California has the most stringent meal and rest break rules in the country. If an employee’s break is not taken within the proper time, is not long enough, or is interrupted, the employer is subject to a one-hour penalty. It’s one thing to impose a penalty on employers for not providing a mandated break. But imposing a penalty because the break is minutes late creates absurd situations.

Copyright: gajus / 123RF Stock Photo
Copyright: gajus / 123RF Stock Photo

Here’s just one example. Nonexempt employees get a 10-minute rest period every four hours or “major fraction thereof.” So an employee who works 10 hours gets two rest periods (plus a meal break). But if the employee works past 10 hours, she becomes entitled to a third rest period. If she isn’t offered it, the employer owes her a one-hour penalty. Suppose the employee goes to her supervisor and says that she worked a bit past the 10-hour mark and she’s ready to go home. The supervisor asks if she’s taken a third rest period and she says “No.” The supervisor then has to offer her a 10-minute rest period. The employee obviously doesn’t want or need a rest period. She’d rather just go home. But if the employer doesn’t offer her the break, it owes her for an additional hour.

Every other jurisdiction manages to see that employees receive breaks without these overly restrictive and punitive provisions. If anything, the situation is getting worse with the recent decision in Augustus v. ABM Security emphasizing that employers must not only “relieve their employees of all duties” during their breaks, but must also “relinquish any control over how employees spend their break time.” So don’t expect the number of class action lawsuits against California employers to decrease anytime soon.

I hope you’ll join my Fox colleagues Keith Chrestionson and Jaemin Chang and me on January 27 for the next in our series of breakfast briefings in our San Francisco office.  Our breakfast series explores various topics of interest to the Bay Area’s business communities in informal presentations and interactive Q&A sessions.  This session will focus on new California laws and local ordinances that are most likely to affect employers throughout the state, including:

  • Legalization of marijuana and its effect on the workplace
  • Amendments to the California Fair Pay Act
  • “All gender” bathrooms
  • New rules for meal and rest periods
  • Domestic violence leave
  • Expanded prohibitions on smoking at work
  • State disability and paid family leave benefits
  • Local ordinances (parental leave, minimum wage)

The event will take place at:

345 California Street
Suite 2200
San Francisco CA 94104-2670
(View Google Map)

The presentation and Q&A session will begin at 8:30 a.m., followed by a networking reception at 9:30 a.m. Breakfast and refreshments will be served.  Please register here by January 25.

Let’s pick up where we left off. In our last post of 2016, I was complaining about the California Supreme Court’s decision in Augustus v. ABM Security Services, Inc. The majority opinion in that case said that employees who were required to carry phones or pagers on their rest breaks, even if they didn’t get called or paged, were deprived of their statutory breaks and were therefore owed a one-hour penalty. While I found plenty to complain about in that decision (I’m good that way), there’s another issue I want to address.

Copyright: bruno135 / 123RF Stock Photo
Copyright: bruno135 / 123RF Stock Photo

The third sentence of the decisions says: “During required rest periods, employers must relieve their employees of all duties and relinquish any control over how employees spend their break time.” The language comes from Brinker Restaurant Corp. v. Superior Court, which dealt with meal periods. But what does it mean? Are employees exempt from substance abuse, dress code, firearm possession, and harassment prevention policies during breaks? Stated differently, is the employer powerless if workers use their break time to get drunk, strip off their clothes, and chase co-workers around the workplace with guns demanding sexual favors? I’d like to think that the answer is “no,” but Augustus, in interpreting the wage orders, urges us to give language its “plain and commonsense meaning,” If that’s what we’re supposed to do, it would be nice if the courts chose their words with a little more care. The penalties for not complying with wage and hour laws are draconian enough without the laws being too vague for employers to know what’s expected.

The worst aspect of California employment law is the way it combines unclear requirements with exorbitant penalties for noncompliance. So employers can’t necessarily tell what the law requires and, if they get it wrong, face crippling financial penalties. The latest illustration of that principle comes from the California Supreme Court’s December 22, 2016 opinion in Augustus v. ABM Security Services, Inc.

The plaintiffs in this consolidated class action worked as security guards and were required to keep their pagers and radio phones on during their 10-minute rest periods and to respond when needs arose. ABM argued that it was providing a sufficient rest period. But the trial court disagreed and decided on plaintiffs summary judgment motions that they were not relieved of all duty and that they were therefore entitled to $90 million in damages, interest, and penalties (the penalty for missing a 10-minute rest period being an hour of pay).

ABM appealed and the Court of Appeal reversed, holding that being on call does not constitute performing work. Then the California Supreme Court granted review and reversed the Court of Appeal, reinstating the $90 million judgment.

The Industrial Welfare Commission Wage Orders clearly state that employees must be “relieved of all duty” during meal periods. But there is no corresponding language in the rest period requirement. Instead, the majority opinion intuited that employees must be relieved of all duties during rest periods from analyzing the definition of “rest.” The court also looked at Labor Code §226.7, which prohibits employers from requiring employees to work during rest periods. Finally, the court focused on the fact that the Wage Orders make provisions for on-duty meal periods, but not for on-duty rest periods. That being the case, it reasoned, on-duty rest periods must not be allowed.

