October and November 2017 employment law decisions

Unenforceable arbitration agreement

October 26, 2016, First District Court of Appeal, Maya Baxter v. Genworth North America Corporation: Ms. Baxter sued her former employer for wrongful termination. Genworth moved to compel arbitration of the dispute. The trial court concluded that the parties’ arbitration agreement was unenforceable on grounds of unconscionability. On appeal, the First District agreed with the trial court that the agreement was procedurally unconscionable because Ms. Baxter had to accept it as a condition of continued employment (contract of adhesion). The appellate court also found the agreement to be substantively unconscionable. There was a one-sided limitation on employees obtaining information outside the formal discovery process, and default limitations on discovery could only be exceeded for “good and sufficient cause” (a higher standard than “showing of need”). The limits were low: for example, only two depositions, and Ms. Baxter demonstrated that she would need six to ten depositions. In addition, the statute of limitations to commence arbitration was one year as compared to up to three years in court after considering the administrative requirement to file with the Department of Fair Employment and Housing and a potential investigation by that agency. Finally, the arbitration claim process with its short deadlines had the practical effect of limiting an employee’s right to seek remedies with the DFEH.

Continuance to oppose summary judgment justified

October 30, 2017, First District Court of Appeal, Richard Denton v. City and County of San Francisco: Mr. Denton filed a lawsuit against his employer, San Francisco, and his supervisor. Defendants sought dismissal of the case (motion for summary judgment), and in the weeks leading up to the hearing on the motion the parties engaged in settlement discussions. That led to a settlement and Mr. Denton’s then-counsel filed a notice of conditional settlement. A week later, after Mr. Denton had discharged his attorney, defendants’ counsel successfully persuaded the trial court to have the settlement set aside, even though Mr. Denton twice assured defendants’ counsel that he was not backing out of the settlement. Four days later, the motion was heard at which Mr. Denton, representing himself, insisted the parties had a settlement and requested a continuance so he could oppose the motion. The trial court denied the request. On appeal, the First District found that the trial court acted arbitrarily or capriciously. It also concluded that Mr. Denton had good cause for a continuance of the motion because San Francisco refused to recognize a settlement it had previously asserted to exist, and from which Mr. Denton had not withdrawn, and Mr. Denton was justifiably surprised that the motion was being heard and needed additional time to seek new counsel to help oppose the motion if he could not settle.

Employee fails to show an implied contract to not terminate without good cause

November 1, 2017, First Appellate District, Steve Jameson v. Pacific Gas and Electric Company: Mr. Jameson sued his employer, alleging PG&E fired him in violation of an implied-in-fact employment contract not to terminate his employment without good cause. The trial court dismissed the case (summary judgment) on the basis that Mr. Jameson did not have evidenced to show an implied employment contract. Mr. Jameson’s claims were premised on his position that PG&E’s progressive discipline guidelines and code of conduct, his reliance on those policies, and his prior tenure with PG&E created an implied contract not to terminate his employment without just cause. On appeal, the First District decided it need not address this premise because, even if true, Mr. Jameson has not shown facts to show he was terminated without just cause. The appellate court determine that the issue was whether PG&E’s decision to terminate was reached honestly, after an appropriate investigation and for reasons that were not arbitrary or pretextual. The First District concluded that PG&E had evidence that it acted with good faith in making the decision to terminate, following an investigation that was appropriate under the circumstances, which gave it reasonable grounds for believing Mr. Jameson had engaged in misconduct. The court of appeal rejected Mr. Jameson’s expert who opined that the investigation was flawed. An employer need not undertake a precise type of investigation as long as the process was fair.

