Proposed California Employment Laws Still Pending

Back in the days of the Gray Davis administration, you could count on 15-20 new employment laws every year. The Legislature would pass them en masse, and then the Governor would veto one or two to show how pro-business he was, and then sign the rest. For some reason, the number of new employment law proposals has dropped to a handful in more recent times. This year, the Legislature seems intent on passing a select few bills the California Chamber of Commerce affectionately refers to as "job killers." Courtesy of the Chamber, see the list of pending bills here.

The pending bills include a couple of health care measures. One of them, SB 840, again attempts to impose a "single payer" healthcare system. According to the Healthcare for All blog, the voters rejected single payer back in 1994 with Prop. 186. I guess it's time for another run? Another bill requires large employers to provide a certain level of health insurance or pay a tax to the state. I think the voters rejected a "pay or play" system a couple of years ago with Prop. 72. I also think a court just invalidated a similar effort in Maryland. Stay tuned....

DGV

Jennifer's Recent Columns

Jennifer writes a bi-weekly column published in the Sacramento Daily Recorder legal newspaper. Recent topics include:

- CALIFORNIA SUPREME COURT EMPLOYMENT LAW DECISIONS 2005 - 2006

- THE U.S. SUPREME COURT EXPANDS TITLE VII RETALIATION CLAIMS

- ONE OPTION FOR REDUCING OVERTIME LIABILITY: THE ADOPTION OF ALTERNATIVE WORKWEEK SCHEDULES

In the off chance you don't subscribe to the Daily Recorder, you can sign up on Shaw Valenza LLP's website to receive copies of Jennifer's articles via email.

DGV

Prop. 64 Restrictions on Unfair Competition Cases Apply to Pending Cases

The California Supreme Court held that Prop. 64, the voters' 2004 amendments to California's Unfair Competition Law, apply to cases that were pending when the initiative was passed. That means a bunch of pending cases under Bus. and Prof. Code section 17200 must be re-examined to ensure the plaintiffs have standing and that the action otherwise complies with the revised statute. Californians for Disability Rights v. Mervyn's. The opinion is as dry as dirt, but trust me, this is good news for employers.

WARN Act doesn't apply when the government orders a layoff

When the federal TSA assumed the security screening operations at San Jose, California airport, Globe Aviation Security Services laid off a number of employees previously performing security checks there. Employees brought a class action claiming the federal WARN Act required Globe to provide 60 days' notice of the layoff. Not so, says the Ninth Circuit, in Deveraturda v. Globe Aviation Security Services. The court held that the WARN Act applies only when the "employer" orders the layoff. In this case, the federal government's legislation federalizing airport security mandated Globe's activities.

Four rules of employment litigation

Sonoma County Superior Court was the venue for one of the largest single-plaintiff employment law verdicts in California history. The bloggers from Suits in the Workplace infer from this case 4 important rules of employment litigation, by way of of Ross' Employment Law Blog.
What are their rules?

1. No good deed goes unpunished.
2. California's just different.
3. The plaintiff's lawyer knows no shame.
4. It's not about justice, it's about the money.

Again, these are their rules, not mine. Yeah, ok, they're usually true. Read the post - the facts of the case will make you smack your forehead. Everyone chuckles when you do that.

Have a nice weekend.

DGV

Employees' Lawyers Can Swear to Employee's Discrimination Charge

When employees file discrimination charges at the Department of Fair Employment and Housing, they often do not have a lawyer. They must sign the charge for it to be valid, and the signature is "verified," meaning it signifies the charge is signed under penalty of perjury. In Blum v. Superior Court, Blum filed a discrimination charge against his employer, Copley Press and some employees too. But Blum's lawyer signed the administrative charge on his behalf. Copley claimed that Blum's failure to "verify" or swear to his own charge was a defect which invalidated the discrimination complaint and rendered his civil lawsuit fatally defective.

The Court of Appeal started off by saying that a "verified" or sworn charge is a jurisdictional requirement. So far so good. But then the Court said that the Fair Employment and Housing Act does not specifically require the employee alleging discrimination him or herself to provide the verification. So, because the law did not expressly say that the charging party - the person with knowledge of the facts - has to sign his or her own charge, the Legislature did not care who actually swears to the allegations. Stop rolling your eyes, they could get stuck that way.

At the end of the opinion, the Court includes a couple of admonitions for the plaintiff's bar:

We hold an attorney may verify a DFEH complaint for his or her client by subscribing his or her own name to the complaint. The attorney may not verify by signing the client's name. We would, however, caution attorneys about verifying such complaints unless they believe the allegations made therein to be true and they are acting in good faith as they are subject to penalties for perjury if they sign their name to DFEH complaints.

**** Caution: Private musings follow *******

So, let's review. Before a lawyer swears to facts under penalty of perjury in lieu of the client who has personal knowledge of the facts, the lawyer at least should believe the facts are true, and the lawyer should not sign the client's own name. And there I was about to say the Court's decision turned the signature on the charge into something essentially meaningless. Hmmm....I wonder if defense lawyers will start taking depositions of plaintiff's attorneys who sign these charges.

