California Agency Issues Amendments to CFRA Regs

maternity-leave-062314The California Family Rights Act (CFRA) was established to ensure secure workplace leave rights for the birth of a child, for purposes of bonding, placement of a child in the employee’s family for adoption or foster care, for the serious health condition of the employee’s child, parent or spouse, or for the employee’s own serious health condition.

Importantly, the CFRA applies only to employers who employ 50 or more employees within a 75-mile radius. This is not new. However, the amended regulations clarify how to determine if this threshold is met for employees with no fixed worksite (i.e., work from home, etc.). The regulations now provide that such employees’ worksite is the location (1) to which they are assigned as their home base; (2) from which their work is assigned; or (3) to which they report.

CFRA leave is only available to employees who have been employed for at least 12 months and at least 1,250 hours during the preceding 12 months period. The amended regulations provide that employees who are not eligible for CFRA leave at the start of a leave because they did not meet this requirement, may become eligible for protected CFRA leave during their non-CFRA leave because their continued employment during such leave counts toward the 12 month threshold.

Formerly, employers could require an employee using CFRA leave to obtain a second opinion of the employee’s “serious health condition” if the employer had “reason” to doubt the validity of the first medical certification. This regulation has been amended to allow an employer to require a second opinion only where it has a “good faith, objective reason” to doubt the certification. Employers are also now prohibited from contacting health care providers except to authenticate a medical certification.

As amended, the regulations now provide that an employee who fraudulently uses CFRA leave is not protected for purposes of job restoration (at conclusion of leave) or health benefits.

Finally, the amended regulations require employers to post a notice explaining the CFRA and how to file a complaint with the Department of Fair Employment and Housing (DFEH).

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Update: Court Orders Publication of Nealy v. City of Santa Monica

In my last post, I highlighted a recent California Court of Appeal Decision, Nealy v. City of Santa Monica, in which the Court held that an employer is not required, as part of its duty to accommodate an employee’s disability, to eliminate an essential function of the employee’s job. At the time of my post, the case was not published, meaning it could not be cited as authority. In the interim, the case has been ordered published, meaning it is now citable authority. Good news!

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California Case Clarifies Obligation to Provide Reasonable Accommodation for Disabled Employee

558877The California Court of Appeal, in Nealy v. City of Santa Monica, recently provided insight about the extent of an employer’s obligation to provide reasonable accommodation to a disabled employee. Specifically, the Court addressed whether an employer is required to remove an “essential job function” as a reasonable accommodation.

Factual Background

The employee, Tony Nealy, worked for the City as a “solid waste equipment operator.” He suffered two work-related injuries, leaving him partially disabled. When the agreed medical examiner ultimately approved Nealy’s return to work, he stipulated that Nealy should be precluded from “kneeling, bending, stooping, squatting, walking over uneven terrain, running, and prolonged standing relative to the right knee, as well as climbing and heavy lifting.”

Nealy’s pre-injury job as a “solid waste equipment operator” requires workers be able to operate at least four different types of refuse collection vehicles, as well as refuse and recyclable collection/disposal duties, heavy lifting and equipment maintenance/inspection.

Nealy took the position that, even with his work restrictions, he could still work as a “solid waste equipment operator” if the job duties were altered in his case to limit his responsibility to a single refuse collection vehicle (automated side loader). When the City refused this suggestion, he sued, claiming disability discrimination and other theories.

Essential Function and Reasonable Accommodation

California law imposes on employers the obligation to make “reasonable accommodations” for known disabilities. “Reasonable accommodation” has been defined as “a modification or adjustment to the work environment that enables the employee to perform the essential functions of the job.” (Nadaf-Rahrov v. Neiman Marcus Grp., Inc., 166 Cal.App.4th 952, 974 (2008).)

