United States: July 2017 California Employment Law Notes

California Supreme Court Resolves Day-Of-Rest Questions

Mendoza v. Nordstrom, Inc., 2 Cal. 5th 1074 (2017)

In response to three questions asked of it by the United States Court of Appeals for the Ninth Circuit, the California Supreme Court opined as follows:

  1. A day of rest is guaranteed for each workweek. Periods of more than six consecutive days of work that stretch across more than one workweek are not per se prohibited.
  2. The exemption for employees working shifts of six hours or less applies only to those who never exceed six hours of work on any day of the workweek. If on any one day an employee works more than six hours, a day of rest must be provided during that workweek, subject to whatever other exceptions might apply.
  3. An employer causes its employee to go without a day of rest when it induces the employee to forgo rest to which he or she is entitled. An employer is not, however, forbidden from permitting or allowing an employee, fully apprised of the entitlement to rest, independently to choose not to take a day of rest.

Employee May Proceed With Sexual Orientation Discrimination Claim

Husman v. Toyota Motor Credit Corp., 2017 WL 2665191 (Cal. Ct. App. 2017)

Joseph Husman alleged sexual orientation discrimination based on the "perception he was too gay" as well as retaliation for alleged criticisms he made concerning Toyota's commitment to diversity. The trial court granted Toyota's summary judgment motion, but the Court of Appeal reversed dismissal of the discrimination claim on the ground that Husman had raised a triable issue of fact as to whether his termination was substantially motivated by discriminatory bias (i.e., an alleged dislike for "Husman's being too gay"). In so holding, the Court rejected the "same actor" defense because, although the same supervisor who was responsible for Husman's advancement at Toyota (George Borst) also fired him, there was conflicting evidence of "cat's paw" influence that was allegedly exercised through Borst by another supervisor who "had it out for [Husman]."  The Court affirmed dismissal of Husman's retaliation claims in the absence of evidence of "pointed criticism or opposition [by Toyota] salient to an act reasonably believed to be prohibited by FEHA."   Cf. Park v. Board of Trustees of the Cal. State Univ., 2 Cal. 5th 1057 (2017) (discrimination claim by professor who was denied tenure should not have been dismissed in response to Anti-SLAPP motion – such a claim may be struck only if the speech or petitioning activity itself is the wrong complained of).

Employer's Attorney May Be Liable For Retaliation Under FLSA

Arias v. Raimondo, 2017 WL 2676771 (9th Cir. 2017)

José Arnulfo Arias worked as a milker for Angelo Dairy. The dairy did not complete and file a Form I-9 when it hired Arias. According to the appellate court, "[i]nstead of complying with federal law, the Angelos wielded it as a weapon to confine Arias in their employ" by threatening to report Arias to the federal immigration authorities when, for example, he considered accepting employment with another dairy. In 2006, Arias filed a state court lawsuit against the dairy on behalf of himself and other similarly situated employees, alleging a variety of workplace violations, including failure to provide overtime pay and meal and rest periods. Ten weeks before the trial was scheduled to begin, the employer's attorney (Anthony Raimondo) enlisted the services of the United States Immigration and Customs Enforcement ("ICE") to take Arias into custody at a scheduled deposition and then remove him from the United States. There was evidence of "Raimondo's pattern and practice of similar conduct in other cases."  In this federal court lawsuit against Raimondo personally, Arias alleges that the dairy's lawyer, acting as its agent, retaliated against Arias in violation of the anti-retaliation provision of the Fair Labor Standards Act. Raimondo's sole legal defense is that because he was never Arias's employer, he is immune from liability under the FLSA. Although the district court dismissed Arias's complaint, the Court of Appeals reversed, holding that the FLSA's anti-retaliation provision applies to "any person," including a "legal representative" such as Raimondo. See also Cal. Labor Code § 1019, et seq., and Cal. Bus. & Prof. Code
§ 6103.7 (recently enacted California restrictions on "unfair-immigration related practices").

