Last week in Green v. Bank of America Corp., No. 11.56365 (9th Cir. Feb. 13, 2012), the Ninth Circuit held that “suitable seats” lawsuits cannot be dismissed at the pleading stage based on an employee’s failure to allege that he or she requested suitable seating. The Ninth Circuit’s reversal raises significant questions regarding one of the more common employer defenses to the recent wave of “suitable seats” litigation based upon IWC Wage Order 7-2001.
Filed in April 2011, the plaintiffs in Green raised standard “suitable seats” allegations by claiming Bank of America failed to comply with the requirement of Section 14 of IWC Wage Order 7-2001 that employees be provided with “suitable seats when the nature of the work reasonably permits use of seats.” The district court granted Bank of America’s motion to dismiss, holding that the bank only needed to provide tellers access to seats if seats were requested. On appeal, the Ninth Circuit reversed, holding that the district court mistakenly assumed a requirement that employees allege that they requested seats where the text of the Wage Order does not expressly require such a request. The Court’s brief opinion also clarified that its reversal did not present an opinion on whether any seating provided to the employees was “suitable” or whether the nature of the work “reasonably permits use of seats” because these issues would be developed at the district court upon remand.
Though Green is confined to its context and should not be read to preclude employers from raising the defense of a failure to request suitable seating, it nonetheless raises the critical question of whether employers have an affirmative obligation to provide suitable seats in the absence of any employee requests. As more “suitable seats” lawsuits reach the summary judgment and trial stages, and as state appellate courts begin to take up the issue, employers should expect more clarity. In the meantime, employers should stay tuned for further updates regarding this rapidly changing area of employment law.
In Aleksick v. 7-Eleven, Inc., California’s Fourth District Court of Appeal provided a stark reminder that claims brought under California’s Unfair Competition Law (“UCL”) must specifically invoke an underlying law or public policy in order to be properly pled. The plaintiff in Aleksick alleged that 7-Eleven, which provides payroll services to its franchisees, used a payroll system that improperly converted partial hours worked from minutes to hundredths of an hour. According to the plaintiff, this practice of “truncating” hours shorted employees a few seconds of time for every converted partial hour and thereby violated the UCL, which prohibits “any unlawful, unfair or fraudulent business act or practice.” The plaintiff’s complaint, however, did not specify any underlying Labor Code section as a basis for plaintiff’s UCL claim.
The court affirmed the trial court’s grant of summary judgment for 7-Eleven on two grounds. First, the court held that the plaintiff’s complaint failed to specifically allege a statutory predicate for the UCL claim of “unlawfulness,” and that plaintiff’s failure in this regard constituted a forfeiture of her UCL claim. Second, the court held that, even absent forfeiture of the UCL claim, the claim necessarily failed against 7-Eleven because 7-Eleven was not the plaintiff’s employer. Rather, under both the applicable Wage Order and the common law, the individual franchisee was the plaintiff’s employer. As the court observed, only the employer has the duty to pay wages. Thus, the plaintiff could not assert a UCL claim against 7-Eleven, whether based on an assertion of “unfair” or “unlawful” business practices.
Aleksick is a helpful decision for employers because it reinforces a pleading rule that is not always followed by plaintiffs’ attorneys: complaints alleging UCL claims must specifically invoke the statutory or public policy bases underlying the UCL claims. It also could cause plaintiffs’ attorneys to think twice before naming franchisors in lawsuits involving allegations of unpaid wages.
Please do not include any confidential, secret or otherwise sensitive information concerning any potential
or actual legal matter in this e-mail message. Unsolicited e-mails do not create an attorney-client
relationship and confidential or secret information included in such e-mails cannot be protected from
disclosure. Orrick does not have a duty or a legal obligation to keep confidential any information that
you provide to us. Also, please note that our attorneys do not seek to practice law in any jurisdiction
in which they are not properly authorized to do so.
By clicking "OK" below, you understand and agree that Orrick will have no duty to keep confidential any
information you provide.