Copyright: twinsterphoto / 123RF Stock Photo
Copyright: twinsterphoto / 123RF Stock Photo

All of this begs the question whether being required to carry a radio or pager constitutes work. The majority opinion states that employees are not relieved of all duties if they’re required to be on call. This conclusion, it notes, is the most consistent with its interpretation of the Wage Orders and Labor Code and with the axiom that those sources should be construed in a manner to protect employees.

A two-justice dissenting opinion explained that the “the bare requirement to carry a radio, phone, pager, or other communication device in case of emergency does not constitute ‘work’ in any relevant sense of the term.” This was especially true, the dissent noted, given the lack of any evidence that any guards’ rest breaks ever were, in fact, interrupted. The dissent also explained that the majority opinion creates further ambiguity by saying that the employees in question were deprived of their rest periods where they were required to “remain on call, vigilant, and at the ready during their rest periods.” If requiring employees to be “vigilant” and “at the ready” is part of what made these rest periods inadequate, the dissent asked, shouldn’t the court explain what that means? Or do we need another decade’s worth of class-action litigation to sort that out, too?

Here are steps employers should take now to comply with this decision:

  • Prohibit employees from carrying employer-provided pagers, radio phones, or similar communication devices at work.
  • In most situations, you should not prohibit employees from using their personal mobile phones on rest breaks, since the time is their own and they must be free from employer control. But you should not require them to monitor their phones.
  • If an employee’s rest period is interrupted with work requirements, either provide a different uninterrupted 10-minute rest period (you could start the 10 minutes running again after the interruption) or pay the penalty.
  • If, as the employer, you exercise any control over what employees can do during their rest periods, consult counsel as to whether that practice is still defensible.

If an employee is required to be available by radio, pager, mobile phone, or the like on a rest break, does it count as a rest break? Like so much of California employment law, it depends on whom you ask.

We previously reported on Augustus v. ABM, where the court of appeal answered that question: “Yes,” explaining that requiring someone to be available to work wasn’t the same as requiring them to work. In fact, we got a little glib about starting off the new year with good news.

Now, the California Supreme Court has granted review and will decide the issue anew. So, for now, the answer to the question is a clear “Maybe.”

Takeaways:

Copyright:  / 123RF Stock Photo
Copyright: / 123RF Stock Photo
  1. The conservative response to this development would be to have employees, whenever practicable, hand-off their communication devices (other than personal cell phones) during rest breaks.
  2. The standard for meal periods is different. There’s no question for meal periods that employees must be “relieved of all duty.”
  3. Anytime I use “California,” “employment law,” and “good news” together in a sentence, assume that we’re just waiting for the other shoe to drop.
damedeeso
damedeeso

While the 2012 California Supreme Court decision in Brinker clarified some of the landscape for meal and rest period litigation, break requirements continue to give rise to more than their share of class action claims.

In Augustus v. ABM, security guards filed suit in Los Angeles in 2005 arguing that they did not receive adequate rest breaks because they were required to carry radios and be available, if necessary. In 2012, the plaintiff’s moved for summary judgment arguing that the evidence was undisputed that ABM violated the law and that they were entitled to damages, interest, and penalties totaling $103.8 million. Despite the absence of any evidence that anyone’s rest period had actually been interrupted, the superior court granted the motion and awarded plaintiffs $89.7 million.

ABM appealed and the appellate court, in an unpublished opinion, reversed. The appellate court explained that Labor Code § 226.7 said that “[a]n employer shall not require an employee to work during a meal or rest or recovery period.” (The statute has since been amended to include recovery periods to prevent heat illness.) But requiring someone to work is different than requiring them to be available. In addition, while the wage orders clearly state that employees must be relieved of all duties during meal periods, they contain no such requirement for rest periods. So according to the appellate court, employees need not be relieved of all duties during rest periods.

Because the decision is unpublished and can still be taken up for review, this may not be the final word on the topic. [On January 29, 2015, the case was ordered to be published.] Still, it’s nice for our first post of 2015 to be good news for employers.

From the employer’s perspective, the only way to truly “win” an employment case is to avoid it in the first place. We litigators love the thrill of gettting a judge, arbitrator, or jury to decide in our client’s favor. But it can be awfully expensive to get to that point. So without further ado, here are ten commandments for avoiding employment litigation in California.

I. Thou shalt pay employees for all hours worked and provide them their breaks. It’s hard to think of a large employer in California that hasn’t spent gobs of time and money litigating this issue.

II. Thou shalt not treat nonexempt employees as exempt. This is another wage and hour issue that has given rise to thousands of class action claims.

III. Thou shalt not treat employees as independent contractors. Multiple government agencies are reviewing this issue in an effort to collect unpaid taxes.

IV. Thou shalt engage disabled employees in the interactive process. This is one of the hot areas in employment litigation. Failure to comply is, by itself, a violation of the Fair Employment and Housing Act.

