California Supreme Court: Out of State Employers Bound by California Overtime Law...

...when employees work in California for at least a day or a week at a time.

Sullivan v. Oracle is a wage hour class action we addressed here.  If you don't remember, you're forgiven. This was back in 2008.  I had more and darker hair; Lehman Brothers was a functioning company.  You could buy a Pontiac. Remember?

Anyway, so Sullivan and his class were employees who periodically worked in California.  They wanted California wage law to apply during any full day in which they worked in California. The federal court of appeals asked the California Supreme Court to answer "certified questions."

First, does the California Labor Code apply to overtime work performed in California for a California-based employer by out-of-state plaintiffs in the circumstances of this case, such that overtime pay is required for work in excess of eight hours per day or in excess of forty hours per week?

Here, the Court said "yes." When employees visit California from other states, California overtime laws apply:

To exclude nonresidents from the overtime laws’ protection would tend to defeat their purpose by encouraging employers to import unprotected workers from other states.  Nothing in the language or history of the relevant statutes suggests the Legislature ever contemplated such a result.

The Court ensured its holding was limited to overtime, not necessarily to other wage-hour laws:

the case before us presents no issue concerning the applicability of any provision of California wage law other than the provisions governing overtime compensa­tion.  While we conclude the applicable conflict-of-laws analysis does require us to apply California’s overtime law to full days and weeks of work performed here by nonresidents (see post, at p. 12), one cannot necessarily assume the same result would obtain for any other aspect of wage law.  California, as mentioned, has expressed a strong interest in governing overtime compensation for work performed in California.  In contrast, California’s interest in the content of an out-of-state business’s pay stubs, or the treatment of its employees’ vacation time, for example, may or may not be sufficient to justify choosing California law over the conflicting law of the employer’s home state.  No such question is before us.

The court then turned to the second question:

Second, does [Business and Professions Code section] 17200 apply to the overtime work described in question one?  Third, does [section] 17200 apply to overtime work performed outside California for a California-based employer by out-of-state plaintiffs in the circumstances of this case if the employer failed to comply with the overtime provisions of the FLSA?”

The Supreme Court noted it already has held that the UCL applies to overtime claims. Therefore, the Court answered "the second certified question as follows:  Business and Professions Code section 17200 does apply to the overtime work described in question one. "

As for the third question, the Supreme Court decided that out of state plaintiffs could not sue a California-based employer for overtime violations occurring outside of California.  Thus, merely because an employer is headquartered in CA, that does not make the employer subject to suit under the UCL for alleged wrongs entirely occurring somewhere else.

The case is Sullivan v. Oracle Corp. and the opinion is here.