A Taco Bell Employee Purchases a Discounted Meal & Has To Eat It On Premises During the Break? Enjoy, But Do Not Expect to Be Paid For It

Rodriguez v. Taco Bell - Ninth Circuit Court of Appeals

Facts:  Bernardina Rodriguez ("Rodriguez") worked at Taco Bell.  During her employment, she had a 30 minute meal break and had the voluntary option to purchase a meal at a discount, provided the meal was eaten at the restaurant.  Taco Bell implemented this policy to prevent theft.  Rodriguez proceeded to file a putative class action against Taco Bell on the grounds that she was entitled to paid for the time spent on the premises eating the discounted meal during meal breaks.  Rodriguez argued that since Taco Bell requited the discounted meal to be eaten at the restaurant, she was under "sufficient employer control" to render this time compemsable.

The district court ruled in favor of Taco Bell on the grounds that the employees were free to use the 30 minute break however they wanted and were only subject to the restriction to stay on premises if they voluntarily chose to purchase a discounted meal.  Rodriguez subsequently appealed.

Holding:  Generally speaking, California requires that non-exempt employees be afforded rest and meal breaks after working a certain number of hours.  The Court pointed out that California Wage Order 5-2001 requires employees be relieved of all duty during a requisite meal period.  For those employers found to have violated this Wage Order, they are required to pay the employees "one additional hour of pay at the employee's regular rate of compensation for each workday that the meal or rest or recovery period is not provided."  Relying upon a California Supreme Court decision, the Court noted that employers fulfill their obligation to provide meal periods to their employees when they relieve their "employees of all duty, relinquish[] control over their activities and permit [] them a reasonable opportunity to take an uninterrupted 30 minute break, and do[] not impede or discourage them from doing so."

Rodriguez acknowledged that while the condition of "on premises consumption" of discounted meals was to ensure the meals were not taken off the premises and given to someone else, employees were still under Taco Bell's control during the meal period.  As Taco Bell had asserted previously, and did again before the Court of Appeals, the discounted meal purchase was voluntary and employees were free to choose to spend their break time however they wanted.

In this case, the Court found that Taco Bell's meal policy satisfied the standard as set forth in the California Supreme Court case, as employees were relieved of all duty and Taco Bell relinquished control over their activities.  Of note, the Court pointed out that the discounted meal purchase was voluntary, employees were free to leave the premises or spend the break in any way they chose, and were even free to purchase a meal at full price and eat them wherever they chose.

Judgment:  The Ninth Circuit Court of Appeals affirmed the district court's ruling and held that Taco Bell did not violate California Wage Order 5-2001 when it required its employees to stay on premises and eat a discounted meal that they had voluntarily purchased, thus these employees were not under "sufficient employer control" and therefore were not entitled to compensation for being required to stay on premises to eat their discounted meal.

The Takeaway:  While Rodriguez had a novel argument, I think it fell short on several grounds (notwithstanding the great weight of caselaw against her).  For one, the purchase of the discounted meals was voluntary.  Instead, employees could choose to not purchase a discounted meal and leave the premises.  As well, employees could even choose to purchase a meal at regular price and leave the premises.  Taco Bell's reasoning for implementing the "on premises consumption" for its discounted meal purchase made sense (with Rodriguez herself even acknowledging Taco Bell's reasoning for the policy).  Given this justification, I think the Ninth Circuit Court of Appeals got it right when it held that Taco Bell employees that voluntarily chose to purchase a discounted meal and had to stay on premises to eat it were not entitled to compensation under California Wage Order 5-2001.

Majority Opinion Judge:  Judge Schroeder

Date:  July 18, 2018

Opinion:  http://hr.cch.com/eld/RodriguezTacoBell071818.pdf