In case you missed it (did anyone miss it?), President Joe Biden was sworn into office yesterday. Although workplace issues are hardly the only pressing item on the new President’s agenda, employers should be prepared for the rollout of additional employee protections under the Biden administration.
Priorities That President Biden Has Already Announced
Extending and
Last year, California Governor Gavin Newsom signed Assembly Bill (“AB”) 5, which signaled a seismic shift in the way California employers classify workers as either independent contractors or employees. On September 4, 2020, Governor Newsom signed AB 2257, which modifies (slightly) some of the rules and provisions of AB 5.
To recap, AB 5 codified the California Supreme Court’s decision in Dynamex. In Dynamex, the Supreme Court rejected the multifactor test set forth in S.G. Borello & Songs, Inc. v. Department of Industrial Relations for classifying workers and announced a new, more objective standard for determining worker classification for the purposes of the California wage orders. Under this new standard, the burden is on the hiring entity to establish that the worker is an independent contractor who was not intended to be included within the coverage of the California wage orders. In order to satisfy this burden, the hiring entity must establish all of the following: (1) that the worker is free from the control and direction of the hiring entity in connection with the performance of work, (2) that the worker performs work that is outside the usual course of the hiring entity’s business, and (3) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.
Continue Reading California Modifies the ABC Test – But It Doesn’t Really Help
Just when you thought it was safe to go back in the water (or stop sheltering in place anyway), a wave of COVID-19-related employment lawsuits are being filed across the country. At our last count, nearly 50 labor and employment-specific cases have been filed. The first in Oregon was filed earlier this month by a former assisted living facility employee who seeks $950,000 in damages for alleged whistleblower and sick leave retaliation. Although the types of claims being brought by employees are typical—wage/hour, whistleblower, contract, wrongful termination, protected leave and discrimination claims, WARN Act violations—employers now face a perfect storm: defending real-time decisions made to keep their businesses afloat against the backdrop of a global pandemic that has completely disrupted business operations. (And as we all know, “You can’t just call time out and stroll on into the beach if you don’t like the way things are going.”)
As we have mentioned during several COVID-19-related client briefings, courts will now have to wade into murky waters and provide clarity on how newly enacted or amended local, state and federal leave laws such as the Family First Coronavirus Response Act (“FFCRA”) operate, especially where statutory and regulatory guidance has not always been clear. Courts will also need to provide direction on how well-settled legal schemes, such as disability and contract law, apply in the face of a pandemic.
Of particular concern for employers right now are trends in wage and hour class actions suits, which can pose significant risk of crippling wage penalties and plaintiffs’ attorney fees, as well as leave discrimination and whistleblower retaliation claims. These kinds of claims could draw sympathy from jurors and sink a business. Here are a few of examples of employment cases recently filed across the country, and trust us, “You’re gonna need a bigger boat.”
Continue Reading COVID-19 Litigation: The Next Wave
California is like every other state in that it does not require employers to provide employees with paid time off. Unlike in most other states, however, if an employer does provide employees with paid time off, then employees have a vested right in such time. What this means is that employers are prohibited from enacting “use it or lose it” paid time off policies. It also means that upon separation, California employers must pay out employees for any unused paid time off.
Due to these requirements, and to remain competitive with other employers, some employers have instituted “unlimited” paid time off policies whereby employees do not accrue any specific amount of vacation time but, rather, are free to take (or not take) as much (or as little) vacation as they want. The commonly held belief amongst most employers is that such unlimited paid time off policies benefit employees by providing them with flexible schedules while, at the same time, allowing employers to avoid the obligation to pay out any unused paid time off upon separation. In McPherson v. EF Intercultural Foundation (McPherson), the California Court of Appeal issued a shot across the bow to employers adhering to this commonly held belief by holding that the unlimited paid time off policy at issue did obligate the employer to pay out unused paid time off upon termination.
Continue Reading California Court of Appeal Issues Warning to Employers with Unlimited Paid Time Off Policies
The U.S. Department of Labor announced today that an estimated 1.3 million workers will soon be eligible to receive overtime or be in line for a raise. Effective January 1, 2020, the minimum salary threshold for the “white-collar” exemptions under the Fair Labor Standards Act will be $684 per week or $35,568 per year, an
SB 123, just passed by the legislature and signed by Governor Brown, makes several amendments to Oregon’s pay equity law. Most notable are the revisions to the limited affirmative defense available to employers in litigation. The law previously provided employers a “safe harbor” from emotional distress and punitive damages if a lawsuit is filed,
Spring is in the air and summer is around the corner. You can see the signs everywhere. Flowers. Chirping birds. Increasing temperatures. And summer intern resumes. Experienced HR professionals know they will soon receive many resumes from eager students or recent graduates hoping to work as interns in order to gain valuable experience and networking opportunities. Often, intern candidates offer to work for free in exchange for the chance to gain experience in a job or industry.
Of course the idea, however enticing, of free labor should raise red flags. Many “for profit” business have run into trouble by failing to pay minimum wage and overtime pay to “unpaid interns” who the courts concluded were actually employees.
Continue Reading Are Employers Required to Pay Interns?
On March 22, the Department of Labor (“DOL”) published a new proposed rule that would make several changes to current overtime law. The proposed rule, which is not yet in effect, would require that:
Continue Reading Department of Labor Proposes Rule to Make More Employees Eligible for Overtime
Many classes of California workers are entitled to “reporting time pay,” which is partial compensation given to employees who go to work expecting to work a certain number of hours but are deprived of working the full time due to inadequate scheduling or lack of notice by the employer. Prior to the California Court of Appeal’s decision in Skylar Ward v. Tilly’s, Inc. most employers understood that such pay was only required if the employee physically appears at the workplace. In that decision, however, the Court of Appeal told those employers that they were wrong.
Continue Reading California Court of Appeal Significantly Broadens the Scope of Employees Entitled to Reporting Time Pay
A recent California Court of Appeal decision upheld the state’s complex rules for compensating piece-rate employees. In Nisei Farmers League v. California Labor & Workforce Dev. Agency, 2019 Cal.App. LEXIS 10 (Cal.Ct.App. Jan. 4, 2019), the Court held that the Labor Code’s requirement that piece-rate employees be separately compensated for “nonproductive time” was not