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New Law Further Limits Types of Cases That Can Be Settled Confidentially

Oct 14, 2021 in

Since 2019, it has been illegal to require confidentiality in settlement agreements for claims of sexual assault, sexual harassment or discrimination based on sex.

Senate Bill (SB) 331, signed into law, expands that prohibition to include allegations of other acts of workplace harassment or discrimination that are not based on sex. The law applies to agreements signed on or after January 1, 2022.

California Appellate Decision Will Delay Pre-Employment Background Checks

Oct 12, 2021 in

A California appellate court has issued an opinion, All of Us or None v. Hamrick, which will almost certainly delay the process of obtaining criminal background checks for employers. Criminal background searches are a legal requirement for employers in many industries.Companies performing background checks rely, in part, on searches of criminal case indexes using date of birth and driver’s license number.

In All of Us or None v. Hamrick, a civil rights organization supporting ex-offenders sued the Riverside Superior Court claiming it permitted searches using dates of birth and driver’s license numbers, in violation of California Rule of Court, Rule 2.507.

The trial court threw the case out. But the California Court of Appeal reversed, emphasizing the privacy interests of ex-offenders. While the case was brought against the Riverside Court, it will impact searches of most courts because CRC Rule 2.507 is a statewide law.

What California Employers Need to Know About Current State and Federal COVID-19 Vaccine/Testing Regulations

Sep 9, 2021 in

Sadly, COVID-19 remains with us. In an ongoing effort to control the spread of the virus, our state and federal governments continue to push forward regulations and policies guaranteed to impact the workplace. Here are some important developments:

School Workers Must Prove Vaccination or Weekly COVID-19 Testing

On August 11, 2021, the state of California ordered all workers in public and private K-12 schools to show proof of vaccination. Workers unable to show proof of vaccination must undergo weekly PCR or antigen testing for COVID-19. Schools with unvaccinated workers should develop a plan to track testing results and conduct contact tracing. Results must be submitted to local public health departments. Covered schools have until October 15, 2021 to comply with requirements.

Nursing Homes Mandate Staff Vaccinations or Face Federal Funding Loss

On August 18, 2021, President Biden directed the Department of Health and Human Services to require nursing homes to require all employees be vaccinated against COVID-19 or face possible loss of Medicare and Medicaid funding. There is presently no deadline for compliance. However, any California nursing home that has not already mandated employee vaccination in compliance with the California Department of Public Health’s August 5th order that all health care workers to be vaccinated by September 30, 2021, should ensure compliance.

California Legislature Contemplates Statewide Workplace Vaccine Mandate

Rumors out of Sacramento suggest the California legislature is contemplating a statewide mandate that all employers require employees in every industry to be vaccinated against COVID-19 or undergo weekly testing. If such legislation comes to fruition, California would lead the nation in workplace vaccine mandates.
Importantly, there is no draft bill and any legislation would need to clear hurdles, including possible resistance from business interests, and may hinge on the outcome of the election to recall Gov. Newsom.

Cal/OSHA Encourages Masking Indoors Regardless of Vaccination Status

In an August 25th press release, Cal/OSHA said, “as a best practice, Cal/OSHA encourages employers and workers to follow the recent update from the [California Department of Public Health] recommending that all individuals wear face coverings while indoors regardless of vaccination status.”
This is a recommendation only and the election by employers not to require vaccinated workers to wear masks will not expose them to Cal/OSHA penalties. This could change and we will continue to monitor the situation. Additionally, a California Department of Public Health Guidance published on July 28, 2021, requires masks “for unvaccinated individuals in indoor public settings and businesses (examples: retail, restaurants, theaters, family entertainment centers, meetings, state and local government offices serving the public).” Exceptions to this broad mandate apply.

California Supreme Court Clarified Rule for Calculating Meal and Rest Period Premiums, and it Applies Retroactively!