DGV

Cal. DFEH Revises Anti-Discrimination Poster

The California Department of Fair Employment and Housing updated the poster that employers must maintain. The California Chamber of Commerce advises the DFEH has said employers are not responsible for posting the new poster until the new Spanish version becomes available "sometime later this year." We looked, but saw nothing on the DFEH's website announcing the new poster or the implementation date. In other, possibly related, news, vendors of those handy "combo" posters heartily rejoiced upon reading Shaw Valenza LLP's blog today....

DGV

The NLRB Hurts a Handbook

The National Labor Relations Board held in Long's Drugs that a handbook's confidential information policy violated the National Labor Relations Act. As a result, the employer was required to rescind the policy and post a notice. However, the Board did not require a new union election, which the employer had won the first time around.

Here is the Board's discussion of the policy language that the Board held violated the NLRA:

The Respondent’s 2000 handbook, under the heading “Corrective Action/ Employee Conduct,” states that “Unauthorized disclosure of confidential information regarding customers, employees, or the business of the company” is conduct subject to discipline, including discharge. A provision directly following this general confidentiality provision, under the heading “Privileges of a Team Member,” states, “Your pay is confidential company information and should not be discussed with fellow employees.” Neither of the aforementioned provisions appears in the 2003 handbook, which at relevant times was distributed to only five unit employees. However, the 2003 handbook, under the heading “Professional Behavior,” states that the Respondent “expects compliance with the following behaviors . . . Maintain confidentiality, including but not limited to, information regarding customers, employees and the company.” The handbook further states that employees are “expected to adhere to the policies and procedures that protect customer and employee confidential information, and thereby, comply with federal and state privacy laws,” and that the Respondent trusts employees not to disclose “such information to unauthorized persons, or organizations, or using it for personal gain.”

Sounds like a lot of handbooks, right? Well, here's what the NLRB said about the confidentiality language:

As noted, the 2000 handbook contains a general confidentiality provision and a
particular confidentiality provision prohibiting the discussion of wages. The 2003 handbook contains a general confidentiality provision. . . . . With respect to the general provisions, which are alleged to be unlawful, we believe that they must be read in the context of the particular provision and Gilbert’s specific affirmation that the Respondent considered employee wage rates to be confidential information. So read, we conclude that the general provisions of the 2000 and 2003 handbooks, which prohibit the disclosure of confidential information, are unlawful.

Does the confidentiality language above seem similar to the one in your handbook? Are employees prohibited from discussing working conditions including their wages? There are a number of provisions in an employee handbook that may implicate the National Labor Relations Act, including solicitation, bulletin boards, prohibitions on discussing wages, promises to abide by all policies, and even "insubordination" prohibitions. The NLRB may take jurisdiction of a claim even when the employer is "non-union." So, be careful out there....

Secret Recording of Interstate Phone Calls May Violate California Privacy Law

One reason employment law so interesting and challenging is that many not-so-obvious areas of the law affect the advice employment practitioners give their clients. The UCL standing case blogged yesterday was a good example. The California Supreme Court gave us another one today.
In most states, one party to a conversation lawfully may record it without letting the other party know. But, along with several other states, California is a "two party" state - both parties must consent to the recording. So ,what happens when one party to a call is in California, and the other party is recording in a "one-party" state?
The California Supreme Court said today in Kearney v. Salomon Smith Barney, that a business located outside California may violate California law by recording a phone call with a California-based person. However, the Court emphasized that the law does not apply when the business announces that calls are recorded:

California law does not totally prohibit a party to a telephone call from recording the call, but rather prohibits only the secret or undisclosed recording of telephone conversations, that is, the recording of such calls without the knowledge of all parties to the call. Thus, if a Georgia business discloses at the outset of a call made to or received from a California customer that the call is being recorded, the parties to the call will not have a reasonable expectation that the call is not being recorded and the recording would not violate section 632.

Now you know why you hear "calls may be monitored or recorded for quality assurance purposes" at the beginning of a call. You also now know why employers who record California employees' conversations cannot do so without their consent.*

* As the Court noted, there are narrow circumstances under which secret recording is permitted:

Other provisions of the statutory scheme identify a number of limited circumstances in which secret recording by one party to a communication is permissible, such as when the recording is made “for the purpose of obtaining evidence reasonably believed to relate to the commission by another party to the communication of the crime of extortion, kidnapping, bribery, any felony involving violence against the person, or a violation of Section 653m [making obscene phone calls with the intent to annoy]” (§ 633.5), or when a victim of domestic violence, acting pursuant to court authorization, records “any prohibited communication made to him or her by the perpetrator” of domestic violence (§ 633.6, subd. (a)).

UCL Class Actions Just Got Tougher to Plead

California's Unfair Competition Law, Bus. and Prof. Code section 17200, gets used against employers in wage and hour and other cases. Sometimes, plaintiffs try to use the UCL to extend the statute of limitations, because the UCL's statute of limitations is four years.

