The California Labor Commissioner continues to promote her department’s aggressive pursuit of employers who do not comply with wage and hour laws. In August, she targeted a Chula Vista restaurant, Dorantes, Inc., doing business as La Querencia, for back pay to six workers totaling $164,688, plus another $110,150 in penalties.

La Querencia was reporting it had five employees, but investigators discovered there were 14. There were six workers who received no meal or rest breaks and were paid $50/day over a nearly three-year period no matter the hours they actually worked.

The company’s failure to comply with its legal obligations resulted in citations for:

• $72,290 minimum wage underpayments
• $1,735 unpaid overtime
• $3,077 meal break violations
• $3,234 rest break violations
• $83,131 liquidated damages (the unpaid minimum wage amount plus interest)
• $1,221 waiting time penalties (payable to former employees who did not receive their full wages on departure)

The company was also fined $54,500 for wage statement violations and assessed another $34,650 in civil penalties for minimum wage and overtime violations. The restaurant also received a $21,000 citation for insufficient workers’ compensation coverage.

The Labor Commissioner declared: “Honest business owners in California should not have to compete with businesses that skirt the law and deprive their workers of their hard-earned pay.”

Back wage and penalty assessments of this magnitude can easily close down a small business. The clear lesson is to always pay minimum wage and overtime and encourage employees to take their required breaks. See also:

• Cautionary Tales Episode One, A Minimum Wage and Overtime Recovery for Three Times Amount Claimed (July, 2017)
• Cautionary Tales Episode Two, Two Tow Companies Owe $4.8M in Unpaid Wages and Overtime (August, 2017)
• Cautionary Tales Episode Three, Construction Company Sued for $6,300,338,Alleged Misclassification of Independent Contractors (August, 2017)
• Location, Location, Location…Location, California Municipal Minimum Wage Rates Continue to Grow (July, 2017)
• Working Overtime in California

Helena Kobrin
October 13, 2017

California is one of some 21 states prohibiting workplace discrimination against “marital status,” defined in government regulations as an individual's “state of marriage, non-marriage, divorce or dissolution, separation, widowhood, annulment, or other marital state.”

In California, a “spouse” is a partner in marriage, regardless of gender.
While a person’s status as married or single must be irrelevant to employment decisions, the recent Court of Appeal decision in Nakai v. Friendship House Association of American Indians (August 10, 2017) confirms that suspending or firing an employee arising from his or her marriage to a particular person is not unlawful.

Friendship House, a drug and alcohol rehabilitation center, had employed Orlando Nakai for over 20 years. Helen Waukazoo, Friendship’s CEO, was also Orlando’s mother-in-law. In May, 2016, after some two years of marriage difficulties, Karen Nakai (also a Friendship employee) called her mother, asserting Orlando had a gun, was angry with Friendship workers, was dangerous, and had relapsed on drugs.

On the basis of daughter Karen’s information, Helen, the CEO, immediately suspended Orlando and later fired him. He sued Friendship House, alleging Helen terminated him “solely because of his status as the spouse of the complaining employee and [her] son-in-law.” Orlando contended his firing constituted marital status discrimination prohibited by California’s Fair Employment and Housing Act (FEHA).

The courts disagreed, denying Orlando relief. Valid marital discrimination employee claims are for terminations due to the worker’s status as “married,” “single,” “divorced,” etc., not for “the status of being married to a particular person.” Orlando’s case failed because his employer could validly fire him out of a family dynamics problem, not a marital discrimination problem. Friendship House thus properly let Orlando go from the “entirely reasonable perspective” of thwarting a prospect of workplace violence.

Federal and state anti-discrimination laws protect employees from termination and other adverse workplace consequences based on factors unrelated to their ability and performance. Human resources executives must be able to distinguish between valid operations-based grounds for personnel decisions and those that cross the line into an employer’s unlawful conduct.

Please contact one of our lawyers, Tim Bowles, Cindy Bamforth, or Helena Kobrin, for guidance on such matters.

Tim Bowles
September 29, 2017

Federal and California law guarantee minimum wage and overtime pay, and prohibit retaliation against an employee who complains about a perceived violation of those laws. In California law, unlawful retaliation includes reporting or threatening to report any worker to U.S. Immigration and Customs Enforcement (ICE) to discourage or derail a wage claim.

