Plaintiffs’ attorneys in California love making claims based on technical violations related to paystubs.  An employee will go see a lawyer complaining about wrongful termination or harassment or discrimination and the lawyer will say, “Let me see your paystub.”  Labor Code Section 226 lists at least 9 items that an employer must include on employees’ paystubs.  Even omitting one item (e.g., pay period dates on a “final” paycheck) can expose employers to extensive liability depending on the nature of the oversight, the number of affected employees, and how often the improper paystubs were issued.  Under the Private Attorneys General Act (“PAGA”) a single employee can bring a lawsuit on behalf of all affected employees, also known as “aggrieved employees,” regardless of whether those employees want to be included, and without having to go through the rigorous requirements of class certification.  [We told you about this in a 2009 California employment law newsletter,]

Up close of wage statementEmployees (or rather, the class action attorneys that bring these cases) do not have to prove that anybody was injured by the omission on the paystub because the code section provides an automatic penalty per paycheck in place of requiring employees to prove actual damages (which are typically non-existent).  Because employers have virtually no defense to these paystub cases, they are generally referred to as “gotcha” claims.

Recently a California Court of Appeal handed PAGA attorneys a “gotcha” of their own.  In Khan v. Dunn-Edwards Corporation, the appellate court upheld summary judgment dismissing Plaintiff Khan’s PAGA claims because he failed to comply with required administrative procedures.  Though Plaintiff’s regular paychecks appeared to be in order, his final paycheck failed to list the start date of the pay period.  On the basis of that single oversight on a single check, Khan and his attorneys filed their lawsuit seeking to recover penalties on behalf of a group of employees who may have received a similar final paycheck.  Khan’s notice and exhaustion letter to California’s Labor and Workforce Development Agency, however, was peppered with references to violations of his rights, and nowhere referenced any other employee other than himself.  The Court was not impressed.  It held that Khan’s use of the word “my” instead of “we,” or any other language indicating that he was seeking to claim penalties on behalf of anyone but himself, constituted a failure to give proper notice to the individuals involved, and a failure to comply with administrative requirements.  Thus, the Court upheld summary judgment in favor of the employer, and dismissed Khan’s PAGA claim.

If you are in the unfortunate position of having to defend yourself (or a client) against a PAGA action, make sure you take a very close look at the employee’s letter to the Labor Workforce and Development Agency to make sure the employee has followed every technical requirement of the law in giving notice to the employer and the Agency.  You might find a technical shortcoming in the letter on which to defend your client.  Or better yet, make sure that your employees’ paystubs contain the required information in advance.

Employees generally love Alternative Workweek Schedules. They prefer, for example, working four 10-hour days to working five eight-hour days. They work the same number of hours but they get an additional day off and less time commuting. The advantage to employers is that they can give employees the schedule they prefer without incurring additional overtime liability. But before California employers can implement an Alternative Workweek Schedule (or AWS), they need to jump through all sorts of hoops, including having secret ballot elections where two thirds of the affected employees approve the arrangement. All this is spelled out in Section 3 of the Wage Orders. Get it wrong and you risk employees coming back down the road and asking for years’ worth of unpaid overtime.

Once an employer in California adopts an AWS, different rules apply to (for example) sending employees home early, transferring them to different work units and locations, and changing their schedules. The following Q&A addresses many of these issues.

1.   What happens if an employee scheduled to work 12 hours as part of an AWS is asked to work a 12-hours shift on a different day?

Because they are not subject to an AWS that covers that day, all hours they work on that day would be considered overtime. The employee would get 1.5 times his regular rate of pay for the first 8 hours and double his regular rate of pay for the last 4 hours.

2.   What happens if an employee scheduled to work 10 hours as part of an AWS is sent home after 9 hours?

If you require the employee to work fewer hours in a day than they’re normally scheduled to work, you lose the advantage of the AWS. So in this case, you pay overtime (time and a half) after 8 hours on that day.

3.   What happens if an employee scheduled to work 10 hours as part of an AWS is sent home 10 or fewer minutes before their shift ends?

Pay them according to the AWS, but don’t make a habit of this.

4.   What happens if an employee scheduled to work 10 hours as part of an AWS is sent home between 10 and 30 minutes early?

Don’t do that. Keep them around until the shift ends. It’s cheaper to pay them to do nothing than to unnecessarily incur an hour and a half or more of overtime.

5.   What happens if an employee scheduled to work 10 hours asks to leave after 9 hours?

If the employee volunteers to work fewer hours than they’re scheduled as part of an AWS, there is no overtime liability. But have the employee put their request to leave early in writing (even e-mail) to avoid disputes later as to whether it was voluntary.

