February and March 2020 employment law decisions

Employees must be paid for shifts for which they make themselves available to work.

March 19, 2020, Ninth Circuit Court of Appeals, Alexia Herrera v. Zumiez, Inc.: California law requires employers to provide “reporting time pay” to retail employees who report for work but are not actually provided work. Ms. Herrera filed a class action alleging that Zumiez failed to pay its employees reporting time pay for “call-in” shifts during which employees must make themselves available to work even though they may not be required to work. While this appeal was pending, a California Court of Appeal decided in a factually similar case involving “on-call” shifts that the employer had to provide reporting time pay. The Ninth Circuit determined that it would follow the decision in that case.

Employees can bring representative actions for Labor Code violations even if they settle and dismiss their individual actions for the same violations.

March 12, 2020, Justin Kim v. Reins International California, Inc.: In this case of first impression, the California Supreme Court had to determine whether an employee who settles and dismisses their individual claims for Labor Code violations loses standing to pursue a representative claim under the Labor Code Private Attorneys General Act of 2004 (PAGA). It concluded that the answer is no. The PAGA law only has two requirements for standing: the plaintiff must be someone who was (1) employed by the defendant and alleged violator, and (2) suffered (along with other employees) one or more of the alleged violations.

Employees must name their employer in a complaint with the Department of Fair Employment and Housing prior to filing suit.

March 10, 2020, Second District Court of Appeal, Judy Alexander et al. v. Community Hospital of Long Beach: The three nurses who brought this case previously filed complaints with the Department of Fair Employment Housing (DFEH), naming Community Hospital of Long Beach and two individuals as potential defendants; and later, Memorial Counseling Associates Medical Group (MCA), which  was founded by the hospital to supply physicians for patients in the hospital’s mental health ward. They did not name Memorial Psychiatric Health Services (MPHS), which was founded by the hospital to run the ward. The nurses then filed suit, naming the hospital and MCA as defendants; and later, MPHS. The court of appeal decided that the nurses’ failure to name MPHS in the DFEH complaint precluded them from pursuing claims against MPHS in the civil case.

Prior rate of pay cannot be used to justify paying women less than men who perform the same work.

February 27, 2020, Ninth Circuit Court of Appeals, Aileen Rizo v. Jim Yovino: The federal Equal Pay Act allows for women to be paid less than men who perform the same work if the pay difference is based on a factor other than sex. The Ninth Circuit concluded that Ms. Rizo’s prior rate of pay is not a factor other than sex that justified her lesser pay. Only job-related factors are allowed.

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February 2020 employment law decisions

Louisiana law applies to wage and hour claims by employees who perform some work off the coast of California.

February 18, 2020, Second District Court of Appeal, Gulf Offshore Logistics, LLC v. Superior Court of Ventura County: Former crew members of a ship that provides maintenance services to oil platforms off the California coast alleged violations of California’s wage and hour laws. The appellate court decided that Louisiana, not California, law applied because the employees lived outside of California, worked for a Louisiana-based employer, performed some work inside California’s territorial waters (on the ship) but otherwise had no significant contact with California, and the management and administration of the employment relationship was performed in Louisiana.

Employers must pay for employee time spent waiting and undergoing exit searches of personal items brought to work.

February 13, 2020, Supreme Court of California, Amanda Frlekin v. Apple Inc.: The Ninth Circuit Court of Appeals requested that the Supreme Court of California decide whether the time spent on the employer’s premises waiting for, and undergoing, required exit searches of packages, bags, or personal technology devices voluntarily brought to work for personal convenience by employees must be paid. The court’s answer was yes because the employees were under Apple’s control during the searches: the searches are mandatory and conducted on Apple property, and Apple requires its employees to perform supervised tasks while waiting for and during the searches.

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December 2019 and January 2020 employment law decisions

The time to file an administrative discrimination claim can be extended by the filing of a workers’ compensation claim; and the filing deadline period starts at the end of ongoing discriminatory conduct or with a constructive termination.

January 28, 2020, First District Court of Appeal, Jay Brome v. California Highway Patrol: Mr. Brome’s claims for harassment and sexual orientation discrimination were not barred by the statute of limitations because the one-year period to file with the Department of Fair Employment and Housing was tolled while a workers’ compensation claim was pending; a jury could conclude that there was harassment that continued to within the limitations period extended by the tolling; and a jury could conclude that Mr. Brome was constructively terminated when he resigned less than one year before he filed with the Department.