An “essential function” of a given position has been defined as “the fundamental job duties of the employment position the individual with a disability holds or desires.” (Cal. Gov. Code §12926(f).) The City argued that the ability to operate multiple different refuse collection vehicles was an essential function of the job of “solid waste equipment operator” because (1) employees could be required to “fill-in” for one another, operating different vehicles, in the event of an absence; and (2) a natural disaster may dictate that larger vehicles than the automated side loader would be required to adequately clear debris.

Among the questions presented to the Court was whether the City’s duty to accommodate Nealy’s disability required it to eliminate an essential job function of a “solid waste equipment operator,” so that he would be required only to operate the automated side loader and not perform any of the other duties that fell outside his restrictions. Citing authorities, including Lui v. City and County of San Francisco, 211 Cal.App.4th 962, 985 (2012), and Dark v. Curry County, 451 F3d.1078, 1089 (9th Cir. 2006), the Court said no. Elimination of an essential function is not a reasonable accommodation of an employee’s disability.

Summary

Nealy v. City of Santa Monica is an unpublished opinion, which means it cannot be cited to a court as authority. However, it provides valuable insight into the extent of an employer’s obligation to provide reasonable accommodation to a disabled worker. Specifically, the case suggests reasonable accommodation does not require the elimination of an essential job function.

Employers facing questions of reasonable accommodation of an employee’s known disability would be wise to consult with their employment law counsel, to help reduce the likelihood of a violation of state and/or federal law.

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Supreme Court Will Decide When A Prevailing Employer Can Recover Its Litigation Costs

aleMany employers are familiar with the fact that an employee who brings and wins a discrimination case will recover his or her attorney’s fees. In order for a winning employer to recover its attorney’s fees, by contrast, the employer is required to show that the employee’s claims were frivolous, unreasonable or groundless, which is an extremely difficult standard to meet. The policy underlying this distinction is not to discourage employees from bringing discrimination lawsuits out of fear they will, if they lose, be “on the hook” for thousands of dollars in attorney’s fees.

Notwithstanding this limitation on a prevailing employer’s ability to recover attorney’s fees, winning employers have historically been able to claim and obtain a judgment for out-of-pocket litigation costs, without a showing the claims were frivolous, unreasonable and groundless. These costs include filing fees, deposition and court transcript fees and certain witness expenses.

A case now pending before the California Supreme Court, Williams v. Chino Valley Independent Fire District, will resolve a split of authority among California appellate courts whether prevailing employers in discrimination cases will continue to be able to claim litigation costs without being required to meet the frivolous, unreasonable or groundless standard. The plaintiff bar is urging the Supreme Court to resolve the split of authority by holding that prevailing employers seeking to recover attorney’s fees or costs must prove the claim was frivolous, unreasonable or groundless.

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California Supreme Court Addresses Sleep Time

The California Supreme Court has ruled that “hours worked” under the California Labor Code and Industrial Wage Commission (“IWC”) Wage Order No. 4-2001 includes all time spent at an employer’s workplace and under the employer’s control, including sleep time.

In Mendiola v. CPS Security Solutions, Inc. (Jan. 8, 2015), a trailer guard required to spend his night at assigned jobsites in residential trailers sued because the employer’s on-call agreement only compensated guards for on-call time spent actually responding to alarms and investigations. The Guard argued that this policy violated IWC Wage Order No. 4-2001, which requires that employers “pay to each employee . . . not less than the applicable minimum wage for all hours worked in the payroll period.”

While the trial and appellate courts agreed with the security guards with respect to weekday on-call, the California Court of Appeal held that weekend on-call time constituted non-compensable sleep time.

The California Supreme Court reversed the holding of the Court of Appeal. It held the trailer guards’ on-call time constituted compensable “hours worked” under the Wage Order because the employer exercised significant control over the guards’ activities. This included the requirement that they live onsite and they were expected to respond promptly, in uniform, to alarms. Additionally, although the guards were allowed to engage in personal activities, including sleeping and watching television, the Court found it significant that the “guards’ mere presence [at the jobsite] was integral” to the employer’s business.

