“DFEH Now Authorized To File Civil Suits On Behalf Of Victims Of Human Trafficking”

On July 7, 2016, Assembly Bill No. 1684 (“AB1684”)[1], introduced in support California’s anti- human trafficking laws, passed both the Senate and the House of Representatives and was ordered enrolled.

Originally introduced earlier this year by Assembly Member Mark Stone, AB1684 amends the current law to expressly allow the Department of Fair Employment and Housing (“DFEH”) to receive, investigate, conciliate, mediate, prosecute and bring civil actions for and on behalf of victims of human trafficking against the perpetrator.

AB1684 allows any damages in a civil action brought by the DFEH to be awarded directly to the victim.   Specifically, in a civil suit brought by the DFEH, a successful plaintiff may be awarded the following:

  • Exemplary damages (punitive damages) to be awarded by the jury or court;
  • A civil penalty of $25,000 to be awarded to the individual human trafficking victim; and
  • Attorney’s fees and costs as may be determined by the court, which will be awarded to the DFEH for bringing the claim.

The bill will now be delivered to the Governor to sign into law.

[1] http://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201520160AB1684

 

Employers Subject to California Prevailing Wage Beware! California Will Resume Enforcement of The Requirement To Electronically Submit Certified Payroll Records

On July 20, 2016, California Department of Industrial Relations (“DIR”) issued a press release stating DIR enforcement of a contractor and subcontractor’s requirement to submit certified payroll records(“CPRs”) using DIR’s online system will resume on August 1. DIR clarified that the requirement to keep CPRs has not changed. Previously, DIR suspended enforcement of filing CPRs electronically because of problems with the system and improvements. However, employers should have continued to maintain CPRs and the ability to file them electronically was operational. The key difference is now DIR will enforce the filing requirement effective August 1st. See press release

California prevailing wage requirements are complicated and we recommend you consult with the Jackson Lewis attorney you normally work with regarding any compliance issues or feel free to contact Jonathan Siegel at siegelj@jacksonlewis.com.

 

 

Are My California Pay Stubs Compliant?

Nearly all California employment wage and hour class action lawsuits assert a cause of action under California Labor Code Section 226 as plaintiffs’ attorneys almost always automatically include such cause of action when there are other alleged underlying wage violations, i.e. failure to pay overtime. By asserting this cause of action in their class action complaint, the plaintiffs are provided with the ability to access written itemized wage statements (more commonly known as pay stubs) of (a) a sample of putative class members regardless of whether or not a class action is certified and (b) the entire class if a class action is ultimately certified. At first glance, disclosing pay stubs does not seem problematic except for the time and expense associated with providing the same to the plaintiffs’ attorneys. However, once the plaintiffs’ attorneys are in possession of the pay stubs, they will analyze them to determine if they are non-compliant on their face, which can create large penalties for an employer.

Employers are required to provide employees with pay stubs, which can be a stand-alone document or a detachable part of a pay check. In California, Labor Code Section 226 governs pay stubs. Under Labor Code Section 226, the following items must appear on every pay stub:

Gross wages earned;

  1. Total hours worked by each employee (except for salaried employees who are exempt from the state overtime rules);
  2. The number of piece-rate units earned and any applicable piece rate (if the employee is paid on a piece rate basis);[1]
  3. All deductions;
  4. Net wages earned;
  5. The inclusive dates of the period for which the employee is being paid;
  6. The employee’s name and only the last four digits of the employee’s social security number or an employee identification number other than a social security number;
  7. The name and address of the legal entity that is the employer (and if the employer is a farm labor contractor, the name and address of the legal entity that secured the services of the employer); and
  8. All applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee.

Temporary service employers are also required to provide on pay stubs the rate of pay and the total hours worked by each temporary employee for each temporary services assignment. It should also be noted that in California, the amount of paid sick leave available to an employee is also required to be on the face of the pay stub or provided to the employee in a separate document with the employee’s wages on the designated pay dates.