Trial Court Abused Its Discretion In Refusing To Compel Employer To Produce Data Sought By EEOC

EEOC v. McLane Co., 857 F.3d 813 (9th Cir. 2017)

Damiana Ochoa filed a charge with the EEOC alleging sex discrimination (based on pregnancy) in violation of Title VII, when, after she tried to return to her job following maternity leave, her employer (McLane Co.) informed her that she could not come back to the position she had held for eight years as a cigarette selector unless she passed a physical strength test. Ochoa took the test three times but failed to pass and, as a result, her employment was terminated. McLane disclosed that it administers the test to all new applicants and to employees returning from a leave that lasts more than 30 days. Although McLane voluntarily provided general information about the test and the individuals who had been required to take it (gender, job class, reason for taking the test and the score received), it refused to disclose "pedigree information" for each test taker (name, social security number, last known address, telephone number and the reasons why particular employees were terminated after taking the test).

In this EEOC subpoena enforcement action, the district court refused to compel production of the pedigree information, but the United States Court of Appeals for the Ninth Circuit (in an earlier opinion) reversed that order following a de novo review of the lower court's order. The United States Supreme Court then vacated and remanded the judgment of the Ninth Circuit, holding that the district court's decision to quash or enforce an EEOC subpoena should be reviewed under the more deferential abuse of discretion standard. In this latest opinion, the Ninth Circuit held that the district court had indeed abused its discretion when it denied enforcement of the EEOC's subpoena and once again vacated the district court's order, remanding the matter back to the district court.

Attorney Work Product Belongs To Law Firm, Not Former Attorney Employee 

Tucker Ellis LLP v. Superior Court, 2017 WL 2665188 (Cal. Ct. App. 2017)

Evan C. Nelson, who is a California attorney specializing in asbestos defense, was employed as a trial attorney by Tucker Ellis in the firm's Mass Tort & Product Liability Practice Group. The firm promoted Ellis to the position of "non-capital partner" approximately two years before he left Tucker Ellis to join a competing law firm. After Nelson left Tucker Ellis, the firm received a subpoena for, among other things, attorney work product emails authored by Nelson during his employment with Tucker Ellis. Tucker Ellis produced the Nelson emails in response to the subpoena, which spurred Nelson to send a "clawback" letter to Tucker Ellis and the subpoenaing party, asserting the emails contained privileged attorney work product and demanding they be sequestered and returned to Nelson. Tucker Ellis did not respond to Nelson's letter. Nelson sued Tucker Ellis for negligent and intentional interference with contract, invasion of privacy, conversion, among other things, and asserted that the emails were made available on the Internet and disseminated to over 50 asbestos plaintiffs' attorneys, which interfered with Nelson's ability to work effectively with experts in the asbestos field and ultimately resulted in his being terminated from his new law firm and unable to find new employment.

In this writ proceeding (which followed a series of adverse rulings against Tucker Ellis), the Court of Appeal held that the law firm and not Nelson is the holder of the attorney work product privilege codified at Cal. Code Civ. Proc. § 2018.030 and that, therefore, Tucker Ellis had no legal duty to secure Nelson's permission before disclosing the emails to others:  "...[T]he purpose of the attorney work product privilege will be better served by allowing the firm itself – with current knowledge of ongoing litigation and client issues and in the context of the firm's ongoing attorney-client relationships – to speak with one voice regarding the assertion of the privilege."

Punitive Damages Claim Against Employer Is Dismissed Absent Action By "Managing Agent"

CRST, Inc. v. Superior Court, 11 Cal. App. 5th 1255 (2017)

Hector Contreras was employed as a truck driver by CRST when the truck he was driving collided with the car of Matthew and Michael Lennig. In this writ proceeding, CRST sought summary adjudication of the Lennigs' prayer for punitive damages. The Court of Appeal issued a writ of mandate directing the trial court to vacate its order denying CRST's motion for summary adjudication and entering a new order granting summary adjudication in favor of CRST on the punitive damages issue. The Court held there is no evidence that the CRST fleet manager (Marge Davis) was a "managing agent" within the meaning of the punitive damages statute (Cal. Civ. Code § 3294(b)) because she had no authority to change or establish corporate policy.

