November 2018-January 2019 employment law decisions

Whistleblower case based on reporting employer’s alleged noncompliance with use tax law.

January 23, 2019, First District Court of Appeal, Says Siri v. Sutter Home Winery, Inc.: Ms. Siri’s case cannot be resolved by summary judgment.

Independent contractor or employee?

January 11, 2019, First District Court of Appeal, Nichelle Duffey v. Tender Heart Home Care Agency, LLC: to determine Ms. Duffey’s status, the recent California Supreme Court decision (Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903) indicates the standard described in the law she sued under (Domestic Worker Bill of Rights) must be used.

Recovery for unpaid overtime claim?

January 4, 2019, First District Court of Appeal, Terry Furry v. East Bay Publishing, LLC: despite Mr. Furry’s imprecise evidence of his hours works, it was error to completely deny him relief because the employer failed to keep accurate records of his hours.

Whether judgment in representative action concerning alleged meal break violations will stand.

December 20, 2018, Fourth District Court of Appeal, Kileigh Carrington v. Starbucks Corporation: Ms. Carrington was an “aggrieved” employee who could bring the action because the claims included employees who, like Ms. Carrington, worked more than five hours without being provided a timely meal break or paid a meal period premium.

Catholic elementary school exempt from employment discrimination claim?

December 17, 2018, Ninth Circuit Court of Appeals, Kristen Biel v. St. James School: Ms. Biel can pursue her Americans with Disabilities Act claim against the Catholic elementary school that terminated her employment.

Can health care employees waive a second meal period?

December 10, 2018, California Supreme Court, Jazmina Gerard v. Orange Coast Memorial Medical Center: A wage order of the Industrial Welfare Commission permitting health care employees to waive a second meal period even if they have worked more than 12 hours does not violate California’s Labor Code.

Does rejection of a statutory settlement offer allow a prevailing employer to recover its costs?

November 14, 2018, Second District Court of Appeal, Felix Huerta v. Kava Holdings, Inc.: Settlement offers under Code of Civil Procedure 998 have no application to costs and attorneys fees in Fair Employment and Housing Act claims unless the lawsuit is found to be frivolous, including litigation that predates January 1, 2019.

Age Discrimination in Employment Act application to state or municipal agencies.

November 6, 2018, U.S. Supreme Court, Mount Lemmon Fire District v. Guido: The ADEA applies to state and municipal agencies regardless of the number of employees.

Does federal case decision in favor of employee preclude state case to recover more than back pay?

November 6, 2018, First District Court of Appeal, Victor Guerrero v. California Department of Corrections and Rehabilitation: Mr. Guerrero may pursue his claims for damages in state court.

Americans with Disabilities Act regarded as disabled definition.

November 1, 2018 (amended), Ninth Circuit Court of Appeals, Herman Nunies v. HIE Holdings, Inc.: A reasonable jury could conclude that HIE terminated Mr. Nunies because of its knowledge of Mr. Nunies’ shoulder injury.

Posted by deanroyerlaw in Employment

September and October 2018 employment law decisions

An individual is not an independent contractor unless the employer shows that he was engaged in an independent business.

October 22, 2018, Fourth District Court of Appeal, Jesus Garcia v. Border Transportation Group, LLC: Mr. Garcia filed a lawsuit against his employer, for whom he worked as a taxi driver, and its owner and another employee. Some of his claims were based on Industrial Welfare Commission wage orders (unpaid wages, failure to pay minimum wage, failure to provide meal and rest breaks, and failure to furnish accurate pay statements) and others were not. The trial court dismissed the case (summary judgment) after deciding that Mr. Garcia was an independent contractor, not an employee. On appeal, the Fourth District applied the recent California Supreme Court decision (Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903) to review the dismissal of the claims based on the wage orders. The employer had to demonstrate that Mr. Garcia was customarily engaged in an independently established trade, occupation, or business apart from his work for Border Transportation Group. In other words, that Mr. Garcia independently made the decision to go into business for himself. In addition, the employer could not satisfy this showing with evidence that Mr. Garcia could have engaged in an independent business; rather, that Mr. Garcia was engaged in an independent business. Because Border Transportation Group did not present any evidence that Mr. Garcia in fact provided services for other entities independently of his relationship with them, the Fourth District reversed the dismissal as to the claims based on wage orders. As for the other claims, the Dynamex decision did not apply and the appellate court affirmed the dismissal.

Individuals may be liable for civil penalties for causing violations of overtime or minimum wage laws.

