Properly Confronting the Chronically Negative Employee

According to Wiktionary.org, a “Debbie Downer” is a “naysayer; one whose negative remarks depress or dissuade others.” Most seasoned managers will be all too familiar with how one negative individual can bring down the entire workforce’s morale.

Employers are often reluctant to terminate someone just for a negative attitude, particularly if the worker otherwise appears to be doing a good job, shows up on time and is not overtly flouting workplace policies or rules.

Disciplining someone for having a “bad attitude” may also run afoul of legitimate employee protections. For example, employers must not violate the National Labor Relations Act, which shields certain activities including criticisms over working conditions. Employees also have rights prohibiting wrongful termination or discrimination based on his/her protected class, such as gender, age, race, religion, and physical or mental disability.

Yet continuing to employ a “Debbie Downer” or, say, a “Bob Bummer” can create a toxic environment in which other valuable employees may choose to leave. If to resolve legitimate workplace concerns, an employer is determined to part ways with Ms. Downer or Mr. Bummer, it should consider consulting with knowledgeable employment counsel to minimize the prospects of legal repercussions, including:

• Treating all employees fairly, consistently and appropriately in accordance with company policy.
• Documenting specific behavior that negatively impacts others, impedes productivity, etc.
• Verbal counseling and a written performance improvement plan in an attempt to correct the behavior.
• Placing the employee on probation or suspension, especially if the negative behavior violates company policy, such as insubordination.
• Offering additional severance pay upon termination in exchange for a signed release and waiver of all claims, real or imagined, known or unknown.

See also:

• The Best Offense is a Good Defense (June, 2019).
• Oh No You Didn’t! (July, 2018).
• Employee Terminations (April, 2018).

For further assistance, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

June 14, 2019

Federal Appeals Court Rules New Independent Contractor ABC Test Applies Before It Existed

Industries and employers throughout California have been grappling since April 2018 with the effect of Dynamex Operations West, Inc. v. Superior Court on their independent contractor relationships. Rejecting a multi-factor standard that had been in place since 1989, the California Supreme Court in Dynamex required employers to prove all three prongs of a newly-adopted ABC test to justify classifying workers as independent contractors. See Independent Contractor Status in California Now Falls Under Radically Different Rules (June 2018).

When asked to rule if the ABC test applied retroactively, the California Supreme Court declined. Since then, some lower California courts have ruled that it does, for example, Garcia v. Border Transp. Grp and Johnson v. VCG-IS, LLC.

Now, the Ninth Circuit federal appeals court has ruled that the ABC test is retroactive in Vazquez v. Jan-Pro Franchising International, a case that was originally filed in 2008, 10 years before the Dynamex decision. The court made little of the financial chaos and unfairness that retroactive application of ABC would cause and Jan-Pro’s reliance on the previously existing rules. Instead, the court endorsed retroactivity for multiple reasons, finding: (1) retroactivity is standard for court decisions: (2) California courts would rule that way and some, albeit lower courts, have already done so; (3) workers and their families must be protected; and (4) employers with substandard practices should not gain a competitive advantage as a result.

Employers with independent contractors should have taken notice to review those relationships a year ago when the Supreme Court issued Dynamex. If they did and changed such classifications as warranted by ABC, their retroactive liability under pertinent statutes of limitations is decreasing over time. Any employers who have not conducted review so should not delay. Any liability can continue back for up to four years from the date of any misclassification claim.

Stay tuned. The California legislature is currently considering competing bills on the long-term application of the ABC standard. See, California Legislature Dealing with Competing Proposals to Kill or Expand New Dynamex Test (April 2019).

See also:

• Radically New Dynamex Test Only Applies to Certain Employee Classification Cases (November 2018)

For further assistance, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Helena Kobrin

May 31, 2019

Walmart Hit with Six Million Dollar Verdict for “Discouraging” Off-Site Meal Breaks

California employers must provide non-overtime-exempt employees unpaid meal break(s) based on the number of hours worked in a given day. See, Required Meal Periods and Rest Breaks Revisited (April, 2018).

The California Supreme Court’s 2012 Brinker Restaurant Corp. decision clarified that “employer-provided” breaks does not mean companies have to police workplaces to ensure employees take their meals. Rather, California employers must relieve employees of all duty, relinquish control over their activities, and permit them a reasonable opportunity to take an uninterrupted 30-minute break on or off the worksite without “impeding or discouraging” them from doing so.

In Chelsea Hamilton et al. v. Wal-Mart Stores, Inc. et al, two plaintiff-employees brought a class action on behalf of 5,000 non-exempt co-workers at Walmart’s Chino, California fulfillment center. They alleged that each time employees left the building they had to go through anti-theft metal detectors, potentially cutting into their 30-minute breaks, thus dissuading them from leaving the building to eat lunch.

