California Supreme Court: On-Call Employees Required to Sleep on Employer’s Premises Must Be Paid

On January 8 the California Supreme Court held that security guards who spend eight hours of their 24-hour shifts sleeping on their employer’s premises must be paid for that sleep time, disapproving a 2011 appellate court decision holding that eight hours of on-call sleep time during 24-hour shifts need not be compensated. The new case is Mendiola v. CPS Security Solutions, Inc.

CPS Security Solutions employed guards to provide security at construction sites. CPS required the guards to live on-site in residential trailers equipped with beds, bathrooms, kitchens, heating and air conditioning. On weekdays, guards worked 16-hour shifts consisting of eight hours on patrol and eight hours on-call. On weekends, they worked 24-hour shifts consisting of 16 hours on patrol and eight hours of on-call “sleep time.”

During on-call shifts, guards were required to remain on site. They were not allowed to have children, pets, or alcohol on site, and had to obtain prior approval to receive adult visitors. CPS did not pay the guards for any on-call time unless they were asked to perform work.

In 2008 guards filed class action lawsuits, arguing that Industrial Welfare Commission Wage Order 4, which governed their work, required CPS to pay them for all the on-call time, including sleep time. The trial court agreed, finding all the guards’ on-call time was compensable “hours worked.”

CPS appealed, citing previous appellate decisions, including Seymore v. Metson Marine, Inc., a 2011 case approving the exclusion of “sleep time” based in part on a federal regulation (29 CFR 785.22) that authorizes employers to enter into agreements with employees working 24-hour shifts to designate up to eight hours as on-call “sleep time” and exclude it from compensable “hours worked.” The state appellate court agreed with CPS as to the sleep time issue, holding that CPS could exclude the sleep time from compensable hours worked.

The California Supreme Court held that all the guards’ on-call time—including the sleep time—constituted compensable hours worked under California law. The Court noted the absence of any language in Wage Order 4 justifying a sleep time exclusion (unlike Wage Order 9, which provides a sleep time exclusion for ambulance drivers and attendants). The court expressly “disapproved” Seymore v. Metson Marine as wrongly decided, finding no justification for incorporating the federal regulation into California law given California’s broader definition of “hours worked,” which includes not only working time but also time an employee is “subject to the control” of an employer.

This case is yet another reminder that California wage and hour laws differ from federal law in many important respects, and compliance with federal law does not necessarily protect an employer from wage claims brought under California law. Any company employing workers in California, especially companies based outside the state that may be less familiar with California wage laws, should review their wage practices on a regular basis.

Employers that schedule employees for unpaid on-call time should review whether the employees are sufficiently restricted such that they need to be paid, or the employees’ restrictions reduced, to meet the requirements of this new ruling.

Aaron BuckleyPaul, Plevin, Sullivan & Connaughton LLP – San Diego, CA

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