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Recent Employment Law News for Jan 27, 2012
Labor Commission Issues Updated FAQs on Wage Theft Prevention Act
Thu, 26 Jan 2012 20:06:53 - Pacific Time
On January 23, 2012, the California Labor Commissioner released an updated and expanded version of the previously issued “frequently asked questions” (FAQ) related to the new Wage Theft Protection Act (AB 469). The Wage Theft Prevention Act went into effect on January 1, 2012. The new legislation amends existing laws, and adds new requirements which “criminalizes willful violations for non-payment of wages after a court judgment or final administrative order; requires restitution to the employee in addition to a civil penalty for failure to pay minimum wages; requires that specified information be provided to employees at the time of hire and in wage claim proceedings and that employers update changes within specified periods; extends the time period for obtaining judgments on final orders for collection of penalties by the Division of Labor Standards Enforcement (DLSE); enhances bond requirements for employers with convictions or court judgments for non-payment of wages including requiring an accounting of assets upon request by DLSE or court order; establishes that penalties under the Labor Code for failure to comply with wage-related statutes are minimum penalties; and allows employees to recover attorney’s fees and costs incurred to enforce a judgment for unpaid wages.”
The new legislation also requires that employers provide notice to employees of their rate(s) of pay, designated pay day, the employer’s intent to claim allowances (meal or lodging allowances) as part of the minimum wage, and the basis of wage payment (whether paying by hour, shift, day, week, piece, etc.), including any applicable rates for overtime. The new law also requires that the notice contain the employer's "doing business as" names, and that it be provided when the employee is hired and within 7 days of a change, provided the change is not listed on the employee’s pay stub for the following pay period. The notice must be provided in the language the employer typically uses to communicate workplace information to the employee. The Labor Commission has provided translated notices. The Commissioner is also recommending that all non-exempt existing employees be provided with the same information although the new legislation only pertains to new hires. A template has been provided by the Commissioner which can be found at: http://www.dir.ca.gov/dlse/Governor_signs_Wage_Theft_Protection_Act_of_2011.html. Read More.
.NLRB Releases Second Report Detailing Social Media Cases
Thu, 26 Jan 2012 05:08:28 - Pacific Time
In order to provide further guidance to employers and human resource professionals, the National Labor Relations Board (NLRB) has released a second report describing social media cases reviewed by the NLRB’s Acting General Counsel. The Operations Management Memo involves 14 cases, half of which involve questions about employer social media policies. The NLRB found that five of the policies were unlawfully broad, one was lawful, and one was found to be lawful after the employer revised the policy. The remaining cases involved terminations of employees after they posted comments to Facebook. The NLRB determined that several of the terminations were unlawful because they flowed from unlawful policies. However, in one case, the NLRB upheld the termination despite an unlawful policy because the employee’s posting was not work-related. The report emphasized two important points made in an earlier compilation of cases: (1) “Employer policies should not be so broad that they prohibit the kinds of activity protected by federal labor law, such as the discussion of wages or working conditions among employees; (2) An employee’s comments on social media are generally not protected if they are mere gripes not made in relation to group activity among employees.”
In light of the evolving nature of social media cases, the Acting General Counsel requested that all NLRB regional offices forward cases which the Regions believed to be meritorious. Approximately 75 cases have been forwarded to date. The report does not name the parties to the cases or their locations; however, the report does demonstrate that social media cases are very fact-specific.
The report also reflects the Acting General Counsel’s interpretation of the National Labor Relations Act as it relates to communication methods that were not in existence when the Act was written. Three cases involving social media questions are currently pending before the NLRB. It is anticipated that the decisions in those cases will provide further guidance for employers on this complicated issue. Information on the three cases may be found: here, here, and here. Read More.
.Court Rules Commissioned Employees Were Properly Classified As Exempt
Wed, 25 Jan 2012 05:07:05 - Pacific Time
Pursuant to the “commissioned employees exemption” from overtime, employers are not required to pay overtime wages to employees whose earnings exceed one and one-half (1 1/2) times the minimum wage if more than half of that employee's compensation represents commissions. In a recent case involving employees working as senior consulting managers, who claimed they were owed overtime because their employer classified them as exempt from overtime, both the trial court and the court of appeal concluded that the employees were properly classified as exempt under the commissioned employees exemption. The case involved Tyrone Muldrow, who filed suit against Surrex Solutions Corporation (Surrex) on behalf of himself and a class of current and former Surrex employees. In his complaint, Muldrow alleged that Surrex failed to pay overtime and failed to provide meal periods. Surrex asserted that it was not required to pay overtime to because the employees were subject to the commissioned employees exemption.