If any of the items enumerated above are missing, employees may be entitled to penalties. Under Labor Code Section 226, an employee may recover the greater of all actual damages or $50 for each initial violation per employee, and $100 per employee for each subsequent violation, not to exceed an aggregate penalty of $4,000 for a period of one year preceding the filing of a lawsuit. When such penalties are applied to each member of a class, the financial exposure for the employer can be considerable. In addition, employees may recover costs and reasonable attorney’s fees. Moreover, if there is a violation on the face of the pay stub, a plaintiffs’ motion for class certification will more than likely be granted, at least with respect to a Labor Code Section 226 claim.

Although this post relates to California’s itemized wage statement requirement, this issue is not unique to California. In fact, the majority of states have requirements for what must be included on a pay stub as well as applicable penalties for the failure to comply.

[1] Note that pursuant to Labor Code Section 226.2, additional rules apply to employees paid on a piece rate basis.

New PAGA Amendments – What Employers Doing Business in California Need to Know

We previously reported on Governor Brown’s 2016/2017 budget change proposal as something employers should monitor.[1]  The proposal included increased funding for the Labor & Workforce Development Agency (“LWDA”), the agency responsible for overseeing the Private Attorneys General Act of 2004 (“PAGA”).  The budget proposal also contained recommendations for widespread changes to the way PAGA cases are handled.

On June 15, 2016, the California Legislature passed SB 836, which contained numerous amendments to the PAGA. While not all of the original proposals were enacted, there are several significant changes of which employers should be aware.

  • While PAGA notices previously were required to be provided to the employer and the LWDA by certified mail, PAGA notices are now required to be provided to the LWDA online, accompanied by a $75 filing fee, unless the filing party obtains a waiver.
  • Any employer response to the notice must also be accompanied by a $75 filing fee, unless the employer obtains a waiver.
  • The LWDA now has 60 days to review a notice under Labor Code § 2699.3(a), rather than the 30 days it previously had.
  • For cases filed on or after July 1, 2016, the time for the LWDA to investigate the claim has been extended from 120 to 180 days.
  • For cases filed on or after July 1, 2016, the aggrieved employee or representative must provide a file-stamped copy of the complaint, which includes the case number assigned by the court.
  • A civil action cannot be filed until 65 days after the aggrieved employee sends notice to the LWDA. The previous waiting period was 33 days.
  • Any proposed settlement provided to the superior court for review must also be submitted to the LWDA at the same time it is submitted to the court.
  • Any superior court judgment in a civil action that provides for, or denies, an award of civil penalties pursuant to PAGA must be submitted to the LWDA within 10 days after entry of the judgment or order.
  • Any PAGA cure notices submitted by employers to the LWDA must be submitted online.

The PAGA amendments set the stage for the LWDA to assert heightened scrutiny of PAGA cases and settlements, as the LWDA will have more time, information, and resources at its disposal. (The Department of Industrial Relations (“DIR”) had estimated “less than 1% of cases have historically been reviewed/investigated.”)  It remains to be seen how the LWDA will utilize its authority, and whether the amendments help curb some of the abuses to PAGA litigation, or instead create uncertainty and increased litigation costs for employers defending PAGA claims.

[1] http://www.californiaworkplacelawblog.com/2016/02/articles/calosha-2/governor-browns-proposed-paga-unit-may-have-power-to-challenge-paga-settlement-in-court/; and http://www.californiaworkplacelawblog.com/2016/02/articles/paga/state-budget-proposal-seeks-to-reduce-paga-litigation-through-increased-state-oversight/

 

Los Angeles Approves Minimum Wage Increases and Mandates Employers to Provide 48 Hours of Paid Sick Leave

Los Angeles Approves Minimum Wage Increases and Mandates Employers to Provide 48 Hours of Paid Sick Leave

Employers in the City of Los Angeles will need to review their current minimum wage and paid sick leave policies to ensure they comply with the new City ordinance increasing the minimum wage and extending paid sick leave benefits to employees working in the City.

On June 1, 2016, the Los Angeles City Council voted in favor of requiring employers in the City to provide their employees with 48 hours of paid sick leave, double the mandatory minimum under California’s statewide paid sick leave law, and approving future increases of the minimum wage. Ordinance No. 184320 goes into effect on July 1, 2016.