Employee who went on military service leave can recover for denial of bonus

November 2, 2017, Ninth Circuit Court of Appeals, Dale Huhmann v. Federal Express Corporation: Mr. Huhmann was hired by FedEx in 2001 to pilot a “narrow-body” aircraft. Mr. Huhmann was later selected for training to be a first officer on a “wide-body” aircraft that would qualify him for a higher pay grade. Before the training could begin, Mr. Huhmann was mobilized for active Air Force duty. While on duty, FedEx and Mr. Huhmann’s labor union negotiated a signing bonus for pilots employed (including those on military leave) on the day a collective bargaining agreement was signed. The amount of the bonus would be determined by the highest crew status the pilot held. After completing his military service, Mr. Huhmann returned to active pay status and received a signing bonus based on his status as a narrow body crew member. Mr. Huhmann sued Fedex alleging a violation of the Uniformed Services Employment and Reemployment Rights Act by failing to pay him the signing bonus based on a wide-body crew member status. The trial court found in favor of Mr. Huhmann after deciding that it was reasonably certain that Mr. Huhmann would have become a wide-body crew member prior to the date the collective bargaining agreement was signed if he had not gone on military leave. On appeal, the Ninth Circuit concluded that the trial court properly analyzed whether Mr. Huhmann’s military status was a substantial or motiving factor for an adverse employment action based on him receiving the smaller bonus after concluding that he was entitled to the higher bonus based on the “reasonably certain” test. This test applies to any denial of “reemployment” or “benefit of employment,” which includes a bonus.

Tax consequence adjustment is a remedy under federal employment discrimination law

November 3, 2017, Ninth Circuit Court of Appeals, Arthur Clemens, Jr. v. Qwest Corporation: Arthur Clemens, Jr., sued his employer Qwest Corporation (“Qwest”) for race discrimination and retaliation under Title VII. A jury awarded $457,000 in damages for back pay, emotional distress, and punitive damages. But the trial court denied Mr. Clemens’s request for a “tax consequence adjustment” or “gross up” to compensate for increased income-tax liability resulting from his receipt of his back-pay award in one lump sum. On appeal, the Ninth Circuit noted that back pay is taxable and that a lump-sum back pay award will sometimes push a plaintiff into a higher tax bracket than he would have occupied had he received his pay incrementally over several years. The Ninth Circuit decided to join the Third, Seventh, and Tenth Circuits, and reject the D.C. Circuit, in concluding that a tax consequence adjustment is available as part of the district court’s equitable relief powers.

No attorney’s fees for a prevailing individual defendant

November 29, 2017, Second Appellate District, Elisa Lopez v. Gregory Routt: Ms. Lopez sued her employer and her supervisor for harassment in violation of the California Fair Employment and Housing Act (FEHA). A jury found in favor of the City and Mr. Routt on the harassment claim, and Mr. Routt moved for prevailing party attorney fees. The trial court denied Mr. Routt’s motion, concluding he had failed to establish Ms. Lopez’s claim was frivolous, as is required for a prevailing defendant to obtain an attorney fee award under FEHA. On appeal, Mr. Routt argued the frivolousness standard should not apply to a fee request by a supervising employee who has been sued as an individual defendant. Based on California Supreme Court precedent and the relevant legislative history, the Second District concluded the same standard applies to an individual defendant’s request for attorney fees under FEHA as applies to an employer defendant, and thus a fee award is only available in the discretion of a trial court when the court finds that the plaintiff’s claim was frivolous.

Union grievance does not satisfy the Government Claims Act

November 29, 2017, Second Appellate District, Cassidy Olson v. Manhattan Beach Unified School District: The trial court dismissed Mr. Olson’s case after deciding that his complaint failed to allege that he satisfied the claim filing requirements of the Government Claims Act. On appeal, Mr. Olson contended that his filing of a grievance substantially complied with the claim filing requirements. Substantial compliance is normally raised where a timely but deficient claim has been presented to the public entity, but where there is a complete failure to serve any responsible officer of the entity, the doctrine does not apply. Because Mr. Olson’s complaint did not allege that he served or attempted to serve a claim on any responsible officer of the school district, the doctrine of substantial compliance did not apply. Mr. Olson also contended that his grievance was a “claim as presented.” This applies to a claim that fails to comply substantially with Government Code sections 910 and 910.2, but nonetheless puts the public entity on notice that the claimant is attempting to file a valid claim and that litigation will result if it is not paid or otherwise resolved. But Mr. Olson’s grievance did not disclose the existence of a claim against the school district, which if not satisfactorily resolved, would result in litigation. Finally, Mr. Olson argued that he was excused from filing a government claim because it would have been futile. The Second District disagreed because Mr. Olson did not identify any case applying the futility exception to the claim filing requirement, the Government Code does not provide for futility as an exception from the claim filing requirements, and application of the futility doctrine would contravene the purposes of the claim filing requirement because even a “futile” claim would provide a public entity with notice of a potential claim enabling adequate investigation and fiscal planning.