Aug 10, 2021 in

On July 15, 2021, the California Supreme Court, in Ferra v. Loews Hollywood Hotel, LLC, clarified the rule for calculating the premium required when employees are unable, because of workload, to take a timely rest or meal period. Given the potential for employees to sue employers in class actions for failing to strictly comply with this rule, and the fact that the holding applies retroactively, this is a significant development.
By way of background, California employers are required to provide nonexempt employees a paid 10-minute rest period for every 4-hours of work, and an unpaid 30-minute uninterrupted meal period by the end of the 5th hour (and 10th hour, if applicable) of work. These rules should already be quite familiar to employers.
The California legislature recognizes this is not always possible due to an employee’s workload or other issues. Therefore, an employee who is not provided required rest and/or meal periods must be paid an additional hour of pay at the employee’s “regular rate of compensation” for every missed meal or rest period. Until the Ferra decision, this “regular rate of compensation” was simply a worker’s hourly wage, without regard to additional, non-discretionary payments, such as bonuses or shift differentials.
In Ferra, the Court held the opposite, that meal or rest period premiums must be paid at a rate of pay that reflects regular pay + incentives, such as non-discretionary bonuses or shift differentials. Calculating this “regular rate of compensation” for rest and meal period premiums now mirrors the formula previously applied to determine the “regular rate of pay” when calculating overtime premium pay.
If an employee is indeed paid non-discretionary bonus or incentive pay, the calculation of his or her “regular rate of compensation” can initially seem somewhat daunting. Consider an employee who earns $17/hr, but also receives an additional $3/hr shift differential when she works a night shift. In a particular week, she works 60 hours (40 regular hours, 13 overtime hours and 5 double time hours). Of those 60 hours, 30 are paid at the employee’s base rate of $17, and the remaining 30 hours are paid at $20/hr to reflect the $3 night shift differential.
Under the old rule, any rest or meal period premium would be paid at the employee’s base pay, $17. However, under the Ferra holding, an additional calculation must be conducted, which establishes the rest or meal period premium must be paid at the weighted average rate of $18.50. (Total compensation is $1,110, divided by 50 hours, equals the weighted average rate of $18.50; this is her “regular rate of compensation” for that week only.)
Given this development, what should employers do? We recommend the following:
  • Ensure your timekeeping system recognizes each instance in which an employee is not afforded an uninterrupted 10-minute rest period during every 4 hours of work, or does not begin a 30-minute uninterrupted, unpaid meal period by the end of his/her 5th hour of work;
  • Ensure your payroll provider is properly calculating the rest or meal period premium under the formula described above;
  • Monitor employee practices to ensure employees are timely taking required rest and meal periods, to reduce the incidence and incidental cost of rest and meal period premiums. Opportunistic employees may abuse the system and routinely collect a rest or meal period premium. Employers should conduct training or, in some circumstances, discipline employees who are unnecessarily triggering rest or meal period premiums.
  • If the term “nonexempt” is unfamiliar, or if you were unaware of the rules regarding rest and meal periods, or the requirement to provide a rest or meal period “premium,” don’t be embarrassed. However, if you have any hourly workers, you absolutely must know these rules or you are potentially at risk for very costly administrative actions or civil lawsuits. Please contact us so we can explain these rules to you an help you stay in compliance with California’s strict wage-hour laws.

Quick Reminder on Wage Statements in California

Jul 10, 2021 in

Many California wage-hour lawsuits include a claim that employees’ wage statements (pay stubs) fail to comply with the law. By way of reminder, each wage statement must contain:
  • Gross wages earned;
  • Number of hours worked (not required for exempt employees);
  • Number of piece-rate units earned (if applicable);
  • All deductions;
  • Net wages earned;
  • Inclusive wages of the period for which the employee is paid;
  • Employee’s name;
  • Last 4 digits of employee’s Social Security number or employee ID (NOTE: It is unlawful to include an employee’s entire SSN);
  • Name and address of legal entity that is the employer;
  • All applicable hourly pay rates in effect during the pay period and the number of hours worked at each rate; and
  • Amount of Paid Sick Leave available to the employee.
Additionally, the Labor Code also requires the check be drawn on a bank with at least one branch in California, and the check must state the name and address of a business in California where the check can be cashed on demand without a discount

Alex Craigie Selected for Inclusion in 2022 Southern California SuperLawyers for Employment Litigation

Jul 8, 2021 in

The Law Offices of Alex Craigie is excited to announce that Alex Craigie has been selected by Thomson Reuters for inclusion in the 2022 Southern California SuperLawyers for Employment Litigation.

