Restaurant operators risk increased payroll expense and legal liability when they schedule employees to work two shifts in one workday, for example, scheduling servers to work a lunch shift of several hours and then to return that evening to work a dinner shift of several more hours. Under California and New York law, such “split shifts” generally occur whenever an employer schedules an employee with an unpaid break of more than one hour in a day, other than time off for bona fide meal or rest breaks. In California, New York and other parts of the country, state law requires employers to pay employees an extra hour of pay for each day employees are required to work a split-shift. If employees file suit for an operator’s failure to pay such “split shift premium wages,” restaurants may also be required to pay the employees’ attorney’s fees.
California: ‘Split-Shift’ Premiums
Under California law, for each workday an employee works a split-shift, the restaurant must pay the employee a split-shift premium consisting of one extra hour of pay at the state minimum wage rate, that is, one hour of pay in addition to the hours the employee actually worked that day.
There are exceptions to the requirement:
- A split-shift premium is not required if the employee’s base pay (i.e., his hourly wage excluding tips) for the day is equivalent to at least the minimum wage for all hours worked plus an additional hour at minimum wage.
As an example, a bartender who is paid $15 per hour works two shifts of four hours in one workday. His total pay for the day is $120 ($15 x 8.) Because the bartender’s total base pay for the day is more than the minimum wages owing for all hours worked ($80 under California’s minimum wage of $10 per hour) plus an additional hour of minimum wage ($10), the restaurant is not required to pay him a split shift premium wage for that workday.
- A split-shift premium is offset in part if the employee’s base pay rate is more than minimum wage, but her total pay for the day is less than minimum wage for all hours worked plus an additional hour of minimum wage. In that instance, the employee is entitled to only the difference between what she actually earned and what she would have earned had she been paid minimum wage for her entire workday plus an extra hour at the minimum wage.
For example, a server who is paid $10.30 per hour (.30 over California’s minimum wage) works two shifts of four hours in one workday. Her total base pay for the day based on hours worked is $82.40 ($10.30 x 8.) For purposes of the split shift premium, the server is owed the difference between what she would have earned had she been paid the minimum wage plus an extra hour at minimum wage ($90) minus what she did earn ($82.40) = $7.60. Thus, the employee’s total daily pay, aside from tips, would be $90 ($7.60 in split shift premium plus $82.40 in wages.)
- California restaurant operators are also not required to pay split shift premiums if the break in the work time is scheduled at the employee’s request. Thus, no split-shift premium is due to an employee who asked for the two-hour break in the middle of her shift to run a personal errand.
Protect yourself: Whenever an employee asks to be scheduled for a “split shift,” require the employee to submit the request in writing, dated and signed by the employee, and keep the request in the employee’s personnel file. Such documentation will obviously be critical defensive evidence if the employee later claims the restaurant unlawfully failed to pay split shift premium wages. Be aware, though, that requiring employees to submit written requests for paid sick leave may violate California’s Paid Sick Leave law.
New York: ‘Spread of Hours’ Pay
New York hospitality employers (private employers in the restaurant and hotel industries) are not required to pay their employees a premium wage merely by virtue of the employees working two shifts in one day. However, restaurant and all-year hotel operators are liable to non-exempt employees for an extra hour of pay at the minimum wage on all days where the “spread of hours” worked is greater than 10. The “spread of hours” refers to the total hours from the start of the employee’s work that day to the end of her workday, including all working and non-working time. When the “spread of hours” in one workday exceeds ten hours, the employee is owed an extra hour of pay at the state minimum wage rate.
Of key importance is that, unlike other industries, there is no offset for employees in the hospitality industry who earn more than minimum wage. Operators also may not apply any credit or allowance to offset the spread of hours pay, including offsets for meals, lodging, and tips.
An employee is owed an hour of minimum wage if the start of the first shift and end of the second shift totals 10 hours or more, even where the employee works fewer than 10 hours.
The New York Hospitality Wage Order provides the following examples of a situation in which an employee works less than 10 hours, but the “spread of hours” is more than 10:
Shift 1: 7 a.m. – 10 a.m.; Shift 2: 7 p.m. – 10 p.m.
Six hours worked over a 15-hour spread
Shift 1: 11:30 a.m. – 3 p.m.; Shift 2: 4 p.m. – 10 p.m.
Nine and a half hours worked over a ten-and-a-half hour spread.
In both cases, the operator must pay the employee one additional hour of pay at the state minimum hourly rate.
Protect yourself: To avoid payment of the “spread of hours” premium, restaurant operators can craft work schedules to minimize the hours between the start of the first shift and end of the workday. However, the workday must recur on a regular basis, consistent with the employer’s normal operations, and not be created to get around the operator’s legal obligations.
Restaurant Operators Outside of California and New York
There is no similar requirement to pay a premium wage for split-shifts or spread of hours exceeding 10 under federal law, namely, the Fair Labor Standards Act. Operators outside California and New York should contact employment counsel to determine their obligations under their state law.
Jeffrey S. Horton Thomas, Esq. is a partner and Zoe J. Sussman is an associate in Thomas Employment Law Advocates, APC, West Hollywood, CA. The firm is an employment defense boutique which focuses on representing employers in the hospitality industry throughout Southern California. For more information, visit www.thomasemploymentlaw.com.