Posted by deanroyerlaw in Employment

October 2017 employment law decisions

Independent contractor versus employee

October 5, 2017, First District Court of Appeal, Darnice Linton v. DeSoto Cab Company, Inc.:  Mr. Linton alleged DeSoto Cab Company violated certain wage and hour laws by requiring him to pay a set fee (“gate fee”) in exchange for obtaining a taxicab to drive for each of his shifts. The Labor Commissioner found in his favor. DeSoto appealed to the California Superior Court. After a bench trial, the court concluded Mr. Linton was not entitled to recover the gate fees because he was an independent contractor and not an employee of DeSoto. The trial court reasoned that decisions setting forth the test for independent contractor versus employee—S.G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341, Yellow Cab Cooperative, Inc. v. Workers’ Comp. Appeals Bd. (1991) 226 Cal.App.3d 1288, and Santa Cruz Transportation, Inc. v. Unemployment Ins. Appeals Bd. (1991) 235 Cal.App.3d 1363—are not controlling because they were decided in workers’ compensation or unemployment insurance benefits cases. The First District determined that in cases involving workers’ compensation and other protective, remedial legislation, courts have applied a control of work details factor with deference to the purposes of the protective legislation. The appellate court concluded that the goal of both workers’ compensation law and the Labor Code’s wage and hour provisions is to protect a class of workers who otherwise would not enjoy statutory protections. Therefore, the Borello case applied. The First District also found that the trial court misconstrued the decision in Ayala v. Antelope Valley Newspapers, Inc. (2014) 59 Cal.4th 522—another case concerning the test for independent contractor versus employee—as disavowing Borello. The appellate court concluded that there can be no doubt that Borello sets forth the common law test now applicable in the courts, and that the test involves a multipurpose inquiry that looks not only at the right to control work details, but also at additional secondary factors. The First District observed that multiple appellate decisions have applied Borello to wage and hour cases and the Borello decision itself indicates that its test applies in those cases. Finally, the appellate court concluded that the trial court failed to apply the presumption of employment and did not shift the burden of proof on DeSoto to dispute that relationship.

Retaliation claim affirmed on appeal

October 11, 2017, Ninth Circuit Court of Appeals, Jose Flores v. City of Westminster: Three Latino police officers sued their employer and won at trial. The jury awarded a total of $3,341,000 in general and punitive damages, and the court awarded $3,285,673 in attorney fees, $40,028.49 in expert fees, and $18,684.12 in costs.  The officers alleged that the City of Westminster and current and former Police Chiefs discriminated and retaliated against them. On appeal, the City challenged the verdict in favor of Officer Flores for his retaliation claim under California law (Fair Employment and Housing Act). The Ninth Circuit concluded that the jury reasonably found adverse employment action taken against Officer Flores because after he filed a discrimination complaint he suffered actions that would impair a reasonable employee’s job performance or prospects for advancement: removal from a list of officers chosen to mentor and train new recruits, negative Supervisor’s Log entries, and his first written reprimand. The appellate court also determined there was evidence that the discrimination complaint substantially motivated the adverse action because the City offered no evidence to show the removal from the list was justified, workplace policies were inconsistently applied to Officer Flores, and there were multiple actions taken against him.