Trial Court Erred By Failing To Certify Class Action For Unpaid Rest Periods

Bartoni v. American Med. Response W., 11 Cal. App. 5th 1084 (2017)

Current and former employees of an ambulance service company sued their employer for unpaid meal and rest periods. The complaint alleges claims on behalf of a putative class as well as non-class claims under the Private Attorneys General Act of 2004 ("PAGA"). The trial court denied plaintiffs' class certification motion, but in this opinion the Court of Appeal determined the trial court had erred and issued a peremptory writ of mandate commanding the trial court to vacate that portion of its order denying class certification as to the on-duty rest period claims. The appellate court denied AMR's motion to dismiss the appeal and exercised its discretion to treat the appeal as a writ petition. While the Court affirmed denial of class certification of the on-duty meal period claims ("an on-call meal period is [not] necessarily 'on-duty' for purposes of the wage and hour laws"), it found error in the trial court's similar determination with respect to on-call rest periods based upon the recent California Supreme Court opinion in Augustus v. ABM Sec. Servs., Inc., 2 Cal. 5th 257 (2016), which post-dated the trial court's order in the case. Cf. Microsoft Corp. v. Baker, 582 U.S. ___, 137 S. Ct. 1702 (2017) (federal courts of appeals lack jurisdiction to review an order denying class certification or striking class allegations after the named plaintiffs have voluntarily dismissed their claims with prejudice).

Foreign National Who Worked For Travel Tour Company Was An Employee, Not An Intern Or Exempt Manager

Kao v. Joy Holiday, 2017 WL 2590653 (Cal. Ct. App. 2017)

Ming-Hsiang Kao was employed by Joy Holiday (a travel tour company) initially performing IT-related duties and then eventually as its office manager. While he was still in Taiwan, Kao worked with Jessy Lin (one of the owners of Joy Holiday) as a tour organizer. Kao later arrived in California on a tourist visa and moved into the home of Lin and her husband Harry Chen. (Kao was paid a salary of $1,700 per month, representing a gross amount of $2,500 less an $800 rent deduction.)  After he received an H-1B visa, Kao was put on the company payroll and worked as the "office manager" of Joy Holiday where he booked hotels and coordinated bus tours. The trial court determined that Kao worked roughly 50 hours per week. Kao was later demoted to "non-manager status," moved into his own apartment and eventually was terminated after working for Joy Holiday for approximately two years. Kao filed suit for breach of contract and violation of various wage/hour statutes. Defendants contended that Kao was not an employee while he was awaiting his H-1B visa and, thereafter, he was an administrative exempt employee. Although the trial court rejected Kao's statutory wage claims, the Court of Appeal reversed, holding that Kao was an employee (not a non-employee trainee or intern) before he received the visa and, thereafter, he was not paid a sufficient salary to be classified as an exempt administrative employee – the offsets for rent were not part of Kao's salary. Accordingly, the Court held that Kao is entitled to unpaid wages and overtime, penalties for Joy Holiday's failure to provide itemized wage statements and waiting-time penalties.

Mortgage Underwriters Are Not Exempt From FLSA Overtime Requirements

McKeen-Chaplin v. Provident Sav. Bank, 2017 WL 2855084 (9th Cir. 2017)

Mortgage underwriters at Provident Savings Bank review mortgage loan applications using guidelines established by Provident and investors in the secondary mortgage loan market, including Fannie Mae, Freddie Mac and the FHA. In this lawsuit for unpaid overtime arising under the federal Fair Labor Standards Act (the "FLSA"), the United States Court of Appeals for the Ninth Circuit reversed the summary judgment that was entered in favor of Provident and ordered, instead, that summary judgment be entered in favor of McKeen-Chaplin, concluding that "where a bank sells mortgage loans and resells the funded loans on the secondary market as a primary font of business, mortgage underwriters who implement guidelines designed by corporate management, and who must ask permission when deviating from protocol, are most accurately considered employees responsible for production, not administrators [exempt from overtime] who manage, guide, and administer the business."

Employee Is Not Entitled To Attorney's Fees For Breach Of Contract Claim

Shames v. Utility Consumers' Action Network, 2017 WL 2807920 (Cal. Ct. App. 2017)

Michael Shames filed this lawsuit against the Utility Consumers' Action Network ("UCAN"), alleging various causes of action stemming from the termination of his employment. Although his amended complaint alleged UCAN's breach of contract for its failure to pay him multiple bonus payments, Shames did not seek attorney's fees under that cause of action. (Shames had sought attorney's fees under two other causes of action on which he did not prevail.)  The trial court granted Shames $2,000 in attorney's fees, but it denied him the fees he incurred "for the entire litigation" because he failed to seek fees under the specific causes of action on which he had prevailed: "[Labor Code] section 218.5... clearly places a very specific requirement on a party who seeks an award of attorney fees in such an action – i.e., to demonstrate that one of the parties to the action requested those fees 'upon the initiation of the action.'"  The Court of Appeal affirmed.

California Employment Law Notes

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions