Farm Owners Required to Comply With Overtime Law

Sacramento, CA: When it comes to California compliance overtime laws might be among the laws that are most widely violated. Employers are accused of misclassifying employees as exempt from California overtime, or just full-out failing to pay non-exempt workers for overtime hours. In some cases, workers aren't even eligible for overtime pay, or have different standards for paying overtime. One group of workers - farmworkers - could soon see that change.

California Labor Law Compliance Lawsuit Grew from Accident at Tesla

Fremont, CA: A developing issue in the global automotive industry pertaining to labor law compliance appears to have its roots in California and, specifically, the Tesla automotive plant. A California labor law compliance lawsuit filed by an injured worker toiling for a subcontractor during a construction job at the Tesla plant is effectively reverberating around the globe.

The recent California compliance labor lawsuit was filed by a worker who was seriously injured on the job while working at the Tesla automotive plant in May of last year. Plaintiff Gregor Lesnik was employed by ISM Vuzem, a subcontractor to Eisenmann Corp., a German-based enterprise that supplies paint shop systems to the automotive industry.

According to an investigative report in the Mercury News (5/15/16) of San Jose, Tesla Motors, Inc. had contracted with Eisenmann Corp. for the installation of a paint shop system at its facility in Fremont. Eisenmann, in turn, subcontracted some of the work out to ISM Vuzem, which is headquartered in Slovenia and a company that specializes in factory construction and the installation of equipment.

Lesnik, the plaintiff, claims in his lawsuit that he was working on the roof of the Tesla facility as an employee of ISM Vuzem when a temporary roof panel gave way and he fell, sustaining serious injuries. His lawsuit notes there was no safety net installed below the work area, he was not provided with a safety harness, and a safety supervisor was not present when the accident happened. He fell the equivalent of three stories and broke both his legs, sustained rib fractures and a concussion.

Lesnik noted in his California labor law compliance lawsuit that some 150 Eastern European workers had been provided to Eisenmann by ISM Vuzem in a subcontracting arrangement. The workers, the lawsuit said, worked long hours for low wages - as little as $5 per hour, or so it has been reported.

The labor law compliance lawsuit claims that such conditions were violations of California labor laws.

Tesla issued a statement noting that while not legally responsible for the injuries sustained by the employee of the subcontractor, it would nonetheless “take action to address this individual’s situation,” citing a moral obligation to do so.

“Tesla did everything correctly,” the company said in the statement, posted on its website. “We hired a contractor to do a turnkey project at our factory and, as we always do in these situations, contractually obligated our contractor to comply with all laws in bringing in the resources they felt were needed to do the job.”

Tesla pledged also to impose additional oversight to ensure that “our workplace rules are followed even by sub-subcontractors,” the statement said.

For its part, the German corporation has launched a probe into its supplier contracts. As for Lesnik, Eisenmann says it hired Lesnik through a subcontractor and thus, denies responsibility also. ISM Vuzem also denies responsibility and has tried to persuade Lesnik to drop his lawsuit.

Case information was not available.

California Supreme Court Rules Employees Entitled to Seats

Sacramento, CA: The Supreme Court of California has ruled that employees must be provided with seats if sitting does not interfere with the work they are doing. The decision came after a California employee lawsuit filed by workers at CVS and Chase Bank, who argued they were forced to stand on the job despite California law requiring access to seats where work reasonably permits sitting.

According to court documents, at issue in the lawsuit was the requirement that all working employees must be provided with suitable seats “when the nature of the work reasonably permits the use of seats.” The question was whether that phrase referred to individual tasks performed throughout the workday or the entire range of duties in a day or shift. Employers argued that if a portion of the employee’s job duties required employees to stand, seating could be denied.

Further, the Supreme Court considered whether the nature of “reasonably permits” should include an employer’s business judgment. For example, if the employer is concerned about how customers react to a bank teller sitting on the job, does that give the employer the right to deny seating to employees?

“There is no principled reason for denying an employee a seat when he spends a substantial part of his workday at a single location performing tasks that could reasonably be done while seated, merely because his job duties include other tasks that must be done standing,” Justice Carol A. Corrigan wrote for the court, which ruled unanimously. “Further, defendants’ view could also result in different seating requirements for employees with different duties and job descriptions while they perform the same work (italics in original).”

