Newsletters
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02/20/2013 California Supreme Court Clarifies Employer's Burden of Proof in Mixed-Motive Cases
California Employment Law AlertOn February 7, the California Supreme Court decided the issue of whether the federal "mixed-motive" defense applies to employment discrimination claims under the California Fair Employment and Housing Act (FEHA). By way of background, this defense states that if the employer had both discriminatory and non-discriminatory reasons for firing an employee, the employer should not be found liable as long as the non-discriminatory reasons standing alone were sufficient to warrant dismissal. In Wynona Harris v. City of Santa Monica, the Court affirmed the Court of Appeal's decision overturning a damages verdict against the City of Santa Monica, finding that employers may properly assert a mixed-motive defense in discrimination cases under FEHA to defeat liability for damages where the employee would have been terminated anyway for a non-discriminatory reason. Specifically, the Court held that when a jury finds that unlawful discrimination was a "substantial factor" motivating a termination of employment, but the employer proves it would have made the same decision absent such discrimination, a court may not award damages, back pay, or an order of reinstatement. However, the Court also held that an employee who proves that discrimination was a substantial motivating reason for his or her termination may still be entitled to injunctive and declaratory relief, as well as reasonable attorneys' fees and costs. To read more about the Harris decision please download the attachment. -
12/20/2012 Beginning on January 1, 2013, Commission Agreements for California Employees Must Be In Writing and Signed
California Employment Law AlertBeginning on January 1, 2013, all employers must have written commission agreements for California employees who are compensated on a commission basis. To read more about this new law, please open the attachment. -
11/19/2012 Arbitration and Class Action Waivers After Concepcion and D.R. Horton: Courts and the NLRB Reach Divergent Conclusions
California Employment Law AlertSince the U.S. Supreme Court came down with its landmark decision in AT&T Mobility v. Concepcion in April 2011, courts and the National Labor Relations Board ("NLRB") have reached divergent conclusions regarding the legality of individual arbitration agreements in the employment context. -
10/02/2012 Federal District Court Issues First Decision Allowing Whistleblower Allegations to Proceed Under Dodd-Frank Act
Federal Employment Law AlertOn September 25, 2012, United States District Court Judge Stefan R. Underhill, District of Connecticut, issued the first decision allowing a plaintiff's whistleblower allegations against his employer under the Dodd-Frank Act to survive a motion to dismiss. The decision applied a much more lenient definition of "whistle-blower" than that contained in the "bounty-hunter" provision of Dodd-Frank, allowing claims by employees who are terminated or disciplined after making a good-faith report of violations of Dodd-Frank or Sarbanes-Oxley ("SOX"), to supervisors with investigative authority or to the SEC itself. Because Dodd-Frank has a much longer limitations period than SOX, and provides for double back-pay damages, the decision may encourage employees and plaintiffs' attorneys to dramatically expand their use of Dodd-Frank for retaliation claims. -
09/12/2012 Five Months Post-Brinker: Courts' Application of the Seminal Decision
California Employment Law AlertOn April 12, 2012, the California Supreme Court in Brinker Restaurant Corp. v. Superior Court issued a crtical decision regarding break and off-the-clock claims and the standards governing an employer's obligation to provide breaks under California law. Since the Supreme Court issued its opinion, employers have been eagerly awaiting its application by the lower courts in determining the suitability of class treatment for break and off-the-clock claims. To read more please click on the attached document. -
09/01/2012 Payne & Fears LLP Proud Sponsor of Best Places to Work in Southern Nevada
AnnouncementThe firm is pleased to be the exclusive event sponsor for the Southern Nevada Human Resources Association's Best Places to Work in Southern Nevada® awards. -
08/28/2012 Payne & Fears LLP Selected to Join the Worldwide Network of First Law International
AnnouncementPayne & Fears LLP has been selected to join the worldwide network of First Law International ("FLI NET") and has entered into a joint venture agreement with FLI NET as of July 26, 2012. -
08/13/2012 California Supreme Court Rejects Insurance Industry's Attempt to Constrict Coverage for Long-Tail Losses
California Insurance Law Alert -
06/06/2012 California Court of Appeal Upholds the Use of Class Action Waivers in Employment Arbitration Agreements
California Employment Law Alert -
05/01/2012 California Supreme Court Puts Damper on Meal and Rest Break Lawsuits