Employees’ do not prevail on sexual harassment claims.

January 22, 2020, Second District Court of Appeal, Tamika Schmidt v. Superior Court: Court verdict finding no sexual harassment against two court employees is affirmed because the court properly applied the applicable law and did not exhibit bias amounting to a due process violation.

Unionized federal employees may only bring discrimination claims through either their union’s grievance procedure or their agency’s Equal Employment Opportunity office.

January 16, 2020, Ninth Circuit Court of Appeals, Garry Heimrich v. United States Department of the Army: Mr. Heimrich could not pursue a wrongful termination claim before his agency’s Equal Employment Opportunity office because he previously raised the same matter in a union grievance: in both instances the underlying action was premised on a termination motivated by race, retaliation, and disability.

Employers cannot use acronyms in wage statements and PAGA claims need only cite the applicable Labor Code section.

December 26, 2019, Third District Court of Appeal, Mohammed Noori v. Countrywide Payroll & HR Solutions, Inc.: Mr. Noori asserted a valid claim for failure to provide a proper itemized wage statement because the employer’s name was indicated only by an acronym; and a valid claim under the Private Attorneys General Act of 2004 (PAGA) by citing the Labor Code section (as opposed to the specific subdivision) that was allegedly violated; but his failure to maintain wage statements claim failed because the employer’s failure to state its name in the statements was not an actionable injury.

State defendants cannot avoid liability for claims by removing cases to federal court.

December 23, 2019, Ninth Circuit Court of Appeals, Donald Walden, Jr. v. State of Nevada: A State that removes a case to federal court waives its immunity from suit on all federal-law claims in the case, including the Fair Labor Standards Act claim in this case.

Fourth District claims no adverse action based on rejection of accommodation requests despite statutory and case law authority to the contrary; and affirms dismissal of interactive process and reasonable accommodation claims on grounds the employee did not identify his particular disability despite case law emphasizing the discussion of limitations resulting from the disability.

December 19, 2019, Fourth District Court of Appeal, John Doe v. Department of Corrections and Rehabilitation: Dismissal (summary judgment) of Mr. Doe’s disability discrimination, retaliation, and harassment claims was affirmed because criticism of Mr. Doe’s work, ordering a wellness check when Mr. Doe was out sick, suspecting Mr. Doe of bringing a cell phone to work, and assigning Mr. Doe as primary crisis person on the day he had a union meeting did not amount to an adverse employment action. The Fourth District further affirmed the dismissal on grounds that no court had ever held a failure to accommodate a disability is an adverse employment action, despite a 2002 case (Bagatti v. Department of Rehabilitation (2002) 97 Cal.App.4th 344) that did and the statute specifically providing that failure to accommodate is an adverse action (Government Code section 12940(m)(1)). The dismissal of Mr. Doe’s interactive process and accommodation claims was affirmed on grounds Mr. Doe was responsible for the breakdown in the accommodation discussions because he did not identify his disability, despite case law providing that the focus of such discussions is on the employee’s limitations, not specific disabling conditions.

No punitive damages against public entities available under whistleblower law.

December 17, 2019, Fifth District Court of Appeal, Visalia Unified School District v. Superior Court: Award of punitive damages to employee who sued Visalia Unified School District under the whistleblower statute covering public school employees (Education Code section 44110 et seq.) was reversed based on public entity immunity to punitive damage awards.

Verdict in favor of employee of religious organization upheld under federal, but not state, law.

December 12, 2019, Sixth District Court of Appeal, Jeremiah Mathews v. Happy Valley Conference Center, Inc.: Verdict in favor of Mr. Mathews upheld with respect to his retaliation claim under federal law (Title VII) because the jury properly concluded that Happy Valley and the Community of Church, of which Happy Valley was an affiliate, were joint employers collectively employing more than 15 employees based on common ownership, closely intertwined management, interrelated operations, and evidence showing Mr. Mathews’ termination was influenced or even dictated by the Church. But the verdict in favor of Mr. Mathews with respect to his retaliation claim under state law (Fair Employment and Housing Act) was reversed because religious associations or non-profit corporations (other than hospitals and schools) are completely exempt from FEHA claims and Happy Valley did not waive this exemption.

