You will want to sit down when you read this.  A California appellate court handed down a decision last week involving 99¢ Only Stores that impacts virtually every California business.  The appellate panel ruled that California employers who don't provide employees with suitable seating may be sued in a class action type of suit for sizeable penalties.  Here is what happened.

Nearly every employer in the state is required to post a Wage Order.  If you haven't read it lately, you should.  Along with the other regulations about who gets overtime, when meal and rest periods must be provided, etc. is the "seat" rule.  That's right, there is a state regulation pertaining to employee seating.

In very simple language, it says:  "All working employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats."   It goes on to say, "When employees are not engaged in the active duties of their employment and the nature of the work requires standing, an adequate number of suitable seats shall be placed in reasonable proximity to the work area and employees shall be permitted to use such seats when it does not interfere with the performance of their duties."

That's simple enough.  If employees can sit while working, you have to provide them with a chair, stool or something to sit on.  If the employee's job requires standing  (say, they are a cashier at the grocery store, a front desk agent in a hotel or an assembler on an assembly line), then you need to have a place for them to sit nearby where they can rest when it does not interfere with their work.

Like so many other retail operations, 99¢ Only Stores have their cashiers standing by the cash register to check out customers.  An enterprising class action lawyer filed suit claiming the practice violated the seat rule.  The lawyer was seeking penalty damages (and his attorney's fees) under California's so-called Private Attorney General Act.  Known by its initials, the PAGA law enables private lawyers to act like the California Labor Commissioner and file suit over violations such as this, then split the bounty with the State.

The lower court threw the case out, claiming that the PAGA law didn't apply to this kind of case.  But, the appellate panel ruled the opposite way and has reinstated the case. This is big news because PAGA penalties are up to $100 per employee per pay period for an initial violation and up to $200 per employee per pay period for subsequent violations.  With the PAGA limitations period being one year, these penalties add up quickly.  And, the lawyer filing suit is entitled to collect his or her attorney's fees, if successful, from the employer being sued.

What is  worse, PAGA suits do not have to meet the rigorous standards for a class action, says the California Supreme Court.  Therefore, it's a lot easier for one employee to file one of these claims on behalf of all other employees.

The case is significant because it opens the door to similar PAGA suits over virtually every other rule in the Wage Order.  Are you in compliance with the coat closet rule?  How about the temperature rule or the rules on pay stub information, uniform maintenance or cash shortages?

The case is not over yet.  It remains to be seen whether the trial court will rule that the cashiers at 99¢ Only Stores must actually be provided a seat while working, or at least in between customers.  It is also possible that this ruling will be appealed to the Supreme Court.  There is also another similar case pending before a different panel of the Court of Appeal, and it possible that they rule the other way.  However, since the case could take years to resolve, employers statewide must decide what to do in the interim.

I suspect we will see a lot more of these cases being filed.  And, it's quite possible that other trial courts and appellate panels could look at these cases differently.  Until the legal dust settles (we have been awaiting a ruling from the Supreme Court on meal and rest breaks for more than two years), business owners will have to decide what to do.

If risk management is your thing, the first order of business is to sit down and read the Wage Order applicable to your business.  If you don't have a copy, you can get one from the Industrial Welfare Commission website (www.dir.ca.gov/Iwc/WageOrderIndustries.htm).  Not being aware of the many rules to be followed is like having a target on your back.  Once you get the basics, it is a good idea to review the company practices and policy with labor counsel, to be sure you got it right.