California Employment Law AlertThe California Supreme Court held that aggrieved employees are not entitled to recover their attorney's fees in lawsuits to obtain pay for missed meal and rest breaks. The Court also banned employers from recovering attorney's fees when they successfully defend such cases. -
04/18/2012 Payne & Fears LLP Files Friend of Court Brief with U.S. Supreme Court in Church Property Dispute
Payne & Fears LLP filed on behalf of its client St. James Church a "friend of the court" amici curiae brief with the U.S. Supreme Court to encourage it to hear a case that could resolve the uncertain and inconsistent rulings of state supreme courts about church property disputes. -
04/12/2012 Employers Breathe Sigh of Relief: California Supreme Court Issues Much-Anticipated Brinker Restaurant Decision
California Employment Law AlertOn April 12, 2012 the California Supreme Court decided Brinker Restaurant, the long-awaited case which has important implications for the workplace about whether California law (1) requires employers to "ensure" that employees take their 30-minute meal periods or merely requires that employers make meal periods "available," (2) whether an employee is entitled to a meal period for every five hour work period (the so-called "rolling five" requirement) or only requires one meal period for each day in which the employee's work period exceeds five hours and a second period on each day in which the employee's work period exceeds ten hours, (3) the timing of rest breaks, and (4) the extent to which the employees can bring class action lawsuits for alleged wage and hour violations. To see how the California Supreme Court, in its unanimous opinion issued today, answered those questions, please see the attached pdf document. -
01/06/2012 California Supreme Court Issues Long-Awaited Decision Regarding Administrative Exemption
California Employment Law AlertThe California Supreme Court’s decision in Harris v. Superior Court limits both the application and importance of the “administrative/production worker dichotomy,” a doctrine that has been used by many courts to find that employees did not qualify for the administrative exemption. -
10/20/2011 California Enacts New Law Restricting Use of Credit Checks for Employment Purposes
California Employment Law AlertGovernor Brown has signed legislation that restricts California employers from using consumer credit information for employment purposes. The law goes into effect on January 1, 2012. -
10/13/2011 California Enacts New Law Prohibiting Willful Misclassification of Independent Contractors
California Employment Law AlertOn October 9, 2011, Governor Brown signed legislation that prohibits the willful misclassification of individuals as independent contractors. The new law creates civil penalties of between $5,000 and $25,000 for each willful misclassification of a worker. -
08/16/2011 California Court of Appeal Holds Undocumented Workers Cannot Pursue Discrimination and Retaliation Employment Claims
California Employment Law UpdateIn Salas v. Sierra Chemical Co., the California Court of Appeal held that an employee not authorized to work in the United States could not pursue discrimination and retaliation employment claims. The court reasoned that the undocumented worker had no recourse for alleged losses tied to an employment position for which he was not lawfully qualified. In addition, the court found that it would be inequitable to provide the plaintiff with any relief in light of his misconduct in the form of misrepresenting to his employer his ability to lawfully work in the United States. -
04/29/2011 United States Supreme Court Decision Gives California Employers Opportunity to Prevent Class Action Claims
Employment Law AlertThe United States Supreme Court has ruled that federal arbitration law clears the way for arbitration agreements in California to bar claims from bring brought on behalf of a class. Employment arbitration agreements can now be used to prevent class action claims against California employers. -
04/26/2011 Payne & Fears LLP Obtains Important Victory for Arizona Policyholders
Insurance Law AlertIn a victory not only for homebuilders but for all policyholders, the Arizona Court of Appeals recently rejected an attempt by several liability insurers to dramatically expand Arizona's "fair debatability" defense to policyholder bad faith claims. Lennar Corp. v. Transamerica Ins. Co., No. 1 CA-CV 10-0141 (April 14, 2011) ("Lennar II"). Our client, Lennar, a Fortune 500 homebuilder, sued several insurers for breach of contract and bad faith after they denied coverage for a multi-plaintiff construction defect lawsuit. After several years of litigation, the trial court summarily dismissed Lennar's bad faith claim on the basis that a prior trial court ruling in the case validating the insurer's "no occurrence" coverage defense established that coverage was "fairly debatable," even though the trial court's "no occurrence" ruling was subsequently reversed on appeal. See Lennar Corp. v. Auto-Owners Ins. Co., 214 Ariz. 255 (2007) ("Lennar I"). In Lennar II, the Court of Appeals rejected the insurer's "erroneous ruling" theory. To continue reading please click on the attachment. -
