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Labor Law Class Action Defense Cases–Isner v. Falkenberg: California Court Affirms Summary Judgment In Favor Of Defense In Labor Law Class Action Holding Resident Employees Need Only Be Compensated For Carrying Out Assigned Duties

Class Action Alleging Failure to Pay Resident Employees for Time Spent “On Call” though not Performing Assigned Tasks Properly Subject to Summary Judgment in Favor of Defense California State Court Holds

Plaintiffs filed a putative labor law class action against their former employer, a property management company, alleging inter alia that it had failed to pay them for overtime and waiting time; specifically, the class action complaint alleged that defendant failed to pay its “resident employees” for “on-call” time. Isner v. Falkenberg/Gilliam & Associates, Inc., 160 Cal.App.4th 1393, 73 Cal.Rptr.3d 433, 434 (Cal.App. 2008). The class action alleged that the resident employee employment agreement signed by plaintiffs required that they be on call “on designated evenings from 5:00 p.m. until 8:00 a.m. and on designated weekends from 5:00 p.m. Friday evening until 8:00 a.m. Monday morning.” The agreement further required employees to “remain on the facility premises within hearing distance of the emergency alarms systems and telephone” while on call, but provided that they were “otherwise free to use on-call time as he or she chooses.” Id. The appellate court explained, “The gravamen of the complaint was that these resident employees were entitled to payment not just for the hours they spent responding to emergencies while on call, but for all the hours they were on call and thus confined to their apartment or the building office so as to remain within audible range of the telephone and alarm.” Id., at 436. Defense attorneys moved for summary judgment arguing that plaintiffs were entitled to wages only for time spent on the job; the trial court agreed that payment was due only for work “actually performed” and, accordingly, granted summary judgment on the class action complaint. Id. The appellate court affirmed.

The pertinent facts established that resident employees were allowed to arrange for another resident employee to “respond to emergency calls with the Employee, or in the place of the Employee” and that employees would be paid for “[a]ll time spent in responding to emergencies.” Isner, at 434. Moreover, if emergencies prevent an employee from obtaining 5 hours of “uninterrupted sleep,” then defendant agreed to “credit Employee with eight hours’ time worked under the terms of [the agreement].” Id., at 435. Plaintiffs were given an apartment to live in, and at least one of them stayed within range of the alarm and telephone while on duty or on call. Id. “While [plaintiffs] were on duty and on call, they slept, ate, talked on their personal telephone, used the internet, played computer games, read magazines or watched television in their apartment when they were not responding to an emergency.” However, while on duty or on call, plaintiffs could not go to the pool or walk around the apartment, because they would be unable to hear the alarm or telephone, and they could not leave the apartment. Id. It was plaintiffs’ responsibility to keep track of and bill their time with respect to “both their usual eight-hour work day and times spent responding to emergencies,” id. And while defendant permitted them to bill all time spent on the job, plaintiffs generally “recorded only the calls that took 15 minutes or more.” Id., at 435-36. “[T]here was never an occasion when [plaintiffs] were not paid for time they recorded on their time sheets.” Id., at 436.

Preliminarily, the appellate court rejected plaintiffs’ claim that issues of fact precluded summary judgment, concluding that “the motion presents purely legal issues.” Isner, at 437. Specifically, “The legal dispute turned on the proper interpretation of the Industrial Welfare Commission’s Wage Order No. 5, which provides in pertinent part that ‘in the case of an employee who is required to reside on the employment premises, that time spent carrying out assigned duties shall be counted as hours worked.’” Id. (italics in original). After noting that the DLSE interprets “hours worked” by resident employees as “only the time spent performing physical, mental or other specified tasks,” id., at 437-38, the appellate court found persuasive that plaintiffs were “free to sleep, eat, talk on the telephone, use the internet, play computer games, read for leisure and watch television while they were not responding to an emergency, so long as they remained available to respond (i.e., within audible range of the telephone and alarm),” id., at 438. The Court held that plaintiffs were entitled to compensation only “for the time they spent carrying out assigned duties, i.e., responding to emergency calls,” but not “for the time they were able to attend to personal matters while remaining available to respond to emergency calls.” Id. Accordingly, the Court of Appeal affirmed the grant of summary judgment in favor of the defense. Id., at 439.

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