V. Thou shalt pay attention to the unique legal requirements of the localities thou operates in. Following federal law isn’t enough. Even following California law isn’t enough if you’re operating in a locality, like San Francisco, with its own requirements.

Moses with the Ten Commandments VI. Thou shalt train thy managers to comply with applicable laws. Having the best policies in the world won’t protect a company if its managers don’t know how to implement them or whom to turn to with issues. This is especially true for harassment training (which is mandatory in California for employers with 50 or more employees).

VII. Thou shalt properly document the steps thou takes. I completed an arbitration last week that, because an issue went up on appeal, took place four years after the decisions in question. Notes of key conversations are critical in these situations.

VIII. Thou shalt require employees to waive class actions and arbitrate disputes. The law is now clear in California that, with an appropriate arbitration agreement, you can require employees to waive their right to class-wide relief. There are still open issues regarding collective actions under California’s Private Attorney Generals Act, but protection against class actions can still be of great value.

IX. Thou shalt provide employees an up-to-date employee handbook.

X. Thou shalt stay up to date regarding ever-changing legal requirements. One way to do that is to subscribe to this blog.

Another way to avoid litigation is to consult an employment lawyer (like me or my colleagues) before making decisions that may result in litigation. It’s frustrating to see companies spend years and hundreds of thousands of dollars litigating issues that could have been avoided with a phone call. So next time you confront these issues, make the call!

One of the new laws for 2014 is SB 435, which requires one hour of premium pay for an employer’s failure to provide additional rest breaks to serve as heat recovery periods for employees who work outdoors.  Cal-OSHA regulations require that employees who work outdoors in temperatures exceeding 85 degrees be allowed and encouraged to take a cool-down rest period of 5 minutes to avoid overheating.  Therefore, employers who do not comply with this regulation can be subject to claims for failure to provide rest breaks and/or to pay the one-hour premium for missed rest breaks.

The question that has come up for many businesses is whether this new law applies to their employees who may occasionally work outside.  For example, some of my hospitality clients want to know if the heat recovery rest break rules apply to employees who work an outside catering event, or to servers who work by the pool, or to an engineer who may do some painting or repair work outside.

While I originally posted back on February 24, 2014, that these heat recovery rules do not apply to the hospitality industry; I was mistaken. While the high-heat (over 95 degrees) Cal-OSHA heat recovery regulations only apply to certain industries (Agriculture, Construction, Landscaping, Oil/Gas Extraction, and certain Transportation/Delivery services), the remaining portions of the regulations apply to any business with outdoor employees when the temperature exceeds 85 degrees.

These regulations require employers to provide water and shaded areas big enough to accommodate 25% of the outdoor workforce, and to allow employees to take paid rest breaks in the shade for up to five minutes as needed to prevent over-heating. Other cooling measures, such as misters, can be provided in the employer can show they are as effective as shade.

Employers also have some to-do items arising from this new regulation including:

  • Add a heat recovery rest break policy to your employee handbook.
  • Add a heat recovery section to your IIPP (Injury and Illness Prevention Program).
  • Include in that IIPP a protocol for training managers who oversee outdoor employees to ensure compliance.

As summer approaches, employers should ensure that their policies are updated, and that their managers are trained on those outdoor procedures and apply them to any situation where employees are working outside in temperatures over 85 degrees in any industry.

 

 

Meal and rest period class actions haven’t gone away since the California Supreme Court issued its Brinker decision. While it’s become harder for plaintiffs to get classes certified, there’s an approach they’ve been using more and more often.

Most employers realize the importance of policies that specifically inform employees of the breaks that they’re provided. But plaintiffs have been arguing that policies and practices are two separate things.

While policies are an important first step, employers need to ensure that they’re actually followed. The best policy in the world won’t save you if staffing, scheduling, work assignments, or pressure from supervisors prevent employees from taking the breaks they’re entitled to.

Six cases that had been in grant and hold status with the California Supreme Court pending the decision in Brinker v. Superior Court were all transferred back to their respective Courts of Appeal today.  The six cases are: Brinkley v. Public Storage, Faulkinbury v. Boyd & Associates, Brookler v. Radio Shack Corp., Tien v. Tenet Healthcare, Flores v. Lamps Plus, and Hernandez v. Chipotle.  In all six cases, the Courts were instructed to vacate their prior decisions and reconsider the actions in light of the Brinker decision. 

Of these six cases, only Brookler found that a meal period class was appropriate, citing to the case of Cicairos v. Summit Logistics for the proposition that employers have an affirmative duty to ensure the employee is relieved of all duty during a meal period. In contrast, the other cases all found that meal period classes were inappropriate, generally holding that an employer’s duty was only to provide meal periods to employees, not ensure that they were taken. However, in Faulkinbury, the Court denied class certification to the meal period class because there was a lack of common issues due to the many site-specific circumstances affecting the employees’ ability to take their meal periods. 

While the appellate courts are obligated to follow the state supreme court’s holding, the real impact of the Brinker decision will now be felt as the Courts apply that holding to the specific issues before them.  We will provide updates on these cases as they become available.