Category - Labor Law

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California Legislative Alert
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Federal And State Courts Of Appeal Offer Further Guidance On Discriminatory Versus Legitimate Non-Discriminatory Business Decisions And The Weight Of The “Knowledge” Factor
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California Court Of Appeal Holds Plaintiff’s Rejection Of Settlement Requiring Waiver Of Claims Is Reasonable In Goglin v. BMW of North America, LLC (2016) 4 Cal.App.5th 462
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Immigration Status No Longer Discoverable in Personal Injury Cases
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The Ongoing Debate Concerning Automobile Service Advisors’ Rights to Overtime Wages
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Proof or It Did Not Happen: California Court of Appeal Rules on Electronic Signature Authentication
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Top Dollar for the White Collar: Obama Administration Increases Salary Thresholds for White Collar Overtime Exemptions
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Distinguishing License Bonds From Insurance: The Contours of California Contractor License Bonds

California Legislative Alert

By: Richard H. Glucksman, Esq. and Chelsea L. Zwart, Esq.
August 4, 2017

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AB 1701 recently passed the Assembly and is pending in the Senate’s Labor and Industrial Relations and Judiciary Committees. The Bill, if signed by the Governor, would create a new section in the California Labor Code (Section 218.7) making “direct contractors” – defined as a contractor “making or taking a contract in the state for the erection, construction, alteration, or repair of a building, structure, or other private work” – liable for wages a subcontractor or sub-subcontractor fails to pay to its employee for work included in the general contractor’s contract with the project owner.

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Federal And State Courts Of Appeal Offer Further Guidance On Discriminatory Versus Legitimate Non-Discriminatory Business Decisions And The Weight Of The “Knowledge” Factor

By: Gregory K. Sabo and Chelsea L. Zwart
May 25, 2017

Mendoza v. The Roman Catholic Archbishop of Los Angeles (9th Cir. 2016) 824 F.3d 1148

In Mendoza v. The Roman Catholic Archbishop of Los Angeles (9th Cir. 2016) 824 F.3d 1148, the Ninth Circuit Court of Appeals held that an employer is not required to offer an employee the same position upon return from sick leave if the position was eliminated during the employee’s leave period for a legitimate non-discriminatory business reason.

In Mendoza, prior to taking sick leave for ten months, the plaintiff worked full-time as a bookkeeper for a small Catholic church.  During her absence, the pastor of the church took over the bookkeeping duties himself and determined that the duties could be performed adequately by a part-time bookkeeper.  Accordingly, when the plaintiff returned to work, the pastor offered her the same bookkeeping position she had held before her leave of absence, but on a part-time basis.  The plaintiff refused, demanding a full-time position.  She then sued her former employer, asserting claims under the Americans with Disabilities Act (“ADA”) for discrimination, disparate treatment, and failure to accommodate for failing to return her to a full-time position following her medical leave.

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California Court Of Appeal Holds Plaintiff’s Rejection Of Settlement Requiring Waiver Of Claims Is Reasonable In Goglin v. BMW of North America, LLC (2016) 4 Cal.App.5th 462

By: Gregory K. Sabo and Chelsea L. Zwart
May 25, 2017

In Goglin v. BMW of North America, LLC (2016) 4 Cal.App.5th 462, the Fourth District California Court of Appeal held that a plaintiff’s rejection of a pre-litigation offer including extraneous non-financial terms is reasonable and therefore does not preclude the plaintiff from recovering attorneys’ fees under California’s Song-Beverly Consumer Warranty Act (California Civil Code §§1790 et seq.) upon prevailing in the action.

Prior to initiating litigation in Goglin, the plaintiff notified BMW of her claims, asserting the dealer violated the Consumer’s Legal Remedies Act (“CLRA”) by selling her a used vehicle with undisclosed prior collision damage and an extensive history of mechanical failure. To resolve the issue, BMW offered to repurchase the vehicle, pay off her loan, and reimburse her for the down payment and loan payments made less an offset for depreciation and reimburse her for reasonable attorneys’ fees. The offer was contingent upon the plaintiff signing a settlement and release agreement including terms for a general release, waiver of California Civil Code §1542, dismissal with prejudice of any lawsuit she may have filed against BMW, and a confidentiality and nondisparagement clause.

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Immigration Status No Longer Discoverable in Personal Injury Cases

By: Jon A. Turigliatto, Esq. and Chelsea L. Zwart, Esq.
December 9, 2016

NEW CALIFORNIA EVIDENCE CODE SECTION 351.2 PROHIBITS DISCOVERY AND ADMISSIBILITY OF A PERSON’S IMMIGRATION STATUS FOR PURPOSES OF LIMITING DAMAGE CLAIMS.

On January 1, 2017, AB 2159, which prohibits discovery related to a person’s immigration status in personal injury and wrongful death actions, will become effective, adding Section 351.2 to the California Evidence Code and overturning Rodriguez v. Kline (1986) 186 Cal.App.3d 1146.