In defense, Walmart established one of the named plaintiffs took her meal breaks outside the workplace while citing plaintiffs’ own expert on over 30,000 instances of class members taking meal periods of at least 30 minutes outside the facility.

The court noted, however, that plaintiffs were not required to show the security check actually prevented them or others from taking off-site meal breaks; they only needed to present evidence from which a jury could conclude that the security check impeded or discouraged them from doing so.

The jury returned a unanimous verdict for the employees, awarding over $6 million in damages. Walmart is appealing.

Whatever this case’s ultimate outcome, employers should implement policies and procedures to unequivocally encourage employees to take off-site meal breaks. If workers must undergo security checks before leaving for such breaks, employers should also consider installing a remotely-located timeclock beyond the security checkpoint so that employees can clock out for lunch after completing the security check.

See also:

• Workers Don’t Lose The Snooze (June, 2017).
• Brinker Case Settles for $56 Million (August, 2014).
• Brinker Decision and Rest Periods. California Employers Get a Break(May, 2012).
• Brinker: California’s Meal Break Breakthrough. Employers are No Longer the Lunch Police(May, 2012).
• Brinker: Employees May Skip Breaks. Yet Greater Flexibility Requires Greater Documentation(May, 2012).
• Brinker: Clocking In on Employee Timekeeping. Dos and Don’ts for California Employers(May, 2012).
• Brinker’s New Rules for Meal and Rest Breaks. The Necessity of Management Training(May, 2012).

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

May 23, 2019

Walmart Hit with Six Million Dollar Verdict for “Discouraging” Off-Site Meal Breaks

Employers Must Heed Pay Stub Technicalities

California employers must accurately list specific wage-related information on each worker’s pay stub per pay period, including but not limited to the company’s name and address, total hours worked, wage rate(s), gross and net wages earned, all deductions, and inclusive dates of the pay period.

Seemingly, the easiest requirement should be listing the employer’s name and address (Labor Code 226 (a)(8)). However, to mangle Shakespeare, that which we call an employer by any other name might not be as lawful.

In Savea v. YRC Inc., the plaintiff, on behalf of himself and all co-workers, sued this employer for failing to provide the correct company name on its wage statements (pay stubs). Instead of listing its corporate name, YRC Inc., the company listed its fictitious business name, YRC Freight. The plaintiff also alleged the employer’s address improperly omitted its mail stop code and its extended four-digit zip code (the ZIP+4 code). Plaintiff sought statutory damages, civil penalties, attorney fees, and costs.

In a rare victory for employers, the court sided with YRC. The court emphasized that the legislature enacted Labor Code 226 to ensure an employer properly documents “the basis of the employee compensation payments” to help the employee ascertain whether he or she has been paid properly. As YRC had a valid, properly recorded fictitious business name statement, the court decided there was no confusion about the employer’s identity. The court also concluded that YRC’s proper mailing address does not need to include either the mail stop code or ZIP+4 Code.

This decision serves as an important reminder for California employers as failure to properly adhere to any pay stub requirements can be costly. For any offense within 12 months of the filing of a claim, each affected worker can recover at least $50 for the first violation and a minimum $100 for each subsequent occurrence up to a maximum of $4,000. If a company’s non-compliance applies to a large number of employees, that total potential liability could be very significant. See Labor Code 226(e).

Best practices:

• Preferably list the employer’s name as registered with the California Secretary of State on all pay stubs.
• If the employer operates under a fictitious business name (FBN), ensure the FBN is properly renewed prior to its expiration.
• Correctly and fully state the corporate name and/or FBN on all pay stubs without abbreviating or shortening them.
• Do not print the company logo on the pay stub in lieu of the actual corporate name or FBN name.
• Routinely audit the company’s pay stubs to ensure compliance with all required items, preferably in consultation with experienced legal counsel.

See also:

• Correct Pay Stubs Save Bucks (May, 2018)
• California’s Itemized Pay Stub (March, 2016)

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

May 17, 2019

Employers Must Heed Pay Stub Technicalities

California At-Will Employees Bound to Lawful Policy Changes by Continuing to Work after Their Adoption

In Diaz v. Sohnen Enterprises, California employer Sohnen Enterprises instituted a mandatory dispute resolution policy requiring that all employee claims be arbitrated. “Arbitration” is a private dispute resolution tool, bypassing court trials by jury.

The company informed the employees of the new policy and that, even if they did not sign it, continued employment constituted acceptance of the agreement.