01/18/2011 New Court of Appeal Decision Highlights Importance of Having Current Employee Handbook and Electronic Communications Policy
California Employment Law AlertA new decision from the California Court of Appeal found that emails sent between an employee and her attorney were not confidential because the emails were sent from a company computer and the employee was informed, through an employee handbook, that emails were not private and could be monitored. -
01/14/2011 Prominent Publication Features Payne & Fears' Unique Name in 'The Name Game'
The Lawyers Weekly -
01/01/2011 Daniel M. Livingston featured in The Legal OC (5/16/2011)
www.thelegaloc.comPayne & Fears LLP partner Daniel M. Livingston has been featured in The Legal OC, a new blog covering lawyers and legal developments in Orange County. -
10/25/2010 New Court of Appeal Decision Makes It More Difficult for Employers to Require Arbitration of Employment Disputes
California Employment Law AlertA new decision from the California Court of Appeal makes it more difficult for employers to enforce arbitration clauses in employment agreements that provide for an award of attorney's fees and costs to the prevailing employer and that allow the parties to seek injunctive relief in court. -
08/10/2010 The California Supreme Court Permits Older Workers to Pursue Age Claim Against Google
California Employment Law UpdateIn Reid v. Google, Inc., the California Supreme Court decided two questions, one procedural and one substantive, which will have a substantial impact on an employer's ability to defeat employment litigation via use of a summary judgment motion. First, the Supreme Court found that the trial court's failure to rule expressly on evidentiary objections did not waive those objections on appeal. Second, the Supreme Court rejected the stray remarks doctrine's categorical exclusion of evidence after determining that application of the doctrine is unnecessary and that such categorical exclusion of evidence might lead to unfair results. -
07/01/2010 Liability Insurer's Montrose Endorsements Construed in Favor of Policyholders: Court of Appeal Rejects Insurer's "Dual Trigger" Approach
Insurance Law UpdateOn June 28, 2010, the Court of Appeal of the State of California, Fourth Appellate District, certified its June 3, 2010, opinion in Pennsylvania General Ins. Co. v. American Safety Indem. Co. (No. D054522) for publication. Pennsylvania General is a significant victory for policyholders, particularly homebuilders, contractors and others facing liability for continuing-injury claims. It narrowly construes two “Montrose” endorsements used by many insurers that, American Safety (“ASIC”) argued, impose a “dual trigger:” (1) property damage during the policy period (2) caused by an occurrence during the policy period. The Court of Appeal rejected ASIC’s interpretation of the endorsements and the “dual trigger” burden that ASIC’s interpretation created. -
06/22/2010 U.S. Supreme Court Finds Employer's Review of Employee Text Messages Reasonable Under the Circumstances
Employment Law UpdateThe United States Supreme Court held in City of Ontario v. Quon that the review of a police officer's text messages sent using an employer-issued pager did not violate his Fourth Amendment rights. While the decision was a victory for the employer, the Court noted that emerging technologies and the rapidly changing ways in which employees communicate in the workplace may impact future determinations of an employee's right to privacy in electronic communications. -
05/26/2010 California Supreme Court Expands the Definition of Employer for Purposes of Legal Liability
California Employment Law UpdateIn Martinez v. Combs, the California Supreme Court expanded the definition of "employer" for purposes of liability for unpaid wages under the California Labor Code. The Court adopted three alternative definitions of employer, pursuant to which entities with some control over a worker could be found to be the employer, and thus legally responsible for any unpaid wages. -
04/19/2010 COBRA Subsidies Again Extended
Employment Law UpdateAs previoulsy reported (see PDF to right), in 2009 President Obama signed into law the American Recovery and Reinvestment Act, which, among other things, provided for a 65 percent subsidy for Consolidated Omnibus Budget Reconciliation Act ("COBRA") premiums. On April 15, 2010, President Obama signed the Continuing Extension Act of 2010 that continues the 65 percent subsidy for 15 months for individuals who lost their jobs through May 31, 2010. The Continuing Extension Act also provides transition relief for those who lost their jobs between March 31, 2010 and April 15, 2010, the date of enactment. Employers are again required to notify former employees and their dependents of the retroactive relief. -
02/11/2010 Eric C. Sohlgren, Payne & Fears Partner, Addresses Bar Association on Recent Developments in Employment Law
