The California Supreme Court recently ruled, in Augustus et al. v. ABM Security Services, Inc., that California law requires employers to relieve their employees of all work related duties and employer control during their 10 minute rest periods and that “on duty” rest periods are prohibited under Wage Order 4, subdivision 12(A) and Labor Code §226.7.
The putative class action was filed on behalf of security guards (“Guards”) who worked at ABM who were required to keep their pagers and radio phones on during their rest period per ABM’s policy. ABM’s rest period policy required the Guards “to remain vigilant and responsive to calls when needs arose.” ABM acknowledged the policy and plaintiffs moved for summary adjudication of their rest period claim.
ABM argued that the Guards were merely “on call” in case an incident required a response and provided evidence that class members regularly had rest periods uninterrupted from service calls. The trial court was not persuaded and granted summary adjudication in favor of the plaintiffs. In doing so, it reasoned that a rest period with “on call” responsibilities was indistinguishable from the Guards’ regular work day of responding to requests when needed. The trial court awarded $90 million in statutory damages, interest and penalties. The Court of Appeal reversed by concluding that “on call [d]oes not constitute performing work.”
The California Supreme disagreed with the Court of Appeals and reversed by relying on their previous ruling regarding meal periods in Brinker (infra 53 Cal.4th 1004) where employers must “relieve the employee of all duty and relinquish any employer control over the employee and how he or she spends the time.”(Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1038-1039 (Brinker). The court states that section 226.7’s parallel treatment of meal periods and rest periods creates distinct obligations of “duty free” periods. The Court highlighted the wage order specifically says that rest periods “shall be counted, as hours worked for which there shall be no deduction from wages.” The Court stated the excerpt only makes sense if the employee is relieved of all duties. Otherwise the wage order would simply require the payment of wages.
In concluding that the wage order and Labor Code require “duty free” rest periods, the California Supreme Court turned to whether “on-call” rest periods satisfy the requirement. The Court stated the short timeframe of the rest period means employees must remain on premises and “at the ready and capable of being summoned to action.” The obligation to be at the employer’s call prevented employees from using their rest periods for their own purposes (Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575, 585).
This ruling has a far reaching impact for employers with regards to the rest breaks of non-exempt employees. All rest periods of non-exempt workers which require on-call duty do not satisfy the requirements under the wage order or the Labor Code. Thereby, requiring the employer to provide premium pay set forth in Wage order 4, subd. 12(B) and section 226.7.
For more information regarding how this ruling may impact your business please contact Brandon Saxon at (619) 544-7229 or bsaxon@gordonrees.com or Andrew Deddeh at (619) 230-7706 or adeddeh@gordonrees.com.