In Naranjo v. Spectrum Security Services, Inc., the Supreme Court today holds that the extra-hour’s pay an employer owes for improperly making an employee work during all or part of a meal or rest break period constitutes statutory “wages” that must be reported on required wage statements and be paid by specified deadlines when an employee leaves the job. Violations of the wage-statement and pay-deadline mandates can trigger penalties.

The court’s unanimous opinion by Justice Leondra Kruger finds, “Although the extra pay is designed to compensate for the unlawful deprivation of a guaranteed break, it also compensates for the work the employee performed during the break period.”

The court also concludes that the state Constitution’s seven percent default rate — not a statutory 10 percent rate in actions for the nonpayment of wages — is the appropriate measure of prejudgment interest on amounts due for failure to provide breaks.

The court reverses in part the Second District, Division Four, Court of Appeal published opinion. The two courts are in sync on the prejudgment interest issue. The Supreme Court also disapproves a 2016 Sixth District decision, Ling v. P.F. Chang’s China Bistro, Inc. (2016) 245 Cal.App.4th 1242, regarding the applicability of the pay-deadline requirement. The Supreme Court denied review in Ling.