2009 Key Employment Law DevelopmentsEric C. Sohlgren, Partner, recently delivered his third annual address to the Orange County Bar Association on recent developments in employment law practice. With over 100 employment law attorneys, judges, arbitrators and mediators from throughout Southern California attending, Mr. Sohlgren surveyed over 50 published court decisions and legislative changes recently affecting employment law practice. Mr. Sohlgren emphasized a clear and direct approach to changes in the law, highlighting how these cases would impact employee rights and employer obligations in the workplace. Mr. Sohlgren represents companies, managers and employee benefit plans in employment litigation before federal and California courts, and in administrative proceedings. With a background in human resources, he frequently advises employers about legal compliance and preventative measures to reduce the risk of litigation. An active speaker, he has trained thousands of human resources professionals, managers and attorneys on employment law. -
01/12/2010 Recent California Supreme Court Decision Continues Trend Toward Greater Certainty and Lower Amounts in Punitive Damage Awards
California Business Litigation UpdateLate last year, the California Supreme Court decided Roby v. McKesson Corporation. One of the central holdings of Roby was that, on its specific facts, the constitutional maximum for a punitive damages award in the discrimination and harassment case consisted of a 1:1 ratio between compensatory and punitive damages. As a result, a jury award of $15 million in punitive damages ultimately was rolled back to just over $1.9 million. -
12/07/2009 California Supreme Court Expands Basis for Harassment Claims While Limiting Punitive Damages Against Employers
California Employment Law UpdateOn November 30, 2009, in Roby v. McKesson Corporation, the California Supreme Court ruled on two significant issues for California employers: (1) whether evidence of personnel actions can support harassment claims; and (2) whether the amount of punitive damages awarded was constitutionally excessive. The Court answered both questions in the affirmative. -
12/03/2009 National Defense Authorization Act of 2010 Expands Entitlements Under the FMLA
Employment Law UpdateOn October 28, 2009, President Obama signed the National Defense Authorization Act of 2010 ("NDAA 2010") into law. The NDAA 2010 significantly alters employers' duties under the Family and Medical Leave Act of 1993 ("FMLA") and expands the family military leave entitlements that went into effect on January 29, 2009. All provisions of the NDAA 2010 became effective upon their enactment on October 28, 2009. -
09/18/2009 Court of Appeal Holds Customer Non-Solicitation Agreements Only Enforceable If Limited to Prohibiting Former Employees from Using Trade Secret Information to Solicit Customers
California Employment Law UpdateIn The Retirement Group v. Galante, a California Court of Appeal held that customer non-solicitation agreements are enforceable only to the extent they prohibit former employees from using trade secrets to solicit their former employer's customers. The defendants in Galante had informed many of The Retirement Group's ("TRG") customers that they had left TRG for a new entity and gave them forms to transfer their business. TRG sought and obtained a preliminary injunction, which prohibited numerous categories of conduct, including directly or indirectly soliciting current TRG customers to transfer their business to defendants. The Court of Appeal held that the non-solicitation provision was not enforceable since it was not limited to restraining former employees from using or disclosing trade secret information to solicit TRG's customers. -
08/12/2009 California Supreme Court Identifies Guidelines For Surveillance In The Workplace
California Employment Law UpdateThe California Supreme Court held in Hernandez v. Hillsides that the defendant employer did not violate employee privacy rights by installing a hidden camera aimed at catching a person viewing online pornography in the workplace after business hours. The Court found that while employees have a reasonable expectation of privacy in the workplace, that right has limits and it does not prevent employers from conducting covert video surveillance in the workplace under certain limited circumstances. -
07/17/2009 Employers on Winning and Losing Ends of California Supreme Court Decisions Involving Standing and Class Action Pleading Requirements
California Employment Law UpdateIn a pair of companion cases, the California Supreme Court ruled on two major issues for employers facing workplace violation suits. In Arias v. Superior Court (Angelo Dairy), the Court held that employees do not need to satisfy class action requirements in order to bring an action on behalf of themselves or other "aggrieved employees" under the Labor Code Private Attorneys General Act ("PAGA"), but that they are required to meet class action requirements to bring an action on behalf of others under California's Unfair Competition Law. In Amalgamated Transit Union, Local 1756, AFL-CIO v. Superior Court (First Transit, Inc.), the Court barred unions from bringing either unfair competition or PAGA claims on behalf of their members. Taken together, the two cases give employers reason for both concern and comfort. -
