A class action lawsuit set to be heard before the California Supreme Court could have wide reaching implications for the guard industry in the state. At issue in Mendiola v. CPS Security Solutions is whether or not security guards assigned to work at construction sites - 16-hour shifts on weekdays and 24-hour shifts on weekends - are entitled to be compensated for so-called "sleep time" in which they are required to reside in trailers provided by their employer on the jobsite enabling them to attend to any alarms and to help prevent vandalism and theft.
As a condition of their employment, these guards are required to sign an on-call agreement which designates eight hours a day – generally 9 p.m. to 5 a.m. – as the time in which they are required to stay in trailers on the jobsite. Guards are paid for time in which they’re interrupted during these hours and they can also ask for permission to leave, according to Howard Knee, an attorney with the law firm of Blank Rome LLP, which is representing CPS in the case.
"They get paid for anytime that they’re interrupted so that’s not an issue, but the issue is are they entitled to be paid for the time when they’re not interrupted - when they are sleeping, eating, watching television, reading on the Internet, or whatever they’re doing in their trailers?" said Knee. "If somebody wants to leave the jobsite, they can call dispatch and they’re either given permission to leave or, if they’re not given permission to leave, then they’re paid from the moment they request to leave going forward from the rest of the sleep time."
Attorneys working on behalf of the guards in this case, however, paint a not so flattering picture of this on-call agreement. In a brief submitted to the court, the guards attorneys’ call CPS’ assertion that trailer guards are at the construction site "voluntarily" a "red herring."
"Prisoners assigned to work programs are not 'voluntarily' at work. Persons who are enslaved are not 'voluntarily' at work," they wrote in the brief. "CPS Trailer Guards, like all other 'free laborers,' do what their employer tells them to do, and stay at the jobsite when the employer tells them to stay at the jobsite, voluntarily but with the understanding that the likely price of disobeying an employer’s directives will be loss of employment."
For its part, CPS’ attorneys fired back by saying this analogy was a "use of hyperbole" which "demonstrates the weakness of their position."
According to Knee, there are essentially a few questions before the court.
"One is whether they’re sufficiently under the control of the employer because they are permitted to leave or get paid, so that the time in the trailer constitutes hours worked so that’s compensable," explained Knee. "Even if these hours worked are compensable, can the employer and the employee agree to exclude the eight hours of sleep time from compensable hours worked by agreement. Those are the issues that are before the California Supreme Court."
Cathe L. Caraway-Howard, one of the attorneys representing the guards in this case, said that one of the flaws in CPS’ argument is that this on-call period is not sleep time.
"As we’ve argued over and over, yeah they get to sleep for some of it, but if the alarm goes off they have to respond immediately in uniform and go check out what’s going on," said Caraway-Howard. "That could happen at any time during this so-called sleep time. CPS has called this period of eight hours a variety of things. They’ve given it multiple labels. Sleep time is the most recent one because they latched onto this argument."
Additionally, Caraway-Howard said that the California Supreme Court has ruled in previous cases that state wage laws prevail over federal laws that provide less rights for California workers. She said the problem with the appeals court decision is that they imported this sleep time agreement exemption from federal case law into their ruling.
This lawsuit, which was initially filed in 2008, has seen varying legal opinions issued by the courts. A lower court judge granted a motion of summary judgment in favor of guards. However, when the case was heard by the appellate court, they ruled in favor of CPS when it came to weekends when guards are required to be onsite for 24 hours, but they ruled in favor of the guards when it came to weekday shifts.
Because many construction and guard firms throughout California have the same business model as CPS, Caraway-Howard believes that these businesses will have to make adjustments in how they handle their labor costs moving forward.
"Already from the fact that the plaintiffs in this case prevailed on their issues for the time that (the guards) were scheduled for less than 24-hour shifts, the industry has to already adjust to that. Of course, that is exactly what the defendants have appealed -- that part of the decision," added Caraway-Howard. "I think there’s going to be some adjustments, but as I see it when overtime rules are limited that means they could give more people jobs, because now if it costs them so much to have someone there on a 16-hour shift, and not be able to make it on-call time for eight of those hours, and therefore have to pay that overtime, they can’t have that savings anymore. The question is does it cost them more or less to have two guards cover those 16 hours?"
Caraway-Howard said that there were more than 1,800 people who were officially certified as a part of this class action group in 2009. When taking into account that the back wages sought in this case go back to May 2004, with penalties and interest, a judgment for the guards could be well in excess of $50 million.
In terms of the impact that this case could have on guard services providers in California, Knee said if the court rules in favor of the guards then it may make providing this level of service at construction sites cost prohibitive.
"I think if we were required to pay every guard for all of the time that they spend in their trailers that the cost of providing that type of guard service to clients would be prohibitive," said Knee. "We put in our brief, I believe, that a ruling in favor of guards wouldn’t mean that the guards get paid more money, it would mean that there would be no more guards of this type."