Interesting UCL restitution order: Ybarra v. Aramark Corp.

On May 1, 2008, Judge David C. Velasquez, Supervising Judge of the Orange County Superior Court Complex Civil Panel, issued an interesting order in a wage and hour case, Ybarra v. Aramark Corp., No. 30-2008-0018008-CU-OE-CXC (Orange Cty. Super.). Judge Velasquez held that waiting time penalties under Labor Code section 203 were recoverable under the UCL as "restitution":

In similar fashion to the "additional hour of pay" [in Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1108], the instant court observes that Labor Code §203 does not provide that the employer is "subject to" the imposition of the waiting time penalty. Rather that section states "the wages of the employee shall continue" if the employer does not pay separation wages within 72 hours of the employee's termination. The employee is not required to do anything affirmative — "take action" — in order to be entitled to the continuing right to wages. The right to the waiting time penalty is self-executing, i.e., the employee's right to payment of the waiting time penalty arises immediately upon the satisfaction of the condition precedent, late payment of the last wages due to the employee at the time of termination from employment. In that respect, because the waiting time penalty becomes immediately due and payable to the employee, the right to receive the penalty becomes a vested property right of the employee and the proper subject of restitution. (Cf. Cortez v. Purolator Air Filtration Products Co. (2000) 23 Cal.4th 163, 178 [wages which are due but unpaid are the proper subject of restitution].)

Minute Order at 2. This would be a form of what I call "vested interest" restitution. Judge Velasquez therefore denied the motion to strike the complaint's references to UCL restitution and to the four-year statute of limitations (and overruled the defendant's demurrer to the UCL cause of action as a whole).

Many thanks to the blog reader who emailed this order to me. If you know of an interesting trial-level order like this one, I'd be glad to receive a copy of it (uclpractitioner@gmail.com).

Comments

[michael walsh]

This will get appealed to the same panel that gave us McCoy v. Superior Court (2007) 157 Cal.App.4th 225, which makes this case an interesting vehicle for expansion of the law. In McCoy, the court ruled that the statute for section 203 penalties that do not include claims for the underlying wages was one year. And that this ruling meant that the court did not need to address the claim that the statute was four years under the plaintiff's alternate theory uf unfair competition.