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What An “On-Duty” Meal Period Looks Like in California

tiredCalifornia’s meal period rules generally prohibit employers from having employees work more than 5 hours without providing a meal period of at least 30 minutes. However, the Wage Orders do recognize an exception to this rule where (1) the nature of the work performed by the employee prevents him/her from being relieved of all duty; and (2) the employee and employer agree in writing to an “on-duty” meal period.

It is important to bear in mind this is not a waiver of the meal period. A couple of additional points:

  • The written agreement must clarify that the employee will be paid for his/her “on-duty” meal period.
  • The written agreement must expressly state that the agreement may be revoked by the employee at any time. I would also include the buzzword “voluntary” in any agreement that I drafted.

A persistent question is when does “the nature of the work” performed prevent the employee from being relieved of all duty for at least 30 minutes. Department of Labor Standards Enforcement (DLSE) opinion letters and case law suggest this determination must be made on a case-by case basis. Employers who avail themselves of this meal period exception should be wary of any kind of “blanket” application of the “on-duty” meal period for all employees, restricting its use to only those situations in which the employer can make a colorable argument that a normal, “off-duty” meal period is unrealistic.

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New California Law Requires ‘Abusive Conduct’ Prevention Training

Workplace-bullying-laws-neededPoliticians in several states have been lobbying for years to make “bullying” in the workplace illegal. While Tennessee is the only state with such a law currently on its books, California took a step closer when Governor Brown signed AB 2053, which will require certain employers to provide “abusive conduct” training as a component of already mandatory sexual harassment prevention training for supervisory employees.

The existing requirement, found in Government Code section 12950.1, applies to employers with 50 or more employees and requires supervisory employees receive two hours of sexual harassment prevention training, within six (6) months following their assumption of a supervisory role. Follow up training is required every two years.

Here is what the amendment adds to Section 12950.1:

  • Training must now include a component on the “prevention of abusive conduct.” This need not necessarily extend the length of the training beyond two hours.
  • “Abusive conduct” is “conduct with malice that a reasonable person would find hostile, offensive, and unrelated to an employer’s legitimate business interests.”
  • “Abusive conduct” may include repeated infliction of verbal abuse (e.g., derogatory remarks, insults, and epithets), verbal or physical conduct that a reasonable person would find threatening, intimidating, or humiliating, or the gratuitous sabotage or undermining of a person’s work performance.
  • “Abusive conduct” need not be based on any otherwise protected classification, such as race, age, gender, disability or religion.
  • A single act does not constitute “abusive conduct” for purposes of the training, unless it is especially severe or egregious.
  • The amendment takes effect January 1, 2015.

What Employers Should Do – Employers with 50 or more employees should immediately consult with their regular employment attorneys to update training to comply with the new law.

 

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California Enacts Mandatory Paid Sick Leave

FerrisCalifornia lawmakers and Governor Brown have been busy enacting new laws that are guaranteed to impact California businesses, particularly small employers. One requires employers to provide accrued, paid sick leave beginning on July 1, 2015.

The Healthy Workplaces, Healthy Families Act of 2014 (“Act”) will apply to all employers. It will cover employees, including otherwise exempt employees, who work 30 or more days in California within a year from the commencement of their employment. Excluded from the Act are: (1) employees covered by a collective bargaining agreement (“CBA”) that provides for paid sick leave; (2) certain construction employees covered by a CBA, even if it does not provide for paid sick leave; (3) airline flight crew employees who already accrue paid time off of at least one hour for every hour worked; and (4) in-home support service providers. There are additional requirements to trigger these exclusions.

Paid sick leave is accrued at a rate of “not less than” one hour for every 30 hours worked. Employers can limit accrued sick leave to 48 hours (6 days), and can limit carryover to 24 hours (3 days) each year. The hourly rate for sick pay is calculated by dividing the employer’s total wages (no overtime premium) by the total hours worked in the full pay periods of the prior 90 days. Calculating this rate may be challenging for employees paid at varying rates depending on work.

