74 Litigating CA Wage & Hour Class and PAGA Actions (24th Edition) Seyfarth Shaw LLP | www.seyfarth.com B. Purpose Of The Wage Statement Statute In Savea v. YRC, the Court of Appeal examined the purpose behind Labor Code section 226, and noted that it was intended to ensure that employees can understand what they are being paid, so they can evaluate if they have been compensated properly for all of their work.352 Savea observed that the Legislature had required wage statements to include the employer’s name and address for workers compensation and tax purposes, and also so that the employer could be contacted regarding any question about wages paid.353 Savea held that there was no requirement to include the exact legal name, as long as employees could properly identify and contact the employer.354 The Ninth Circuit went further in Mays v. Wal-Mart Stores, Inc., holding that Wal-Mart wage statements could list the name of the employer as “Wal-Mart Associates, Inc.” even though the actual employer was “Wal-Mart Stores, Inc.”355 Mays noted that "California Labor Code § 226 was established to protect the concrete interests of California’s workers, not merely to confer pure procedural rights."356 Mays noted the plaintiff’s failure to “allege any real-world consequences flowing, or even potentially flowing, from the violation. Nor does the relatively trivial nature of the violation—swapping “Wal-Mart Associates, Inc.” for “WalMart Stores, Inc.”—pose a clear threat of harm. ... [The employee’s] bare confusion, without more, lacks a meaningful nexus to the concrete interests safeguarded by § 226.”357 C. The Supreme Court Approves Of Derivative Wage Statement Claims Based On Unpaid Meal And Rest Premiums In Naranjo v. Spectrum Security Services, Inc., the California Supreme Court held that “an employer’s obligation under Labor Code section 226 to report wages earned includes an obligation to report premium pay for missed breaks.”358 Therefore, “provided the conditions specified in the statute are otherwise met, failure to report premium pay for missed breaks can support monetary liability under section 226 for failure to supply an accurate itemized statement reflecting an employee’s gross wages earned, net wages earned, and credited hours worked.”359 As a result of the Naranjo decision and its retroactive application, plaintiffs can seek wage statement penalties that are purely derivative of meal and rest break claims. This overruled, at least in part, a prior Court of Appeal decision that had, quite sensibly, held that the Legislature wanted wage statements to accurately report the 352 Id. at 178-179. 353 Id. at 180. 354 Id. 355 Mays v. Wal-Mart Stores, Inc., 804 Fed. App’x 641, 642 (2020), 356 Id. at 643. 357 Id. at 643-44. Note that the Mays decision rested on its finding that the plaintiff failed to satisfy Article III’s injury-in-fact requirement. Id. at 644. Mays noted that the plaintiff might have been able to maintain her claim in the friendlier confines of the state courts. Id. 358 13 Cal. 5th 93, 121 (2022). 359 Id.
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