BILL ANALYSIS Ó SENATE COMMITTEE ON LABOR AND INDUSTRIAL RELATIONS Senator Tony Mendoza, Chair 2015 - 2016 Regular Bill No: SB 1344 Hearing Date: April 13, 2016 ----------------------------------------------------------------- |Author: |Stone | |-----------+-----------------------------------------------------| |Version: |February 19, 2016 | ----------------------------------------------------------------- ----------------------------------------------------------------- |Urgency: |No |Fiscal: |Yes | ----------------------------------------------------------------- ----------------------------------------------------------------- |Consultant:|Brandon Seto | | | | ----------------------------------------------------------------- Subject: Domestic work employees KEY ISSUE Should the Legislature allow certain domestic work employees, through agreement with their employers, to deduct a scheduled sleeping period from their pay? ANALYSIS Existing law Uses regulations created by the Industrial Welfare Commission (IWC) to determine the wages, hours, and conditions of labor and employment in the various occupations, trades, and industries in California (Labor Code §1173). Defines "Domestic work" as services related to the care of persons in private households or maintenance of private households or their premises. This includes childcare providers, caregivers of people with disabilities, sick, convalescing, or elderly persons, house cleaners, housekeepers, maids, and other household occupations (Labor SB 1344 (Stone) Page 2 of ? Code §1451). Defines a "Domestic work employee" as an individual who performs domestic work including live-in domestic work employees and personal attendants (Labor Code §1451). Requires wages to be paid for "hours worked" defined in IWC Wage Order No. 15 for household occupations, including domestic workers, as the time during which an employee is subject to the control of an employer, and all the time the employee is suffered or permitted to work, whether or not required to do so (IWC Wage Order No. 15, §2[H]). Existing federal law Permits under the federal Fair Labor Standards Act (FLSA), that an employer and employee may agree to deduct a bona fide regularly-scheduled sleeping period of not more than 8 hours from hours worked, provided adequate sleeping facilities are furnished by the employer and the employee can usually enjoy an uninterrupted night's sleep (Title 29, Part 785 of the Code of Federal Regulations, §785.22 [a]). Requires that if the sleeping period is interrupted by a call to duty, the interruption must be counted as hours worked. If interruptions prevent the employee from getting a reasonable night's sleep, which is considered to be five uninterrupted hours, the entire period must be counted. (Title 29, Part 785 of the Code of Federal Regulations, §785.22 [b]). This Bill Allows live-in domestic work employees or those on duty for 24 or more consecutive hours to enter into a written agreement with their employers to exclude a regularly-scheduled sleeping period from hours worked, and thus from employee pay. Lays down the following terms regarding the agreement: 1) The scheduled sleeping period should not be more than eight hours of uninterrupted sleep if the employee has eight hours free of duty and available for continuous, uninterrupted sleep. SB 1344 (Stone) Page 3 of ? 2) If the sleeping period is interrupted by an emergency, only time spent working during the emergency shall constitute hours worked. COMMENTS 1. Need for this bill? A recent California Supreme Court ruling in the case of Mendiola v. CPS Security Solutions, Inc., S212704 (2015) denied federal sleep time deductions for employees that fall under Wage Order No. 4 which shares similarities with Wage Order No. 15. The court determined that the federal sleep time deduction was not valid in this case because it is not specifically cited in the wage order itself. The ruling in the Mendiola case has created great uncertainty for home care agencies with employees who fall under Wage Order No. 15, which like Wage Order 4 does not cite the federal sleep time deduction. The author states that this bill is needed to fix the uncertainty created by the decision in the Mendiola v. CPS Security Solutions, Inc. case to ensure that those providing care under Wage Order No. 15 are able to utilize a sleep time exemption similar to the one allowed in the federal Fair Labor Standards Act. 2. Background on the Mendiola v. CPS Security Solutions, Inc. Case This case came about when security guards employed by CPS Security Solutions, Inc. filed a class-action lawsuit alleging that the 24-hour shifts and on-call time required by the company constituted "hours worked" under Wage Order No. 4. During these shifts the guards were required to reside in company trailers on their job sites. The California Supreme Court examined whether the guards were entitled to compensation for these on-call hours and if sleep time could be excluded from their hours worked. These guards worked a weekday shift that consisted of patrol for 8 hours, followed by 8 hours of on-call time, and finally 8 hours off-duty. On weekends they patrolled for 16 hours and SB 1344 (Stone) Page 4 of ? then were on-call for 8 hours. At the heart of this matter, was the issue of employer control as part of the "hours worked" definition specified in Wage Order No. 4 for CPS's workers, and also specified in Wage Order No. 15 as the time during which an employee is subject to the control of an employer. The issue of employer control in defining "hours worked" revolves around the possibility that although an employee may not be working at a given time in a shift, they are still subject to regulation, restriction, and engagement by their employer. This means that they often must abide by certain standards, including requirements about their physical location at their place of employment even if they are not actually on-duty. Also, the fact that employees might be called to work even if they are on-site, but off-duty creates