The voters of California pared back the UCL in November 2004 with the passage of Proposition 64. Among the initiative's most important components - a requirement that a plaintiff have "standing" - actual injury in fact - in order to assert the claim.

In this non-employment law case, Pfizer v. Superior Court, a plaintiff tried a UCL class action alleging that Pfizer falsely advertised Listerine as a substitute for dental floss. The plaintiff tried to define the class as anyone who bought Listerine during the class period.

The Court of Appeal held that Prop. 64 requires each member of a purported class to have suffered actual injury. Thus, it is not enough that a class member merely purchased Listerine during the class period.

This case will help employment practitioners in cases where the plaintiff cannot say that each putative class member actually suffered injury as a result of a practice. Thus, for example, in an overtime case, the employer can argue a UCL claim should not include class members who did not actually work overtime because those putative class members did not suffer "actual injury" as a result of alleged mis-classification.

A day's work and a day's pay - are due the same day

The California Supreme Court in Smith v. Superior Court (L'Oreal U.S.A.), decided that an employee who is hired for one day is due his or her wages on the day of termination of employment under Lab. Code section 201. The decision makes it tough on the relatively small group of employers who routinely employ workers for just one day. But that's pretty much what the statute says:

[Labor Code section]201. (a) If an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately.

Unfortunately, L'Oreal is 0-2 in employment law cases before the California Supreme Court this Term.

- DGV

Ninth Circuit Gives Employers a Dark Day

Robert Dark, a truck driver for Curry County, Oregon, typically would receive a physical warning from his body (an "Aura") in advance of having an epileptic seizure. One day, Dark ignored his body's pre-seizure warning. He had a seizure at work, and passed out behind the wheel of a pickup truck. Curry County discharged him for misconduct. Dark sued under the Americans with Disabilities Act of 1990, claiming not only that the County failed to accommodate him, but also that the County fired him for discriminatory reasons. The Oregon district court granted summary judgment. The U.S. Court of Appeals for the Ninth Circuit reversed and sent the case back to court for trial.

Apparently, the employer did not litigate whether Dark had a disability under the ADA standard, which is tough on employees. The opinion is silent on this point. The court moved on to the County's legitimate business reason for termination, holding it was insufficient for summary judgment. Dark's supervisor stated Dark was fired because he could not safely perform his essential job functions and was a direct threat to himself or others. But when Dark appealed to the Curry County Board of Commissioners, the Board found that Dark engaged in misconduct by reporting to work despite the Aura and not telling his co-workers of the possibility of a seizure. On appeal, the County insisted on the latter explanation (probably because there were no efforts to reasonably accommodate Dark, putting the county into a difficult legal position).

The Court held the County was not permitted to argue Dark's falling unconscious behind the wheel is "misconduct," because it arose from the disability itself. The Court distinguished cases (e.g., Collings v. Longview Fibre), in which an employee was fired after engaging in misconduct arising from drug or alcohol use, and where the employee engaged in egregious criminal conduct (e.g., Newland v. Dalton). The Court also noted Dark provided evidence of six employees' accidents where the employees escaped discipline. Apparently, even Dark himself previously had been involved in accidents but was not disciplined at all.

The other significant issue addressed is the employer's obligation to accommodate. The County made no effort to engage Dark in an "interactive process" and offered him no accommodation in light of the misconduct conclusion. The Ninth Circuit reiterated that employers have an affirmative duty to engage in the interactive process to determine whether accommodation is possible. In this case, temporary reassignment to a non-hazardous was a possible accommodation. The court held that the employer must consider reassignment to a vacant position that is either vacant now OR is likely to become vacant in the reasonably near future. This is a mushy standard will create much uncertainty for employers seeking a workable standard for evaluating temporary transfer as a form of accommodation.

The Carrot and the Stick, So to Speak

Employers seeking to control health care costs increasingly have become more aggressive in efforts to influence employees' non-working behavior. Employers have subsidized health club memberships for years. Newer programs are more aggressive, with some employers now refusing to hire smokers in states that don't have smoker protection laws. (In a recent report, The ACLU's National Work Rights Institute estimates 6,000 employers have such policies). Forbes reports some employers use the "carrot," passing healthcare cost savings on to employees who enroll in weight-loss programs or refrain from smoking. This USA Today article discusses a new twist- employers are replacing vending machine candy with healthier snacks, and subsidizing healthful cafeteria items. What's next, excluding motorcycle riders from insurance coverage for motorcycle-related injuries? (Oh, your slippery slope arguments are wasted on me). Yep. Employers tempted to institute such programs should research whether state "lawful activity" statutes will protect employees' otherwise lawful, off-premises activity.

- DGV

Subscribe to email updates

Happy Sunday! Who knew one could open a new law firm and then spend all his time learning HTML? Right, I guess I know. Anyway, now you can subscribe to updates via email by entering your email address in the right margin. Directions to the right margin: this way: ----------->. With this handy addition to our user-friendly blog, updates will be delivered via email and you won't have to check this space. Next, I'm going to try to find HTML code that will automatically prepare veal cordon bleu and other gourmet items. NOW, you'll sign up.