September 28, 2018, Fourth District Court of Appeal, Marco Atempa v. Paolo Pedrazzani: The trial court issued civil penalties against Mr. Pedrazzani for causing violations of California’s overtime and minimum wage laws. On appeal, the issue was whether any individual other than the corporate employer can be liable for such civil penalties where there is no finding that corporate laws have been misused or abused for a wrongful or inequitable purpose (alter ego). The Fourth District reviewed the overtime and minimum wage laws, both of which authorize civil penalties against an employer or other person acting on behalf of the employer who violates or causes to be violated the laws. The appellate court rejected Mr. Pedrazzani’s contention that he cannot be liable for civil penalties because he was merely an individual officer of the corporate employer. The language of the laws are unambiguous that individual liability exists.

Employee can sue religious employer for breach of contract.

September 25, 2018, Third District Court of Appeal, Sarah Sumner v. Simpson University: Ms. Sumner was the dean of a theological seminary who had a written employment agreement. After Simpson University terminated her, she sued for breach of contract and other tort claims. The trial court dismissed the case (summary judgment) on grounds Ms. Sumner’s employment was within the ministerial exception. The United States Supreme Court had previously decided that this exception, which derives from the First Amendment right to free exercise of religion, bars a minister’s employment discrimination suit based the church’s decision to fire her (Hosanna-Tabor Evangelical Lutheran Church & Sch. v. EEOC (2012) 565 U.S. 171) but did not address whether it applies to a breach of contract or tort claim.  The California appellate court first determined that Simpson University is a religious organization. Next is found that Ms. Sumner was a “minister,” which includes nonordained employees with duties functionally equivalent to ministers. The Third District then turned to the question of whether the ministerial exception applies to a contract claim. It decided that it did not because in reviewing the claim the court would not be required to review Ms. Sumner’s religious qualification or performance as a religious leader. That is because the University’s stated reason for termination was insubordination, not religious reasons. Finally, the appellate court concluded that Ms. Sumner’s tort claims (defamation, invasion of privacy, intentional infliction of emotional distress) were barred by the ministerial exception because they were based on the University’s reasons for and process of terminating Ms. Sumner’s employment. Although the reasons were not strictly religious, the First Amendment protects the act of a decision rather than a motivation behind it.

Employee regarded as having a disability.

September 17, 2018, Ninth Circuit Court of Appeals, Herman Nunies v. HIE Holdings, Inc.: Mr. Nunies’s request for a transfer to a part-time, less-physical warehouse job was all set to go through until he told his employer about the reason for his request—a shoulder injury. After HIE terminated him, Mr. Nunies sued under the Americans for Disabilities Act claiming the termination was because of the shoulder injury. The trial court dismissed the case (summary judgment). On appeal, the Ninth Circuit considered whether the trial court properly interpreted the expanded definition of being disabled, which includes being regarded as having a physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity. The appellate court determined that the trial court improperly relied on pre-expansion decisions that required a showing that the employer subjectively believed that the employee was substantially limited in a major life activity.

Posted by deanroyerlaw in Employment

July and August 2018 employment law decisions

Employer subject to waiting time penalty for failing to immediately correct an employee’s accrued vacation pay check.

August 1, 2018, First District Court of Appeal, Taryn Nishiki v. Danko Meredith, APC: Ms. Nishiki filed a complaint with the California Labor Commissioner seeking vacation wages, rest period premiums, and waiting time penalties. The Labor Commissioner awarded Ms. Nishiki waiting time penalties in the amount of $4,250. Her former employer appealed the award to court, which affirmed the Labor Commissioner’s award. On appeal, Danko Meredith contended that the waiting time penalties were unwarranted because the unpaid amount of accrued vacation pay resulted from a discrepancy in the numerical amount as compared to the amount spelled out in words in a check that was not “willful.” The court agreed after finding the discrepancy was the result of a clerical error. But the First District also considered the effect of Danko Meredith’s delay in sending a corrected check after being informed by Ms. Nishiki that she could not deposit the original check. The appeals court found that Danko Meredith violated its statutory obligation to pay wages promptly by not immediately correcting the clerical error by either stopping payment on the original check and issuing a new check for the correct amount or by sending an additional check for the amount owed—instead it waited nine days to issue a new check. As a result, Ms. Nishiki was entitled to a waiting time penalty for nine days.

Non-payment of small amounts of compensable time not allowed under California law.