Workers’ compensation decision bars court case based on the same claim

October 12, 2017, Fifth District Court of Appeal, Va Ly v. County of Fresno: Three Laotian correctional officers filed suit against the County for racial and national origin discrimination, harassment, and retaliation while simultaneously pursuing workers’ compensation remedies. In the workers’ compensation proceedings, the administrative law judges denied the officers’ claims after finding the County’s actions were non-discriminatory, good faith personnel decisions. The trial court then dismissed the court case on grounds it was barred by the decision in the workers’ compensation case. On appeal, the Fifth District noted that workers’ compensation is ordinarily the exclusive remedy of an employee who is injured while performing services growing out of and incidental to her employment; racial or national origin discrimination and harassment is not a normal incident of employment; and, therefore, a claim for damages under California employment discrimination law is not barred by the workers’ compensation act. Nevertheless, California law allows an injured employee to choose to recover for psychiatric injury caused by racial or national origin discrimination or harassment by means of a workers’ compensation claim. (Lab. Code, § 3208.3(b)(1).) In such cases, an employer may assert as a defense that the psychiatric injury “was substantially caused by a lawful, nondiscriminatory, good faith personnel action.” The officers contended that they could pursue their claims in both venues because they involved different “causes of action.” The appellate court reviewed the doctrine of “claim preclusion,” under which a party’s cause of action is comprised of a “primary right.” The Fifth District concluded that the officers’ causes of action in both the workers’ compensation proceeding and in court was the primary right to work in an environment free of discrimination, harassment, and retaliation. Therefore, the decision in the workers’ compensation case barred a “second bite of the apple” in court.

Union arbitration versus Labor Code claim in court

October 17, 2017, First District Court of Appeal, George Melendez v. San Francisco Baseball Associates LLC: Mr. Melendez contended that he and other security guards were employed “intermittingly” for specific job assignments (baseball games or other events) and were entitled to but did not receive immediate payment of their final wages upon the end of each assignment. The Giants asserted that payment immediately after each event was not required because a collective bargaining agreement between the Giants and the security guards defines the guards as “year-round employees who remain employed with the Giants until they resign or are terminated pursuant to the CBA.” The Giants moved to compel arbitration or to dismiss the action under the arbitration provision of the collective bargaining agreement. The First District decided that the final wages claim did not come within the collective bargaining agreement because the agreement defines a grievance as a dispute regarding the interpretation, application, or alleged violation of any of the terms of the agreement. Mr. Melendez’s case did not allege a violation of the agreement, but, rather, the Labor Code. Nevertheless, arbitration was required. The underlying issue was whether the guards were “discharged” within the meaning of Labor Code section 201. In order to determine whether the conclusion of a baseball game or season or other event constituted a discharge, it was necessary to first determine the terms of employment. The appellate court found that although no provision of the collective bargaining agreement provided an explicit answer, the duration of the employment relationship must be derived from what is implicit in the agreement. Because interpretation of the collective bargaining agreement was required an arbitration was the exclusive remedy.

Posted by deanroyerlaw in Employment

August and September 2017 employment law decisions

Statute of limitations to file with the Department of Fair Employment and Housing

August 29, 2017, Second District Court of Appeal, Guillermo Aviles-Rodriguez v. Los Angeles Community College District: The California Supreme Court previously decided (Romano v. Rockwell International, Inc. (1996) 14 Cal.4th 479) that an employee alleging that a discriminatory act led to the termination of his or her employment has until one year from the termination date to file an administrative claim. That case involved an at-will employee with advanced notice of the effective termination date. In this case, the employee was a professor who was denied tenure, filed a grievance regarding the denial, and then was terminated based on the denial of tenure. The Court of Appeal concluded that the rule established in Romano also applied in this case, i.e., the one-year statute of limitations began on the date of the termination, not the notice of denial of tenure.

Marital status discrimination does not include marriage to a particular person

September 5, 2017, First District Court of Appeal, Orlando Nakai v. Friendship House Association of American Indians, Inc.: Mr. Nakai was terminated by Friendship House’s CEO, who also happened to be his mother-in-law, after his wife informed the CEO that Mr. Nakai had a gun and was angry at Friendship House employees and she had obtained a restraining order. Mr. Nakai filed a case for marital status discrimination and failure to conduct a reasonable investigation prior to termination. The trial court dismissed the case on grounds Mr. Nakai had insufficient evidence for a jury trial (summary judgment). The Court of Appeal agreed. Mr. Nakai’s theory was that he was terminated because he was the spouse of the employee who reported him and the son-in-law of the CEO. While marital status discrimination prohibits decisions based on an employee’s status as unwed or single or the granting of employment benefits to married employees only, it cannot be based on the status of being married to a particular person. Mr. Nakai’s case was based on the latter. As for the failure to investigate claim, Mr. Nakai was an at-will employee. As such, he had no right to a pre-termination investigation.

