Bell v. H.F. Cox, Inc., 2012 WL 3846827 (Cal. Ct. App. 2012)

Oscar Bell and other truck drivers filed a putative class action against Cox, alleging wage and hour violations. Among other things, the drivers alleged that Cox had failed to pay promised vacation benefits to current employees (it paid them a flat rate of $500 of vacation pay per week, which was later increased to $650) as well as vacation benefits due upon termination of employment. The trial court held that the vacation benefits claims were preempted by ERISA. The Court of Appeal reversed in part, finding a triable issue of fact as to whether Cox’s vacation benefits plan was funded from Cox’s general assets or from a separate trust (as required by ERISA). However, the Court held that the trial court had properly adjudicated in Cox’s favor the claim for failure to pay promised vacation benefits because “a vacation benefits policy [need not] provide for payment of vacation time at an employee’s regular rate of pay.” The Court also determined that the employees are exempt from the FLSA’s overtime compensation requirement pursuant to the Motor Carrier Exemption. Finally, the Court held that the partial reversal of the judgment compelled reversal of the trial court’s award to Cox of $120,000 in attorney’s fees. See also Arias v. Kardoulias, 207 Cal. App. 4th 1429 (2012) (employee’s untimely appeal of labor commissioner’s award did not entitle employer to recovery of attorney’s fees pursuant to Labor Code § 98.2); Hester v. Vision Airlines, 687 F.3d 1162 (9th Cir. 2012) (answer of employer that engaged in multiple discovery violations was properly stricken, default judgment was properly entered and class should have been permitted to seek punitive damages during trial).