6.   What happens if an employee scheduled to work 10 hours as part of an AWS is required to work 12 hours on that day?

The additional 2 hours would be paid at time and a half. Any hours beyond 12 would be at double their normal hourly rate.

7.   What happens if an employee who is subject to an AWS is asked to work his normal shift, but at a different location that does not have an AWS?

This work would not be subject to the AWS and would be subject to normal overtime rules.

8.   What happens if an employee who is subject to an AWS volunteers to work his normal shift, but at a different location that does not have an AWS?

Same as paragraph 7.

9.   What happens if an employee who is not subject to an AWS is asked to work on a day she is normally scheduled, but at a different location that has an AWS?

This work would not be subject to the AWS and would be subject to normal overtime rules, unless (1) the employee is told that the different location has an AWS; and (2) the employee works at the different location for one or more full workweeks (as defined under the AWS). If both conditions are met, the employee’s overtime can be calculated the same as other employees who are subject to the AWS for each full workweek the employee works at that location. To avoid disputes later on, have the employee document that she was informed of the AWS.

For example, assume that (1) an employee is assigned from Monday, January 1st through Thursday, January 18th to a location with an AWS; (2) the employee is told in advance about the AWS; and (3) the location’s workweek under the AWS begins Monday at 12:01 a.m. The employee would be paid according to the AWS from Monday, January 1st through Sunday, January 14th and paid normal overtime (e.g. time and a half for 8-12 hours) for time worked between January 15th and 18th (since that is not a full workweek).

As another example, if the situation was the same as in the last paragraph, except the employee learned on January 2nd that the new location had an AWS, the employee would be paid according to the AWS from Monday, January 8th through Sunday, January 14th and paid normal overtime the rest of the time.

10. What happens if an employee who is not subject to an AWS volunteers to work on a day she is normally scheduled, but at a different location that has an AWS?

Same as paragraph 9.

11. What happens if an employee who is subject to an AWS works only at a location that is subject to a different AWS?

The employee would be treated the same as in paragraph 9. In other words, the employee would be paid according to the AWS at the location he was assigned to for each full workweek he worked there, as long as he knew about that AWS in advance.

12. What happens if an employee who is subject to an AWS works in the same workweek at his normal location and at a location that is also subject to an AWS?

The time the employee works at his normally assigned location would be paid according to the AWS at that location. The time he works at the second location would be treated as overtime (time and a half for the first eight hours in a workday, as long as the employee hasn’t yet exceeded 40 hours for the workweek and double time after eight hour in a workday or for all hours beyond 40 in a workweek). If the two locations have different workweeks, use the workweek at the location to which the employee is normally assigned.

13. If an employee is repeatedly asked to deviate from the approved AWS, can the employer lose the benefits of the AWS?

Yes, if the deviations are more than “occasional.”  As a general rule, an alternative workweek must be “regularly scheduled.”

Takeaway: How typical of California law! Employers offering a schedule that employees prefer have to negotiate a maze of complex requirements and face serious exposure for even an accidental misstep. California employers wishing to implement an Alternative Workweek Schedule should get guidance from qualified counsel in doing so. Those with one in place should ensure that their managers understand the consequences of deviating.

Illustration of a fox with sunglassesWe often blog about how different California employment laws are when compared to the rest of the US.  Whether it is the minimum wage, mandatory harassment prevention training requirements, or that funky law called PAGA, find out how to comply with laws in what we fondly refer to as the United Republic of California with this handy guide to Doing Business in California.

Many thanks to Sahara Pynes for her assistance in updating this informative guide.  Check it out on the Fox Rothschild website.

The California state flag

I read an article yesterday about a writer accused of sexual harassment.  So what, you are probably thinking? While articles like that are commonplace these days, what infuriated me was that the individual had been investigated multiple times for sexual harassment related misconduct.  The alleged harassment occurred at numerous companies, with prominent HR departments, yet each time he was fired or left for a new job, his new employer had no idea about his past behavior.  And I feel partly to blame for that.

As an employment lawyer, we advise our clients that best practices with regard to references is to establish a policy where the company simply confirms dates of employment and job title(s) held.  We used to allow salary confirmation upon request of the departed employee, but that is no longer advised under California’s Fair Pay Act.  So, we have inadvertently created a system where alleged harassers (and other terminated employees) get to move on and become someone else’s (client’s) problem. The primary concerns in opting not to give a substantive reference is fear of a defamation lawsuit or tortious interference with a business opportunity claim under Labor Code section 1050.  There are many resources on the intricacies of these claims, so I won’t get into them here.

