.

And here's the other little secret that a lot of people don't realize. An APAGA case, which is that separate set of penalty structure for any type of violation of labor code, 29 minute lunch break, you know, we talked about that, we showed the numbers. And APAGA case, 75% of all of the penalties collected goes straight into the state of California's general fund, and only 25% goes to the employees.

So what does that mean? Tons, because these cases are just going like crazy right now. So much money is flowing into the coffers of the state of California.

It funds the Supreme Court salaries, it funds the legislature, it funds the governor, it funds all of the state agencies. So there, I would even go so far as to say there's a potential conflict of interest right now in the state of California, which is why APAGA is not going anywhere anytime soon. Wage and hour class actions are not going anywhere, anytime soon.

These cases are going to continue to be on the rise. At some point, there's going to be a tipping point that might get into the political a little bit. So I'm going to shut up.

What I would say is if you have employees in the state of California, you cannot put your head in the sand any longer. Things that you did four weeks ago to manage employees no longer apply. You have to have a plan in place.

Last question, and I'm going to end it is will this be, these are great questions, by the way, will this be one of those the way California goes, so goes the nation type of things? Yes and no. Many of you watching this, you know, if you've been doing business in California for a long time, if you have California employees, meal and rest breaks have just been kind of part of the norm.

It might surprise you, though, to know that federal law has no meal and rest break requirement. The Fair Labor Standards Act, the FLSA doesn't have that. I don't believe there's any other state in the country that has meal and rest break requirements.

There might be one other state that's doing that. California is so far ahead or behind, however you look at it, in terms of how they believe they need to protect employees. So it would first require another state to have meal and rest break requirements and then have a whole system in place to do this.

I've heard some chatter from some other states talking about some type of AGA representative action, but California is kind of its own little island, honestly. I mean, I wouldn't put it past me for some enterprising plaintiff's lawyers to go get licensed in another state, try to find a way to make money somewhere else. I mean, where are all the Californians going to go to Idaho?

They're going to Tennessee, they're going to Texas. You know, maybe in 10 years you see some of these other states. But California is really kind of leading the charge in terms of employee protections and these types of lawsuits.

So maybe that's the way it happens. I don't see it happening anytime soon. But again, if you're a California business, you need to be informed and you need to have a plan in place.

I think that is all the questions that we have for today. So I want to thank everybody live as well as on the recording for giving us a little bit of your time. As I said previously, we're always available for questions.

You can find me at the website address below, happy to chat further, happy to talk about how we can go about getting you a compliance plan, doing a demo of the CCS product that I showed, talking about arbitration agreements and talking about a wage and hour focus handbook. We do all of those things. We can bundle them.

We have all sorts of solutions depending on the size of your business. So I'd be happy to provide further information. So thank you again.

We appreciate it.