Super Lawyers selects attorneys using a multiphase selection process. Peer nominations and evaluations are combined with independent research. Each candidate is evaluated on 12 indicators of peer recognition and professional achievement. Selections are made on an annual, state-by-state basis. The objective is to create a credible, comprehensive and diverse listing of outstanding attorneys that can be used as a resource for attorneys and consumers searching for legal counsel. Only 5% of attorneys in Southern California receive this distinction.

Alex Craigie is a trial lawyer recognized for his innovative, cost-effective and, where necessary, highly aggressive approach to Employment dispute advocacy. After 10 years as a Partner at a leading national law firm, Alex launched his own practice in 2014 with the aim of using the skills and experience he gained representing Fortune 500 companies in high-stakes lawsuits throughout the nation, to represent clients exclusively in Employment Law throughout California.

Cal/OSHA Issues Revised COVID-19 Emergency Temporary Standards

Jul 7, 2021 in

On June 17th, the California Division of Occupational Safety and Heath (Cal/OSHA) adopted a revised set of proposed revisions to the COVID-19 Prevention Emergency Temporary Standards. They took effect immediately.
Here are the major changes in the revised regulations:
Testing and Quarantine. Fully vaccinated employees do not need to be tested or quarantined following close contact with COVID-19 cases, unless they exhibit symptoms. As a result, employers are only required to offer paid testing and time off for testing for the following employees:
  • Symptomatic, unvaccinated employees;
  • Unvaccinated employees after an exposure to a COVID-19 case;
  • Vaccinated employees after an exposure, if they develop symptoms;
  • Unvaccinated employees in an “outbreak” (defined as 3 + cases in a group);
  • All employees in a “major outbreak” (defined as 20+ cases in a group).
Physical Distancing. The revised regulations remove any physical distancing or barrier requirements, regardless of employee vaccination status, with one exception: if the worksite has a “major outbreak” (20+ cases in a single employee group). By contrast, if the worksite has an “outbreak” (3+ cases), the employer must evaluate whether to enforce distancing or barriers.
Face Covering. Vaccinated employees are exempt from wearing face coverings indoors, EXCEPT: (1) in “outbreak” situations (3+ cases) when distancing cannot be maintained; and/or (2) in those settings in which the Cal. Dept. of Public Health (CDPH) requires face coverings: schools, youth settings, public transit, healthcare settings (including long term care facilities), prisons, shelters and cooling centers. Employers must document vaccination record and it must be kept confidential.
Unvaccinated workers must still wear face covering, except when: (1) outdoors; (2) alone in a vehicle; (3) eating or drinking; (4) when disability or religious-related accommodation is required; or (5) when job duties make covering infeasible.
Respirators/N95s. Employers must make respirators/N95 masks available to unvaccinated employees upon request.
Air Filtration. Employers must evaluate ventilation systems to maximize outdoor air and increase filtration efficiency.
Still Required. Employers are still required to:
  • Maintain a written COVID-19 Prevention Program;
  • Provide effective training how to use the Prevention Program;
  • Notify the public health department of “outbreaks”;
  • Notify employees of exposure and close contacts;
  • Offer testing to employees after potential exposure.

San Diego Court Rejects Claim Worker Brought Covid-19 Home

Jun 10, 2021 in

In February, a United States District Court in San Diego dismissed a lawsuit brought by a spouse against her husband’s employer, Kuciemba v. Victory Woodworks, Inc. The suit alleged that the husband contracted Covid-19 while at work due to the employer’s negligence and brought the virus home, where his wife contracted it. The husband brought a separate worker’s compensation claim against Victory Woodworks.