06/29/2009 Employer Victory in U.S. Supreme Court Age Discrimination Ruling
Employment Law UpdateThe U.S. Supreme Court held in Gross v. FBL Financial Services, Inc. that plaintiffs must prove that age is a “but for” cause of an adverse employment decision under the Age Discrimination in Employment Act (“ADEA”). As a result, an employer faced with an ADEA claim is not required to show that it would have taken the same adverse action regardless of age, even if evidence indicates that age may have been a contributing factor. The Court’s 5-4 decision, written by Justice Thomas, may also signal significant developments in employment law beyond the ADEA. -
06/05/2009 California Court of Appeal Overturns $105 Million Award to Employee in Starbucks Tip Pooling Case
California Employment Law Update On June 2, 2009, the California Court of Appeal, Fourth Appellate District issued its opinion in Chau v. Starbucks Corporation. Reversing the Superior Court of San Diego County’s decision, the court held that Starbucks did not violate Labor Code section 351 by permitting shift supervisors to share in tips placed by customers in a collective tip box. Employers are allowed to equitably distribute collective tips among all employees who provide the service that the tip rewards, even when an “agent” of the employer is part of the service team. -
05/27/2009 U.S. Supreme Court Sides With Employer In Pregnancy Leave Discrimination Case
Employment Law UpdateOn May 18, 2009, the United States Supreme Court issued its opinion in AT&T Corp. v. Hulteen. Reversing the Ninth Circuit’s decision, the Court held that AT&T did not violate the Pregnancy Discrimination Act of 1978 (“PDA”) by calculating the accrual of pension benefits in a way that gives less retirement credit to employees who took pregnancy leave before enactment of the PDA than to employees who took other kinds of medical leave. The decision illustrates a strong policy against retroactive application of the PDA and partially immunizes employers that use bona fide pension schemes that incorporate seniority accrual rules that were once lawful, but have since been deemed discriminatory by subsequent legislation. -
04/08/2009 Supreme Court Upholds Enforceability Of Collective Bargaining Agreements That Mandate Arbitration For Statutory Claims
Employment Law UpdateIn the decision 14 Penn Plaza v. Pyett, the United States Supreme Court held that a provision in a collective bargaining agreement expressly requiring union member to arbitrate age-discrimination claims is enforceable. The decision illustrates a continuing trend favoring arbitration of disputes – even ones involving statutory rights – and gives effect to collectively bargained provisions that most jurisdictions had treated as unenforceable.
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03/10/2009 The American Recovery and Reinvestment Act Amends Coverage for Provisions of COBRA
Employment Law UpdateOn February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act (“the Act”), attempting to provide economic stimulus to the nation’s economy. Among the provisions of the Act are important changes to the continuation coverage of the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). The Act Revises COBRA to alleviate nearly two-thirds of the cost to employees form continuing their medical benefits following an involuntary termination for eligible tax payers earning below a maximum threshold. For eligible individuals, the Act provides for 65 percent subsidy of the required COBRA premium for a maximum period of nine months. Eligible employees will only be required to pay 35 percent of the COBRA premium that he or she would otherwise be required to pay for employee and family coverage. This new COBRA benefit under the Act applies to persons who became eligible for COBRA between September 1, 2008 and December 31, 2009, due to an employee’s involuntary termination of employment. The act requires employers to change some COBRA notices and practices, and also affects payroll tax obligations.
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03/10/2009 California's New "Foreclosure Prevention Act"
California Business Litigation UpdateOn February 20, 2009, Governor Schwarzenegger signed into law the “California Foreclosure Prevention Act.” The law, until January 1, 2011, and with respect to loans that were recorded between January 1, 2003 to January 1, 2008, prohibits a portage, trustee, or other person authorized to take sale form giving a notice of sale for an additional 90 days if the loan at issue is the first mortgage or deed of trust that the property secures, the borrower occupied the property as his or her principal residence, and the notice of default has been filed.