For example, a stock person and a sales clerk could both spend time working at a cash register, but if an overall view of the employee’s tasks is used, the stock person could be denied a seat while at the cash register even though a sales clerk would be permitted to sit.

The judges wrote that courts should look at the actual work done and time spent at each task when determining if employees should be permitted to sit, rather than strictly looking at individual job tasks or an employee’s overall job duties.

“If the tasks being performed at a given location reasonably permit sitting, and provision of a seat would not interfere with performance of any other tasks that may require standing, a seat is called for,” the judges wrote.

And although an employer’s business judgment is relevant to the determination of allowing seating, the court found that it was not the only factor. An objective determination about seating should be made, rather than one that focuses on whether customers might be offended by sales clerks who sit at the cash register.

The lawsuit is Kilby v. CVS Pharmacy, Inc., S215614. The ruling came from the Supreme Court of California after the 9th Circuit Court of Appeals requested input.

TrueCar Truly Believes It Is Compliant with California Law

Santa Monica, CA: In an ongoing California compliance battle between the California New Car Dealers Association (CNCDA) and TrueCar Inc. (TrueCar), the former continues to chase the latter in the courts over what the CNCDA feels is unlawful pricing, together with false and misleading advertising on the part of TrueCar, or so it is alleged.

TrueCar is an entity that was founded in 2005, and reportedly has grown to be a popular resource for car buyers in the Golden State. According to the Sacramento Bee (1/7/16), TrueCar forges relationships with car dealers across the country, and employs those relationships to provide accurate and detailed pricing information on the cost of vehicles through its digital platform. TrueCar claims to have the capacity to link buyers to economically favorable offers from its affiliated dealers, and thus avoid on-site haggling that is normally the bastion of the automotive sales industry.

However, the CNCDA has cried foul, alleging that TrueCar is not complying with California law that serves to regulate the automotive sales industry. For one, the CNCDA accuses TrueCar of false and misleading advertising by way of assertions that TrueCar advertises a claim of “no surprise or hidden fees” on its website, when in reality - or so it is alleged - TrueCar receives a fee from each sale moved through its digital platform.

“TrueCar actually matches a buyer and a seller and gets paid for doing so. This is brokering, and TrueCar isn’t licensed as such,” insisted Brian Maas, CNCDA president, in comments published in the Sacramento Bee. The California compliance lawsuit asserts that TrueCar is not in compliance with California law and seeks a remedy to bring TrueCar into compliance.

TrueCar, for its part, asserts that it is already in compliance, and suggests that a lawsuit having twice been amended by the plaintiff is a sign that the CNCDA non-compliance lawsuit is full of holes.

The CNCDA, based in Sacramento, represents over a thousand franchised new car and truck dealers in the state of California and bills itself as the largest association of its kind in the United States. It brought a California non-compliance lawsuit against TrueCar in May of last year.

According to the Sacramento Bee, the plaintiff made its first of two amendments to its lawsuit in the summer following TrueCar’s attempts to have the lawsuit dismissed in August. Johnny Stephenson, identified as the Chief Risk Officer for TrueCar, suggested in an e-mailed statement to the Sacramento Bee that his company moved to have the newly amended complaint dismissed outright, based on various “defects” TrueCar noted in the complaint.

According to published reports, the Los Angeles Superior Court in Santa Monica did actually dismiss the CNCDA complaint in December of last year, but left the barn door open sufficiently to allow the plaintiff to further amend its complaint and refile again.

The CNCDA did just that and resubmitted its complaint last month. The plaintiff contends that TrueCar is, effectively, acting as a broker in matching buyers with vehicles - and in the state of California, entities undertaking brokerage of any kind must be licensed to do so.

According to the Los Angeles Times (5/20/15), TrueCar charges its affiliated dealers a fee for each sale - about $299 for a new car and $399 for a used car. In some states, including California, TrueCar charges a monthly subscription fee that roughly translates to those rates. It is that subscription fee that generated the California lawsuit. Since California state law dictates that consumers must be provided with a disclosure that outlines whether they or a dealer are paying a fee to a broker, the CNCDA sees that subscription fee as the impetus for a non-compliance lawsuit.

TrueCar, based in Santa Monica, insists it remains compliant with the letter of the law. To that end, the CNCDA is not seeking monetary damages in its California compliance lawsuit, but rather seeks compliance on the part of TrueCar according to California law, should it wish to continue its current business model.