The court initially dismissed the wife’s claim on the basis that worker’s compensation is the exclusive remedy for her claims. Following amendment of the complaint, the court again dismissed the claims, holding that an employer’s duty is only to provide a safe workplace for its employees, and that this duty does not extend to nonemployees, including spouses at home.

While this was certainly a favorable ruling for the employer, the fact it was issued by a federal judge sitting in San Diego may mean the same issue decided by a state court judge sitting elsewhere in the state might reach a different result. Federal judges tend to be more willing to dismiss marginal claims, particularly in San Diego, a conservative jurisdiction.

Los Angeles County Requires Employers to Provide Paid Leave for Employees to Get Vaccinated

Jun 8, 2021 in

On May 18th, Los Angeles County passed an emergency ordinance requiring employers within unincorporated areas of the county to provide employees with up to 4 hours of paid leave (in addition to ordinary Paid Sick Leave and the state-wide Covid-19 Supplemental Paid Sick Leave (SPSL) which took effect in March, 2021.

This applies to all employers, regardless of size of workforce. Full-time employees are defined as either those designated by the employer as full-time, or who were scheduled to work on average at least 40 hours per week in the two weeks preceding the leave. Again, these employees are entitled to take up to 4 hours of paid leave for each vaccination injection.

Part-time employees are entitled to a prorated portion of additional paid leave for vaccination. For example, a part-time employee who worked 20 hours in the two weeks preceding the leave are entitled to just 2 hours of additional vaccination leave.

Additional details:

  • This leave is only available to employees who have fully exhausted all California Paid Sick Leave and SPSL;
  • Employers can request written verification of Covid-19 vaccination;
  • Employees receive their normal rate of pay for this leave, which may be calculated by using the employee’s highest average two-week pay from January 1 – May 18, 2021.
  • Covered employers must “conspicuously display” a written notice of this ordinance; and
  • Covered employers must maintain records demonstrating compliance with this ordinance for four (4) years; failure to provide these records creates a presumption of noncompliance.

Sure You Can Require Employees to Arbitrate Claims, But Should You?

May 19, 2021 in

 California currently permits employers to require workers to submit claims arising from their employment to binding arbitration. Excluded are workers’ compensation controversies or disputes relating to employee benefit plans; but most other disputes, including claims of discrimination, harassment, retaliation and wage-hour violations may be arbitrated, outside of court. Before taking the arbitration plunge, however, I urge my clients to give careful consideration to the following points before requiring their employees to submit to mandatory arbitration.

 

Pros of Mandatory Arbitration

Arbitrator, Not Jury, Decides the Case

The biggest advantage of arbitration for business defendants is the fact that both liability (i.e., whether you did anything wrong) and damages (what is the employee owed) are decided by a single (usually) arbitrator rather than a panel of jurors who are generally relative strangers to the legal process and who invariably bring their own experiences into the decision-making process. Some jurors have concealed bitterness toward institutions in general and employers in particular. They bring this into the deliberations and it injects uncertainty and risk for the employer defendant.

If the claim is submitted arbitration, the parties generally, though not always, agree upon an arbitrator. If the parties cannot agree, there are mechanisms available for the court or an Alternative Dispute Resolution provider to select the specific arbitrator. Any arbitrator I agree upon will be a retired judge with demonstrated expertise in employment law. I spend time researching potential arbitrators and this often includes informal input from other employment lawyers on their experience with the arbitrator.

Arbitrators are typically less likely to inject huge bias against the employer and can be skeptical of an employee’s claims, particularly if they strain credibility. If the arbitrator is a retired judge, he/she will have seen literally thousands of witnesses on the stand demonstrating various degrees of (dis)honesty and will have a much better handle on this than an average juror. Arbitrators are far less likely to award punitive damages and the damages award in general may be more carefully tailored to the facts of the case. Put another way: some jurors don’t know the value of a buck.

Confidentiality

As a general matter, employers tend to prefer not to air dirty laundry in public. Arbitration creates an avenue for private resolution of disputes without making the evidence or outcome public. Sealing testimony, documents or rulings in the civil court system is extraordinarily difficult if a case proceeds through trial to verdict or appeal.

