California Employment Law : Employment Lawyer & Attorney : Fox Rothschild Law Firm : San Francisco, Oakland, Los Angeles, San Diego

In a previous rant, I discussed how Title VII and other laws prohibiting harassment are intended to address a form of discrimination.  They are not, as the Supreme Court cautioned in Harris v. Forklift, intended to become a "general civility code."  Apparently seeing that as an oversight, the California legislature is taking its first tentative steps towards adopting a civility code.

This morning, the State Assembly passed ACR 112 -- a resolution declaring the first week of March as "Cuss-Free Week."  The resolution now moves to the Senate.  There's no enforcement and no penalties.  It merely

"invites the people of this state to take the No Cussing Challenge each year during the first week of March to improve our relationships, to set a tone of harmony and connectedness in our communities, and to inspire ourselves to
higher endeavors."

It's a good thing the state has no really pressing problems to deal with.

Update (March 2, 2010): The resolution did not pass the Senate.  Instead, it was postponed indefinitely.  It seems that some legislators believe that the state's $20 billion budget deficit requires their immediate attention.  One can only hope that its sponsors, when informed that the resolution had stalled, issued some choice expletives.

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As we said before, we love federal court.  And yesterday the United States Supreme Court made it easier for us to get there.  In Hertz Corporation v. Friend the Court recognized a bright line rule regarding a corporation's principal place of business:

[W]e conclude that the phrase "principal place of business" refers to the place where the corporation's high level officers direct, control, and coordinate the corporation's activities. Lower federal courts have often metaphorically called that place the corporation's "nerve center." See, e.g., Wisconsin Knife Works v. National Metal Crafters, 781 F. 2d 1280, 1282 (CA7 1986); Scot Typewriter Co. v. Underwood Corp., 170 F. Supp. 862, 865 (SDNY 1959) (Weinfeld, J.). We believe that the "nerve center" will typically be found at a corporation's headquarters.

Before this decision, much time was spent comparing and contrasting how much business a corporate defendant had in one state versus another.  Now, absent a showing of jurisdictional manipulation, the inquiry is simple:

[T]he courts should instead take as the "nerve center" the place of actual direction, control, and coordination.

 

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It’s been more than 10 years since California enacted Labor Code § 233, commonly referred to as the “kin care” statute.  In essence, the statute requires employers to allow employees to use half of their sick leave accrual to care for certain relatives if they become ill.  State law does not require employers to offer sick leave.  But if they do, the must allow employees to use up to half their sick leave to care for a sick child, parent, spouse, or domestic partner.

But what happens when an employer doesn’t cap sick leave? That was the situation in McCarther v. Pacific Telesis Group (pdf). The plaintiffs worked under collective bargaining agreements that allowed employees to take up to five consecutive days off for each illness with pay.  Once they returned to work, even for a day, they would again be entitled to another paid sick leave period of up to five days in a row.  If there absences were excessive, they could be disciplined.  But the system did not provide for accrual of sick time and, because there was no accrual, there was no cap.

If there’s no cap on paid sick leave, how do you apply the rule that employees get to take half their sick leave for kin care?  The California Supreme Court said last week that you don’t.  It ruled that “the reach of the statute is limited to employers that provide a measurable, banked amount of sick leave.”  As a result, the court ruled that the employer in this situation wasn’t required to provide kin care to its employees.

So what is half of infinity?  In this case, zero.

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If you arbitrate employment disputes, then you may have seen that the limits on discovery vary from arbitrator to arbitrator.  Some allow interrogatories, some don't.  Some limit the number and length of depositions, some don't.  The American Arbitration Association's Employment Arbitration Rules don't provide much guidance, saying simply that:

The arbitrator shall have authority to order such discovery, by way of deposition, interrogatory, document production, or otherwise, as the arbitrator considers necessary to a full and fair exploration of the issues in dispute, consistent with the expedited nature of arbitration." 

Contrast that with the 70 pages or so of the California Code of Civil Procedure devoted to discovery and you can see how much flexibility and discretion arbitrators have in this area.

According to a California court of appeal decision published last week, Dotson v. Amgen, limits on discovery can be included in the arbitration agreement, itself.  In that case, the agreement stated:

Each party shall have the right to take the deposition of one individual and any expert witness designated by another party. . . .  Additional discovery may be had where the arbitrator selected pursuant to this agreement so orders, upon a showing of need.

