Espinoza v. Classic Pizza, Inc., 114 Cal. App. 4th 968 (2003)

Pedro Espinoza, a non-exempt employee, worked at Classic Pizza from August of 1995 until June of 1999. He testified that he worked 62 hours per week until approximately June or August of 1998, and, thereafter, he worked 60 hours per week. Prior to January 1, 1998, Espinoza was owed overtime pay for any workweek exceeding 40 hours or any workday exceeding eight hours. However, because of a temporary change in the applicable wage order (which was only in effect in 1998 and 1999), after January 1, 1998, Espinoza was owed overtime pay only for hours worked in excess of 40 hours per week. The Court of Appeal held that from 1995 through 1997, Espinoza’s hourly rate of pay should have been calculated by dividing his weekly salary by 40, and, after January 1, 1998, the rate should have been calculated by dividing his weekly salary by 60 (i.e., the “fluctuating workweek method”). The parties’ “vague understanding” that Espinoza’s weekly salary was to include compensation to him for overtime that he worked did not render him ineligible for overtime pay. The Court further held that Espinoza was entitled to prejudgment interest from each day on which his right to accrue overtime vested. Finally, the Court upheld the award of $923 in sanctions against Espinoza’s attorney for his refusal to abide by the trial court’s order quashing a subpoena for defendants’ checking account records.