State Reveals Its Template for Notice to All Newly Hired Employees
Balancing Worker Privacy with an Employer’s Rights to Protect Safety
A recent California Court of Appeal case – Sanchez v. Swissport, Inc. (February 21, 2014), 213 California Appellate Reporter, fourth series (Cal.App.4th) 1331 – confirms that employers must comply with both the Pregnancy Disability Leave Law (PDLL) law and the wider protections for women disabled due to pregnancy under in the Fair Employment and Housing Act (FEHA).
The PDLL requires any employer with four or more persons on payroll to provide a worker up to four months of unpaid leave for her pregnancy, delivery and newborn care. Pregnant employees have those rights even if they must go out on such leave within days of taking on new employment. These protections extend to full time and part-time workers alike.
The FEHA also requires any employer with four or more employees to provide disabled individuals equal employment opportunity if such persons are able to perform the essential functions of the job position in question with reasonable accommodation as necessary. However, an employer is not required to accommodate such a worker if such action would create undue hardship on that company’s operations. For example, a business may decline to hire a blind person for a truck driving position (since accommodation would be too burdensome on the company) but likely may not decline to hire a qualified computer programmer because he or she cannot walk (since accommodation for sitting at a terminal is probably a simple, inexpensive matter).
In the above case, Ana Sanchez alleged Swissport employed her for some two years (mid-2007 to mid-2009). In early 2009, she requested and received a temporary leave for medically required time away on her high-risk pregnancy. While she then had to be away from the job until that October to give birth and attend to newborn care – obviously more than four months later — Ms. Sanchez alleged that “very soon after she was scheduled to give birth, she would have returned to work, with the need for only minimal accommodations, if any, in order to perform the essential function[s] of her job.” 213 Cal.App.4th at 1334-1335.
Ms. Sanchez claimed that Swissport nevertheless terminated her in July on the company’s contention it had no further obligation to accommodate her once she had been absent for the four months under the PDLL. Ms. Sanchez also asserted that prior to her termination, Swissport never contacted her “to engage her in a timely, good faith interactive process in order to identify available accommodations, such as the extended leave of absence she had requested, so that she could remain employed.” Finally, she alleged that “the reasonable accommodations necessitated by her pregnancy and pregnancy-related disabilities would not have created an undue hardship upon [Swissport], nor would said accommodations have adversely impacted, in any way, the operation of [its] business.” 213 Cal.App.4th at 1335.
Swissport convinced the trial judge to dismiss the case, on its claim that its obligations to accommodate Ms. Sanchez’s pregnancy ended after it provided the four month leave. The California Court of Appeal disagreed and allowed Ms. Sanchez to continue her suit. An employer’s compliance with PDLL does not fulfill its obligations to comply with the wider disability protections under the FEHA. “We conclude that … the plain language of the PDLL … makes clear that its remedies augment, rather than supplant, those set forth elsewhere in the FEHA. By its terms, the PDLL provides that its remedies are ‘in addition to’ those governing pregnancy, childbirth, and pregnancy-related medical conditions set forth in the FEHA.” 213 Cal.App.4th at 1338.
This decision underscores the importance of employer’s open and constructive communication with any worker seeking time away from the job due to pregnancy, child birth or newborn care. It is a business’s obligation to ensure it seeks to understand and reasonably accommodate such conditions short of undue hardship to its operations. This is particularly critical in instances where an employee is requesting such accommodations after she has expended her maximum four month time away under the PDLL.
Please contact attorneys Tim Bowles, Cindy Bamforth, or Helena Kobrin for assistance in this highly sensitive area of employee relations.
There are economic risks for an employer who misclassifies a worker who should be employed as an independent contractor. A wide range of California and federal agencies have the power to impose back taxes, interest and penalties upon companies who unsuccessfully attempt the tactic.
California placed greater deterrents on the practice in 2012. Labor Code sections 226.8 and 2753 permit certain officials or a court to impose civil penalties between $5,000 and $25,000 for each instance of willful misclassification against both employers and any individual adviser (other than a lawyer) who “knowingly advises an employer to treat an individual as an independent contractor to avoid employee status”.
The agency or court directing such payment must also direct the business or person to post a notice on its website for one year, specifying that the company has violated the law, has had to change its business practices in order to cease doing so, and that employees who believe they were also misclassified may contact the Labor and Workforce Development Agency. See also, “Personal Liability and Mandatory On-Line Flogging for Misclassifying Employees as Independent Contractors.”