Minimum Wage Increases

Beginning on the dates below, employers with at least 26 employees must provide the following minimum wage rates:

  • July 1, 2016: $10.50/hour
  • July 1, 2017: $12.00/hour
  • July 1, 2018: $13.25/hour
  • July 1, 2019: $14.25/hour
  • July 1, 2020: $15.00/hour

On July 1, 2022, and annually thereafter, the minimum wage will increase based on the Consumer Price Index. Employers with 25 or fewer employees will have an extra year to comply with the increases.

Paid Sick Leave Requirements

Who is covered?

Every employee who, on or after July 1, 2016, works in the City for the same employer for at least 30 days within a year from the commencement of employment is entitled to paid sick leave. The Ordinance defines “employee,” in part, as any individual who in a particular week performs at least two hours of work within the geographic boundaries of the City.

Under the Ordinance, an “employer” is “any person, as defined in Section 18 of the California Labor Code, including a corporate officer or executive, who directly or indirectly or through an agent or any other person, including through the services of a temporary service or staffing agency or similar entity, employs or exercises control over the wages, hours or working conditions of the Employee.” This potentially may make corporate officers and executives individually responsible for providing sick leave.

The Ordinance does not provide any exemption for workers subject to a collective bargaining agreement.

How much sick leave is required and can employers limit the amount used?

Employees will be entitled to take up to 48 hours of sick leave in each year of employment, calendar year, or 12-month period. Like the California state law, employers may choose to provide the entire 48 hours of paid sick leave up front (“grant method”) in each year of employment, calendar year, or 12-month period, or employers may use an accrual method such that sick leave accrues at the rate of one hour for every 30 hours worked. Accrued paid sick leave must carry over to the following year of employment, but may be capped at 72 hours.

Employers who provide an amount of paid leave or paid time off, or provide payment for compensated time off, that is equal to or no less than 48 hours are not required to provide additional time.

When do employees begin to accrue paid sick leave?

Employees accrue paid sick leave on the first day of employment or July 1, 2016, whichever is later.

When can employees start using paid sick leave?

Employees may use paid sick leave beginning on the 90th day of employment or July 1, 2016, whichever is later.

For what reasons can an employee use paid sick leave?

Employees may use paid sick leave for their own medical care and for the medical care of certain covered family members for the same reasons paid sick leave must be provided under state law, i.e., for preventive care or diagnosis, care, or treatment of an existing health condition, or for certain purposes as a victim of domestic violence, sexual assault, or stalking.

In addition to allowing paid sick leave to be used for the care of family members defined under state law, the Ordinance also allows for use of paid sick leave for “any individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship.”

Can employers set restrictions on the use of paid sick leave?

Employers must provide paid sick leave upon the oral or written request of an employee. Employers may require an employee to provide reasonable documentation of an absence from work for which paid sick leave is or will be used. The state paid sick leave law is silent regarding whether an employer can require documentation regarding absences.

Do employers have to pay out unused, accrued paid leave upon termination?

Employers are not required to pay out earned sick leave upon termination of employment if the earned sick leave is separate and distinct from a paid time off or vacation plan. However, if an employee is rehired within a year from the date of separation, previously used and unused paid sick time must be reinstated.

What are the posting and notice requirements?

Every employer shall post at the workplace or job site the notice published each year by the City informing employees of the current City minimum wage rates, sick time benefits and of their rights under the Ordinance. The notice must be posted in any language which is spoken by at least 5% of the employees at the workplace or job site.

Every employer also must provide at the time this Ordinance becomes effective or at the time of hire, whichever is later, the Employer’s name, address, and telephone number in writing.

Implementation and Enforcement

The Office of Wage Standards of the Bureau of Contract Administration (designated the “DAA”) may issue guidelines and rules to implement the law. If the DAA determines that the employer’s established policy is more generous overall, the DAA may allow an employer’s established paid leave or paid time off policy or one which provides payment for compensated time off to remain in place and deemed in compliance with the Ordinance even though it does not meet all of the requirements of the Ordinance.

The Office of Wage Standards of the Bureau of Contract Administration within the Department of Public Works shall be responsible for enforcement of the Ordinance.

