Wage Law

Study Shows Courts Far More Reluctant to Vacate Employment Arbitrations if Employer Wins

According to a new study published by a professor at the University of Illinois Law Center, and discussed in the National Law Journal today, courts are more commonly vacating or partially vacating arbitration awards for employees, and rarely disturbing awards that favor employers.

"When courts vacate many awards that rule for employees, the individual must either return to a lengthy and costly 'do over' arbitration -- or worse, be stuck with a useless award, and no other recourse ... [Court review is becoming] "an insurance program that protects employers from costly awards."

Arbitration reform could be a significant issue in 2009 if the Democrats win the White House in November.

Why Class Certification Orders Are Not Immediately Appealable

This is double-hearsay, but attorney H. Scott Leviant, who authors the legal blog The Complex Litigator, published a Forum piece in last week's Daily Journal, entitled "Cutting Class". We can't link to the article for non-subscribers, but there's a nice summary of the article over at the UCL Practitioner. The article explains why A.B. 1905, which would have allowed defendants to immediately appeal orders granting class certification, appropriately died in committee last month.

Public Entities Are Permitted to Retain Counsel on Contingent Fee Basis

Public entities are permitted to enter into contingency-fee agreements with outside counsel. County of Santa Clara v. Superior Court (Atlantic Richfield Co.) (2008) __ Cal.App.4th __. A Santa Clara County Superior Court judge had previously ruled that such arrangements were "antithetical to the standard of neutrality that an attorney representing the government must meet when prosecuting a public nuisance abatement action." The decision was based upon a 1985 case, Clancy v. Superior Court (1985) 39 Cal.3d 740, in which the California Supreme Court called the contingent fee agreement between a city government and a private attorney in a lawsuit against an adult bookstore “inappropriate under the circumstances.”

Federal government agencies will continue to avoid such arrangements, under an executive order signed by President Bush barring the federal government from entering contingent-fee arrangements to compensate lawyers or witnesses. If you are interested in this kind of work, you can download the opinion here in pdf or word format.

Some Labor Commissioners Are Worse Than Others

Here in California, we don't have a Labor Commissioner known for protecting the rights of employees against business interests, but at least our Labor Commissioner isn't seen as a drunk who gets detained by the police and hauled away to a detox center ("an alternative to the county jail intended to give a person a chance to keep his or her record clean") after trying to steal a guitar.

Oklahoma's is, allegedly.

Senator Feinstein Likes Arbitration

Senator Feinstein on the wonderful world of arbitration:

I value arbitration as an alternative to litigation. Earlier this year, I supported an arbitration bill, the "Fair Contracts for Growers Act," when it was considered by the Senate Judiciary Committee. That bill does not mandate arbitration, but allows it to be used to resolve livestock or poultry contract disputes only if both parties consent in writing after the dispute arises.

Enact, Enact

As we mentioned this morning, Governor Schwarzenegger vetoed just about everything the Chamber of Commerce didn't like. The Chamber didn't hate all of the wage & hour measures passed this year, however. Schwarzenegger signed two wage & hour measures, both of which benefit employers:

Senate Bill 812 (Correa): Pharmacist alternative workweeks.

Existing law generally requires premium overtime rates of pay for work in excess of 8 hours in a day and work in excess of 40 hours in a workweek with specified exceptions, including where the employer and employees have agreed to an alternative workweek pursuant to specified procedures. The Industrial Welfare Commission, pursuant to constitutionally authorized delegated powers from the Legislature, has established regulations, denominated wage orders, governing wages, hours, and working conditions in various industries. Pharmacists, depending on the nature of their work, may be regulated by Wage Order 7, relating to the mercantile industry, or Wage Order 4, relating to professional, technical, clerical, mechanical, and similar occupations, including employees in the health care industry. Although both wage orders permit the adoption of alternative workweek schedules by agreement for those employees performing work in those industries, Wage Order 7 requires that any such agreement provide not less than 2 consecutive days off within a workweek, whereas, Wage Order 4 has no such restriction.

This bill would provide that pharmacists engaged in the practice of pharmacy who are employed in the mercantile industry, pursuant to Wage Order 7, shall be permitted to adopt alternative workweek schedules allowed by Wage Order 4, including alternative workweeks that can be adopted by employees working in the health care industry.

Senate Bill 929 (Codgill): Computer programmer exemptions / Prevailing wage determinations.

Existing law provides that 8 hours of labor constitutes a day's work. Under existing law, any work in excess of 8 hours in one workday and any work in excess of 40 hours in any one workweek and the first 8 hours worked on the 7th day of work in any one workweek is required to be compensated at the rate of no less than 11/2 times the regular rate of pay for an employee. Existing law exempts a professional employee in the computer software field from this overtime compensation requirement if the employee is primarily engaged in work that is intellectual or creative, the employee's hourly rate of pay is not less than $41, and the employee meets other requirements. This bill would decrease the hourly rate of pay requirement for this exemption to not less than $36. Existing law generally requires contractors and subcontractors performing work on public works, as defined, costing over $1,000 to pay to their workers the general prevailing rate of per diem wages, including these wage rates for holiday and overtime work, in the locality in which the public work is performed. Existing law provides that per diem wages includes both hourly wage rates and employer payments for employee benefits, as specified. Existing law requires the Director of Industrial Relations to determine per diem wages by referencing collective bargaining agreements, wage rates for federal public works, and, in certain instances, data from the labor organizations and employers associations, as specified. If the director determines that the general prevailing rate of per diem wages is the rate established by a collective bargaining agreement, and that collective bargaining agreement contains definite and predetermined changes during its term that will affect the rate adopted by the director, existing law requires the director to incorporate those changes into his or her prevailing wage determination.