Boiled down, employers can impose their oversight and control over an employee’s daily production while independent contractors are, well, independent, free to provide services to the hiring party by any means the contractor chooses. However, there are never any absolutes. Determination of “employed” or “contracted” status is an exercise in comparing and balancing many factors, sometimes conflicting, on the degree and manner of control. Two recent California appeals court decisions illustrate how this is always a case-by-case proposition.
In Bain v. Tax Reducers, Inc. (2013) 219 Cal.App.4th 110, the California Court of Appeal found that an accountant working for a tax preparation and bookkeeping firm was an employee and not an independent contractor as the company had classed him. The court noted the firm required the accountant to:
• attend staff meetings;
• have his work reviewed before it went to clients;
• do administrative functions and fill out time sheets like employees did;
• do work the firm assigned to him; and
• work the hours the company established.
The court also pointed out that:
• the accountant had no other clients,
• he primarily used supplies and equipment provided by the company,
• the company marketed him as its worker and he did not market himself,
• he was at-will,
• he performed a function central to the firm’s services to the public,
• the firm reimbursed his expenses,
• he did not invoice the company,
• he did not use subcontractors or his own employees to do any of the work.
In contrast, in Beaumont-Jacques v. Farmers Group, Inc. (2013) 217 Cal.App.4th 1138, another California Court of Appeal panel found that a district manager for a group of related insurance companies was an independent contractor. The manager hired agents, who had to be approved by the company, and she trained and motivated the agents to sell the company’s products. Most importantly, the court found that even though she had to follow the company’s “‘normal business practice’ and ‘goals and objectives,’” the company did not control “to any meaningful degree the means by which [she] performed and accomplished her duties as a district manager.”
The court also observed that the manager:
• determined her own schedule, including hours, breaks, and vacations;
• hired and supervised her own staff and withheld taxes for them;
• she did administrative functions in her own office; and
• paid her own costs, such as a lease, telephone and office supplies, and deducted them on her tax return, which she filed as an independent contractor.
The court found her properly classified as an independent contractor even though she was required to and did prepare reports and attend meetings of district managers.
As a relatively few pennies of prevention is clearly more sensible than the many thousands that it may cost to resolve a classification gone wrong, businesses should confirm any contractor relationship is soundly defined and justified as independent in practice. For assistance, please contact attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.
United Parcel Service, Inc. (UPS) essentially “won” an age discrimination case when a California jury awarded an ex-employee only $27,280 in damages. That relative victory was short-lived, erased by the trial judge awarding the worker $700,000 for her attorney fees. The appeals court recently upheld this decision. Muniz v. United Parcel Service, Inc. (9th Cir. 2013) 738 F.3d 214.
Kim Muniz sued employer UPS alleging, in part, that supervisor Ron Meyer demoted her based on gender and age discrimination and retaliation in violation of California’s Fair Employment and Housing Act (FEHA), California Government Code 12900 and following sections. UPS argued it had promoted Muniz beyond her level of competence and Meyer was simply the first to recognize Muniz’s failings.
The jury found Muniz’s gender wrongfully motivated UPS to demote her and was a substantial factor in causing her harm. However, while Muniz requested damages totaling over $700,000, the jury only awarded her $27,280 — $9,990 for lost earnings, $7,300 for past medical expenses and $9,990 for past non-economic losses.
Both sides claimed victory and sought payment from the other for attorney fees under FEHA, Government Code section 12965(b). The court found Muniz the prevailing party, at which point she requested $2,000,000 in attorneys’ fees (some 73 times the damages award). The district court judge then awarded her some $700,000, or 26 times the jury’s damage award.
UPS appealed the $700,000 assessment, claiming Muniz didn’t deserve that much after her very limited success at trial. However, the appeals court was unsympathetic, ruling that “a trial court does not under California law abuse its discretion simply by awarding fees in an amount higher, even very much higher, than the damage awarded, where successful litigation causes conduct which the FEHA was enacted to deter [to be] exposed and corrected.’”