While there is no duty to provide a reference and saying nothing is still the most conservative course of action, I think some employers will want to be more progressive in the #metoo era and I’d like to give some guidelines on how not to sweep this under the proverbial rug.

  • California employers are protected by a qualified “common interests” privilege against defamation claims as a result of giving reference checks. So long as statements are based on credible evidence and are made without malice, employer references are given a special privilege that forms the basis of a defense against defamation.  California courts have regularly supported this employer privilege in the interest of public policy, which is now more prominent than ever.
  • If you have an existing policy on references, be consistent in following it, or change it to something you are comfortable with.
  • Designate one person to handle all references so the conduct and statements of individual managers don’t become a liability for the company.
  • If you opt to provide a substantive reference, the reference should not be misleading. Don’t give a glowing reference for an employee terminated for misconduct or there could be liability for fraud or misrepresentation, plus the potential for a wrongful termination suit from the alleged harasser.  The best bet is to be truthful, without providing too many unnecessary details.
  • Some examples of how to give a negative reference without disclosing details include: ineligible for rehire, investigated for policy violations or was the subject of complaints by coworkers.
  • While the fear (and fear of the expense) of being sued is enough to chill employers into keeping their mouths shut, and consequently perpetuating a cycle of harassment or other bad behavior, the reality is there are very few published cases on this in California, leading me to believe that while the risk is real, this isn’t likely to be a money-maker for the plaintiff’s bar.

Finally, while there is pending California legislation in the form of SB 820 that would prohibit confidentiality clauses in any sexual harassment settlement agreements, so far there are no added protections for employers providing substantive references.

The decision of how much, if any, information to provide, involves an individualized risk assessment, but I can see California’s public policy interest as a strong driving force in changing the current “no comment” practices of many employers.

I don’t know Aziz Ansari and I can’t purport to know what happened in his apartment on the night of the first date that has headlined the news this week.  But, after 17 years as a labor & employment attorney, with a concentration in counseling on more than 100 sexual harassment claims in the workplace, I thought I would add a few nuggets to the conversation.

The claims against Ansari invoke the stickiest of scenarios, though they did not occur in the workplace.  An anonymous complainant, a consensual sexual encounter, the allure of a suitor with “power”, regret, and poor communication…Translating these factors into a workplace investigation can cause some pitfalls for even the best HR departments.

  • A significant percentage of complainants want to remain anonymous, presumably for fear of retaliation. While employers should not guarantee that any aspect of the investigation will be kept confidential, employers should limit details on a need-to-know basis.
  • Confronting an alleged harasser when an employer can’t or chooses not to disclose the identity of the complainant or details of the complaint is really tough.  Accused employees want to be able to appropriately defend themselves and California requires a “fair, prompt and thorough” investigation.
  • Because employers have to balance the investigation with the need to maintain a harassment-free workplace, employers aren’t required to know with absolute certainty that harassment occurred in order to take disciplinary action. The legal standard is an objectively reasonable belief that misconduct occurred (after a fair and objective investigation, which I’ll get to in a moment).
  • While the standard for an adequate investigation includes notice of the claimed misconduct and a chance for the employee to respond, this standard was set before the ubiquity of texts, and sometimes I see some really blatant and incriminating texts which make it easier for an employer to take action.
  • Once action is taken, the type of response an employer needs to give to the complainant is another source of disagreement.  Complainants want details about all aspects of the investigation, including who said what.  Yet employers want to safeguard not only the complainant’s rights, but the privacy rights of the accused and witnesses. A typical response you may have seen is that the matter has been handled and appropriate action has been taken.  Employers aren’t required to give details and if too many details are given, an accused may claim defamation.
  • Finally, harassment policies need to have specific information on prohibited conduct, reporting and investigation procedures, and no-retaliation.  Consensual relationships between supervisors and staff they manage should be prohibited to avoid the potential for coercion claims.  I have seen many cases where a complainant contends they engaged in the sexual conduct consensually, but because they felt pressured to do so or it was “easier” than saying no. It’s best to remove the power/control element of a workplace relationship.

There are no easy answers here and every single complaint of harassment is unique.  But in the effort to support victims, employers should not forget the reasonableness standards set by our courts and the balancing acts that need to occur during the course of an investigation.

One issue that consistently trips up employers is the interplay of laws for an employee with work-related medical issues.  This is sometimes referred to as the Bermuda Triangle of workers’ compensation, ADA/FEHA (disability), and FMLA/CFRA. 