Judge in Uber Case Rules on Arbitration Agreements

San Francisco, CA: Plaintiffs in the Uber misclassification lawsuit have been handed another victory in their litigation against the ridesharing company. The judge in the lawsuit has ruled against Uber’s arbitration agreement, setting the stage for thousands more plaintiffs to join the lawsuit.

US District Judge Edward Chen ruled Uber’s arbitration agreement was not enforceable, meaning drivers who signed it are eligible to join a class-action lawsuit against the ridesharing company after all. In September, Judge Chen granted plaintiffs class-action status, although at the time the class did not include drivers who signed Uber’s arbitration agreement.

In December, however, Judge Chen ruled on the arbitration agreements, finding them unenforceable as a matter of public policy. Judge Chen found that the 2014 and 2015 arbitration agreements “contain a non-severable PAGA [Private Attorney General Act] waiver, rendering the entire arbitration agreement also unenforceable.” As a result, UberBlack, UberX and UberSUV drivers will now be eligible to join the lawsuit if they signed up under their individual name, even if they did not opt out of the arbitration agreement.

In addition to ruling on the arbitration agreements, Judge Chen also ruled class members could pursue claims linked to work expenses, including vehicle and phone expenses.

Uber has appealed the decision.

The lawsuit was initially filed by Uber drivers who claimed they were misclassified as independent contractors even though Uber reportedly treated them like employees. Because they were classified as independent contractors, they were not eligible for certain protections, including overtime, sick days and health insurance.

Some employers require workers to sign arbitration agreements, which essentially waive an employee’s right to file a lawsuit to settle disputes such as wrongful termination and wage complaints. Instead, employees are forced to go through an arbitration process to resolve any claims. Arbitration cases have different rules about sharing information between claimants and defendants than court processes and usually do not allow for appeals.

Up to 160,000 drivers could now be included in the class against Uber, although some drivers are still excluded. The ruling also shows that not all arbitration agreements are enforceable and the courts may still be required to make judgments on the legitimacy of individual agreements.

The lawsuit is O’Connor et al. v. Uber Technologies Inc. et al., case number 3:13-cv-03826, US District Court for the Northern District of California.

$4.9 Million Settlement Approved for California Prevailing Wage Compliance Lawsuit

San Francisco, CA While various guidelines in the California labor code cover a wide swath of regulations governing wage and labor issues in the state, the California Prevailing Wage Law provides more specific guidelines and requirements for construction, installation and other projects that fall within the purview of public works.

To that end, a class-action lawsuit filed some time ago by six workers claiming they were not paid prevailing wages and were denied other benefits as required under the California Prevailing Wage Law, has ended with the approval of a multimillion-dollar settlement that will see roughly 533 class members receive about $5,000 each.

The lawsuit, filed in April of 2011, centered on the alleged non-compliance of defendant SimplexGrinnell LP, a division of Tyco International Ltd. Six laborers were hired to install fire alarms and other work for SimplexGrinnell under a public contract - which thus would trigger the need for compliance liability within California Prevailing Wage Law.

However, the plaintiffs claimed in their lawsuit they were not paid per diem wages, overtime or benefits as required under the Prevailing Wage law.

The defendant’s “acts and omissions in this regard are willful and not in good faith, and are without reasonable grounds for believing that the alleged acts and omissions are in compliance with the California Prevailing Wage Law,” the suit said.

The law requires employers with public contracts to pay workers the general prevailing wage rate for the work, as determined by the California Department of Industrial Relations. In addition to regular pay and overtime, the prevailing rate includes health benefits, pensions and vacation.

In early September, US District Judge Jon S. Tigar gave final approval to the settlement, worth $4.9 million. Satisfied that the settlement was “fair, reasonable and adequate,” Judge Tigar noted that the court recognized “the value to class members of defendant’s agreement to change its pay practices and pay prevailing wages for testing and inspection work, with payment retroactive to January 2015,” Judge Tigar wrote, noting no class member objected to the settlement. “This factor favors approval, which offers immediate and certain recovery to class members.”

It’s been reported the two sides in the California Prevailing Wage compliance lawsuit reached a tentative settlement last November. Judge Tigar gave his preliminary blessing in April of this year, before finally signing off on the agreement just last month.

The case is Bennett et al. v. SimplexGrinnell LP, Case No. 3:11-cv-01854, in the US District Court for the Northern District of California.