Sick leave will be available for treatment of a health condition or preventative care for the employee or a family member, or if the employee was a victim of domestic violence, sexual assault or stalking. There is a 90-day “threshold” period of employment that the employee must cross before first taking sick leave under the Act.

There are posting requirements. Employers must display a poster explaining the new sick leave accrual requirements. New employees must be informed in writing of sick leave accrual rights. All employees must be given notice of sick time accrued after each pay period. Employers must maintain records reflecting hours worked and sick leave accrued and used for three (3) years, so they can make them available if requested by the employee or Labor Commissioner.

Employers should act proactively to protect themselves from liability under either new law. Over the next few months, employers should revise policies, including handbooks, to reflect compliance with the new paid sick leave law. Employers are encouraged to consult with their regular employment attorneys to ensure they are in full compliance.

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Don’t Forget To Bring This To Your Next Labor Board Conference

BepreparedWhen California employees initiate complaints for unpaid wages (including misclassification or for unpaid overtime), the typical procedure is for the Labor Commissioner to schedule a conference, under California Labor Code Section 98.3, to include a Deputy Commissioner, the employer and the aggrieved employee.

A pamphlet issued by the Labor Commissioner says this about these conferences:

“The conference will be conducted informally and the parties will not be under oath.  The purpose of the conference is to determine if the claim can be resolved without a hearing.  Plaintiffs are not required to prove their case at the conference.  The parties should be prepared to talk with the deputy about the claim, including whether there are any witnesses.  However, the parties do not need to bring witnesses to the conference.  Plaintiffs should bring a copy (not the original) of any document that supports the claim, but should not bring documents that have already been submitted with the claim form.  Defendants should also bring any documents that support their position.”

The vast majority of wage claims resolve at this conference. And this should be a goal, since it’s essentially a “free” settlement conference, though the Deputy Labor Commissioners are not usually unbiased, which is why I strongly recommend that employers have attorneys accompany them to the conference.

If the claim does resolve during the conference, the Deputy Labor Commissioner has a form “settlement agreement” that they will fill out which purports to document the settlement. The parties will sign the agreement.

Unfortunately, this agreement is about as narrow as possible, meaning that, in exchange for the employer agreeing to pay a sum, the agreement provides only that the employee releases and waives her rights to further pursue the wage claim, but nothing else. If the employee subsequently decides to pursue a retaliation, discrimination or harassment claim, the agreement will have no impact.

I believe it is a prudent practice, when attending these conferences, to come prepared with a broader settlement agreement that, in exchange for the same sum of money, requires the employee to effectively release all claims she could have up until that point. A poorer alternative, I’ve found, is to make the settlement subject to the employee signing an agreement to be subsequently prepared and provided by the employer’s counsel. This is a poorer alternative because, after the employee leaves the conference, she may decide she wants to pursue additional claims, but will not be bound by any agreement.

What should a full blown settlement agreement include? Lawyers may disagree on this, but my practice is to spell out all potential statutes (i.e., Title VII, FEHA, Railroad Act, etc.). A California Civil Code Section 1542 waiver is routine. My agreement typically also includes both a nondisparagement and confidentiality clause (concerning the terms of the settlement). If the employee is no longer working for my client, I will also include a clause precluding her from applying for future employment, which effectively eliminates any claim that she was subject to retaliation or discrimination if not re-hired. Finally, my agreements always include choice of law, integration and merger clauses.

An employee, either alone or represented by counsel, might refuse to sign such a broad settlement agreement, and insist instead on the narrow agreement provided by the Labor Commissioner. You and your client will need to decide whether this is satisfactory. Perhaps it is. Perhaps it isn’t. Either way, you’ve come prepared.

