The California Court of Appeal’s recent decision in Cochran v. Schwan’s Home Service, Inc. was simple. When employees must use their personal cell phones for work, California law requires employers to reimburse them, regardless of whether the cell phone plans are for limited or unlimited minutes. This decision, however, could have a wide ranging impact on California employment law.
The plaintiff in Cochran sought to bring a class action lawsuit against his employer based on his employer’s alleged failure to reimburse him and similarly situated employees for use of their personal cell phones for work-related calls. The superior court denied plaintiff’s motion for class certification, finding that the claim was not suitable for class treatment because individual issues predominated. Specifically, the superior court reasoned that the defendant employer’s liability to prospective class members depended on individual factual issues such as whether employees paid for the cell phone plan themselves, whether employees purchased different cell phone plans because of their work cell phone usage, or whether employees suffered any “actionable expenditure or loss,” i.e., loss of cell phone minutes.
The Court of Appeal reversed the superior court’s order. The Court held that it was irrelevant whether the employee had an “unlimited minutes” plan or actually paid his or her cell phone bill him or herself. According to the Court, the critical issues were whether the employee was required to use his or her personal cell phone to make work-related calls and whether the employee was reimbursed. The Court then sent the case back to the superior court with orders to reexamine plaintiff’s motion in light of its interpretation of California law.
The decision in Cochran clearly requires California employers to revise their policies to confirm that work-related calls required to be made on personal cell phones are eligible for reimbursement, as failing to take these and other steps could lead to class action liability for violating California law. Cochran, however, potentially goes further. Employers could be held liable under Cochran’s reasoning for failing to reimburse a portion of its employees’ internet bills if the employees required internet access to obtain work-related emails. While the extent of Cochran has yet to be determined, California employers must, as always, work with counsel to ensure they are complying with this as well as all other aspects of California employment law.