At-will employee Erika Diaz objected to the agreement. “At-will” permits either employer or employee to terminate the relationship at any time, with or without notice and with or without a reason.

Company representatives reiterated to Ms. Diaz that, regardless of her objection, if she continued to work for the company, she would be accepting the policy. While Diaz stayed on the job, she challenged the arbitration policy by filing suit.

Ms. Diaz won at the trial court level. The Court of Appeal reversed, reasoning that Diaz was clearly on notice that continuing employment constituted acceptance of this legally permissible, unilateral change in employment terms for at will employees.

If a company wishes to make such policy changes, an experienced employment lawyer can help position the transition to minimize the prospect of repercussions.

See also:

· The Truth: Get It In Writing (April, 2019)

· The Need for Written Employment Agreements (March, 2018)

· Don’t Kill At Will Employment (June, 2010)

For further assistance, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Helena Kobrin

May 10, 2019

The New Normal?

There appears a growing trend of employers — nationwide and abroad – implementing unorthodox methods to assess job candidates such as escape rooms, capture the flag, professional “speed dating” sessions, glow-in-the-dark miniature golf, laser tag and cooperative board games.

An escape room involves a small group of people locked in a room and tasked to unravel clues, puzzles and riddles to “escape” within a given time frame. The University of Nebraska Medical Center already uses escape rooms to assist students in applying their skills to health care emergencies by solving health-related puzzles simulating different patient health scenarios.

Capture the flag is an outdoor game of tag between two teams. The first team to capture the other’s flag from their base area and bring it back to their own base wins. If a player gets tagged by an opponent while trying to capture the flag, he or she typically remains in a cordoned-off “jail” until released back into the game.

Professional speed dating involves candidates talking with a line of management and lower-level employees one after the other, each “interview” for a specified, short amount of time. Hiring managers then determine who to bring back for the next round.

Although such approaches might well bypass the normal stodginess of an interview and potentially help to evaluate a candidate’s team-building, leadership and communication skills, they can also run afoul of the law.

In California, employers must not directly or indirectly inquire about an applicant’s characteristic protected from federal and state employment discrimination laws including race, religious creed, color, national origin, ancestry, physical or mental disability, medical condition, genetic information, marital status, sex, gender, gender identity, gender expression, age, sexual orientation, or military and veteran status.

Requiring candidates to participate in certain physical activity unrelated to the position’s essential functions could indirectly discriminate against the candidate based on medical condition or age.

Professional speed “dating” could lead to inappropriate questions or flirtatious behavior. It’s not a great idea for an employer to rush through an interview in any event.

Job interviews are of course an important step in the hiring process. By using tools such as the Department of Fair Employment and Housing’s Fact Sheet, employers should be able to apply their creative energies to interviewing without inadvertently discriminating.

See also:

• Interviews Gone Wild (October, 2018)
• Job Interview Errors to Avoid (April, 2018)
• Asking for Job Applicant Age is a No-No (August, 2017)

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

May 9, 2019

Labor Commissioner Broadens Application of Dynamex Decision

In Dynamex Operations West, Inc. v. Superior Court (2018), the California Supreme Court adopted a strict “ABC test” redefining “independent contractor”:

1. The worker is free from the hirer’s control and direction in connection with the performance of the work, both under the contract in fact;
2. The worker performs work outside the usual course of the hiring entity’s business; and
3. The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.

However, Dynamex does not apply across the boards, covering only the California Wage Order employee protections (e.g., minimum wage and overtime issues, deprivation of meal and rest periods, and record-keeping and itemized wage statement requirements). The traditional “balancing test” definition of independent and control factors continues to determine the scope of other workplace laws, including workers’ compensation and unemployment benefits.

Undertaking to eliminate at least some of the resulting uncertainty, the California Labor Commissioner’s office May 3, 2019 opinion letter asserts the ABC test should apply to all California Labor Code provisions intended to enforce Wage Order protections, including Labor Code section 226 (itemized pay stub obligations); 226.7 (meal, rest and cool-down recovery periods); 512 (meal periods); 1182.12; 1194.2 and 1197 (minimum wage); and 510 and 1194 (overtime provisions).

The letter further contends the ABC test should apply to Labor Code section 2802 expense reimbursement claims for those expenses set forth in the Wage Orders (e.g., tools, uniforms and equipment).

The letter also declares the ABC test applies to Labor Code section 203 (which penalizes employers for any wages that are not paid at the time of termination) under certain circumstances: “[W]here section 203 serves to enforce the underlying minimum wage and overtime obligations of the wage orders, application of the ABC test to these claims would be appropriate.”

