The opinion of the court was delivered by: Dean D. Pregerson United States District Judge
ORDER GRANTING PLAINTIFF'S MOTION TO FILE A THIRD AMENDED COMPLAINT [Dkt. No. 29]
Presently before the court is Plaintiff Julian Ramirez Abad's Motion to File a Third Amended Complaint. Having considered the parties' submissions, the court adopts the following order.
Plaintiff proposes to amend his Complaint by expressly alleging that: (1)"holiday pay" should have been included in the calculation of the regular rate of pay; (2) Defendants had an unlawful meal period policy; (3) Defendants miscalculated meal period premiums because they did not include bonuses; (4)Defendants engaged in unlawful rounding;(5) Defendants inaccurately reported overtime on wage statements. Plaintiff also wishes to add Francisco Amaya as a named Plaintiff; Defendants do not oppose adding Amaya as a named Plaintiff.
Federal Rule of Civil Procedure 15(a), which governs requests for leave to amend pleadings, provides that the court should "freely give leave when justice so requires." Fed. R. Civ. P. 15(a). Leave to amend should be granted with "extreme liberality" in order "to facilitate decision on the merits, rather than on the pleadings or technicalities." United States v. Webb, 655 F.2d 977, 979 (9th Cir. 1981). Leave to amend should be freely given unless the opposing party makes a showing of undue delay, bad faith or dilatory motive, futility of amendment, or prejudice. Foman v. Davis, 371 U.S. 178, 182 (1962); see also Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 1989); AmerisourceBergen Corp. v. Dialysist W., Inc., 465 F.3d 946, 951 (9th Cir. 2006).
Defendants Waste Connections, Inc., Waste Connections of California, Inc., and Waste Connections Management Services, Inc. (collectively "Waste Connections") oppose the Motion, arguing that Abad's pleadings are "a moving target stemming from counsel's legal fishing expedition." (Opp. at 3, capitalization modified.) Abad responds that this accusation is "a red herring that is entirely without merit." (Reply at 2.) The court will not take the bait. It is hooked on the principle that leave to amend should be granted liberally and finds that Waste Connections' arguments do not fly.
The action is still in its early stages; no depositions have been taken, there is no trial date, and the class certification deadline is in mid-October. Additionally, Abad's new allegations derive from documents produced by Waste Connections in discovery in late December 2012.
Abad seeks to allege expressly that holiday pay is a form of non-discretionary pay that Defendants allegedly failed to include in the regular rate of pay for overtime purposes. Abad included the phrase "other forms of pay" in the Second Amended Complaint ("SAC"), and he asserts that the phrase comprises holiday pay but seeks to amend because Defendants have apparently refused to provide discovery into their holiday policy. (Reply at 11.)
Waste Connections argues that the claim is futile because holiday pay is statutorily excluded from the regular rate as a matter of law. Under the Fair Labor Standards Act, the regular rate does not include "payments made for occasional periods when no work is performed due to vacation, holiday, illness, . . . ." 29 U.S.C. § 207(e). California uses the federal definition of regular rate pay. See Advanced-Tech Sec. Services, Inc. v. Superior Court, 77 Cal. Rptr. 3d 757, 762 (Ct. App. 2008); RJN Exh. A, Division of Labor Standards Enforcement, Enforcement Policies and Interpretations Manual, 49.1.2.
The court finds that Abad should be able to conduct discovery on holiday pay and make the argument that it should be included in the regular rate. The label "holiday pay" is not dispositive. Hart v. City of Alameda, No. C-07-5845 MMC, 2009 WL 1705612 at *3(N.D. Cal. June 17, 2009)(holding that payments representing the value of a year's holidays but paid over the course of the year, rather than in the period when the holiday occurred, were not payments "due to a holiday"). Abad asserts that Waste Connections' "holiday policy" is not a true holiday policy because it requires that an employee work both the day before and the day after the holiday and therefore functions as an attendance bonus to encourage employees ...