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October and November 2019 employment law decisions

Federal employee’s case that named the wrong defendant is still timely.

November 14, 2019, Ninth Circuit Court of Appeals, Alisha Silbaugh v. Elaine Chao: Ms. Silbaugh filed her case concerning her employment with the Federal Aviation Administration within the time limits (statue of limitations) but named the wrong defendant. After the limitations period ran, the FAA moved to dismiss the action on grounds the case had to be filed against the head of the executive agency to which the FAA belongs. Ms. Silbaugh responded by filing an amended complaint that named the Secretary of Transportation (Ms. Chao) as the defendant. The district court denied FAA’s motion to dismiss as moot. Ms. Chao filed a motion to dismiss on grounds the amended complaint was not timely because it did not “relate back” to the original complaint. The district court agreed. On appeal, the Ninth Circuit reviewed a federal rule of civil procedure (15(c)) that provides that an amendment relates back to the original complaint when a United States officer or agency is added as a defendant if the original complaint and summons was served on the United States attorney, the Attorney General, or the officer or agency within a 90-day period. Because Ms. Silbaugh timely served the United States attorney and Attorney General her amendment to re-name the defendant related back. Accordingly, the Ninth Circuit reversed the dismissal.

Disability discrimination need not be based on animus or ill will.

November 13, 2019, Second District Court of Appeal, John Glynn v. Superior Court of Los Angeles County: Mr. Glynn sued his employer for disability discrimination. The case arose from a temporary benefits staffer mistakenly thinking Mr. Glynn had transitioned from short term disability to long term disability and was unable to work with or without an accommodation. On that basis, the staffer terminated Mr. Glynn. For months the employer ignored Mr. Glynn’s efforts to correct the misunderstanding. The issue before the court of appeal was whether this constituted direct evidence of disability discrimination. Under the direct evidence method of proof the employee must show that his employer knew of his disability and the disability was a substantial motivating reason for an adverse employment action such as termination. The court of appeal reviewed a prior appellate decision in which the court concluded that animus or ill will was not required to prove discriminatory intent; rather, the disability discrimination law protects employees from erroneous or mistaken beliefs about the employee’s disability. In this case, the termination letter stated that Mr. Glynn’s employment ended due to his inability to return to work with or without an accommodation. As a result, the court of appeal concluded that Mr. Glynn’s case could not be dismissed (summary judgment).

Each payment of an alleged discriminatory disability check triggers a new statute of limitations period.

October 31, 2019, First District Court of Appeal, Joyce Carroll v. City and County of San Francisco: Ms. Carroll sued her former employer as a class representative claiming that San Francisco discriminated based on age by providing reduced disability retirement benefits to older employees who took disability retirement after working for the City for less than 22.22 years. A required administrative charge with the Department of Fair Employment and Housing was filed more than 17 years after Ms. Carroll retired. The trial court dismissed the case (demurrer) on grounds the DFEH charge was filed too late (statute of limitations). The court of appeal decided that the one-year limitations period started each time Ms. Carroll received a discriminatory disability payment. Therefore, the dismissal was reversed.

Employer’s service charge may be considered a tip that must be distributed to employees.

October 31, 2019, First District Court of Appeal, Lauren O’Grady v. Merchant Exchange Productions, Inc.: Ms. Grady sued her employer as a class representative asserting a failure to distribute tips (gratuities). Merchant Exchange Productions added a mandatory “service charge” to the contract for every banquet facility it provided and distributed only some of the charge to managerial employees who did not serve food and beverages at the banquet. Ms. Grady alleged that she and other employees who served food and beverages were entitled to the entire service charge as a tip as required by California’s Labor Code (section 351). The court of appeal decided that a service charge can meet the Labor Code’s definition of a tip and that Ms. O’Grady’s complaint sufficiently alleged a violation of law.

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October 2019 employment law decisions

Temporary employee can hold the contracting company liable.

October 17, 2019, Fourth District Court of Appeal, Elvia Jimenez v. U.S. Continental Marketing, Inc.: Ms. Jimenez brought claims under the Fair Employment and Housing Act (FEHA) against her contracting employer (U.S. Continental Marketing), a company that negotiated with her direct employer, a temporary-staffing agency (Ameritemps). At trial, the jury decided that U.S. Continental Marketing was not Ms. Jimenez’s employer. The Fourth District reversed the jury verdict. Under the FEHA, whether a company is an employer is determined by the totality of the circumstances, including the extent of direction and control possessed and/or exercised by the company over the employee. Undisputed evidence showed that U.S. Continental Marketing exercised considerable direction and control over Ms. Jimenez’s terms, conditions, and privileges of employment and terminated her employment with them.