Discrimination must be based on the employee’s race

September 14, 2017, Second District Court of Appeal, George Diego v. City of Los Angeles: Mr. Diego and another police officer sued their employer for discrimination they alleged following their involvement in a fatal shooting. The case went to trial and a jury awarded the officers nearly $4 million. The City of Los Angeles appealed. The appellate court reversed the jury verdict. The officer’s legal theory was that they were treated less favorably because of their race (Latino) and the race of the victim (African-American). They relied on evidence of another shooting incident involving a white officer and Latino victim. They argued to the jury that any decision based on race by the City could demonstrate unlawful employment discrimination, and there were no jury instructions regarding consideration of the victim’s race. But a discrimination claim requires a showing that the employer’s challenged decision was substantially motivated by the employee’s race. The appellate court found that the officers did not have evidence to show that they were treated less favorably because of their race (as opposed to the race of the victim).

Itemized wage statement claim for civil penalties does not require a knowing or intentional violation

September 26, 2017, First District Court of Appeal, Eduardo Lopez v. Friant & Associates, LLC: Mr. Lopez filed a case for civil penalties under the Labor Code Private Attorneys General Act of 2004 for his employer’s failure to include the last four digits of employee Social Security numbers on itemized wage statements. The trial court dismissed the case on grounds the undisputed evidence showed the employer’s omission was not knowing or intentional. The Court of Appeal disagreed. The knowing or intentional standard is in a section (226(e)(1)) that also specifies penalties. But the penalties in section 226(e)(1) are “statutory” in nature. Mr. Lopez’s case was for “civil” penalties, which are specified in Labor Code section 2699(f). Therefore, the knowing or intentional standard did not apply in the PAGA case.

Whistle-blower claim based on University policies

September 26, 2017, Fourth District Court of Appeal, Leah Levi v. The Regents of the University of California: Dr. Levi sued the Regents for a number of claims, including a whistle-blower retaliation claim. The trial court dismissed the entire case by summary judgment. The Court of Appeal reversed with respect to the retaliation claim along with a due process claim. Regarding the retaliation claim, Dr. Levi engaged in protected activity by filing or participated in complaints regarding conflicts of interest related to other Regents’ employees, modified policies favoring another Regents employee, and retaliation for being a whistle-blower, all of which were covered by Regents policies that have the force and effect of California law.

 

Posted by deanroyerlaw in Employment

July and August 2017 employment law decisions

Anti-SLAPP motion and retaliation

July 26, 2017, Fourth District Court of Appeal, Aram Bonni v. St. Joseph Health System: Mr. Bonni sued St. Joseph Health System for whistle-blower retaliation. St. Joseph filed a special motion to strike the complaint (“anti-SLAPP motion”), which the trial court granted. The court of appeal reversed. The Fourth District reviewed the recent Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057 decision, which counseled that in ruling on an anti-SLAPP motion, courts should consider the elements of the challenged claim and what actions by the defendant supply those elements and consequently form the basis for liability. The Fourth District determined that Mr. Bonni’s claim, based on Labor Code 1278.5, arises from St. Joseph’s retaliatory purpose or motive, and not from how that purpose is carried out, even if by speech or petitioning activity. It then observed that Mr. Bonni’s complaint did not allege any specific written or oral statement or writing which allegedly formed the basis of his retaliation claim. Instead, he alleged that an abusive peer review process was initiated by the hospitals because he made complaints about unsafe conditions at the hospitals. Consequently, his claim was not based merely on St. Joseph’s peer review process, or on statements made during those proceedings, but on the retaliatory purpose or motive by which it was undertaken.

