Employers Finally Get a Break—Court Reverses $90 Million Verdict and Holds That Employers Are Not Required to Relieve Employees of All Duty During Rest Periods

On December 31, 2014, the Court of Appeal for the Second District of California held in an unpublished opinion that employers are not required to relieve employees of all duty during rest periods mandated by California state law.  In so holding, the court in Augustus v. ABM Sec. Servs., Inc., No. B243788, 2014 WL 7463154 (Cal. Ct. App. Dec. 31, 2014), reversed the trial court’s award of approximately $90 million dollars in statutory damages, interest, penalties, and attorneys’ fees to the employees.

The plaintiffs in Augustus, former security guards employed by defendant ABM, sued ABM on behalf of themselves and a class of similarly situated individuals, alleging that ABM failed to provide rest periods required by California law in that it failed to relieve security guards of all duties during rest breaks, instead requiring its guards to remain on call during breaks.  After a class was certified, the plaintiffs moved for summary adjudication of their rest period claim based on undisputed evidence that ABM security guards were required keep their radios and pagers on during rest breaks, to remain vigilant, and to respond as needed, including to emergency situations.  According to the plaintiffs, ABM’s requirements rendered the rest breaks per se invalid.  The trial court agreed, holding that a rest period must not be subject to employer control.  Thereafter, the trial court granted the plaintiffs’ motion for summary judgment on their damages claim, awarding plaintiffs approximately $90 million.

The Court of Appeal reversed.  The court first examined the language of the relevant statute and Wage Order (California Labor Code Section 226.7 and Industrial Welfare Commission Wage Order No. 4), finding that they stated only that an employee cannot be required “to work” during a break.  The court then held that simply being on-call does not constitute performing “work.”  Here, the security guards, although on call, were otherwise permitted to engage and did engage in various non-work activities, including smoking, reading, making personal telephone calls and surfing the internet.   The court stated that “remaining available to work is not the same as actual working.”  As further support for its holding, the court pointed to Wage Order No. 4’s language requiring that an employee be “relieved of all duty” during a meal period.  The court held that this language made clear that if the legislators wanted to prescribe that an employee be relieved of all duty during a rest period, they could have done so.  That they did not indicated that no such requirement was intended.

Although the court’s opinion in Augustus is unpublished its reasoning is persuasive and it should deter plaintiffs’ lawyers from making the argument that on-call rest breaks are per se impermissible in the future.