California Court Rejects Punitives in Labor Case

A California state appellate court has denied punitive damages in a case involving meal and rest breaks and minimum wages, reversing a lower court’s jury verdict.

According to the decision Wednesday, December 3, in Christine Brewer v. Premium Golf Properties, Brewer was a longtime waitress at Premium Golf Properties’ Cottonwood Golf Club in Rancho San Diego, California. After returning to work following a back injury in 2005, Brewer was assigned the less lucrative morning shift rather than her normal afternoon shift. Cottonwood denied her request to be assigned the afternoon shift, and Brewer resigned. She then filed a lawsuit claiming, among other things, that she was denied meal and rest breaks and was not paid for the wages she earned.

The jury found that Cottonwood had acted with “oppression, fraud or malice” and awarded her $195,000 in punitive damages in addition to $956 in compensatory damages. The state’s 4th District Court of Appeals reversed the punitive damages award.

According to the three-judge panel’s unanimous decision, under the state’s “new right-exclusive remedy” doctrine, when a statute creates new rights and obligations that did not previously exist in common law, “the express statutory remedy is deemed to be the exclusive remedy available for statutory violations, unless it is inadequate.” The labor code did establish these new rights, the decision said.

Furthermore, said the court, “The breach of an obligation arising out of an employment contract, even when the obligation is implied in law, permits contractual damages, but does not support tort recoveries,” according to the decision, which means Brewer is not entitled to punitive damages.

Lisa Perrochet, a defense attorney with Horvitz & Levy in Encino, California, said the decision is significant “because it’s the first time a California court has applied [the exclusive-right remedy] in this particular context,” although it was a foreseeable development.

Horvitz & Levy attorney Felix Shafir said plaintiff attorneys have increasingly been seeking punitive damages in these cases, which are being filed more frequently.

The attorneys in the case could not be reached for comment.

Filed by Judy Greenwald of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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