In Mendiola v. CPS Security Solutions, ___ Cal.4th ___ (January 8, 2015), the California Supreme Court upheld the order of the Los Angeles County Superior Court (Judge Johnson) granting summary judgment in favor of plaintiffs on their declaratory relief claim that defendant employer’s “on-call” compensation policy violated state minimum wage and overtime obligations.
Plaintiffs were employed as security guards at construction worksites. In addition to working full shifts, each guard was required to spend eight hours of “on-call” time in a trailer at his or her respective worksite. Guards could keep personal items in the trailers and generally use on-call time as they chose. However, children, pets, and alcohol were not allowed, and adult visitors were permitted only with the approval of defendant’s client. An on-call guard wanting to leave the worksite had to notify a dispatcher and indicate where he or she would be and for how long. If another employee was available for relief, the guard had to wait onsite until the reliever arrived. If no reliever was available, the guard had to remain onsite, even in the case of a personal emergency. If relieved, a guard had to be accessible by pager or radio phone and to stay close enough to the site to return within 30 minutes. Guards received no compensation for on-call time unless (1) an alarm or other circumstances required that they conduct an investigation or (2) they waited for, or had been denied, a reliever.
Accordingly, plaintiffs filed class action suits that alleged, inter alia, that defendant’s on-call compensation policy violated minimum wage and overtime obligations imposed by the applicable Industrial Welfare Commission (IWC) wage order and Labor Code. After the trial court certified the class, both sides sought declaratory relief as to the lawfulness of defendant’s s on-call compensation policy and filed cross-motions for summary adjudication of the claim. The trial court granted plaintiffs’ motion, concluding that the on-call hours constituted compensable “hours worked” within the meaning of California law. Defendant appealed and the appellate court affirmed, but reversed as to hours the Guards spent sleeping. The appellate court concluded that a federal regulation which permits the exclusion of eight hours of sleep time from employees 24-hour shifts is incorporated into the California Wage Orders.
The California Supreme Court agreed with the trial court, holding that plaintiffs were entitled to compensation for all on-call hours – including hours spent sleeping – at their assigned worksites because this time constituted “hours worked” within the meaning of the applicable wage order (Wage Order 4). The court first noted that “California courts considering whether on-call time constitutes hours worked have primarily focused on the extent of the employer’s control.” Here, that control was evident, as the guards were required to “reside” in their trailers as a condition of employment and spend on-call hours in their trailers or elsewhere at the worksite. They were obliged to respond, immediately and in uniform, if they were contacted by a dispatcher or became aware of suspicious activity. Guards could not easily trade on-call responsibilities. They could only request relief from a dispatcher and wait to see if a reliever was available. If no relief could be secured, as happened on occasion, guards could not leave the worksite. Defendant also exerted control in a variety of other ways. Even if relieved, guards had to report where they were going, were subject to recall, and could be no more than 30 minutes away from the site. Restrictions were placed on nonemployee visitors, pets, and alcohol use. Finally, this on-call time was spent primarily for the benefit of Defendant. The fact that plaintiffs were also free to engage in their own pursuits during on-call time did not change the nature of this control. As for the time spent sleeping, the court held that there was no exclusion provided for this in Wage Order 4.