California Labor Law: Yard Hostlers Not Getting Proper Breaks

Lancaster, CA Yard hostling might be an area of employment that people are not familiar with, but that doesn’t mean that yard hostlers don’t deserve proper meal and rest breaks. Unfortunately, some companies that employ yard hostlers are accused of not properly scheduling or providing meal and rest breaks because they are more concerned with boosting their profits. One lawsuit alleging California labor violations has already been filed, says Kitty Szeto, attorney at R. Rex Parris Law Firm, and more could certainly follow.

Yard hostling typically involves retailers that have huge facilities, such as Target, Walmart, Costco, or Home Depot. These companies don’t keep their products stored in the back of their facilities; they keep them at other facilities at remote locations. The large retailers then hire trucking companies or logistics companies to transport the product from the remote locations to their stores.

Yard hostlers are employed by trucking companies or logistics companies at these remote locations. Their job is to move the empty trailers around - the same trailers that later haul the product to the retail store - and dock those trailers so workers can fill the trailer with product before it is driven to the store.

“The large retailers pay the logistics companies and trucking companies by the number of trailers moved, so there’s an incentive to move as many trailers as possible,” Szeto says. “This means that yard hostlers are not given proper breaks until all their loads are done. Their lunch breaks are frequently late or interrupted because trailers need to be moved. It’s like a giant game of Tetris, moving the trailers around the yard and to the loading docks.”

There have not been a lot of lawsuits filed so far involving yard hostling, but that could certainly change. Employees have the right to uninterrupted breaks after a certain amount of hours worked. Employers have a duty to schedule breaks for employees, and ensure employees get those breaks.

“In some cases the company isn’t scheduling the breaks. They’re failing to provide breaks under California law.”

Employees in other industries have filed lawsuits alleging their employers failed to provide proper breaks. As more employees learn that their rights are being violated, more lawsuits involving yard hostling could be filed.

“We have one lawsuit currently pending,” Szeto says. “It's an area that’s ripe but hasn’t been saturated because people are not familiar with the job.”

American Apparel Hit with Proposed California Labor Law Class Action

Los Angeles, CA When American Apparel announced to the press an impending mass layoff, the imminent job loss was allegedly news to many of the employees about to be affected, according to a class-action lawsuit filed days ago in California. When the layoffs were triggered on or about April 1, affected employees were blindsided, with little notice and minimal severance. California labor law and the Worker Adjustment and Retraining Notification Act (both federal and state) hold strict tenets as to what is required when a worker is let go through no fault of his own.

The proposed class action also alleges that many employees who had little proficiency with the English language were pressured into signing separation agreements described in court documents as “paltry,” and were also allegedly pressured into signing separation agreements they were unable to understand that left them little recourse for legal claims after the fact.

According to various media reports, American Apparel claimed the layoffs were necessary to ensure the future health and viability of the company. The proposed California labor lawsuit, however, notes that various requirements related to adequate severance and notice of layoff were not properly followed.

The lawsuit noted that various state and federal statutes that require 60 days’ notice prior to a layoff or job termination were not followed, and severance terms were described as “unconscionable,” with some employees offered as little as $300 in severance.

“As American Apparel’s management was well aware, many of these employees receiving these agreements did not speak, read, or write English. Several of these employees did not read or write at all,” the lawsuit said. “Notwithstanding the same, American Apparel’s management insisted that these employees sign these agreements immediately, even if they could not read or understand them.”

The lawsuit also notes the layoffs and terms fly in the face of a retooled ethics policy released by American Apparel in the wake of the recent termination of American Apparel founder Dov Charney in December of last year amidst various allegations of sexual harassment.

The proposed California and labor law class action also alleged that the CEO and other top management within the corporation awarded themselves additional stock options and salary increases, while stiffing laid-off employees with minimal severance, or so it is alleged.

The lawsuit seeks 60 days’ worth of pay for each laid-off worker, as well as backpay and other benefits for the affected workers of American Apparel.

The case is Hirschberg et al v. American Apparel Inc., Case No. 2:15-cv-02827, filed April 16 in the US District Court for the Central District of California.

Silicon Valley Close to Settlement

San Francisco, CA Four Silicon Valley companies that allegedly violated California labor laws are close to reaching a settlement in an antitrust class-action lawsuit involving 64,000 current and former workers.