Vacation pay at time of separation

July 28, 2017, Fourth District Court of Appeal, Nathan Minnick v. Automotive Creations, Inc.: Mr. Minnick sued Automotive Creations, Inc. on behalf of himself and other employees alleging that their employer’s policy violated California law because it required employees who worked for less than one year to forfeit vested vacation pay. The appellate court noted that the California Supreme Court interpreted Labor Code section 227.3 to mean that once vested, vacation pay may not be forfeited. The Fourth District agreed with a Second District decision (Owen v. Macy’s, Inc. (2009) 175 Cal.App.4th 462), which provides that the employer may establish a waiting period before the employee becomes eligible to earn vacation, and if the employer’s policy is clearly stated, the waiting period policy is enforceable. The Fourth District affirmed the dismissal of the case.

Hostile work environment

July 31, 2017, Ninth Circuit Court of Appeals, Cynthia Fuller v. Idaho Department of Corrections: Ms. Fuller sued the Idaho Department of Corrections for its response to a co-worker raping her on three occasions outside of the workplace. The Ninth Circuit reversed the trial court’s dismissal of her case. The appellate court determined that a reasonable jury could conclude that the IDOC effectively condoned the rapes by requiring Ms. Fuller to return to a workplace run by supervisors who showed public support for her rapist, eagerly anticipated his return, and continued to pay him while denying her paid leave. As a result, IDOC created a hostile work environment by making it more difficult for Ms. Fuller to do her job, to take pride in her work, and to desire to stay in her position.

Civil penalty versus unpaid wages

August 2, 2017, Fifth District Court of Appeal, Richard Esparza v. KS Industries, L.P.: KS Industries, L.P. sought to compel arbitration of Mr. Esparza’s claims, on behalf of himself and other employees, for civil penalties and wages arising from minimum wage and overtime violations, meal and rest break violations, timely payment of wages, failure to provide pay statements, and failure to reimburse business expenses. Mr. Esparza relied on Labor Code sections 558 and 1197.1 to contend that recovery of the unpaid wages was a form of civil penalty, which could not be forced into arbitration. The Fifth Circuit disagreed, pointing out that section 558 provides that the employee recovers 100 percent of the underpaid wages, whereas a civil penalty action (Labor Code Private Attorney’s General Act) requires 75 percent of the recovery to go to the State of California.

One day’s rest in seven

August 3, 2017, Ninth Circuit Court of Appeals, Christopher Mendoza v. Nordstrom, Inc.: Mr. Mendoza on behalf of himself and other Nordstrom employees sued Nordstrom under the California law that requires one day’s rest from work in seven. (Labor Code sections 551 and 552.) An exception applies when the employee works less than six hours. The trial court ruled in favor of Nordstrom on grounds that although Mr. Mendoza worked seven consecutive days over two work weeks on three separate occasions, he worked less than six hours on some, but not all, of those days. The Ninth Circuit affirmed the decision, but for different reasons. The California Supreme Court had decided that the seven-day period is only for each workweek and the exception only applies when the employee works less than six hours on all seven days. It was undisputed that Mr. Mendoza did not work seven consecutive days within any one work week.

Retaliation and disability discrimination

August 8, 2017, Fourth District Court of Appeal, Melony Light v. California Department of Parks and Recreation: Ms. Light sued the California Department of Parks and Recreation for retaliation and disability discrimination. The trial court dismissed the retaliation claim on grounds there was no adverse employment action. The Fourth District reversed on grounds there was evidence that would support a finding of an adverse action: Ms. Light was moved to a different office, was subjected to verbal and physical attack during a confrontation, was told she would no longer work at the Department when her out-of-class assignment was over, had a training offer for a position rescinded, was later rejected for promotion to that position, and had her scheduled hours reduced to zero. The appellate court also determined there was direct evidence of retaliatory intent based on a supervisor’s statements that if Ms. Light did not follow orders she would be moved to a different workplace and her work at the District would end. As for the disability claim, the Fourth District affirmed the dismissal because there was no evidence the Department knew of Ms. Light’s disabilities before it took adverse action, only vague references to workplace stress.

Costs of suit

August 15, 2017, Fourth District Court of Appeal, Aleksei Sviridov v. City of San Diego: Mr. Sviridov sued the City of San Diego over his terminations. After three appeals, San Diego was awarded over $90,000 in costs. Mr. Sviridov challenged the award based on the rule that an employer may not recover its costs of suit in a Fair Employment and Housing Act or Public Safety Officers Procedural Bill of Rights Act case unless the court determines it to be frivolous. The court of appeal disagreed because San Diego had made three settlement offers under Code of Civil Procedure section 998, which Mr. Sviridov rejected. The Fourth District reasoned that a blanket application of the FEHA or POBRA costs rule where there is a section 998 offer would erode the public policy of encouraging settlement in such cases.

Age discrimination

August 16, 2017, Ninth Circuit Court of Appeals, Charles Merrick v. Hilton Worldwide, Inc.: Mr. Merrick sued Hilton Worldwide, Inc. for age discrimination. The Ninth Circuit Court of Appeals concluded that Mr. Merrick had a “prima facie” case of discrimination because he was sixty years old when he was permanently laid off, his termination was not based on his performance, and his duties were outsourced or assumed by other employees. The appellate court also determined that Hilton had non-discriminatory explanations for the layoff. Mr. Merrick did not dispute the explanations, but claimed he could prove discrimination because Hilton did not offer to transfer him, mischaracterized his responsibilities and performance, and failed to comply with its layoff policy. The Ninth Circuit found that a position Mr. Merrick pointed to was not available and Hilton provided a list of open positions, the record did not support the mischaracterization claim, and the deviation from the layoff guidelines did not constitute specific and substantial evidence of a discriminatory motive.

Hours worked question

August 16, 2017, Ninth Circuit Court of Appeals, Amanda Frlekin v. Apple, Inc.: The Ninth Circuit certified the following question to California Supreme Court: Is time spent on the employer’s premises waiting for, and undergoing, required exit searches of packages or bags voluntarily brought to work purely for personal convenience by employees compensable as “hours worked” within the meaning of California Industrial Welfare Commission Wage Order No. 7?

Anti-SLAPP motion and discrimination

August 16, 2017, Second District Court of Appeal, Dioka Okorie v. Los Angeles Unified School District: Mr. Okorie sued the Los Angeles Unified School District alleging, among other things, discrimination, harassment, and retaliation. In response, the District filed a special motion to strike the complaint (“anti-SLAPP motion”), which the trial court granted. The court of appeal affirmed. The Second District determined that Mr. Okorie’s case was distinguishable from the recent Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057 decision, which decided that a discrimination claim may be struck only if the speech or petitioning activity itself is the wrong complained of, and not just evidence of liability. The wrong in Park was the university’s decision to deny the plaintiff tenure, but Mr. Okorie complained of a wide array of adverse employment actions, with the bulk of them being statements or communicative conduct made by District personnel. Furthermore, Mr. Okorie did not allege that the primary source of the alleged discrimination was his reassignment from his classroom to his home or his subsequent reassignment from his home to ESC, the so-called teacher’s jail. Instead, the gravamen of Mr. Okorie’s theory is discrimination via humiliation, which is meaningless outside the context of the protected speech to which anti-SLAPP protection applies.

Disability discrimination

August 25, 2017, Ninth Circuit Court of Appeals, Antonio Alamillo v. BNSF Railway Company: Mr. Alamillo sued BNSF Railway Company for disability discrimination and failure to provide a reasonable accommodation. The Ninth Circuit decided that Mr. Alamillo could not establish a “prima facie” case of discrimination because BNSF did not know that Mr. Alamillo was disabled when the decision to initiate disciplinary proceedings was made, and Mr. Alamillo conceded that BNSF disregarded his disability when it decided to terminate him. The appellate court also concluded that there was no reasonable accommodation claim because BNSF provided Mr. Alamillo with a “constant work schedule” and precluding BNSF from terminating Mr. Alamillo for prior misconduct is not a reasonable accommodation.

Posted by deanroyerlaw in Employment

June and July 2017 employment law decisions

Employee during pendency of work visa approval

June 13, 2017, California Court of Appeal, First Appellate District, Ming-Hsiang Kao v. Joy Holiday et al.: Mr. Kao was entitled to overtime pay, penalties for Joy Holiday’s failure to provide wage statements, and a waiting time penalty for the company’s failure to pay all wages due at termination. Mr. Kao was an employee, not a “guest” pending approval of a work visa, because Joy Holiday paid Mr. Kao substantial salary and Mr. Kao performed tasks beneficial to the company. Mr. Kao was also a non-exempt employee (i.e., entitled to overtime pay) because while he was an office manager he was paid less than the equivalent of two times the minimum wage for 40 hours per week and then was demoted to non-manager status.