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02/24/2009 Court of Appeal Clarifies Distinctions Between An Employee And An Independent Contractor
California Employment Law UpdateOn January 23, 2009, the California Court of Appeal, Fourth Appellate District, published its decision in Cristler v. Express Messenger Systems, Inc., providing further guidance on the distinctions between an employee and an independent contractor. The plaintiffs were James Cristler and a class of similarly situated person (collectively “Cristler”), who sued a parcel delivery company, Express Messenger Systems, Inc., doing business as California Overnight (“Express Messenger”). The lawsuit contained a number of causes of actions, including failure to pay overtime wages, all based on a core contention that Express Messenger improperly classified its employees as independent contractors.
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02/09/2009 Significant Changes to the Family and Medical Leave Act Effective January 16, 2009
Employment Law UpdateIn January 2008, President Bush signed into law the first-ever amendments to the Family and Medical Leave Act (“FMLA”) and on November 17, 2008, the Department of Labor (DOL) published its much anticipated final rule on the implementation of these amendments. The DOL’s new regulations went into effect on January 16, 2009, and they clarified the employers’ rights and responsibilities under the FMLA. Significant changes have been made to military rights and the DOL also addresses various issues raised in court cases interpreting the FMLA. The new revisions mark the first significant overhaul of the FMLA’s implementation regulation since its enactment in 1993. Because of these important changes, most employers will have to update their leave policies.
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02/03/2009 Ledbetter Fair Pay Act Signed Into Law by President Obama.
Employment Law UpdateOn January 29, 2009, President Obama signed into law the Ledbetter Fair Pay Act. The bill expressly overturns the United States Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co., Inc. 550 U.S. 618 (2007). The effect for employers is that employees may bring federal claims for discriminatory pay differences years after the decisions that created those pay differences were made, so long as a claim is filed with the EEOC within 180 days (300 in some states) of the receipt of any compensation that is affected by those past decisions.
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01/09/2009 Gender Discrimination Must Be Intentional to Violate The Unruh Civil Rights Act
California Business Law UpdateOn December 19, 2008, the Fourth District Court of Appeal published its opinion in Cohn v. Corinthian Colleges, Case No. G038388. The case arose when the Angels Baseball club gave away tote bags to adult women fans who attended the Angels game on Mother’s Day, 2005. The plaintiff, Michael Cohn, attended the game, requested a bag, and was refuse, allegedly because of is gender. He sued the Angels and Corinthian Colleges, the event’s co-sponsor, under the Unruh Civil Rights Act (Civil Code section 51), alleging that the giveaway discriminated against him as a male. The Angels and Corinthian colleges obtained summary judgments in the trial court, and the Court of Appeal affirmed.
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12/16/2008 California Court of Appeal Rejects Punitive Damages for Labor Code Violations that regulate meal and rest breaks, pay stubs, and minimum wage laws.
California Employment Law UpdatePlaintiff Christine Brewer (“Plaintiff”), a waitress at the Cottonwood Golf Course Restaurant (“Cottonwood”), filed suit against Cottonwood, alleging age discrimination and Labor Code violations related to meal breaks, rest breaks, pay stubs, and minimum wage. The jury returned a verdict in favor of Cottonwood on the age discrimination claim, but found in favor of Plaintiff on most of the Labor Code violations. Most notably, the jury returned a punitive damages award of $195,000 finding that Cottonwood had acted with “fraud, oppression, or malice” toward Plaintiff.
On appeal, Cottonwood challenged the punitive damages award arguing that such damages are not available for the pleaded violations of the Labor Code.
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12/05/2008 Court of Appeal Holds That Home Builders May Pursue Claims for Equitable Indemnity for Purely Economic Losses Under Right to Repair Act
California Construction & Business Law UpdateOn December 2, 2008, the Fourth District Court of Appeal decided Greystone Homes, Inc. v. Midtec, Inc., et al. In a case of first impression, the court ruled that home builder may pursue claims for equitable indemnity against individual product manufacturers for purely economic losses where the losses would be recoverable by a homeowner under the Right to Repair Act (California Civil Code § 895, et seq.), also known as SB 800.