July 26, 2018, Supreme Court of California, Douglas Troester v. Starbucks Corporation: Upon a request by the United States Court of Appeals for the Ninth Circuit, the Supreme Court of California agreed to answer the following question: Does the federal Fair Labor Standards Act’s (FLSA) de minimis doctrine (excuse the payment of wages for small amounts of otherwise compensable time upon a showing that the bits of time are administratively difficult to record) apply to claims for unpaid wages under California Labor Code sections 510, 1194, and 1197? The California Supreme Court first determined whether California’s wage and hour statutes or regulations have adopted the de minimis doctrine found in the FLSA. Its answer was no. Next, the high court decided whether the de minimis principle nevertheless applies to wage and hour claims. It concluded that the relevant wage order and statutes do not permit application of the de minimis rule on the facts given, where the employer required the employee to work “off the clock” several minutes per shift. It did not decide whether there are circumstances where compensable time is so minute or irregular that it is unreasonable to expect the time to be recorded.

Posted by deanroyerlaw in Employment

July 2018 employment law decisions and laws

Sufficient evidence to uphold verdict finding disability harassment.

July 9, 2018, Fourth District Court of Appeal, Augustine Caldera v. Department of Corrections and Rehabilitation: Mr. Caldera sued his employer, the Department, for disability harassment, failure to prevent harassment, and related claims. The case went to trial and the jury found in favor of Mr. Caldera awarding him $500,000. On appeal, the Department argued that there was insufficient evidence the harassment met the standard of being severe or pervasive. The appellate court reviewed the harassment standard, which is harassing conduct that is sufficiently severe or pervasive to alter the conditions of the employee’s employment and create an abusive working environment. The jury must consider the totality of circumstances, including the nature of the conduct, how often and over what period it occurred, the circumstances under which it occurred, and whether it was physically threatening or humiliating. Next, the Fourth District court concluded that the jury could find the conduct to be severe because Mr. Caldera described the conduct—employees, including a supervisor, mocking and mimicking his stutter—as demeaning, embarrassing, harmful, and hurtful; and this conduct caused Mr. Caldera to experience psychological disorders. The appellate court also found that the jury could decide the conduct was pervasive because it happened up to 15 times over a two-year period and was regarded as part of the culture at the prison.

The San Francisco minimum wage increases.

Effective July 1, 2018 the minimum wage in San Francisco is $15 per hour.

San Francisco’s Consideration of Salary History (Parity in Pay) Ordinance becomes effective.

Effective July 1, 2018, this ordinance bans employers from considering current or past salary of an applicant in determining whether to hire the applicant or what salary to offer the applicant. It also prohibits employers from (1) asking applicants about their current or past salary or (2) disclosing a current or former employee’s salary history without that employee’s authorization unless the salary history is publicly available.

Posted by deanroyerlaw in Employment

June 2018 employment law decisions

Wage payments based on rounding off hours worked to the nearest quarter hour approved.

June 25, 2018, Second District Court of Appeal, AHMC Healthcare v. Superior Court: Employees of AHMC Healthcare sued their employer for failure to pay wages and other claims. California law requires employers to pay their employees for all time the employees are at work and subject to the employers’ control. The issue was whether an employer’s use of a payroll system that automatically rounded employee time up or down to the nearest quarter violates the law. The Second District reviewed federal courts interpreting federal law on the issue, which have approved computation of worktime by rounding to the nearest quarter of an hour provided that the rounding system will not result, over a period of time, in failure to compensate employees for all time actually worked. It then noted that California’s wage laws are patterned on federal laws and California courts may look to federal court decisions for guidance. The appellate court pointed to two recent federal decisions where a slight majority of employees losing time over a defined period was not sufficient to invalidate an otherwise neutral rounding practice. The Second District concluded that the payroll system did not violate the law because it was neutral on its face (i.e., applied to all employees) and in practice (at one location, a minority of employees lost time but AHMC compensated employees as a whole for 1,378 hours not worked; at a second location, a slight majority of employees lost time but AHMC compensated employees as a whole for 3,875 hours not worked).

Trial court erred by excluding testimony regarding text messages and “me too” evidence in harassment case.