The trial court found the provision unconscionable and refused to enforce the arbitration agreement.  But the appellate court disagreed.  It recognized that "arbitration is meant to be a streamlined procedure" and that the only way to achieve that streamlining is by limiting discovery.  

Employers creating (or revising) arbitration programs need to be aware of the judicially created rules for an enforceable arbitration agreement.  But as long as they meet those requirements, nothing prevents them from limiting discovery in the manner the Dotson decision upheld.  

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Just over a year ago, Congress enacted the Lilly Ledbetter Fair Pay Act.  This was in response to the U.S. Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co. that said the statute of limitations on discriminatory pay claims begins running when the pay rate was determined.  Congress didn't like that and enacted the LLFPA to provide that each paycheck constitutes a new violation.

Judy Greenwald at Business Insurance Magazine interviewed me for a story about the LLFPA's impact one year after its enactment.  The Act has not thrown open the floodgates, as many feared.  But as a result, it seems that many employers have done nothing in response to the law.  That's a mistake. 

In the article, I and others stress the need to revisit document retention policies.  Under Title VII, the Americans With Disabilities Act, and the Age Discrimination in Employment Act, compensation decisions that had to be challenged within a year of being made, can now be challenged years down the road.  By the time the decisions get challenged, the decision makers may be long gone.  Even if they're available, they may not remember what they did or why.  

Anyone who's worked with management-side employment lawyers has heard this before.  It's important to document employment decisions.  That's because it's much easier to defend employment decisions when someone can explain and support the basis for the decision.  Don't ask me why.  It just is.

It's especially important now to maintain that documentation if it relates to compensation decisions.  This includes not just payroll records, but performance reviews, correspondence between managers, compensation policies, and anything else that bears on the decision what to pay someone.  The standard advice used to be to keep this information for 7 years.  Now, it's important to keep it almost indefinitely.  Only if everyone affected by the decision has been gone at least two years should you think about disposing of it.

Will this increase storage costs?  Yes.  That's why storage companies were such huge supporters of the Act.  [OK.  I made that last part up.] 

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For the first time, OSHA has made the work-related injury and illness data collected from more than 80,000 employers from 1996 to 2007 available in a searchable online database, allowing the public to look at establishment or industry-specific injury and illness data.  The database includes an establishment's name, address, industry, associated total case rate (TCR); days away, restricted, transfer case rate (DART); and the days away from work case rate (DAFWII).

OSHA uses this data to calculate injury and illness incidence rates to guide its strategic management plan and to focus its Site Specific Targeting (SST) Program, which the agency uses to target its inspections. The database can be found online here or here.

NOTE: The second link (www.data.gov) provides more than just OSHA data.  It provides public access to work force data created by the executive branch.

Thanks to Christina Armstrong for this information.

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The statistics are here.  My favorite?  The Statewide average time from filing a Notice of Appeal to the filing of an Opinion is 680 days (p. 18).

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The United States Supreme Court may decide to review Staub v. Proctor Hospital, a case from the Seventh Circuit which raises issues regarding the colorfully named “cat's paw” theory.  The basic theory is one related to imputed intent or, as stated in Staub's request for review, “In what circumstances may an employer be held liable based on the unlawful intent of [subordinate] officials who caused or influenced but did not make the ultimate employment decision?” In California, there are a handful of decisions applying the cat’s paw rationale. E.g., DeJung v. Superior Court, 169 Cal. App. 4th 533, 540 (2008). However, the existing case law provides little guidance on the contours of the doctrine. For example, what type of “unlawful intent” matters? If the subordinate has demonstrated age bias, but the alleged adverse action involves bias based on race, should the Court nonetheless find the whole process flawed? My view, as expressed in a recent brief filed with the California Court of Appeals, is here.

In case you were wondering: The "cat's paw" doctrine derives its name from a fable, made famous by La Fontaine, in which a monkey convinces an unwitting cat to pull chestnuts from a hot fire.  As the cat scoops the chestnuts from the fire one by one, burning his paw in the process, the monkey eagerly gobbles them up, leaving none left for the cat. Today the term "cat's-paw" refers to "one used by another to accomplish his purposes.  EEOC v. BCI, 450 F.3d 476, 484  (10th Cir. 2006).

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Read our e-Book here.

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