Under Rodriguez v. Kline, an individual injured in the United States who is subject to deportation is not entitled to compensation based upon his or her projected earning capacity in the United States, but rather may only recovery damages for lost future income the individual would have earned in his or her country of origin. Later case law applied Rodriguez v. Kline to the recovery of medical costs, limiting recovery by an undocumented person to the amount the individual would have incurred for medical treatment in his or her country of origin.

Newly introduced Evidence Code Section 351.2 states:

(a) In a civil action for personal injury or wrongful death, evidence of a person’s immigration status shall not be admitted into evidence, nor shall discovery into a person’s immigration status be permitted.

(b) This section does not affect the standards of relevance, admissibility, or discovery prescribed by Section 3339 of the Civil Code, Section 7285 of the Government Code, Section 24000 of the Health and Safety Code, and Section 1171.5 of the Labor Code.

Proponents of Section 351.2, which effectively invalidates Rodriguez v. Kline, assert that the rationale behind the new law is to ensure that personal injury and wrongful death victims are not penalized for their immigration status and to protect undocumented immigrants from being exploited.  The intent is to equalize compensation received by persons who work and live in California and thus should be entitled to equal treatment in the California court system, regardless of immigration status.

By prohibiting the discovery and admissibility of a plaintiff’s immigration status, the new code section will have a severe impact on defendants’ potential exposure for damages relating to lost income and medical expenses.  After January 1, 2017, an undocumented person’s loss of earnings claim will no longer be limited to wages earned in his or her country of origin, but will rather be based on the individual’s income in the United States, whether here legally or not.  The same will be true for medical expenses, which will be based on those actually incurred.

Historically, many undocumented plaintiffs did not pursue loss of earnings claims as defendants regularly pointed to immigration status as a way to significantly lower potential exposure for such claims. Given that earnings and medical costs are generally substantially higher in the United States than in countries from which people immigrate without documentation, the enactment of Evidence Code Section 351.2 will deliberately result in larger awards for loss of income and medical expenses to injured immigrants.

The Ongoing Debate Concerning Automobile Service Advisors’ Rights to Overtime Wages

By: David A. Napper and Alexandra R. Rambis
September 30, 2016

Are automobile service agents exempt from the Fair Labor Standard Act’s (“FLSA”) overtime requirements? Although the United States Supreme Court has remanded the case back to the Ninth Circuit to interpret the statute without deference to the Department of Labor’s decision, one thing is certain now: the answer will have significant implications for automobile dealerships.

In Navarro v. Encino Motorcars, LLC (2016) 136 S. Ct. 2117, service advisors brought an action against the automobile dealership where they were employed, alleging that their employer was required by the FLSA to pay them overtime wages. The dealership argued that the position and duties of a service advisor brought the plaintiffs within an exemption to the FLSA provisions, which exempts employees engaged in selling or servicing automobiles from overtime wages. Indeed, the FLSA exemption, codified as 29 U.S.C. §213(b)(10)(A), exempts “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles.”

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Proof or It Did Not Happen: California Court of Appeal Rules on Electronic Signature Authentication

By: Ashley Verdon and Neil Eddington
September 30, 2016

If you belong to one of the ever-increasing number of businesses using electronic signatures, then it might be time to review your authentication security procedures in place.   As electronic signatures become the norm in conducting business, California courts are busy with cases challenging their enforceability.  Recently, in Espejo v. Southern California Permanente Medical Group (2016) 246 Cal.App.4th 1047, the Second District Court of Appeal ruled that an employer sufficiently authenticated an employee’s electronic signature to an arbitration agreement.  In doing so, the court offered some clarity as to what evidence is necessary to enforce an electronic signature under the Uniform Electronic Transmissions Act (“UETA”).  (Cal. Civ. Code §1633.)

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Top Dollar for the White Collar: Obama Administration Increases Salary Thresholds for White Collar Overtime Exemptions

By: Ashley Verdon and Neil Eddington
September 30, 2016

With a regulation sure to invite both praise and condemnation, the Obama Administration announced new salary thresholds for the Fair Labor Standard Act’s (“FLSA”) overtime exemptions. The new thresholds will bring overtime eligibility to millions of previously-exempted white collar workers. Under the new guidelines, executive, administrative, and professional employees earning $47,476 per year or less will be entitled to overtime pay, doubling the previous federal threshold of $23,660.

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Distinguishing License Bonds From Insurance: The Contours of California Contractor License Bonds

By: Ravi R. Mehta
September 30, 2016

A commonly overlooked potential for recovery when a claim arises is the license bond.  Distinct from insurance, a license bond is intended to respond to liability related to a contractor’s violation of Contractors State License law.  It is mandatory for all California contractors to procure a license bond, or alternatively to place a cash deposit with the Contractors State License Board (“CSLB”). The license bond requirement is currently $15,000.00.  However, in the event of license suspension or revocation, the CSLB may require a separate disciplinary bond in an amount between $15,000.00 and $150,000.00. The types of claims to which a license bond may be subject, as well as the types of persons who are eligible to submit a claim against a license bond, are limited.  However, if a claimant’s circumstances fit within the confines of the following limitations, a license bond claim may be better suited to provide redress as compared to an insurance claim.  The following list contains the most common types of allowable license bond claims.

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