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11/24/2008 California Business Establishments Cannot be Liable for Discrimination "In the Abstract"
California Business Law UpdateOn November 18, 2008, the Fourth District Court of Appeal decided Surrey v. TrueBeginnings, et al., a case brought under the Unruh Act and the Gender tax Repeal Act (California Civil Code §§ 51 and 51.6). The Unruh Act prohibits discrimination in the accommodations, facilities, and services of all “Business establishments” within California’s jurisdiction, and the Gender Tax Repeal Act prohibits charging different prices for services based on a person’s gender. The court held that a person must tender the purchase price for a business’s services or products before he or she can sue for discrimination under these two acts.
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11/13/2008 Ninth Circuit Holds that California Labor Laws Apply to Work Performed Within California by Nonresident Employees
California Employment Law UpdateThree employees of the Oracle Corporation, instructors who trained customers to use Oracle software, sued the company for failure to pay overtime wages. The plaintiffs were not residents of California during the employment period in question, but performed some work within the state. The plaintiffs brought three claims against Oracle seeking compensation for unpaid overtime wages.
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11/03/2008 California Employers Await Definitive Answer from California Supreme Court on Meal and Rest Break Obligations
California Employment Law UpdateOn October 22, 2008, the California Supreme Court granted review of and de-published Brinker Rest. Corp. v. Superior Court, 165 Cal.App.4th 25 (2008), an important recent decision that addressed employee meal period and rest break requirements under California law. As reported in our July 2008 Employment Law Update, the Brinker decision held that employers are only required to provide meal and rest breaks to their employees, not ensure that breaks are actually taken. Brinker further held that, in the absence of evidence of uniform policies and practices that violate California wage and hour laws, courts should not certify class action claims seeking meal and rest break premium pay or compensation for work performed “off the clock.” With the California Supreme Court granting review of Brinker, the decision may no longer be cited as precedent and the validity of its holdings is cast into doubt until the Court issues its final decision.
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11/03/2008 FEHA Statute of Limitations Subject to Equitable Tolling
California Employment Law UpdateThe plaintiff in McDonald v. Antelope Valley Community College, a job application for a library administrative staff position, repeatedly applied for a position with the defendant, a community college, but was turned down. After being rejected for a third time, the plaintiff filed a formal complaint of discrimination with the California Community Colleges Chancellor’s Office. The defendant subsequently hired a private firm to conduct an impartial fact-finding investigation of the plaintiff’s claim. The Chancellor’s Office further advised plaintiff in a letter that she could file a Fair Employment and Housing Act (“FEHA”) complaint with the Department of Fair Employment and Housing (“DFEH”).
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10/13/2008 California Legislature Clarifies Overtime Pay Exemption for Computer Professionals
California Employment Law UpdateGovernor Schwarzenegger signed AB 10, which was classified as an “urgency” bill, on September 30, 2008. The bill went into effect upon the governor’s signature, modifying California Labor Code section 515.5 immediately. The bill comes on the heels of a number of class-action lawsuits against California high-tech employers, where employees argued that under the previous version of section 515.5, the salary requirements varied depending on the number of hours the employee worked, making the salary requirement as high as $112,320 for employees working 60 hours per week. This new legislation is touted as an effort to stop the flow of high-tech jobs out of California by simplifying the compensation requirements for overtime-exempt computer professionals.
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08/12/2008 California Supreme Court Brightens Rule Prohibiting Noncompete Agreements
California Employment Law UpdateEdwards v. Arthur Andersen involved an employee, Raymond Edwards (“plaintiff”), of Arthur Andersen (“Andersen”) who attempted to secure employment with competitor HSBC in the midst of the collapse of Andersen in 2002. When Andersen initially hired plaintiff in 1997, plaintiff signed a noncompetition agreement that prohibited him form working for or soliciting certain Andersen clients for limited periods of time following the termination of his employment.
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07/31/2008 Court of Appeals Holds that California Employers Need Only Provide Meal and Rest Breaks Not Ensure that Employees Take Them
California Employment Law UpdateThe plaintiffs, hourly employees of several Brinker-owned restaurants in California, filed a class action against the restaurant chain, alleging rest break violations, meal break and “early lunching” violations, as well as uncompensated off-the-clock work and “time shaving” violations (when managers “shave” time by adjusting employee payroll records to reflect shits of lest than five hours). The trial court certified a class of nearly 60,000 employees, finding that the issues were common to all class members and could be litigated collectively.