Although the courts need not follow such Labor Commissioner interpretations, the letter indicates the ABC test is gaining momentum, with the Labor Board determined to broaden Dynamex’s application.

Best practices to avoid or minimize independent contractor misclassification claims include:

• Carefully evaluate any ongoing independent contractor relationships together with knowledgeable legal counsel.
• Update independent contractor agreements to adequately address the ABC test.
• Consider implementing arbitration provisions with class action waivers.
• As needed, re-classify independent contractors to employees with all proper employee hiring paperwork. See The Best Offense is a Good Defense (June, 2019).
• Promptly work with knowledgeable legal counsel if the company receives any government agency misclassification-related notice, inquiry or audit. See, For Whom the Bell Tolls (April, 2019).

See also:

• Making Dynamex Retroactive (May, 2019)
• Independent Contractor or Employee? (April, 2019)
• Independent Contractor Status? It Depends (November, 2018)
• Game Changer (June, 2018)

For further assistance, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

June 7, 2019

Labor Commissioner Broadens Application of Dynamex Decision

Playa Vista Car Wash Takes a Dunking for $2.36 Million “Wage Theft”

On April 17, 2019, the Labor Commissioner’s Office announced a $2.36 million citation — the largest issued against a car wash business to date — against Playa Vista Car Wash along with its president and general manager for failing to properly pay or provide required breaks to 64 workers.

The Labor Commissioner launched an investigation after it received a referral from the Community Labor Environmental Action Network (CLEAN), a nonprofit that assists car wash workers.

Investigators charged that workers had to physically report to work 30 minutes before the car wash opened in order to ascertain their daily work schedule. Those not selected were sent home several hours later without pay. The car wash also allegedly required workers to take extended lunch breaks with no split shift premiums and/or to work up to 10 hours with no daily overtime pay. Managers also purportedly altered workers’ time cards to reduce total hours worked.

The citation includes payments and civil penalties for violations of minimum wage and overtime, meal and rest break requirements, split shift payments, itemized statement violations, and waiting time violations. Investigators cited an additional $10,000 for failure to register the car wash with the Labor Commissioner as required by Labor Code sections 2054 and 2060.

In her announcement, California Labor Secretary Julie A. Su stated: “Individuals acting on behalf of an employer to steal workers’ wages cannot hide behind corporate entities to avoid personal liability, all the while profiting at the expense of honest businesses that play by the rules.”

Labor Code section 558.1 exposes owners, directors, officers, and managing agents of California employers to personal liability for violations of minimum wage and hours and days of work. Thus, company and personal assets can be levied if a citation is not paid. This latest “mega-citation” is yet one more incentive for businesses to ensure continuing compliance with this state’s compensation laws.

For further information, please contact Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

May 2, 2019

EEOC 2018 Report Reflects Increases in Sexual Harassment Charges

The U.S. Equal Employment Opportunity Commission (EEOC) has announced the number of workplace discrimination charges filed nationwide during fiscal year 2018 (October 1, 2017 to September 30, 2018).

Of the 76,418 discrimination charges filed last year, retaliation topped the list, totaling 39,469 charges, followed by sex, disability, and race-based charges.

During the same period, the EEOC resolved 90,558 discrimination charges and filed 199 lawsuits against employers, securing more than $500 million for claimants.

Sexual harassment charges increased 13.6 percent from 2017 and resulted in $56.6 million in employer damages and settlement payments.

EEOC Acting Chair Victoria A. Lipic stated: “[W]e cannot look back on last year without noting the significant impact of the #MeToo movement in the number of sexual harassment and retaliation charges filed with the agency.”

In addition to sexual harassment prevention training and well-worded anti-discrimination policy, employers should ensure managers and workers alike are educated on other forms of discrimination, such as age, religion, national origin, race, and disability, to better protect and promote workforce morale, trust and productivity.

We provide live on-site anti-harassment seminars for a flat fee.

Contact officemgr@tbowleslaw.com for more information and to schedule your seminar.

See also,

• Harassment Prevention Training Is Mandatory in California 2019 Deadline (February, 2019)
• What’s New for 2019 – California’s Increased Protections Against Workplace Harassment (February, 2019)
• What’s New for 2019 – California’s Increased Protections Against Harassment (January, 2019)
• What’s New in 2019 – #Metoo and The Workplace(December, 2018)
• Are You Doing Everything Possible to Prevent Workplace Sexual Harassment?(March, 2018)
• Ten Top Reasons for Live Sex Harassment Prevention Training(September, 2017)

For further assistance, please contact one of our attorneys Tim Bowles, Cindy Bamforth or Helena Kobrin.

Cindy Bamforth

April 24, 2019