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California Court Clarifies Employer’s Obligation to Reimburse For Cell Phone Use

get smartMost employers understand, at least implicitly, that California law requires employees to be reimbursed for necessary expenditures or losses incurred in the course of doing their job. The California Court of Appeal recently clarified that this rule applies when employees are required to use their own cell phone or personal data device, even if a third party pays the bill or the call/data plan provides for bulk or unlimited minutes or data usage.

In Cochran v. Schwan’s Home Service, a number of employees sought to bring a class action against Schwan’s because they were not reimbursed for work-related use of their personal cell phones. In determining whether a class action was appropriate, the trial Court assumed that where employees did not purchase separate cell phone plans for work use, or where a family member or some third party paid the phone/data usage bill, the employee had no expenditure and therefore incurred no loss.

On August 12, 2014, the California Court of Appeal issued an opinion in the Cochran case, holding that this assumption was wrong. Specifically, the Court said that reimbursement is required, even where the phone/data bill is for unlimited use or paid by another. “Otherwise, the employer would receive a windfall because it would be passing its operating expenses onto the employee.”

What Should California Employers Do?

The Cochran Court provided guidance on how employers can comply with their reimbursement obligation for work-required cell phone/data device use. It said, “[T]o be in compliance with section 2802, the employer must pay some reasonable percentage of the employee’s cell phone bill.”

We recommend employers establish a clear policy, evenly applied to all employees, about work-related cell phone and/or data device use and reimbursement. This policy should be easy to understand and apply, and included in the employer’s up-to-date employee handbook. While you’re at it, this isn’t a bad time to review existing reimbursement policies for all work-related expenditures. If a major correction is required, we encourage employers to involve a skilled employment attorney to develop a strategy to shape and communicate the change in ways that will not invite claims or lawsuits based on past policies or conduct. On that topic, I know a guy . . .

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Avoiding The Perils of Unpaid Interns

treewwAs we greet Summer, employers may be tempted to offer internship programs to provide students and others valuable real-world experience in their industry. An internship can be a terrific opportunity for both the intern and the employer. However, unless the intern is paid and treated exactly like other employees, in compliance with wage-hour laws, for-profit employers may be violating the law and risking a costly claim or lawsuit.

The U.S. Department of Labor (DOL) has provided the following six-part test for-profit employers should use in evaluating whether they can offer an unpaid internship program without violating wage-hour laws:

1. The internship, even though it includes actual operation of the facilities of the employer, is similar to training that would be given in an educational environment.

2. The internship experience is for the benefit of the intern.

3. The intern does not displace regular employees, but works under close supervision of existing staff.

4. The employer derives no immediate advantage from the activities of the intern, and on occasion, its operations may actually be impeded.

5. The intern is not necessarily entitled to a job at the conclusion of the internship.

6. The employer and the intern both understand that the intern is not entitled to wages for time spent in the internship.

The DOL has said that, if all six factors are met, then an employment relationship does not exist under the Fair Labor Standards Act (FLSA).

What About Nonprofits?

The DOL has said that this six-part test for unpaid interns applies to for-profit employers, and that the FLSA recognizes an “exception” for “individuals who volunteer their time, freely and without anticipation of compensation for religious, charitable, civic, or humanitarian purposes to non-profit organizations.” This is consistent with California Labor Code Section 1720.4.

However, nonprofit organizations using interns or trainees, should avoid paying the individual a stipend, unless it is sufficient to meet the otherwise applicable minimum wage requirements. While it may be appropriate to reimburse interns or trainees for certain out-of-pocket expenses, a stipend below the minimum wage suggests the intern or trainee is actually an underpaid employee, and can expose the organization to wage-hour liability.

Workers’ Compensation?

Both for-profit and nonprofit organizations that otherwise legally use unpaid interns should still take steps to reduce their exposure in the event an intern suffers an on-the-job injury. It is wise to review the organization’s workers’ compensation insurance policy to ensure the organization is covered in the event of an accident or injury.

Employers planning to use unpaid interns or trainees are wise to consult with a knowledgeable employment law attorney.