The trial court determined that the class members were subject to the commissioned employees exemption, that Surrex had properly provided meal periods, and that the current law did not obligate Surrex to ensure that the employees utilized the meal periods. Muldrow appealed contending that the commissioned employees exemption did not apply. However, the appellate court held that the trial court did not err in determining the employees were not entitled to overtime pay, due to the fact that they met the criteria for the commissioned employees exemption because they were primarily engaged in sales, their commissions were based on price, and Surrex's compensation system was a bona fide commission system. The court rejected Muldrow’s various arguments including that "searching on the computer, searching for candidates on the website, cold calling, interviewing candidates, inputting data, and submitting resumes," should not be considered sales-related activities. Read More.
.EEOC Obtains Record Amount of Relief in 2011
Wed, 25 Jan 2012 03:02:42 - Pacific Time
The U.S. Equal Employment Opportunity Commission (EEOC) is reporting that it received a record 99,947 charges of employment discrimination and obtained $455.6 million in relief through its administrative program and litigation in Fiscal Year 2011. For the second year in a row, the EEOC resolved more charges than it took in with 112,499 resolutions (7,500 more resolutions than FY 2010—an increase of 7%)—leaving 78,136 pending charges, a ten percent decrease in its inventory. The FY 2011 data show that (1) the EEOC obtained a record $455.6 million in relief for private sector, state, and local employees and applicants, which represents a more than $45 million increase from the past fiscal year, and continues the upward trend of the past three fiscal years; (2) the mediation program reached record levels, both in the number of resolutions – 9,831 – which is 5% more than in FY 2010 (9,362), and benefits -- $170,053,021-- $29 million more than FY 2010; (3) the EEOC filed 300 lawsuits and obtained $91 million in relief, representing the third year in a row that the relief obtained was greater than in the preceding year.
EEOC Chair Jacqueline Berrien commented that, “For the second year in a row, the EEOC received a record number of new charges of discrimination…Nevertheless, the hard work of our employees, combined with increased investments in training, technology and staffing in 2009 and 2010, and strategic management of existing resources made 2011 a year of extraordinary achievements for the EEOC.” While the numbers of charges with race discrimination allegations declined from the previous year, charges with the three other most frequently-cited allegations increased: Sex discrimination--28,534; Disability discrimination--25,742; Age discrimination—23,465. The EEOC’s enforcement of Americans with Disabilities Act (ADA) produced the highest increase in monetary relief among all of the statutes: the administrative relief obtained for disability discrimination charges increased by almost 35.9 percent to $103.4 million compared to $76.1 million in the previous fiscal year. Interestingly, back impairments were the most frequently cited impairment under the ADA, followed by other orthopedic impairments, depression and diabetes. Read More.
.Court Reverses $2 Million Dollar Judgment Against City of Los Angeles for Retaliation
Tue, 24 Jan 2012 06:53:04 - Pacific Time
The California Court of Appeal, 2nd District, has reversed a $2 million dollar judgment against the City of Los Angeles (City). The case involved Richard Joaquin, a Los Angeles Police Department officer, who complained of sexual harassment by Sergeant James Sands. The department investigated and concluded that Joaquin’s complaint was unfounded. Sands then pursued a complaint against Joaquin for filing a false sexual harassment charge. Internal Affairs investigated Sand’s complaint, agreed that Joaquin’s charge was without merit, and recommended that the matter be adjudicated by a Board of Rights. The Board of Rights found that Joaquin fabricated the charges and recommended termination. Subsequently, Joaquin was terminated. Joaquin then filed a petition for writ of mandate. The superior court granted the petition and ordered Joaquin reinstated, concluding that the evidence did not support the Board of Rights’ findings. Joaquin was reinstated. He then filed suit against the City alleging that the City terminated him in retaliation for filing a sexual harassment complaint, in violation of the Fair Employment and Housing Act (FEHA). A jury agreed and awarded Joaquin more than $2 million for lost wages and emotional distress.
The City appealed, arguing that the jury’s verdict was not supported by substantial evidence. The 2nd District Court of Appeal agreed and reversed the $2 million dollar judgment. Notably, in its decision the court focused in on the issue of whether “an employee may be disciplined if his or her employer concludes that the employee has fabricated a claim of sexual harassment, or whether such a complaint is insulated from discipline even where, as here, the employer determines that it was fabricated.” On this important point, the court noted that it was “not aware of any California case that has discussed” the matter although the question of whether “a false report of discrimination or harassment may lawfully be a basis for discipline has been addressed in federal cases interpreting title VII of the Civil Rights Act of 1964.” After reviewing several of these cases, the court concluded that “in appropriate circumstances, an employer may discipline or terminate an employee for making false charges, even where the subject matter of those charges is an allegation of sexual harassment.” Read More.
