Owner’s approval of employment policies enough to support personal liability

Suppose you own a company but aren’t involved in its day-to-day operations. You hire skilled professionals to develop your company policies, implement them, and run the business. And then you get sued personally for alleged wage and hour violations.

Under California Labor Code Section 558.1, business owners and managers may be held personally liable for wage and hour practices that don’t comply with California law.

In the following case, California’s Second District Court of Appeal considered two distinct issues: whether the passive owner of a trucking company could be held personally liable for the business’ wage and hour violations and whether federal transportation laws preempted certain claims relating to meal and rest breaks.

Facts

Guillermo Espinoza was a trucker employed by Hepta Run, Inc. Each day, he reported to work at the truck yard, retrieved a truck, and drove to the Port of Long Beach, where he waited, often for several hours, for a container to be loaded onto. He then drove the container to the recipient’s location and waited for it to be unloaded, a process that could take several hours. He was responsible for keeping the truck clean and gassed and had to stay with the truck at all times.

At the end of his day, Espinoza returned the truck to the yard and went home. He worked nine to 12 hours a day, five days per week. He drove approximately 60 miles per day.