De Minimis Defense Closes Shop on Starbucks Barista’s Off-the-Clock Claim in the Central District of California

On March 7, 2014, Judge Feess of the Central District of California granted Defendant Starbucks’ motion for summary judgment on Plaintiff’s proposed class claims for unpaid wages under the California Labor Code. Plaintiff alleged that Starbucks failed to pay him for the brief time he spent closing the store after he clocked out at the end of every closing shift. His alleged off-the-clock closing duties included closing out of the store’s computer system, activating the alarm, walking out of store, locking the door, walking employees to their cars and staying with co-workers when they waited for rides. He also occasionally moved the store’s patio furniture inside and reopened the store for an employee who forgot personal belonging in the store. Read More

OHSA’s Plan to Air Employers’ Potentially Dirty Laundry Online

Trying to keep your illness and injury reports low profile? According to new rules proposed by the Occupational Safety and Health Administration (“OSHA”), not under their watch! At an estimated cost of $10.5 million per year to employers, OSHA’s three new proposed rules will impact approximately 480,000 employers by making their injury and illness records publicly available for the first time. See Improve Tracking of Workplace Injuries and Illnesses, 78 Fed. Reg. 67273, 67275 (proposed Nov. 8, 2013) (to be codified at 29 C.F.R. pt. 1904). Read More

Further Down the Rabbit-Hole we go: California’s Troubling Treatment of Incentive-Based Compensation Systems

On July 17, 2013, the California Supreme Court denied review of the Second Appellate District’s decision in Gonzalez v. Downtown LA Motors, 2013 Cal. App. LEXIS 257 (Cal. App. 2d Dist. Mar. 6, 2013), which addressed minimum-wage requirements for piece-rate workers. The Court of Appeal held that the employer had to pay a separate hourly rate of at least minimum wage during work time when piece-rate employees are engaged in compensable activity that does not directly produce piece-rates.  Read More

Oxford Health Plans LLC v. Sutter: You Get What You Bargain For, Including the “Good, Bad, or Ugly”

Ever have that feeling that your arbitrator just doesn’t understand you? You may be right, but there’s not much you can do about it. A recent unanimous ruling by the United States Supreme Court should encourage employers to review the language in their arbitration agreements to ensure clarity on the issue of class arbitration. In Oxford Health Plans LLC v. Sutter, No. 12-135, slip op. at 4-5, 8-9 (U.S. June 10, 2013), the Supreme Court reiterated that parties who agree to arbitration and ask the arbitrator to decide an issue are stuck with the “good, bad, or ugly” decision of the arbitrator. Even where, as in this case, the arbitrator makes a dubious decision that the parties’ contract allows class arbitration, Federal Arbitration Act § 10(a)(4) does not allow a court to second-guess that decision.

Sutter, a pediatrician, and Oxford Health Plans, an insurance company, entered into a contract for services that included the following arbitration clause: “[n]o civil action concerning any dispute arising under this Agreement shall be instituted before any court, and all such disputes shall be submitted to final and binding arbitration . . . .” Id. at 1-2. Later, Sutter brought suit in state court on behalf of himself and a proposed class of other doctors alleging that Oxford Health Plans had violated their contracts and various state laws. Id. Upon Oxford Health Plans’ motion, the case was compelled to arbitration. Id. at 2. Critically, the parties agreed that the arbitrator should decide whether their contract authorized class arbitration, and the arbitrator determined that, based on the terms of the clause quoted above, it did. See id. at 2, 3. Oxford Health Plans brought a motion in federal court arguing the arbitrator’s decision should be vacated on the ground that he had “exceeded [his] powers” under Federal Arbitration Act § 10(a)(4). Id. Read More

California Supreme Court Eliminates Damages in FEHA Discrimination Cases Where Employer Proves Mixed Motive Defense

Earlier this month, the California Supreme Court issued a ruling clarifying details of the “mixed-motive” defense applicable to discrimination claims under the California Fair Employment and Housing Act (“FEHA”). Harris v. City of Santa Monica, Case No. S181004 (Cal. Feb. 7, 2013). The Harris opinion is undoubtedly positive news for employers and provides much-needed guidance to trial courts in California handling mixed-motive cases (i.e., cases where legitimate and illegitimate factors motivated the decision). Read More

2013 Updates to the FEHA California Pregnancy Regulations

Amendments to California’s pregnancy regulations became effective on December 30, 2012, creating many new responsibilities for employers. While employers should take note of all of the amended regulations, some of the most significant changes are discussed below. Read More

A New Term in the U.S. Supreme Court: Cases to Watch

Earlier this month, the U.S. Supreme Court began a new term that is anticipated to include decisions on hot-button issues such as affirmative action, same-sex marriage and national security. The Court will also hear several significant cases in the employment context Read More

California Court Finds Arbitration Agreement In Employee Handbook Unenforceable

In a July 30, 2012 decision the Second Appellate District of the Court of Appeal ruled that an employee was not bound by the arbitration clause in his employee handbook for a slew of reasons:

  • the clause itself was buried (or as the Court said “not specifically highlighted”) in a lengthy handbook and was not called to the employee’s attention;
  • the employee did not specifically acknowledge the clause or agree to arbitrate, but merely signed an acknowledgment of receipt of the handbook itself;
  • the handbook contained a (relatively) standard clause that it was not intended to create a contract but, the employer also “had it both ways” and retained the rights to unilaterally amend the handbook’s provisions;
  • the employer failed to provide the employee with the specific arbitration rules; and
  • the clause itself was found unconscionable:  procedurally, because the employer did not distribute the rules governing the arbitration to employees and because the issue of arbitration was not negotiable and, substantively, because it required the employee to relinquish administrative and judicial rights and made no express provision for discovery rights.

While this decision points out the pitfalls of this particular factual scenario, it also highlights some nuances.  As courts reinvigorate their scrutiny of arbitration clauses and agreements, due to what this Court called “the increasing phenomenon of depriving employees of the right to a judicial forum,” employers may want to revisit and revise their handbook language.

California Supreme Court Confirms Work Product Protection for Attorney-Directed Investigations

The California Supreme Court recently clarified the extent of the attorney work product privilege under California law regarding recorded witness statements and the identities of witness interviewed by counsel, resolving a split of authority in the court of appeal. In Coito v. Superior Court, et al., Case No. S181712 (June 25, 2012), the court held that recorded witness statements—including statements made to an attorney’s agent at the direction of an attorney—are entitled to at least a qualified work product protection as a matter of law, and may be entitled to absolute protection upon proper showing. Furthermore, the court held that the identity of witnesses from whom counsel have obtained statements is not entitled to automatic work product protection as a matter of law, but may be entitled to the work product privilege upon proper showing. Read More