.Employee Terminated for Working Through Lunch Wins U.I. Appeal
Tue, 24 Jan 2012 05:19:49 - Pacific Time
Sharon Smiley worked for 10 years as a receptionist and administrative assistant at a Chicago real estate company. However, she was terminated for working through her lunch, in violation of company policy. Specifically, Smiley alleged that she punched out of work for lunch but remained at her desk to finish a project assigned by a manager because she did not plan to eat that day. Another manager advised Smiley that it was time for her to take her meal break and step away from her desk, but apparently she refused. The manager observed Smiley performing her job duties including working on a spreadsheet on her computer, answering the phone and responding to questions by people who approached her desk. The company's human resources director became involved, explaining that hourly non-exempt employees were required to take a 30-minute meal break, a policy that had been in the company handbook for 10 years. Further, the HR director advised that not following the policy would be a violation of Illinois' labor laws. Smiley was terminated and subsequently Smiley filed for unemployment insurance (U.I.) benefits, which were denied due to her “misconduct.” According to the employer, Smiley had been warned several times about working during her meal period. After a two-year battle, an Illinois appeals court has found that denial of her unemployment benefits was "clearly erroneous." Similar to California, Illinois requires employers to provide employees a lunch break. But, according to one legal expert, Michael LeRoy, law professor at the University of Illinois at Urbana-Champaign, the law does not mean that an employer may fire a worker who refuses to take a break in order to finish his or her work. This puts employers in the difficult position of risking a violation of wage and hour laws by not disciplining employees for failing to take their meal periods as required by law and workplace policies versus imposing disciplinary measures for failure to follow company policy, such as termination, which could be interpreted by a court as inappropriate under the circumstances. Read More.
.Covered Employers Must Post Annual OSHA 300A Summary Form by February 1, 2012
Tue, 24 Jan 2012 04:33:04 - Pacific Time
Every employer covered by the Occupational Safety and Health Administration (OSHA) who has more than 10 employees, except for employers in certain low-hazard industries in the retail, finance, insurance, real estate, and service sectors, must maintain specific records of job related injuries and illnesses, including the OSHA Form 300, which is an injury/illness log, with a separate line entry for each recordable injury or illness. Such events include work related deaths, injuries, and illnesses other than minor injuries requiring only first aid treatment not involving medical treatment, loss of consciousness, restriction of work, or transfer to another job. Every year, the employer must post in a conspicuous location in the workplace the OSHA Form 300A, which consists of a summary of the previous year's work-related injuries and illnesses recorded on the Form 300. Employers must also record on the OSHA Form 301 individual incident reports that provide added detail about each specific recordable injury or illness. Read More.
.Dual-Employers Issued $256,445 in Citations by Cal/OSHA for Unsafe Working Conditions
Mon, 23 Jan 2012 21:05:25 - Pacific Time
After receiving complaints from Warehouse Workers United, the California Department of Industrial Relations’ Division of Occupational Safety and Health (Cal/OSHA)conducted inspections and issued $256,445 in citations to warehouse owner National Distribution Centers and its temporary staffing contractor, Tri State Staffing, for more than 60 violations at four warehouses in San Bernardino County, including violations for a lack of fall protection for high-rise pickers, unstable storage stacking and unguarded machinery. Cal/OSHA found three of the warehouses had dual-employer relationships—where one employer hires workers and provides them to another employer—and both employers are potentially liable for the violations of safety and health regulations. “When employers use a contractor for their staffing needs, they are not released from their responsibilities to provide a safe workplace,” said Cal/OSHA Chief Ellen Widess. “As dual employers sharing responsibility for training and worker safety, both National Distribution Centers and Tri State Staffing were responsible for ensuring that all employees are protected on the job.” In addition to the complaints received, attention was brought to these warehouses when, in August 2011, Cal/OSHA found that a 49-year-old warehouse, working inside in 90-degree temperatures, had become dizzy and nauseous and further determined that the employer failed to recognize the symptoms as heat-related or effectively address the conditions in a required Injury and Illness Prevention Program (IIPP). Every employer in the state of California is required to have an IIPP that addresses the safety hazards associated with their specific work site. When a common problem in a workplace puts employees at risk, such as dangerously high temperatures in warehouses, then the IIPP is required to address preventive measures to protect employees from the heat. “It’s not just outdoor workers who are vulnerable to heat illness,” said Cal/OSHA Chief Widess. “Every California employer needs to be aware of heat illness symptoms so that appropriate steps can be taken to prevent serious on-the-job injuries or death.” Read more.
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