Remedy for meal and rest break violations is determined by the hourly wage only.

October 9, 2019, Second District Court of Appeal, Jessica Ferra v. Loews Hollwood Hotel, LLC: In this class action for denial of meal and rest breaks, the employees contended that their “premium wage” remedy of one hour of pay for each missed break should be calculated based on their regular rate of pay including nondiscretionary bonus. The Second District disagreed, concluding that the premium wage is determined by the regular rate of compensation, which is the base hourly wage only.

New independent contractor test applies to California Labor Code claims based on wage order violations.

October 8, 2019, Second District Court of Appeal, Francisco Gonzales v. San Gabriel Transit, Inc.: This class action asserted that San Gabriel Transit misclassified drivers as independent contractors, and as a result violated various California wage and hour laws. While this case was pending, the California Supreme Court made its decision (Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903) establishing the “ABC test” for independent contractors for purposes of claims based on California’s wage orders. The court of appeal concluded that the “ABC test” applies retroactively to pending cases; applies to California Labor Code claims that seek to enforce the protections afforded by wage orders; and claims alleging misclassification not directly premised on wage order protections are subject to the “Borello test” (S.G. Borello and Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341).

Gas station employees cannot pursue claims against Shell Oil.

October 8, 2019, First District Court of Appeal, Billy Henderson v. Equilon Enterprises, LLC: Mr. Henderson filed claims for failure to pay overtime and failure to pay for missed break periods against Equilon Enterprises doing business as Shell Oil Products US. The court of appeal agreed with the trial court that Shell was not a joint employer under the “control,” “suffer or permit,” or “engage” tests. The gas station where Mr. Henderson worked and that had a franchise agreement with Shell unilaterally set Mr. Henderson’s wages and was responsibile for payroll and compliance with labor laws. The station’s agreement with Shell provided that the station had the exclusive right to hire and fire and maintain control over its employees’ daily work activities. Finally, Shell never exercised an option to remove an employee from the station.

McDonald’s employees cannot pursue claims against McDonald’s Corporation.

October 1, 2019, Ninth Circuit Court of Appeals, Guadalupe Salazar v. McDonald’s Corp.: Ms. Salazar and other employees brought a class action for denial of overtime premiums, meal and rest breaks, and other benefits, alleging that McDonald’s was their joint employer with the company who contracted with McDonald’s as a franchise. The Ninth Circuit agreed with the trial court that McDonald’s was not a joint employer under the “control,” “suffer or permit,” or “engage” tests. McDonald’s did not have control over the employees’ wages, hours, or working conditions; rather it only controlled its franchisees with respect to quality control. McDonald’s did not suffer or permit the employees to work because McDonald’s did not have the power to hire and fire the employees. Finally, McDonald’s did not engage the employees to work (California common law) because McDonald’s did not have the right to control the manner and means of work performed at its franchises.

Verdict in favor of employee with retaliation claims is reversed.

October 1, 2019, Second District Court of Appeal, Patrick Nejadian v. County of Los Angeles: A jury found that Los Angeles retaliated against Mr. Nejadian for resisting unlawful orders (Labor Code section 1102.5) and reporting conduct that he reasonably believed constituted unlawful discrimination or harassment in the workplace (Government Code section 12940). On appeal, Los Angeles argued that there was insufficient evidence for these findings. The court of appeal agreed. For the unlawful orders claim, the trial court failed to determine whether the orders resisted by Mr. Nejadian would result in a violation of a statute, rule, or regulation. Furthermore, Mr. Nejadian failed to present sufficient evidence to establish that any acts he was asked to perform would result in a violation of a statute, rule, or regulation. As for the other claim, the court gave a jury instruction that allowed the jury to find in Mr. Nejadian even if he did not report any discrimination or retaliation (refusal to participate in activities that would violate statutes, rules, or regulations). Moreover, Mr. Nejadian failed to present evidence from which a reasonable jury could conclude that Los Angeles was motivated by any reporting of discrimination when it took adverse employment actions against him.

Posted by deanroyerlaw in Employment