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Should Young Lawyers Specialize?

"One word . . . plastics." -The Graduate

“One word . . . plastics.”
-The Graduate

I never for a moment thought about pursuing a career as a transactional attorney. I entered law school for the wrong reasons. I knew I could think, write and argue reasonably well. I was a liberal arts major (Philosophy and Literature-Writing) and did not really appreciate how such skills could translate into success in the business world. And I did not think I would enjoy a career as an educator.

So, I did exactly what I would urge no one do today: I took the LSAT, got into law school, and went to law school, without having any particular passion about the law.

If anyone had asked back then–and I don’t think anyone did–what I planned to do with that law degree, what area I’d practice in, what I wanted to do everyday, if and how I would make a difference, I wouldn’t have had a clue. When I was interviewing and starting my career, there were vastly more jobs in litigation, so I became a litigator. I started out doing insurance defense, but not the interesting kind, and immediately grew bored with fender-benders (“Was the light red or green?”) and slip-and-fall lawsuits (“Was the banana you slipped on yellow or green?”). Fortunately, I got hired right away at a boutique firm that did more interesting work (at least from my perspective). I quickly became a “specialist” in automotive product liability litigation, specifically suits relating to the performance of automobile air bags, which was an emerging technology at that time.

I remained a “specialist” in this area, with a smattering of other kinds of cases, for about the first 10 years of my career. However, I eventually figured out that, deep down, I’m not really a gear-head, and it shouldn’t be a big surprise that the lawyers who really excel in automotive product liability litigation, and who most enjoy what they do, are those who are interested in cars. Well, duh!?!

I eventually migrated to employment law for a number of reasons. First, and most practically, it was the only area that I was able to get any early traction in terms of developing my own clients. Equally important, however, being the opposite of a gear-head, I found I enjoyed disputes that arose out of (often flawed) interpersonal relationships in the workplace. Also, I had long felt that employment law was fertile ground for building a book of business, since every, EVERY employer, particularly in California, needs an employment lawyer. If they haven’t needed one yet–they will!

I had not intended this post to be a memoir. I recognize that my career path probably makes dry reading. But I wanted to tackle a topic that I think is important for law students, recent graduates and those still in the early years of their career: should you attempt to specialize? Like most people, I’m narcissistic and can only approach a personal question by starting from my own experience.

In any event, I posed this question to someone who has a fair amount of expertise in helping lawyers make the most of their legal careers. Gideon Grunfeld, the President of Rainmaking For Lawyers, was gracious enough to provide this valuable insight:

“Too many lawyers get shortsighted advice about whether they should specialize and what that means. There are substantive areas, such as tax, ERISA, and patents, where specialization is almost a necessity. But there are many areas, such as business litigation, where specialization can be counterproductive. Rather than focusing on the substantive nature of the law and, for example, specializing in trade-secret litigation, it’s better to encourage young lawyers to identify the clients they most want to serve. Thus, for example, if someone has a passion for high-tech start-ups, they can focus on cultivating relationships in that world and position themselves to solve the full panoply of legal issues that arise for that market or audience. For most young lawyers this is a more robust not to say more fun way to practice law and build a client base.”

I tend to agree with Gideon’s advice. I like the notion of letting one’s specialty develop organically. In my case, it developed because someone close to me gave my business development efforts a big jumpstart by referring employment cases my way. I found I liked it and wanted to pursue it further. This is pretty much the opposite approach from deciding I wanted to practice entertainment law because I like to go to the movies (which I do).

What I would really caution against is remaining in a practice that never brings you any thrills. Even though I’m not a gear-head, there were parts of my products liability practice that I found compelling. I recognize that this is not the market for young lawyers to quit a job on a whim. On the other hand, there is nothing wrong with developing a mid or long-term career plan to move away from an area that brings you no joy, with the hope of finding something more fulfilling. If I was still fighting cases about people who tripped on a public sidewalk, I’d have to open a vein. But that’s just me.

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