EMPLOYMENT CASELAW AFFECTING CALIFORNIA EMPLOYERS

After a slight lull in 2020, 2021 saw a return to what employment lawyers have become accustomed to – a deluge of employment decision that directly affect employers and employees. In fact, thanks in part to the proliferation of wage and hour and PAGA cases, California is Number 1 on the Judicial Hellholes list for 2022!

• Vazquez v. Jan-Pro Franchising Inter’l, Inc.: Dynamex independent contractor classification decision applies retroactively.
• Ferra v. Loews Hollywood Hotel: Premiums for missed meal, rest, and heat recovery periods must be paid at the employee’s regular rate of pay instead of the base rate. The Ferra decision is retroactive.
• Donohue v. AMN Servs., LLC: No rounding time punches for meal periods. Records showing noncompliant meal periods raise presumption of violation. Rounding start and end times is still permitted but best practice is to not round at all.
• Pollock v. Tri-Modal Distrib. Servs., Inc.: Statute of limitations in a FEHA failure to promote case begins to run at the point when an employee knows or reasonably should know of the alleged unlawful refusal to promote.

Mandatory Arbitration Agreements (Chamber of Commerce of United States v. Bonta): Users of mandatory arbitration agreements entered into, modified or renewed after January 1, 2020, beware. The Ninth Circuit has resurrected part of California’s anti-arbitration statute (Labor Code § 432.6) that criminalizes mandatory employment arbitration.

Mandatory arbitration agreements are arbitration clauses or agreements that employees are required to agree to as a condition of their employment. The law only applies to mandatory arbitration agreements entered into or renewed after January 1, 2020, that employees did not sign. NOTE: This decision is expected to be appealed to the U.S. Supreme Court, but it is the law for now.

This law has teeth. Labor Code section 433 makes violations of section 432.6 criminal misdemeanors, punishable by up to 6 months’ imprisonment in county jail, by a maximum fine of $1,000 or by both. Government Code section 12953 makes a violation of section 432.6 an unlawful employment practice, which means an individual or entity who violates section 432.6 is subject to civil sanctions, including state investigation and private litigation.

LESSONS FROM LITIGATION

Mind your tongue! We are seeing a trend of cases where 3 or fewer stray comments made by a supervisor, if they reflect a discriminatory mindset, can be enough for a discrimination case to survive summary judgment and go to trial.

• Jorgensen v. Loyola Marymount University. It was reversible error when a single comment, in the context of a hiring decision unrelated to the plaintiff, that the decision-making university dean “wanted someone younger” for the position was excluded as evidence in opposition to university’s summary judgment motion.
• Smith v. BP Lubricants USA Inc. Intentional infliction of emotional distress claim against employer and individual supervisors can be based on three racially offensive comments said at one meeting. Previous case law required such comments be accompanied by outrageous conduct.

Joint employment liability is on the rise. The courts are attacking the use of staffing companies in general and penalizing both staffing companies and their clients.

• Medina v. Equilon Enterprises. This court of appeals case held that a person can be a joint employer without exercising direct control over an employee. The court reasoned, “If the [alleged] joint employer … exercises enough control over the intermediary entity to indirectly dictate the wages, hours, or working conditions of the employee, that is a sufficient showing of joint employment.”

Private Attorney General Act (“PAGA”). PAGA claims continued to terrorize California employers in 2021 but there was at least one bright spot. In Magadia v. Wal-Mart Assocs., Inc., the Ninth Circuit overturned a $100 million wage and hour judgment against Wal-Mart, when it held that the PAGA plaintiff who did not suffer any meal-break violation did not have standing to bring PAGA claim.

COVID-19 UPDATE

The Federal OSHA Emergency Temporary Standards (“ETS”) requiring employers with 100 or more employees to mandate vaccines was withdrawn by OSHA.

Cal/OSHA revised its COVID-19 ETS following its mid-December meeting, and made additional revisions that took effect January 14, 2022 to align with recommendations from the California Department of Public Health.

Notice Requirements: Positive COVID-19 Cases

• Given to potentially exposed employees and independent contractors who were at the same worksite as the COVID-19 case.
• Provide the notices using the employer’s normal practices for communicating employment-related issues.
• “Worksite” has been updated to exclude “locations where the worker worked by themselves without exposure to other employees, or to a worker’s personal residence or alternative work location chosen by the worker when working remotely.”

Face Coverings: If an individual cannot wear a face covering because of a medical disability or condition, they should be required to wear a “non-restrictive alternative such as a face shield with a drape”. If that is not possible, they must socially distance and 1) be fully vaccinated OR 2) be tested at least weekly during paid time and at no cost to the employee.

Testing: Asymptomatic fully vaccinated employees in the exposed group, who were previously excluded from testing requirements, must now have testing available to them weekly (for outbreaks) or twice-weekly (for major outbreaks). All employees who were fully vaccinated before a “close contact” with a COVID-19 case must have COVID-19 testing made available to them at no cost and during paid time, even if they are asymptomatic.

• “Outbreak”: Within a 14-day period, 3 or more employees in an exposed group test positive for COVID-19 and have visited the worksite during their high risk exposure period.
• "Major outbreak”: Within a 14-day period, 20 or more employees in an exposed group test positive for COVID-19 and have visited the worksite during their high risk exposure period.

Who to Isolate: Employees who test positive for COVID-19, regardless of vaccination status, previous infection, or symptomology, must isolate for at least 5 days.

• Tested positive and has symptoms: If symptoms are resolving, an employee who tests negative after day 5 from the date of the positive test may return to work but must wear a face covering until after day 10; without a test, the employee whose symptoms are resolving may return to work after day 10. Regardless of test results, employees with a fever of 100.4 degrees or higher may not return to work until they have been fever-free for 24 hours without using fever reducing medications. If symptoms other than fever are not resolving, employees may not return to work until either their symptoms are resolving and they’ve been fever-free for 24 hours without using fever-reducers or at least 10 days have passed since the positive test.
• Tested positive but never developed symptoms: an employee who tests negative after day 5 from the date of the positive test may return to work but must wear a face covering until after day 10; without a test, the employee who never developed symptoms may return to work after day 10.

Who to Quarantine: Asymptomatic employees, regardless of vaccination status, who come into close contact with a COVID-19 case may be excluded from the work place. If they become symptomatic during the quarantine period, employees will not be allowed to return to work without a negative COVID-19 test result.

• Asymptomatic, unvaccinated close contact: may return to work after day 5 from the date of the last close contact if the employee tests negative from specimen collected after day 5 AND the employee wears a face covering until after day 10. Asymptomatic unvaccinated employees who do not get tested may return to the workplace after day 10.
• Asymptomatic, vaccinated and booster eligible but not yet boosted: may return to work if they obtain a negative diagnostic test within 3-5 days of their last exposure AND the employee wears a face covering around other until after day 10.
• Asymptomatic and boosted or vaccinated but not booster eligible are not required to quarantine if they test negative after day 5 and they wear a face covering around others until after day 10. If they cannot be tested, they can return to work, but must wear a face covering and social distance until after day 14.
• Any employee who tests positive during the quarantine period must follow the isolation procedures set forth above.