California Supreme Court Approves Pre-Class Certification Disclosure of Putative Class Members

Class actions often involve discovery battles over the identification of potential class members before a class is certified. The plaintiff wants to be able to contact freely potentially sympathetic witnesses to support the certification motion and win on the merits. The defendant typically wants to preclude the plaintiff from contacting these putative class members since they often are completely unaware of the lawsuit asserted on their behalf.

The California Supreme Court in Pioneer Electronics (USA), Inc. v. Superior Court (Olmstead)endorsed pre-certification identification of putative class members. The Court rejected the court of appeal's procedure for contacting witnesses - a letter permitting contact only if the potential class member affirmatively consented to the disclosure of his or her information. Rather, the Supreme Court favored the trial court's procedure - contact information would be disclosed unless the putative class member objected to the disclosure by returning the letter sent by the parties, checking a box denying consent to disclosure.

The Pioneer case is not an employment law decision per se; the case involved claims that a Pioneer DVD player was defective. And the Supreme Court did not mention disclosure of information in personnel files, or employment class actions, even though the employment bar has been waiting for this decision for a couple of years, and an employers' association filed an amicus brief.

There is little good news for employers in the opinion. However, there is language in the decision supporting more protection when plaintiffs in class action seek employees' contact information or disclosure of information from personnel files. Unlike in the consumer class action context, employees' personnel files are protected from disclosure by statute and have been recognized as information entitled to constitutional protection. Therefore, the courts interpreting Pioneer may well adopt more stringent procedures for identification of information in personnel files.

We will see how this shakes out.

DGV

New Trend Emerging: Anti-"Bullying" Laws

Nobody likes a mean boss. Co-workers naturally do not always like everyone they work with. But a recent San Francisco Chronicle article features the possibility of anti-bullying legislation.
The website "bullybusters.org" contains a growing list of states taking up "model" healthy workplace legislation.

Anti-bullying laws would mean that someone could claim a "hostile environment" without showing a linkage between the conduct and a protected criterion, such as race, sex, disability, religion, etc.

Rhetorical question alert: Think this could increase litigation? Think opportunistic workers will file suits against managers in retaliation for legitimate decision-making?

What does this mean? The case law currently includes many statements by courts to the effect of: "the law does not guarantee a Utopian workplace," that feuds between employees (unrelated to illegal discrimination) are not actionable, and that anti-discrimination laws are not "civility codes." Well, if anti-bully advocates have their way, all these dicta in judicial opinions will become obsolete.

The devil of course is in the details. Everyone understands that an abusive person in the workplace is not conducive to good morale, can result in higher turnover, and can make going to work unpleasant etc. (More rhetorical questions follow). But when does an "intense" manager or employee cross the line and become a "bully' subjecting the employer to financial liability? And who is going to decide this? A jury at a cost of tens or hundreds of thousands in legal fees? How will managers be able to manage poor performance, convey negative feedback, and even let off a little steam without the fear of legal liability? And then there's the backlash - Won't it be easier just to fire an at-will employee than let the worker build a "bullying" case?

Workers have arguments now and then. Supervisors are responsible for managing productivity, work performance, attendance, and other unpopular subjects which naturally cause hurt feelings. Should managers be legally required to be nice? Should managers hire people based on whether they are likely to be friendly? Incidentally, should an employee be injured by such conduct, there already is a remedy for physical or psychiatric through the workers' compensation laws.

So, let's hope that the advocates of anti-bullying legislation consider the various issues that anti-bullying legislation will raise, and set a relatively high standard for what is a "bully."

DGV

Nevada Minimum Wage Increases to $6.15

Employers dealing with California's myriad employment laws may have missed Nevada's minimum wage increase, which actually took effect a couple of months ago.

The new minimum wage of $6.15 applies only to employees who are not covered by the employer's health insurance program. The Nevada minimum wage remains at $5.15 for those who are covered by health care insurance. Here's an AP article.

Fun fact: Nevada hasn't updated its regulations on the web yet. So, the official text says that the minimum wage remains at $5.15. However, the Nevada Labor Commissioner's FAQ's reflect the new figure.

Federal fact: The federal minimum wage is $5.15, but Congress is contemplating a substantial increase this year, perhaps as much as $7.25.

DGV

San Francisco Paid Sick Leave Update

We previously posted about the new paid sick leave ordinance and poster here. There are subtle differences in the language between the ordinance and poster, intended to "clarify" the ordinance. For example, employers may be surprised to know that San Francisco's Office of Labor Standards Enforcement takes the position that paid sick leave must accrue when any employee performs work in San Francisco, even if only temporarily. Once the employee works 30 hours in San Francisco, no matter the time it takes to do so, the employee accrues an hour of paid sick leave. On the other hand, the employee is entitled to take paid sick leave only when scheduled to work in San Francisco.

So, for example, assume an employee based in Oakland comes into San Francisco for a two hour meeting. The employer must track that time so that the employee earns sick leave after 28 more hours performing work in San Francisco. Other examples - a delivery driver spends 3 hours out of 8 delivering in San Francisco per day, or a salesperson whose territory includes San Francisco and others. In each case, the employer is responsible for toting up the hours worked in SF and crediting one hour's sick pay for each 30 hours of work within the City and County of San Francisco.

Obviously, employees who do not regularly work in SF will not accrue much sick time, and probably won't have much opportunity to take it. But this will be a recordkeeping nightmare. The ordinance is effective on 2/5. Get ready!

California Proposed Regs re Expense Reimbursement

California's Division of Labor Standards Enforcement has decided to issue proposed regulations on the reimbursement of employee expenses under Labor Code section 2802. The regulations cover travel and personal automobile expenses, meal reimbursement, and other reimbursement issues. The regulations specifically authorize the DLSE to take expense reimbursement claims at the agency level and provides for attorneys' fees to be awarded in favor of employees based on a "lodestar" formula. There will be a comment period and revisions before these are finalized.

DGV

Update on San Francisco Sick Leave - Poster

Here is the poster for San Francisco's Paid Sick Leave ordinance. The new law takes effect February 5, 2007. All employers with employees working in the City and County of San Francisco must comply. (Us ,too).

Resources - We posted previously on this in November. Also, here is our article we published in the Sacramento Daily Recorder. And here is the ordinance itself.

DGV

Employee Monitoring - California Supreme Court to Review Hernandez v. Hillsides

Happy New Year!

Back in September I posted about the California Court of Appeal's decision in Hernandez v. Hillsides. In that case, two employees were permitted to proceed with an invasion of privacy claim based on video monitoring of their office. There wasn't much monitoring and it was not directed at the employees who sued, so there was a collective shudder among employers who monitor their workers.

Fast forward to today: The California Supreme Court granted review of the case. So, nevermind about Hernandez for the next couple of years. Our advice remains the same anyway: destroy employees' expectation of privacy by giving notice of monitoring and posting signs as appropriate.