Yet, with the rising tide of whistleblower retaliation suits against employers over the past decade, it’s a wonder that many businesses still haven’t been deterred. The June, 2017 decision in Arias v. Raimondo (U.S. 9^th Circuit Court of Appeals) illustrates the prevailing judicial “zero tolerance” toward such ill-considered management attempts at retribution.

After some 11 years of Angelo Dairy employment, Jose Arias, an undocumented alien, brought a 2006 suit alleging unpaid overtime and meal and rest break violations among others. As the trial date neared in that case, the employer’s attorney, Anthony Raimondo, instigated a plan to have ICE arrest Arias at his deposition and deport him.

After settling and dismissing his wage suit out of fear of being removed from the U.S., Arias sued Raimondo and Angelo Dairy for retaliation.

The 9^th Circuit panel found both attorney and his employer-client liable, observing retaliation law prohibits not only an employer, but “any person” from discharging or in some other manner discriminating against an employee because that person filed a complaint or engaged in other protected activity. The law defines “person” as “an individual, partnership, association, corporation, business trust, legal representative, or any organized group of persons.” See 29 U.S.C. 203(a). Mr. Raimondo could thus be held personally responsible for the retaliatory actions alleged.

Lesson: businesses may not retaliate, whether directly or through a third party (here, an attorney) against any employee because he or she complains of workplace conditions. In California at least, this includes threatening to report or report anyone to ICE or other law enforcement over alleged or actual undocumented worker status.

See also:

• The State of Workplace Retaliation and Harassment Claims (July, 2017)
• Workplace Retaliation on the Rise (February, 2017)
• Unlawful Retaliation Defined (September, 2016)
• California Law Protects Undocumented Employees from Workplace Discrimination (April, 2015)

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

Helena Kobrin
September 22, 2017

Mr. Peter Breyer has joined the firm as our finance director.

Peter comes to us with an extensive finance background in the publishing industry. As a chief financial officer, he supervised collections, disbursements and accounting procedures. He is pleased to be working with a law firm, having acquired an interest in the law during his work securing publishing rights.

Originally from Germany, Peter set out at an early age to travel the world, eventually settling in Los Angeles. In his spare time, Peter likes to read and take walks with his dogs. He is also an avid skier and in the winter has been spotted ripping up the slopes at Big Bear.

We welcome Peter to the firm and look forward to working with him!

September 20, 2017

Federal minimum wage rate, currently set at $7.25, is often inadequate to meet basic needs and expenses, especially in certain high-end urban locations.

As a result, many areas have increased local minimum wage rates according to business size and consumer price index.

The following table lists minimum wage levels greater than the federal standard:

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

Cindy Bamforth
September 15, 2017

The California Fair Employment and Housing Act (FEHA) requires employers with five or more on payroll to engage in an “interactive process,” i.e., a timely, good faith communication to explore if and how to reasonably accommodate a physically or mentally disabled worker in order to perform the essential functions of his or her job.

Depending on the situation, different types of reasonable accommodation can include modifying the individual’s job duties, providing temporary unpaid leave, changing work schedules, or providing temporary transfers.

To assist employers in conducting and documenting the “interactive process,” the Department of Fair Employment Housing (DFEH) published a Request for Reasonable Accommodation Package (Package) in July 2017, which includes:

• Section A. The type of accommodation the employee requested and how it will help to perform his or her job; the anticipated recovery date, if any; and whether the employee has requested any protected leave of absence.
• Section B. Employer’s request for medical certification (if required to verify the need for an accommodation).
• Section C. Documentation of “interactive discussions” with the employee, including lists of all potential accommodations and their relative strengths and weaknesses and the employer’s recommended accommodation.
• Section D. Description of specific accommodation(s) provided and an explanation why the employer denied other options.
• Section E. Documentation of all further interactive discussions.

Although not required by law, this Package is a useful tool to help employers properly undertake and document their “interactive process” obligations to a disabled worker.

See also,

• Mind the Stink (June, 2017)
• Employers Duties To Reasonably Accommodate Worker Disabilities (May, 2015)
• Pregnancy Disability Leave (February, 2011)
• Disability and Leave of Absence Policies
• Disability Employment (October, 2010)

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

Cindy Bamforth
August 24, 2017

The California Labor Commissioner has sued Glendale-based Calcrete Construction, Inc. claiming $6,300,338 for the company’s willful misclassification of some 175 persons as independent contractors as well as other wage violations. The Commissioner credits the Carpenters/Contractors Cooperation Committee, a union-affiliated non-profit organization monitoring workplace compliance, for referring the case.