This case underscores that employers must consider the possibility of attorney fee awards to prevailing employees in FEHA discrimination cases even if the worker’s claims appear to be relatively weak. Of course, to reduce the potential for employee claims as much as possible, employers should take effective measures to prevent unlawful workplace conduct. Employers should also always promptly and thoroughly investigate all complaints of discrimination, harassment or retaliation and take effective remedial action as necessary. Company managers must always act as part of the solution to any such claim and, whether out of neglect or other ill-advised reaction, never place themselves in a position where they can be perceived as part of the problem.
For more information or assistance, please contact the Law Offices of Timothy Bowles, 626-583-6600 or visit our website at Law Offices of Timothy Bowles.
Copyrights, trademarks, trade secrets and patents are “intellectual property,” as compared with “real property” or real estate –land and buildings – or “personal property” – other physical property. A company’s intellectual property is often its most valuable asset. Thus of course, ensuring maximum protection for that property is a critical concern for such business.
A recent court decision from Chicago reaffirms the sometimes not-so-obvious rules on a copyright’s life span. Author Leslie Klinger, who according to his website is one of the foremost authorities on Sherlock Holmes, sued the Conan Doyle Estate, Ltd. in February, 2013. Mr. Klinger asserted that certain elements of two Sherlock Holmes characters – Holmes and Dr. Watson – created by Sir Arthur Conan Doyle were no longer protected by copyright. If correct, Klinger would of course no longer have to obtain the estate’s permission to utilize those elements in his own published writings.
The judge’s ruling was split. Elements based on character development, dialogues, settings, and other story aspects in the pre-1923 books and stories are freely usable because they were published before 1923 and thus are now in the public domain. The judge found that other elements published in 1923 or after were still subject to copyright, thus requiring Klinger or anyone else to obtain a license from the estate (and to pay any required fees) in order to include them in published works.
As long as a creative work is subject to copyright, the author or anyone to whom he/she assigns the copyright – has the exclusive right to reproduce, publish, distribute, publicly display, or create derivative works from that work. Anyone else wishing to do so must receive permission from the author or other owner of the copyright. However, while creative works – writings, songs, music, computer code, screenplays, sculptures, paintings, photographs, and more – are born with copyrighted status from the moment of creation, the legally protected term of that copyright does not always start at that moment.
The length of protection depends on where the work was created, as each country has its own law with one or more international treaties thus affecting protections of that work in other nations, as well as when the work is “published.”
For original works created in the U.S. the law has changed over the years and is somewhat complex. For many works published after January 1, 1978, the copyright lasts for life of the author plus 70 years. However, if an individual created a work for an employer or under a particular contract that qualifies it as a “work made for hire,” copyright extends for 95 years. Further, if any work was published prior to 1978, the rule is 95 years from when the work was first published, not the date of creation. This is the “95 year rule” applied in the Conan Doyle Estate case.
To strengthen the protection for copyrights in the United States over their life span, it is a good idea to register them with the U.S. Copyright Office. For help in understanding these issues and protecting your copyrights, contact the firm’s “of counsel” attorney, Helena Kobrin.
Despite staffing cuts, hiring freezes and sequestration woes, the U.S. Equal Employment Opportunity Commission (EEOC) recovered a record $372.1 million for its private sector workplace discrimination charges — $6.7 million more than it recovered the year prior.
The EEOC enforces federal anti-discrimination in employment laws. According to the EEOC’s Fiscal Year 2013 Performance and Accountability Report (PAR), the EEOC received a 93,727 private sector discrimination charges. Although some 6,000 less than the prior three years, it still ranks among the agency’s top five.
The EEOC has continued to focus on systemic enforcement, targeting unlawful patterns, practices or policies which broadly impact an industry, profession, company or geographic area. Systemic practices include discriminatory barriers in recruitment and hiring; discriminatory restricted access to management training programs and to high level jobs; exclusion of qualified women from traditionally male dominated fields of work; unlawful pre-employment inquiries aimed at detecting disabilities; and age discrimination by reductions in a workforce.
The EEOC reports 300 systemic investigations in fiscal 2013 resulting in 63 settlements or conciliation agreements totaling some $40 million. Agency lawsuits filed for systemic enforcement represented over 20 percent of all active suits in that 2013, the largest proportion since tracking started in 2006. The EEOC also obtained more than $160.9 million in monetary benefits for complaining employees through mediation resolutions, the second highest level in the agency’s history.
If you as employer don’t wish to contribute to any further groundbreaking statistics, we can help. For more information concerning California or federal employment laws, contact one of our attorneys Tim Bowles or Cindy Bamforth.