This bill would authorize contractors and subcontractors, whenever the director's prevailing wage determination contains a predetermined change but does not specify how the change will be allocated between hourly wages and employer payments for benefits, to allocate payments equal to that change to either hourly wages or benefits for a specified time period, as provided. This bill would also provide that, if the allocation of a predetermined change is subsequently altered by the parties pursuant to the collective bargaining agreement that was the basis of the prevailing wage determination, a contractor or subcontractor may allocate payments of not less than the amount of the definite and predetermined change in accordance with either the originally published allocation or the allocation as altered in the collective bargaining agreement.

That's your California wage and hour law legislative year-end in review.

Let Us Count The Ways

Jon-Erik Storm asks, Why Does Everyone Diss the DLSE?

I was preparing to explore the theorizing that I and other bloggers did in the wake of Genrty that it would have implications for employment contracts in general, when I came across this footnote in the recent Murphy v. Check ‘N Go case. “Plaintiff requests judicial notice of information on the process for bringing claims before the Labor Commissioner, which is offered to show that this process ‘does not provide the same protections for the employee and is not an adequate substitute for a court proceeding. . . .’” (Slip. Op. at 9-10 n.1)
...

There are so many reasons: they are slow; they do not apply uniform standards; they are not taken seriously by defendants; they change policies depending upon the whim of the governor; they often don't follow the law; they lack the resources to effectively resolve large volumes of cases; they pass regulations without following appropriate protocols; they file amicus briefs against you even if they represented you when you won at trial.

Plus, they have the day off today, and we don't.

CJAC Class Action Initiative Withdrawn, For Now

An article published in the Daily Journal this week reports that the ballot initiative sought by the Civil Justice Association of California (CJAC) to limit class-action lawsuits (the "California Class Action Lawsuit Fairness Act") has been withdrawn from the June 2008 ballot. John Sullivan, CJAC president, said that it did not appear that June was a good time to advance such a ballot measure, because of other measures on that ballot which are predicted to cause a high turnout from Democratic voters. The other potential ballot measures include one to change the state's electoral vote to proportional, rather than winner take all; a defense-of-marriage initiative; and a prisoner-rights statute.

The CJAC initiative was similar to failed Assembly Bill 1505, sponsored by Assemblywoman Nicole Parra. Fundraising efforts for the CJAC initiative were said to be doing poorly, but that claim was neither admitted nor denied by Sullivan. Sullivan also suggested that the measure might still be pursued in the November 2008 election.

Notwithstanding the withdrawal of the California Class Action Lawsuit Fairness Act measure, consumer and labor groups are proceeding with their four counter-initiatives, including one to toughen civil and criminal penalties against corporate executives who fail to report corporate wrongdoing; one to provide compensation for victims of corporate fraud and make certain executives liable for making victims whole; one to force publicly traded corporations to disclose executive compensation; and one to standardize by statute the procedures for filing and maintaining class-action lawsuits.

Class Action Ballot Battle Shaping Up

To counter a ballot initiative proposed by the CJAC, calling itself the "California Class Action Lawsuit Fairness Act", that would gut class action litigation in California, the Consumer Attorneys of California (CAOC) filed initiatives this month that would bring reform to corporate America by making large corporations and their CEOs accountable for their wrongdoing. A broad coalition is forming against the corporate class action killing initiative, including:

AARP Foundation Litigation, ACLU of Northern California, ACLU of San Diego and Imperial Counties, American Association for Justice, Asian Law Caucus, Asian Pacific American Legal Center, California Alliance for Retired Americans, California Employment Lawyers Association, California Foundation for Independent Living Centers, California Labor Federation, California Reinvestment Coalition, California Teamsters, Public Affairs Council, California Women's Law Center, Center for Justice and Democracy, Coalition of Disability Access Professionals, Consumer Action, Consumer Federation of California, Consumers for Auto Reliability and Safety, Designing Accessible Communities, Disability Rights Advocates, Disability Rights Education and Defense Fund, Equal Rights Advocates, Foundation for Taxpayer and Consumer Rights, Gray Panthers, Law Foundation of Silicon Valley, Lawyers' Committee for Civil Rights of the San Francisco Bay Area Legal Aid Society, Employment Law Center, Legal Services for Prisoners with Children Mexican, American Legal Defense and Educational Fund, National Center for Youth Law, National Consumer Law Center, National Immigration Law Center, National Senior Citizens Law Center, Privacy Rights Clearinghouse, Protection & Advocacy, Inc., Public Advocates, Public Counsel, Public Interest Law Project, Speak Out California, Strengthening Our Lives (LA County Federation), Teamsters Union Local No. 70 Utility, Consumers' Action Network, Western Center on Law & Poverty, Women's Employment Rights Clinic, and the Youth Law Center.

The CAOC has identified significant class actions against each one of the CJAC board members and are expanding their efforts to educate the public about each company's wrongdoing. For further information including press releases about CAOC's initiatives or CJAC's initiative and text of the measures, check out http://www.caoc.com/ClassActionInitiative.

Proposition 1505?

CJAC and the Chamber of Commerce have turned Nicole Parra's unsuccessful class action bill (AB 1505) into a ballot initiative and have filed papers to get it on the June 2008 ballot. The changes included in this initiative would make it virtually impossible to get class actions certified in California. Here's a link to CAOC's website regarding the proposed initiative.