We wanted to pass along this information from the American Trucking Associations:
A United States District Court has found that a piece-rate pay system violates the requirements of Californias minimum wage law. The employees at issue were route delivery drivers who were paid based on the number of cases of product delivered, the number of miles driven, and the number of delivery stops made. It was uncontested that other duties, including pre and post shift work, were not directly compensated, but were considered by the employer to be covered under the piece rate payments. The Court concluded that a piece-rate formula that does not compensate directly for all time worked does not comply with California Labor Codes, even if, averaged out, it pays at least minimum wage for all hours worked. Cardenas v. McLane Foodservices, Inc., 2011 WL 2533341 (C.D. Cal. June 23, 2011
In light of this decision, motor carriers with mileage-based compensation systems are advised to review those systems to make certain that they adequately compensate employees for all work performed. At the end of the payroll period, the employee must receive at least minimum wage for each hour worked. Employers with questions about how this case affects their compensation systems are advised to consult with legal counsel.
More information about piece rate pay can be found on HRCalifornia.
A United States District Court has found that a piece-rate pay system violates the requirements of Californias minimum wage law. The employees at issue were route delivery drivers who were paid based on the number of cases of product delivered, the number of miles driven, and the number of delivery stops made. It was uncontested that other duties, including pre and post shift work, were not directly compensated, but were considered by the employer to be covered under the piece rate payments. The Court concluded that a piece-rate formula that does not compensate directly for all time worked does not comply with California Labor Codes, even if, averaged out, it pays at least minimum wage for all hours worked. Cardenas v. McLane Foodservices, Inc., 2011 WL 2533341 (C.D. Cal. June 23, 2011
In light of this decision, motor carriers with mileage-based compensation systems are advised to review those systems to make certain that they adequately compensate employees for all work performed. At the end of the payroll period, the employee must receive at least minimum wage for each hour worked. Employers with questions about how this case affects their compensation systems are advised to consult with legal counsel.
More information about piece rate pay can be found on HRCalifornia.