Wage and Hour

Federal Overtime Formula Falls Flat — California Supreme Court Adopts DLSE Interpretation for Flat Rate Bonuses

In a break from federal law, the California Supreme Court clarified in Alvarado v. Dart Container Corp. the proper formula for calculating flat-rate bonuses into overtime pay under California law.  The Court adopted the Plaintiff’s position and held that, for purposes of calculating the per-hour value of a flat rate bonus, the divisor should be the number of nonovertime hours the employee worked in the pay period rather than all hours worked during the pay period.  READ MORE

Exhaustion Matters – Don’t Try Going It Alone Under PAGA

A recent decision by the California Court of Appeal provides two important reminders for practitioners handling Private Attorneys General Act (“PAGA”) claims. First, exhausting administrative proceedings matters. Second, PAGA claims are representative claims – not individual actions.

Under PAGA, an “aggrieved employee” may file a representative action on behalf of himself or herself and other current and former employees to recover civil penalties for violations of the California Labor Code. READ MORE

CA Court of Appeal Ruling Takes PAGA Standing By The Reins

Since its inception, the Private Attorneys General Act of 2004 (“PAGA”) has been a thorn in employers’ sides by allowing “aggrieved employees” to seek civil penalties on behalf of the State of California and other “aggrieved employees” for violations of the California Labor Code. In a small victory for employers, the California Court of Appeal recently bestowed a key limitation on what it means to be an aggrieved employee for purposes of PAGA standing. Specifically, the court held that an employee who settles his individual Labor Code claims against his employer no longer has standing as an “aggrieved employee” under PAGA. READ MORE

What’s In a “Wage”? Ninth Circuit Seeks Clarification from California Supreme Court

California has some of the most employee-friendly laws in the country, many of which turn on whether the allegedly wronged employee is seeking to recover “wages” due. The Ninth Circuit Court of Appeals recently asked the California Supreme Court to resolve a tension in existing case law about what constitutes a “wage,” with potentially far-reaching impact for employment cases—in particular, those involving meal and rest period claims. READ MORE

Are Interns Actually Employees? DOL Adopts New Guidance for Assessing Whether Interns Qualify as Employees

As part of its revision of Obama-era policies, the U.S. Department of Labor (“DOL”) recently announced a new test for assessing whether interns qualify as employees under the Federal Labor Standards Act (“FLSA”). The agency’s adoption of a “primary beneficiary” test aligns the DOL with several circuit court decisions and provides greater flexibility in analyzing intern-employer relationships under federal law. READ MORE

“Call-In Pay” for “On-Call” Work: New York’s Proposed Employee Scheduling Rules

The New York State Department of Labor has introduced its proposed rules, to address the practice of “on-call” scheduling (also called “just-in-time” or “call-in” scheduling), which the Department describes as “common practices that allow employers to schedule or cancel workers’ shifts just hours before or even after it starts.” Governor Andrew M. Cuomo states that the regulations are intended to “increase fairness for workers and allow employers to retain flexibility.” The full rulemaking package will be release on November 22, 2017, which will kick off the 45-day window for public comment. READ MORE

The Federal Overtime Rule Stalls and State Minimum Wage and Overtime Rules Rev Up

The Obama-Era Overtime Rule Stalls

As we previously reported, a federal district judge’s invalidation of the Obama-era overtime rules – which proposed a sharp increase in the salary threshold for exempt employees, expanding overtime pay to millions of workers – did not doom the possibility of changes to the minimum salary requirements.  Last week, on October 30, the Department of Labor filed a notice of appeal of the decision.  The notice comes after the DOL started the rulemaking process to replace Obama’s Rule with a new rule increasing the current minimum salary level by about 50% (to around $33,000).  If this became effective, it would be a significant departure from the Obama-era Rule, which doubled the minimum salary level to $47,476.  The DOL is expected to issue the new proposed rule in the coming months. READ MORE

COFFEE BREAK: Third Circuit Reminds Employers That Short Breaks May Be Compensable Under FLSA

Most employers in California are all-too familiar with the Golden State’s unique meal and rest break requirements.  But outside of states like California, Oregon, and Washington, which have clear requirements for meal and rest breaks, employers may forget that the Fair Labor Standards Act has its own rest break obligations. READ MORE

Texas Two-Step: Overtime Ruling Does Not Completely End the Obama Rule Dance

On August 31, 2017, Judge Amos Mazzant of the United States District Court for the Eastern District of Texas, issued an order invalidating the Obama-era overtime rules. Finding that the Department of Labor rule exceeded its statutory authority under the Fair Labor Standards Act, the district court appeared to end the saga that had employers furiously determining whether they were going to adjust the pay of a wide swath of their workforces last Fall. However, the decision does not close the books on whether changes to the FLSA white collar exemptions are on the horizon. READ MORE

Some Control Is Just Fine: Ninth Circuit Upholds Independent Contractor Status in Jones v. Royal Admin. Servs.

Just the other week, in Jones v. Royal Admin. Servs., the Ninth Circuit reaffirmed the federal common law standard for distinguishing agents from independent contractors and upheld the independent contractor status of telemarketers providing direct sales services for a company, Royal Administration Services, Inc. (“Royal”).

At issue were telemarketers employed by All American Auto Protection, Inc. (“AAAP”), one of about twenty marketing vendors used by Royal to sell vehicle service contracts.  Several recipients of these telemarketing calls filed suit, first against AAAP and then against Royal, alleging violations of the Telephone Consumer Protection Act (“TCPA”).  The telemarketing call recipients alleged that Royal was vicariously liable because the AAAP telemarketers were Royal’s agents.  Royal filed for summary judgment, asserting that the AAAP telemarketers were not its agents, but rather independent contractors.  The district court granted summary judgment for Royal. READ MORE