Google, Apple, Intel and Adobe have now offered $415 million to settle accusations that they had conspired against their own employees, according to the New York Times (Jan. 14, 2015). This settlement proposal has increased from an earlier offer of $324.5 million, an amount that U.S. District Judge Lucy Koh rejected last August, when she agreed with plaintiff and former Adobe engineer Michael Devine. He protested the amount, arguing that it wasn’t enough money given the wealth of the companies and the scale of their collusion - their “non-poach” agreements. Devine, who is one of five named plaintiffs in the class-action lawsuit, did the math and figured that affected workers would end up with only a few thousand dollars each.

This new settlement amount is still pocket money to the silicon giants, but Devine said it is “at least in the right ballpark.” Pundits say it would be in their better interests to settle rather than go to trial. The latter might tarnish their reputations as forward-thinking and worker-friendly and caring empires.

Of course there is a chance that plaintiffs might lose if it goes to trial. And it’s a big gamble for their lawyers whose share in the settlement could be as much as 25 percent. If they lose at trial, attorneys’ years of hard work goes down the drain. On the other hand, a jury could award the plaintiffs a few billion dollars. Earlier, lawyers estimated that damages were $3 billion, an amount that would be tripled after a guilty verdict, reported Reuters. The case is slated for a trial this spring in San Jose.

This complaint goes back to 2005, when Apple co-founder Steve Jobs asked Google CEO Eric Schmidt to stop poaching Apple workers. In the lawsuit, plaintiffs used the deceased Jobs’ e-mail to Schmidt as evidence that they agreed not to steal each other’s employees by offering them lower wages to discourage them, according to USA Today. And Intel even had a written document regarding a non-poach agreement with Pixar, where Intel’s policy was to not hire any Pixar employee without the Pixar CEO’s approval.

In 2011, after a Justice Department investigation, antitrust complaints were lodged against Google, Apple, Intel, Intuit, Adobe, Pixar and Lucasfilm. All companies paid a combined settlement of $20 million, but one Inuit employee told USA Today that he only received $1,000 - not enough to pay for a vacation in the Caribbean that he had been hoping for. Perhaps this settlement will allow workers to have their days in the sun.

Temp Worker Takes on Former Employer in Proposed Class Action

Los Angeles, CA A woman in California employed by a state-based temp agency has filed what she hopes will become a class action California labor lawsuit against her former employer over allegations of improper payment records.

Allegations of inaccurate wage statements made by plaintiff Tamara L. Bengel could affect upwards of 1,000 potential class members, according to her California labor code action filed earlier this month in California Superior Court.

The defendant, Career Strategies Temporary Inc. (CST), is based in Burbank but maintains satellite offices in seven states, including California. CST provides direct-hire and temporary staffing services to businesses and corporations.

Bengel alleges in her California labor lawsuit that she was paid weekly by CST for work she was assigned as a temporary worker. The issue she has with her wage statements is that her weekly pay stubs did not specify inclusive pay period dates, in violation of the California labor code.

The lack of inclusive pay period dates makes it impossible for employees going forward to accurately track pay stubs against calendar dates when work was performed.

Bengel, it has been reported, has taken two pathways to justice with her allegations. The first is a reporting of her allegations to the California Labor and Workforce Development Agency, which Bengel is described as undertaking about six weeks before filing her California and labor law action.

The plaintiff also seeks to represent at least 1,000 other workers employed by CST in the state of California from a period beginning November 1, 2013 to the present day. She seeks civil penalties under the Private Attorneys General Act (PAGA) of California. Bengel’s suit seeks statutory penalties and attorneys’ fees and costs. If an employer knowingly and intentionally fails to accurately itemize a wage statement, an employee can recover the greater of actual damages or statutory fines of $50 for the first violation and $100 for each subsequent violation up to $4,000, according to the suit.

“Plaintiff and each class member suffered and suffer injuries as a result of the missing pay period because a reasonable person could not promptly and easily determine the pay period from the wage statement alone without reference to other documents or information,” the complaint says.

In her California labor employment law proposed class action, Bengel also suggests that her complaint could be amended to include other defendants, provided there is sufficient cause to believe that other parties may have been participating with CST in violating California labor law.

The case is Bengel v. Career Strategies Temporary Inc., case number BC565227, in the Superior Court of the State of California, County of Los Angeles.