The suit alleges Calcrete forced employees to agree to be independent contractors on threat of termination. The company then purportedly attempted to shield itself from liability by paying these workers through two staffing agencies.

The Commissioner also asserts that starting in 2014, Calcrete underpaid their employees for 18-28 hours of overtime weekly, failed to allocate required sick pay, and provided defective wage statements.

The $6.3M in potential damages includes some $2.6M in penalties for misclassification, $2.5M on the wage issues, and over $1M for failure to provide the proper wage statements.

The Commissioner seeks to use the suit as a warning: “[i]t is illegal for employers to use subcontractors to distance themselves from the obligation to pay workers, and we will use every tool to dissuade employers from this scheme.”

An ultimate finding of willful misclassification could generate back taxes scrutiny for Calcrete from the IRS and the California EDD.

Whatever the outcome here, the suit is a stark reminder of the importance of correct classification of workers as employees or as independent contractors. See also:

• Cautionary Tales Episode One, A Minimum Wage and Overtime Recovery for Three Times Amount Claimed (July, 2017)
• Cautionary Tales Episode Two, Two Tow Companies Owe $4.8M in Unpaid Wages and Overtime (August, 2017)
• Location, Location, Location…Location, California Municipal Minimum Wage Rates Continue to Grow (July, 2017)
• California Paid Sick Leave Law, More About, (November, 2015)
• Independent Contractors and Employees, (October, 2011)
• Working Overtime in California

Helena Kobrin
August 18, 2017

Currently, no federal paid sick leave law exists. However, over the last decade, many states, counties and cities have passed distinct laws requiring covered employers to provide such benefits to designated workers.

Businesses employing persons in multiple covered locations may face conflicting requirements for each.

A current list of jurisdictions nationwide that we have found with such laws:

See also:

• Bulletproofing Los Angeles’s Paid Sick Leave Ordinance (October, 2016).
• San Diego Paid Sick Leave Requirements, Effective July 11 and September 2, 2016 (August, 2016).
• Santa Monica Rides the Sick Pay Wave (August, 2016).
• California Paid Sick Leave Law, More About (November, 2015).
• Oakland Paid Sick Leave Law Provides Greater Benefits Than the Upcoming State Requirements (March, 2015).

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

Cindy Bamforth
August 15, 2017

San Francisco is the first California city to enact an ordinance requiring private employers to provide lactation breaks and rooms to employees who are nursing mothers.

Effective January 1, 2018, all non-governmental employers under San Francisco’s “Lactation in the Workplace Ordinance” must provide breaks for expressing breast milk, concurrent with existing rest breaks required by applicable California wage order, if possible. If not taken at the same time, the lactation break can be unpaid.

Affected employers must provide a “Lactation Location”: a room other than a bathroom, specifically designated for lactation purposes, close to the employee’s work area, free from intrusions and shielded from view. It must have a place to sit, a surface where the employee can place needed items, access to electricity, and be clean and safe. The employee also must have nearby access to a sink and refrigerator.

This room may be multi-purpose, with the company notifying employees that lactation accommodation takes priority.

Such employers must implement a written policy informing workers of the rights to request lactation accommodation, to a required interactive process to address the request, and to be free from ensuing retaliation. Affected businesses must provide that policy to all new employees and to any existing employee who asks about pregnancy or parental leave.

The policy must be included in the company’s workplace policy manual, if any. Employers shall keep records of all such requests and responses for three years.

For the first year, the San Francisco Department of Public Health will issue warnings and notices to employers found in violation of the ordinance. Starting in 2019, it will impose penalties up to $500 for each violation.

An employer who can demonstrate operational hardship due to the size, financial resources, nature or structure of the business will be eligible for an exemption. Examples given in the ordinance are: having to build a room, or remove seating or retail floor space.

More guidance, recommendations, samples and notices shall be provided by the San Francisco Department of Public Health website before January 2018.

For other San Francisco labor ordinances, see:

• Equal Pay for Women (August 2, 2017).
• Paid Parental Leave Required for San Francisco Employers (November, 2016).
• Banned Box and Beyond (August, 2014)

Helena Kobrin
August 9, 2017