Quite often an employee is injured, a workers’ compensation claim is opened, and the employer somehow forgets the other two prongs of the triangle.  For example, the time off is not designated as FMLA/CFRA, with the rights that go along with it.  Or the duty to engage in the interactive process and reasonably accommodate under the ADA/FEHA is somehow forgotten when the employee returns to work with restrictions.

The reality is that many legal issues start with a workers’ compensation injury, and if those claims are handled proactively, then related civil claims arising from disability can be avoided. 

 Here are some tips for handling those workers’ compensation claims:

  1. First, be proactive when the claim comes in.  Investigate what happened.  Make sure witnesses provide statements with sufficient detail.  Preserve security film and video.  Document the extent of injuries (or the lack thereof).
  2. Second, get all of that information to your workers’ compensation carrier promptly so they can properly evaluate the claim.  If the carrier isn’t responsive, follow-up. 
  3. Third, if you have a light duty program, make sure it is only for a limited time (such as 90 days).  Otherwise you risk creating a new job for someone, and no incentive to get better.
  4. And finally, don’t forget about the interactive process.  If the claim is going to end with a Compromise & Release in the workers’ compensation case, then ask your carrier to negotiate for a resignation.  And if the employee comes back to work and is not fully recovered, make sure any restrictions are documented and accommodated. 

And of course, make sure the employee is not retaliated against for filing the claim. 

Be sure to remember all three sides to any work-related injury so you can avoid getting lost in the Bermuda Triangle!

29612338 – i survived the bermuda triangle grunge rubber stamp on white, vector illustration

 

More than ever before, the topic of sexual harassment is dominating the news (and this blog).  It’s time to make sure that your company’s sexual harassment prevention training is up to the task.

Fox Rothschild’s skilled team of attorney trainers will tailor a program to meet your company’s needs.  Take a break from the online routine, and make sure that your next sexual harassment prevention training session is a “wow,” not just a check-the-box compliance item.

38610418 – wow! comic speech bubble, cartoon

To learn more, check out this alert featuring our Los Angeles team.

The laws about what employers can ask job applicants continue to evolve. Here are four areas of inquiry that are not allowed:

  1. Questions about prior salary – With the passage of AB 168, effective January 1, 2018, employers cannot ask applicants for employment about salary history information, including information about compensation and benefits.
  2. Questions about criminal convictions before making a conditional offer of employment – Following the leads of San Francisco and Los AngelesAB 1008 prohibits employers with five or more employees from:
    • Asking on employment applications about criminal convictions;
    • Asking applicants about criminal convictions before making a conditional offer of employment;
    • When conducting background checks on applicants, considering, distributing, or disseminating information about prior arrests not leading to conviction, participation in diversion programs, or convictions that have been sealed, dismissed, expunged, or otherwise nullified. Employers who wish to rely on criminal conviction information to withdraw a conditional job offer must notify the applicant of their preliminary decision, give them a copy of the report (if any), explain the applicant’s right to respond, give them at least five business days to do so, and then wait five more business days to decide what to do when an applicant contests the decision. There are exceptions for employers who operate health facilities hiring employees who will have regular access to patients or drugs.
  3. Questions about membership in protected categories – These questions have been prohibited in some cases for over 50 years. But too many interviewers don’t understand the nuances. Inappropriate questions include:
    • What kind of name is that?
    • What’s your maiden name?
    • How old are you?
    • Do you live alone?
    • Who do you live with?
    • What year did you graduate?
    • How old are your children?
    • Do you plan to have children?
    • What church do you attend?
    • What does your spouse do?
    • Is English your first language?The DFEH published this handout discussing these issues and listing other improper questions.
  4. Medical inquires before an offer of employment – At the pre-offer stage, employers may not make generalized inquiries about a job applicant’s health, present medical condition, or any disability. Nor may employers conduct medical or psychological exams at the pre-offer stage or ask about medical history, on-the-job injuries, workers’ compensation claims, or absences due to illness. The EEOC announced this month that it settled a suit with a staffing agency regarding pre-offer medical inquiries.

Make sure that the people interviewing for your organization are up to date on what areas of inquiry are not allowed.

We write a lot about minimum wages. That’s not because we’re unimaginative. We’re very imaginative. We can imagine things that you couldn’t even imag… But I digress.

Our own Tyreen Torner, who gave you a handy summary of all of California’s paid sick leave rules, has now created this chart summarizing all the minimum wages that apply in California for the next four years. How, you ask, can anyone put so much useful information on a single page? One word: Imagination!