June 21, 2018, Fourth District Court of Appeal, Natasha Meeks v. Autozone, Inc.: Ms. Meeks sued Autozone and one of its employees for sexual harassment. The case went to trial and the jury found in favor of the defendants. On appeal, Ms. Meeks challenged rulings by the trial court excluding evidence from the trial. One ruling concerned text messages from the alleged harasser sent to Ms. Meeks that were of a sexual nature. Because neither Ms. Meeks nor the alleged harasser had possession of the messages, the trial court excluded testimony at trial regarding the specific content of the messages, including words and pictures. The Fourth District rejected the trial court’s justification for its ruling on grounds of fairness because Ms. Meeks’s memory of the content of the messages was not speculation. Furthermore, the alleged harasser could dispute Ms. Meeks’s testimony regarding the specific content by testifying based on his memory. Finally, evidence of the words and pictures was not subject to the hearsay rule because it would not be offered for the truth of the content, but rather to show that the alleged harasser sent the messages. A second ruling excluded evidence concerning sexual harassment of other employees by the alleged harasser (“me to” evidence). The Fourth District concluded that the trial court’s ruling reflected a misunderstanding of the law which allows for admission of this type of evidence.

Administrative decision to uphold termination precludes civil case for discrimination and harassment.

June 21, 2018, Fourth District Court of Appeal, Carol Wassmann v. South Orange County Community College District: Ms. Wassmann sued the District for discrimination (age and race) and harassment. The trial court dismissed the case (summary judgment) on grounds an administrative proceeding provided by the District that upheld Ms. Wassmann’s termination precluded the civil case. On appeal, the Fourth District agreed that the discrimination and harassment claims were barred by the adverse administrative decision. The proceeding was sufficiently judicial in character (e.g., a hearing before an administrative law judge) and Ms. Wassmann could have objected to her proposed termination on grounds of discrimination. Because Ms. Wassman was unsuccessful in getting the administrative decision reversed (writ proceeding) she could not pursue her claims in court.

Dismissal of discrimination, harassment, and retaliation case upheld.

June 11, 2018, Ninth District Court of Appeals, Patricia Campbell v. State of Hawaii Department of Education: Ms. Campbell worked as a high school teacher. She sued her employer claiming discriminatory treatment, hostile work environment, and retaliation for complaining of harassment. The trial court dismissed the case (summary judgment). On appeal, the Ninth Circuit affirmed the dismissal of the discrimination claim on grounds there was no evidence that she was subjected to an adverse action. Ms. Campbell pointed to the Department’s loss of a performance evaluation but she did not identify any evidence to show that the loss could have materially affected the terms or conditions of her employment. In addition, the appellate court rejected Ms. Campbell’s assertion that the Department’s decision to investigate her was an adverse action because the Department allowed her to continue to teach without any changes both during and after the investigation despite findings of misconduct. Furthermore, the Ninth Circuit concluded that the Department’s denial of Ms. Campbell’s request to transfer to another school was not an adverse action because the evidence did not support a finding that she had a right to a transfer because she failed to go through the proper procedures. Finally, the court of appeals affirmed the dismissal of the discrimination claim on grounds that Ms. Campbell did not present any evidence to show that similarly-situated employees were treated more favorably. As for the hostile work environment claim, the Ninth Circuit affirmed the dismissal because the evidence showed the Department took prompt corrective measures regarding the alleged student conduct directed at Ms. Campbell by investigating Ms. Campbell’s complaints and disciplining the students it found to have engaged in misconduct. With respect to the retaliation claim, the appellate court concluded that the investigation could be an adverse action under the broader standard for retaliation claims. Nevertheless, it affirmed the dismissal on grounds there was no evidence to show that the Department’s stated reason for the investigation—receipt of multiple allegations of misconduct—was a pretext for retaliation.

Release of worker’s compensation claim did not also release discrimination claims.

June 8, 2018, Fourth District Court of Appeal, Adrian Camacho v. Target Corporation: Mr. Camacho filed a case against his employer for discrimination, harassment, failure to prevent harassment and discrimination, retaliation, and related other claims. Mr. Camacho also filed a claim for worker’s compensation benefits. The trial court dismissed the discrimination case on grounds language in a compromise and release agreement form used to settle the worker’s compensation action constituted a release of the discrimination claims. On appeal, the Fourth District reviewed the established rule that discrimination claims are not subject to the worker’s compensation system and may be pursued as civil actions. Target contended that language in an addendum to the form releasing “any other claims for reimbursement, benefits, damages, or relief of whatever nature” resulted in Mr. Camacho releasing his discrimination claims. The appellate court disagreed. There was no language in the form or addendum referring to claims outside of the worker’s compensation system. When the form and addendum were considered as a whole, the language upon which Target relied did not satisfy the “clear and non-technical language” requirement for releasing claims beyond worker’s compensation.

Posted by deanroyerlaw in Employment