Seyfarth Synopsis: Members of the plaintiffs’ bar submit about 500 PAGA notices each month to California’s Labor and Workforce Development Agency. Each notice presages yet another PAGA lawsuit against yet another hapless California employer. But today we consider a new sort of PAGA-focused lawsuit. This recent complaint filed last week is not on behalf of
Seyfarth Synopsis: As recent triple-digit temps have shown, California is still one of the hottest places to be—literally. Today’s post reminds all employers, especially with employees who work outdoors or in open-air environments, that OSHA, Cal-OSHA, and the California Labor Code all prescribe protections from the heat.
California rest and recovery breaks.
Seyfarth Synopsis: California is rife with regulation of how employers may obtain and consider background check information for use in hiring and personnel decisions. The relatively new California ban-the-box law (effective January 1, 2018) and the older Los Angeles and San Francisco ordinances and amendments to the California Labor Code set strict rules on when…
Seyfarth Synopsis: After hitting some major roadblocks, the San Diego Earned Sick Leave and Minimum Wage Ordinance has now been enacted. The Ordinance is to take effect this summer, most likely by the end of July. The Ordinance adds another perplexing piece to California’s paid sick leave patchwork.
Quintessential early adapters and always on the go, we Californians love change, and we start trends. That’s good. There has been plenty of change this past year in the world of California labor and employment law. As Father Time prepares to tender his timekeeping duties to Baby New Year, let’s take a moment off the…
As of January 1, 2015, new California Labor Code section 2810.3 requires a “client employer” to share civil liability with “labor contractors” (aka payrolling, temporary staffing, or employee leasing agencies) for (1) payment of wages of the contract employees, and (2) failure to procure worker’s compensation coverage. Client employers will also have non-delegable responsibilities for worksite occupational health and safety.
What Does The New Law Provide?
- No Shifting Of Liability, But Indemnity Allowed. Although a client employer cannot shift away all liability to a labor contractor for either wage payments or workers’ compensation, client employers may seek contractual indemnity against a labor contractor for liability that the labor contractor creates.
- Workplace Safety Compliance Cannot Be Shifted. Client employers cannot contractually make the labor contractor solely responsible for workplace safety compliance.
- 30-Day Notice Requirement Before Filing Civil Action. A worker or his or her representative must notify the client employer of specified violations at least 30 days before suing the client employer. Because of this notice provision, client employers may want to include language in contracts requiring a process in which the labor contractor must attempt to remedy any violation, before a civil action is filed, within the notification period. Client employers should also consider language that allows the client employer to step in and remedy during the notice period, while reserving its right to be reimbursed by the labor contractor.
- No Retaliation. Neither the client employer nor the labor contractor can take action against a worker for providing the 30-day notice or for filing a claim or civil action.
- Records Inspection. While the client employer’s records are subject to inspection by state enforcement agencies, the law also expressly “does not require the disclosure of information that is not otherwise required to be disclosed by employers upon request by a state enforcement agency or department.”
- Exempt Employees Not Covered. The statute excludes from the definition of contracted “workers” those exempt under California’s executive, administrative, or professional exemptions (see Labor Code Section 515).
What Can Client Employers Do To Minimize Liability Under This New Law?
To try to protect against potential liability under the new law, client employers can:…
When you dismiss an employee for poor performance, or when he beats you to the punch by quitting on you, you rarely feel the urge to rush that slacker his final check. But you should. Under the California Labor Code, you must pay all wages due at the time of an…
In theory, the California Labor Code and the Wage Orders allow employers the freedom to do what employers traditionally have done: pay employees solely with commissions or solely with piece rates. This idea of incentive pay—you reap what you sow— has been around a long time!
But a wave of California judicial court decisions has eroded the once-solid foundations of traditional incentive pay systems. In response, employers have been moving towards complicated hybrid compensation systems.
So what do you need to know when deciding to use one of these incentive or hybrid compensation systems?
Beware: Averaging Earnings Over the Pay Period Is Not Allowed to Satisfy Minimum Wage
Federal law allows employers to average wages over a pay period to meet minimum wage requirements (dividing total compensation by total number of hours worked). California does not. Courts have read California’s minimum wage statute to require employers to pay the minimum wage separately for each hour worked.
The tension between this requirement and traditional commission and piece-rate pay systems became apparent in 2005 in the California Court of Appeal decision in Armenta v. Osmose. In Armenta, employees earned their pay solely through piece rates. The Armenta court held that while the piece rate compensated employees for their “productive time”—time spent actually working on piece-rate tasks—the piece rate did not compensate them for their “non-productive time”—time spent doing anything else.
- What Kinds of Pay Systems Have Employers Used In Response, and Do They Pass Legal Muster?
In an attempt to comply with Armenta, many employers created complicated hybrid hourly and incentive compensation systems. Unfortunately, even these laudable efforts to comply with California law may still expose well-intentioned employers to liability.
For example, in Bluford v. Safeway, the employer paid its truck drivers a certain figure to each mile driven, a piece rate for certain non-driving tasks, an hourly rate for other tasks, and a different hourly rate for unexpected driving delays. Even so, an unsympathetic Court of Appeal held that Safeway’s system violated the Wage Order because the system did not provide separately for an hourly rate for rest breaks, which the Wage Order designates as “hours worked.”
- Another Possibility: What About the Commissioned Salesperson Exemption?…
Well-intended employers often lament the various gotchas that await them down the dark and winding road that is the California Labor Code. Perhaps no turn in the road is more treacherous than the one at Wage Statement Junction. Here one crosses at extreme peril, for the California Legislature, in Labor Code section 226, has planted legal land mines that can blow up at the slightest provocation.
A Common Sense Question With a Less-Than-Intuitive Answer: “Can’t I avoid hazards if I just pay them the right amounts and on time?” Sadly, no, there’s much more to it. Labor Code section 226(a) lays out a long list of other requirements, some more sensible than others.
Not so Simple. Timely paychecks must be accompanied by a “simple” wage statement at least semi-monthly, and the wage statement must include nine distinct pieces of information for each employee:…