Predictability

When a court schedules a case for trial, this almost always represents the court’s best estimate when it can try the case. It is never set in stone and, as a consequence, a trial can be continued multiple times resulting in duplicative last-minute preparation, increased cost and witness unavailability. Additionally, even when a trial commences, there are long hours where the parties and their attorneys sit in the hallway waiting for the court to attend to unrelated emergency matters, late jurors, late witnesses or other issues.

When an arbitration is scheduled, it is considered a firm date. Not to say that continuances never occur, but it is generally not for the convenience of the arbitrator. Judges are chiefly concerned with the welfare of the jurors; arbitrators are concerned about the convenience of the parties and lawyers, since they rely on lawyers for their reputation and repeat business. Additionally, arbitration hearings can be scheduled as long as the parties are comfortable, generally between 8 or 9:00 a.m. and 5:00 p.m. on successive days, which results in an overall shorter hearing than a trial with continuous interruptions.

Ability to Preclude Class Actions

It is legal to preclude arbitration of class actions. This can be a huge positive for large-scale employers, such as chain retailers, because it prevents employees from banding together and multiplying their claims under a single action. Lawyers interested in pursuing class-action lawsuits are far less interested in pursuing a single plaintiff lawsuit with the same allegations because the upside attorney fee potential is minimal. For most smaller employers, 100 employees or less, this is not as important since meaningful class actions are less common.

No Right of Appeal

As demonstrated below, this is either a pro or con depending on how the arbitration hearing is conducted and the award. However, there are extremely limited bases to seek review of an arbitrator’s ruling or award. This can cut off the right of an employee who is unsatisfied with the award to drag the process (and costs) on and on with one or more appeals.

Cons of Mandatory Arbitration

Cost

Arbitration is incredibly expensive for employers. This is primarily because, under California law, the employer must pay 100% of the arbitrator’s fee. To better understand this burden, consider a recent case in which I spent hours trying to hunt down a high quality, but reasonably-priced, arbitrator for an employment lawsuit involving discrimination and wage-hour claims. I could not find a retired judge below $700/hour and most were higher, with at least one charging $1,200/hour. For a 5-day arbitration hearing—which is not overly long if there are witnesses—my client was required to deposit approximately $50,000 three months before the arbitration hearing date. This is money that, regardless how well my client did at the hearing itself, it would never see again. Arbitrators cannot order a losing employee to pay any part of the arbitration fees to the employer. In my humble view, this cost can amount to denial of due process.

Study Suggests Employees Actually Do Better in Arbitration

Notwithstanding my suggestion that arbitrators tend to be more conservative than jurors, a 2019 study by the U.S. Chamber Institute for Legal Reform found that employees actually do better in binding arbitration.

No Right of Appeal

If the arbitrator makes a ruling that is against the applicable law, and it harms the employer’s case, there is no way to challenge the ruling.

Inability to Control Admission of Certain Evidence

This factor may or may not be important. However, if there is a very bad piece of evidence for the employer, such as an email or a hearsay statement that would not, under proper application of the rules of evidence, be seen or heard by the trier of fact (i.e., the jury), it is effectively impossible to prevent the arbitrator from knowing about it, since he/she must know about it to decide whether it is admissible. If he/she excludes it as evidence, while he/she should not consider it, as a practical matter there is no way to “un-ring the bell.”

Loose Application of the Rules of Evidence

Some arbitrators do not rigidly apply the rules of evidence. This injects uncertainty into the hearing and outcome, which is not usually good for employers.

Conclusion

On balance, I believe arbitration is a fantastic way to resolve disputes rapidly, particularly for large-scale employers where cost is less of a factor, preventing class actions is a major concern or where confidentiality is important. For employers that do not strictly fit this description, however, I cannot recommend mandatory arbitration because even the smallest dispute is likely to cost tens of thousands of dollars in arbitrator’s fees. As a consequence, an employer can be forced to settle a defensible case because it will cost more to pay for the arbitration.

Employers wishing to further explore this question should contact their experienced employment law counsel or [email protected]

 

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