Decision: In Kilbourne v. Coca-Cola Company, the US District Court for the Southern District of California granted partial summary judgment in favor of Coca-Cola in connection with a former employee’s overtime claims. The court held that, although California Labor Code Section 510 sets forth the basic California overtime rules, Labor Code section 514 exempts employers from those requirements where a collective bargaining agreement (CBA) meets certain conditions, including paying premium wage rates for all overtime hours worked.
The plaintiff argued that the applicable CBAs did not satisfy this exemption because they did not provide premium rates for all overtime hours worked, as defined in Section 510. Plaintiff claimed that although he routinely worked more than 10 hours per day and through his lunch period, he was not paid overtime wages for work performed during his 30-minute meal period.
The district court disagreed with the plaintiff, holding that the relevant CBAs—not Section 510—can define the term “overtime hours.” Pursuant to Section 514: “[w]here there is a valid collective bargaining agreement, employees and employers are free to bargain over not only the rate of overtime pay, but also when overtime pay will begin. Moreover, employees and employers are free to bargain over not only the timing of when overtime pay begins within a particular day, but also the timing within a given week.”
Impact: Because the collective bargaining process is perceived as protecting employee interests, courts are willing to uphold provisions in a CBA that do not comport with standard overtime laws. Section 514 of the Labor Code thus allows employers and unions to bargain over not only the rate of overtime pay, but when the entitlement to overtime pay begins, as long as the employer does not manipulate the employees’ workweeks or schedules to avoid paying overtime.