another possible type of employer control. In the Mendiola case, nearly all of these aspects of employer control occurred. CPS required its on-call guards to reside in a company trailer and imposed numerous restrictions on a guard's activities and movements throughout their entire 24-hour shifts. CPS also paid guards an hourly rate for their time spent on patrol but not for on-call or sleep time unless the guard was engaged to work because of something like a disturbance that required their attention or investigation. Because of these many restrictions, and the fact that the guards spent their on-call time primarily for the benefit of the company by remaining on-site as a deterrent, the court determined that all time that the guards spent on-call should be compensated by CPS. This is due to the fact that the employers exercised control over these employees during these times, which qualifies as "hours worked" under Wage Order No. 4. The court also ruled that CPS could not utilize the federal FLSA sleep time exemption, even though the employees worked a 24-hour shift, because Wage Order No. 4 does not expressly authorize it. Therefore, CPS had to pay its guards for time designated for sleep. 3. This Bill's Relationship with Federal Law SB 1344 (Stone) Page 5 of ? Wage Order No. 15, which covers domestic workers, is very similar to Wage Order No. 4 regarding the issues in question in the Mendiola case. Wage Order No. 15 includes the definition of "hours worked" that includes times when an employee is under an employer's control. Neither wage order specifies a sleep time exemption. The author would like to include a sleep time exemption for domestic workers based on the one allowed under federal law. However the author's language in the bill differs from federal standards regarding sleep time exemptions: 1) Title 29, Part 785 of the Code of Federal Regulations, §785.22 (a) permits an employer-employee agreement to exclude sleep time provided adequate sleeping facilities are furnished by the employer and the employee can usually enjoy an uninterrupted night's sleep. This condition is not specified in this bill. 2) Although the bill states that under these agreements if sleep is interrupted by an emergency, only time spent working during an emergency can be compensated, Title 29, Part 785 of the Code of Federal Regulations, §785.22 (b) states that if the sleep period is interrupted to such an extent that the employee cannot get a reasonable night's sleep, the entire period must be counted. 3) This bill does not take these conditions or possible employer control into consideration. An employee party to an agreement described in the bill has no guarantees for any minimum amount of required sleep time. The bill states that an employee must have eight hours available to sleep, but not does ensure that an employee will sleep for any set portion of that time or be compensated fully for possible interrupted sleep. o In this scenario, an employee could potentially be woken-up to attend to an emergency multiple times during their scheduled sleep period. Even if those interruptions lasted for only a brief time, the employee may not have gotten a reasonable night's sleep or received adequate compensation. SB 1344 (Stone) Page 6 of ? 4. Proponent Arguments : Proponents believe that this bill permits both home care agencies and their aides to provide affordable 24-hour live-in care for seniors and other frail Californians. Seniors depend on private home care services to stay healthy in their own homes and to avoid institutionalization. Their specific and unique needs require flexibility in how a home care provider can best provide that care. This has been accomplished through exemptions in labor law, which keeps the cost of care affordable. SB 1344 would fix the uncertainty created by the Mendiola case and would ensure that those who provide care under Wage Order No. 15 are able to continue using the sleep time deductions specified under the federal Fair Labor Standards Act. 5. Opponent Arguments : Opponents argue that many domestic workers are routinely woken throughout the night and expected to be alert and responsive to their employer's needs around-the-clock. Live-in workers often do not get enough sleep, which increases their susceptibility to illness and injury, while harming their ability to give optimal support to their employers. Opponents state that SB 1344 proposes to make the current situation even worse by allowing individual domestic workers to sign agreements waiving their right to be paid for time they are on the employer's premises, subject to the employer's control, and required to respond at a moment's notice. Opponents claim that characterizing these agreements as a voluntary choice ignores both the unique vulnerability of many domestic workers and the tremendous power imbalance in many of these employment settings. In reality, many workers would be compelled or forced to sign away these rights and would forfeit both their wages and freedom. 6. Prior and Related Legislation : SB 1015 (Leyva), currently referred to the Senate Appropriations Committee - deletes the January 1, 2017, sunset SB 1344 (Stone) Page 7 of ? date of the Domestic Worker Bill of Rights. AB 241 (Ammiano), Chapter 374, Statutes of 2013 - enacted the Domestic Worker Bill of Rights to, until January 1, 2017, regulate the hours of work of certain domestic work employees and provide an overtime compensation rate for those employees. Also, this bill defined various terms for the purposes of the act, including defining domestic work to mean services related to the care of persons in private households or maintenance of private households or their premises. SUPPORT California Association for Health Services at Home (Sponsor) Luxe Homecare, Inc. (Co-Sponsor) 1-Individual OPPOSITION American Federation of State, County and Municipal Employees, AFL-CIO California Domestic Workers Coalition Service Employees International Union United Domestic Workers of America-AFSCME Local 3930, AFL-CIO -- END --