Age discrimination covers political subdivisions with fewer than 20 employees

June 19, 2017, Ninth Circuit Court of Appeals, John Guido and Dennis Rankin v. Mount Lemmon Fire District: the federal Age Discrimination in Employment Act applies to a political subdivision of a state that employs fewer than 20 employees. The ADEA defines three distinct categories of covered employers: (1) a “person” that employs 20 or more employees, where “person” does not include a political subdivision; (2) an agent of a “person;” and (3) States and political subdivisions of States. The Sixth, Seventh, Eighth, and Tenth Circuits previously decided otherwise.

Anti-gay statements outside of the termination decision enough to get case to trial

June 21, 2017, California Court of Appeal, Second Appellate District, Joseph Husman v. Toyota Motor Credit Corporation: Mr. Husman had sufficient evidence that a substantial motivating factor for his termination was stereotyping related to his sexual orientation. There was a perception he was “too gay” as shown by statements made outside the termination decision: second-line supervisor observed at various times that Mr. Husman had made “a very clear statement” about his sexual orientation and should cut his hair, as well as ridiculing him for wearing a scarf as an accessory when it was not cold outside.

Individuals liable for retaliation under Fair Labor Standards Act

June 22, 2017, Ninth Circuit Court of Appeals, Jose Arnulfo Arias v. Anthony Raimondo: the Fair Labor Standards Act retaliation provision applies to any person, including an individual who is not an employer. In this case, after Mr. Arias filed a case against his employer for overtime and meal and rest break violation, the employer’s attorney enlisted the services of U.S. Immigration and Customs Enforcement (“ICE”) to take Mr. Arias into custody at a scheduled deposition and then to remove him from the United States; and attempted to block Mr. Arias’s California Rural Legal Assistance attorney from representing him. The attorney could be liable because the FLSA makes it unlawful for any “person,” which includes a legal representative, to terminate or discriminate against an employee who files a FLSA complaint; and defines “employer” to include “persons” who act in the interest of the employer in relation to an employee.

Attorney’s fees for unpaid wage claims must be requested at the initiation of the case

June 29, 2017, California Court of Appeal, Second Appellate District, Michael Shames v. Utility Consumers’ Action Network: employee could not recover attorney’s fees after prevailing at trial on an unpaid wages claim because he did not request the fees at the initiation of the case. California Labor Code 218.5 provides for attorney’s fees to the prevailing party if she “requests attorney’s fees and costs upon the initiation of the action.” Such a request was not included in either Mr. Shames’s initial complaint (first court filing) or an amended complaint.

Mortgage underwriters are non-exempt employees entitled to overtime

July 5, 2017, Ninth Circuit Court of Appeals, Gina McKeen-Chaplin v. Provident Savings Bank, FSB: Mortgage underwriters are entitled to overtime pay. The administrative employee exemption under federal law did not apply because the underwriters’ primary job duty did not relate to their employer bank’s management or general business operations. The Ninth Circuit followed the Sixth Circuit’s analysis (the underwriters do not decide if the bank should take on risk, but instead assess whether, given the guidelines provided to them from above, the particular loan at issue falls within the range of risk the Bank has determined it is willing to take), and rejected the Second Circuit (which decided that underwriters perform administrative work because they assist in the running and servicing of the bank’s business by making decisions about when the Bank should take on certain kinds of credit risk).

Right to obtain other employees’ contact information in representative action

July 13, 2017, California Supreme Court, Michael Williams v. The Superior Court of Los Angeles County: Employee with a representative case (Labor Code Private Attorneys General Act) was entitled to contact information of other employees that he sought to have represented in the case. The standard established for class actions—contact information is discoverable without any showing of good cause—applies to PAGA cases.

Posted by deanroyerlaw in Employment