Brewer v. Premier Golf Properties: Punitive Damages Are Unavailable For Labor Code Actions for Unpaid Wages, Meal and Rest Break Violations, and Pay Stub Penalties

In Brewer v. Premier Golf Properties (D050868) (December 3, 2008), the Fourth Appellate District determined that an employee may not obtain punitive damages where liability is premised solely on certain Labor Code violations, including failure to pay the minimum wage, unpaid overtime, meal and rest break violations, and failure to provide accurate itemized wage statements.

Background and Holding

The California Labor Code contains a number of separate but related provisions that address the manner in which employees are permitted to work and the manner in which they must be paid for that work. These provisions not only direct employer behavior, they also provide an employee with a remedy if his or her employer's behavior deviates from statutory mandates. In many cases, the Labor Code also provides for civil penalties that compound where a wage payment is delayed or where there are multiple violations. In Brewer, golf course waitress, Christine Brewer, prevailed at a jury trial against her long time employer and was awarded: (1) less than $1,000 in unpaid regular and overtime wages; (2) $6,000 for unpaid meal and rest break wages; (3) $4,000 for pay-stub penalties and (4) $15,200 for minimum wage penalties. In addition to these statutory penalties, the jury awarded $195,000 in punitive damages.

On appeal, the Court determined that punitive damages are not available for Brewer's claims under the Labor Code because the Legislature already provided a comprehensive remedial scheme to address these rights. The Court also noted that statutory wage and break claims “arise from” the employment contract and that punitive damages are not traditionally available in contract actions. Brewer argued that punitive damages should be permitted because the Labor Code provisions at issue provide that the employee's remedies are “in addition to any other penalty provided by law.” The Court rejected this argument, stating that the language was only designed to ensure that employees may recover other statutory penalties under the Code. The decision also distinguished a number of prior cases permitting punitive damage recovery on the basis that those cases involved additional, non-statutory claims.

What Employers Should Know

Because the Labor Code's penalty provisions follow clear formulas, an employer can accurately estimate its potential exposure on any given claim. In contrast, punitive damage awards are inherently unpredictable because it is not always clear when they will be awarded or in what amount. Brewer restores to employers some level of certainty regarding potential exposure in wage and hour cases brought under the Labor Code.