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06/19/2008 New Cell Phone Law Goes Into Effect July 1, 2008
California Employment Law UpdateCalifornia businesses need to be prepared for a new law taking effect on July 1, 2008 that will change how California drivers can use their cell phones. Business with employee drivers in California should educate their workers about this new law and establish policies for compliance. Effective July 1, a driver may not operate a motor vehicle in California while using a wireless phone, unless the phone is used in a manner to allow hands-free listening and talking. However, hands-free devices need not be used when the driver is using his or her wireless phone for certain emergency purposes. Until July 1, 2011, hands-free listening and talking is not required for drivers of certain motor trucks, tractors, farm vehicles, commercial vehicles, and tow trucks. Additionally, effective July 1, 2008, except in case of emergency, drivers under the age of 18 are prohibited from using wireless phones while driving, including cell phones equipped with hands-free devices.
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06/02/2008 Genetic Nondiscrimination Bill Signed Into Law
Employment Law UpdateOn May 21, 2008, President Bush signed the “Genetic Information Nondiscrimination Act,” or “GINA.” GINA is far-reaching in that it intersects with many federal laws including Title VII of the Civil Rights Act, The Health Insurance Portability and Accountability Act of 1996 (HIPAA), and the Employee Retirement Income Security Act of 1974 (ERISA). Title I of GINA prohibits all health insurers from basing eligibility or premium determinations on genetic information. Title II bans employers, labor unions, and employment agencies from using an individual’s genetic information when making hiring, firing, compensation, and other employment-related decisions. Employers also may not limit, segregate, or classify an employee in a manner that denies employment opportunities based on genetic information. Labor unions may not exclude, expel or otherwise discriminate against an individual based on genetic information. In addition, employers, employment agencies, and labor unions may not request, require, or purchase an employee’s or an employee’s family member’s genetic information unless it falls within specific limited circumstances, such as when the genetic information is needed to meet certification requirements of family and medical leave laws, or will be used to monitor the biological effects of toxic substances in the workplace.
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03/27/2008 Starbucks Must Pay Baristas $86 Million Plus Interest for Tip-Pooling Arrangement
California Employment Law UpdateOn March 21, 2008, a San Diego County Superior Court ruled that Starbucks violated California law by allowing shift supervisors to share in the customer tip pool. Jou Chou, a former Starbucks barista in La Jolla who alleged shift supervisors were sharing in employee tips, filed the lawsuit in October 2004. in 2006, the case was granted class-action status. Judge Patricia Cowett ruled that the Seattle-based coffee chain must pay a statewide class of about 120,000 baristas employed by the company since 2000 $86 million plus interest. The court also ruled that Plaintiffs are entitled to an injunction preventing Starbucks from forcing employees to share their tips with shift supervisors.
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03/27/2008 Residential Employees Not Entitled to Pay for
California Employment Law UpdateThe Isner v. Falkenberg/Gilliam & Associates, Inc. case addresses the special circumstance of employers that require their employees to reside where they work. Husband and wife Plaintiffs Ron and Sharon Isner worked as apartment managers for Defendant Falkenberg/Gilliam & Associates, Inc., a property management company specializing in managing nonprofit housing for the elderly. As a condition of their employment, Plaintiffs had to remain on the premises within hearing distance of emergency alarm systems and the telephone during specified period of time, but otherwise were allowed to use on-call time as they saw fit. While on call, they could engage in personal activities – such as watching television, making personal telephone calls, and even sleeping – so long as they remain within audible range of the telephone or alarm. Plaintiffs were always on call together and, with limited exceptions, both always stayed within audible range of the telephone and alarm. They alternated on-call time with other resident employees and only stayed at the complex when on duty, despite being given an apartment in which to live. They sued Defendant for unpaid wages for hours worked, alleging that they were entitled to pay not just for the hours they spent responding to emergencies while on call, but for all of the hours they spent on-call and thus confined to the apartment complex. The trial court granted summary judgment in favor of Defendant, and the Court of Appeal affirmed.
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01/29/2008 Recent Employment Law Legislative Developments
California Employment Law UpdateThe California Legislature continues to be active in passing legislation affecting California employers and employees. This article outlines the most notable employment laws that went into effect in California on January 1, 2008.