California Supreme Court to Employers: No More On-Call Rest Periods

Today, the California Supreme Court handed down its decision in one of the most-watched labor and employment cases of 2016.  In its opinion in Augustus, et al. v. ABM Security Services, Inc., S224853 (December 22, 2016), the Court held that employers may not require employees to remain "on-call" during required rest periods.  The decision, which reverses a Court of Appeal decision that was celebrated by many in the business community, may have enormous ramifications for California employers. 

In Augustus, a class of security guards sued their employer, ABM Security Services, Inc. ("ABM"), alleging the company failed to provide the rest periods that state law entitles employees to receive.  ABM required security guards to keep their pagers and radio phones on during rest periods and to remain vigilant and responsive to calls when needs arose.  The trial court granted summary judgment for plaintiffs, finding ABM liable and awarding approximately $90 million, but the Second District Court of Appeal reversed.  

On appeal, the Supreme Court reviewed California law regarding rest periods, including the Court's landmark Brinker decision from 2012, which held that employers must relieve their employees of all duties and relinquish any control over how employees spend their break time.  The Court held that "one cannot square the practice of compelling employees to remain at the ready, tethered by time and policy to particular locations or communications devices, with the requirement to relieve employees of all work duties and employer control during 10-minute rest periods."

Addressing ABM's argument that prohibiting on-call rest periods "requires an employer to categorically prohibit its employees from ever being recalled to work while they are on rest breaks," the Court held that "[n]othing in [its] holding circumscribes an employer‘s ability to reasonably reschedule a rest period when the need arises."  In such situations, employers may provide employees with another rest period to replace one that was interrupted or may pay premium pay according to law.

Importantly, the Court also declined to adopt a "reasonableness" standard proposed by ABM that would have required courts to determine whether an employer's requirement "unreasonably interferes with an employee‘s opportunity to take an uninterrupted rest period."

Any employer who requires employees to remain on-call should immediately review its rest period policies to ensure compliance with Augustus.  While the decision more obviously impacts employers offering security or emergency-response services, it may also apply to less-specialized categories of employees, such receptionists, customer service professionals, and salespersons.

Augustus is also another reminder that California law regarding rest periods and meal periods has evolved quickly in recent years.  Employers must remain "on-call, vigilant, and at the ready" to reevaluate their policies and procedures in response to new developments.

-Brian Lauter 

Brian Lauter is a Shareholder at Eanet, PC.  Eanet, PC is a boutique law firm focusing on business litigation, real estate litigation, labor and employment litigation, and corporate transactions.