More than a few media sources have reported on the March 10, 2016 wage-hour “victory” by a class of Taco Bell employees on meal period claims in a jury trial in the Eastern District of California. A closer review of the case and the jury verdict suggests that those employees may not be celebrating after all -- and that Taco Bell may well be the victor in the case.
The trial involved claims that Taco Bell had not complied with California’s meal and rest period laws. The employees sought meal and rest period premiums and associated penalties for a class of employees that reportedly exceeded 134,000 members.
Now, it is certainly true that, at trial, a class of employees prevailed on a claim that Taco Bell did not comply with California meal period laws for a limited period of time (2003-2007), when Taco Bell reportedly provided employees with 30 minutes of pay when they were not able to take meal periods, rather than the full one-hour of pay provided for by California law.
And it is certainly true that the class of employees was awarded approximately $496,000 on that claim.
But as it appears that there were more than 134,000 employees in the class, a few punches on the calculator show that, on average, each employee would receive approximately $3.70.
Perhaps more importantly, while it may have lost on that one claim, Taco Bell prevailed on the remaining claims in the case where the class alleged that Taco Bell had violated both meal and rest period laws as to its employees, including a claim that Taco Bell had not provided meal periods in compliance with the law for a period of approximately 10 years (2003-2013). That claim alone likely would have resulted in a jury verdict of several million dollars had the employees prevailed on it. But they did not. Taco Bell did.
In other words, in a case where the employees were presumably asking a jury for several millions of dollars for alleged violations dating back to George W. Bush’s first term as President, they were only awarded approximately $496,000.
In the grand scheme of a class action, where employers must constantly weight the costs of litigation with the benefits of settlement, that is a small sum. It is likely an amount Taco Bell gladly would have paid to settle the case. In fact, one would have to speculate that $496,000 is likely much less than the amount Taco Bell actually offered the employees and their attorneys to resolve the case in mediation or otherwise.
So while the media may be reporting that this is a “victory” for Taco Bell employees, those employees, who will receive $3.70 each on average, may not see it that way. Instead, they may well be questioning the lead plaintiffs and their attorneys about how much Taco Bell offered at the settlement table, if it was rejected, and why.
(And before anyone responds, “But the employees’ attorneys will get their attorneys fees,” we’re talking about the recovery for the employees themselves. If the real victors in the case are the attorneys, that’s another issue, isn’t it?)