Employees may not waive their rights under the Ordinance.

Retaliation

Employers are prohibited from retaliating against employees for requesting or using paid sick leave. Retaliation may include discharge, reduction in compensation, or other forms of discrimination.

***

Employers with operations in the City of Los Angeles should carefully review the Ordinance, their minimum wage rates, as well as policies and practices related to paid sick leave.

Employers should regularly review their policies and practices with employment counsel to ensure they effectively address specific organizational needs and comply with all applicable laws. Please contact Jackson Lewis with any legal questions about the Ordinance.

Employee Who Failed to Provide Additional Doctor Notes to Support New Restrictions May Still Survive Summary Judgment

Last week, in Thomsen v. Georgia-Pacific Corrugated, LLC, a federal district court in California held that an employer might have violated its obligations under California’s Fair Employment and Housing Act (“FEHA”) when it simply told an employee to return to his doctor to obtain a note outlining additional work restrictions.   The Court held that a reasonable jury could find that the employer was obligated to do more than tell the Plaintiff to go back to his physician and get a new doctor’s note, especially because evidence suggested it would have been possible to respond to some of Plaintiff’s concerns without a new doctor’s note.

The Facts

Plaintiff worked as a cut-and-die operator at a corrugated container plant. In May 2012, Plaintiff injured his shoulder at work, went on workers’ compensation leave, and returned to work eight months later after undergoing surgery on his left shoulder. Read More

High Heat Alert in California

On June 1, 2016, The California Occupational Safety and Health Division issued a “High Heat Advisory,” warning employers to protect their outdoor workers from heat illness as temperatures hit extreme highs this week — well over 100 degrees in many locations. This Advisory provides a timely reminder of California’s Heat Illness Prevention (“HIP”) regulation, adopted last year, which set specific requirements for potable water, shade, cool-down periods, high-heat procedures, emergency preparedness, and acclimatization, training, and heat illness prevention plans. Here’s a summary of the HIP regulation’s key requirements:

Potable Water Requirements

Employers must provide employees with access to potable drinking water that is fresh, pure, suitably cool, and provided free of charge to employees and should be located as close as practicable to the areas where employees are working, unless the employer can demonstrate infeasibility.  The employer must provide each employee with a minimum of one quart of water per hour for the entire shift. Read More

Employers Beware of Phishing Scams

On April 20, 2016, a class action lawsuit was filed in the United States District Court, Southern District of California against Sprouts Farmers Market, Inc. The lawsuit was initiated by a former employee whose W-2 was allegedly disclosed as part of a phishing scam that occurred in late March 2016 amid reports that Sprouts’ employees had their IRS tax refunds stolen. According to the complaint, the W-2s of Sprouts’ employees were disclosed to a third party as a result of the phishing scam.

This sort of internet scam, referred to as “phishing,” occurs when someone attempts to acquire sensitive or confidential information under the guise of a legitimate request. For the average internet user, phishing scams often come in the form of a fake email from a bank or other financial institution asking you to click on a link to confirm your password on a web site that looks like a legitimate web site for the business. The fake web site often uses the actual logos and branding from a legitimate site to trick the user. Read More

WHAT’S ON YOUR WAGE STATEMENTS?

California has many requirements for the content of an employee wage statement, including this year’s new requirements for employees paid by a piece rate. Employees paid by piece rates must be separately compensated for rest and recovery periods and, where the employee does not earn at least minimum wage in addition to the piece rate, must be separately paid for non-productive time.  The amount of time for these periods, the applicable rates of pay, and gross wages for these periods is required to be on the wage statement.  Read More

California Teacher Tenure Laws Upheld by Appellate Court

Overturning a trial court ruling, the California Court of Appeal for the Second Appellate District held that teacher tenure laws are constitutional in the case of Vergara v. State of California, decided April 14, 2016.

The case involves nine public school students who challenged several provisions of California’s Education Code that govern K-12 public school teachers’ employment. The basis of the challenge is that the tenure, dismissal, and layoff laws result in grossly ineffective teachers being transferred to lower-performing schools with predominantly minority and low-income populations, rather than being terminated; and that; therefore, those students receive an inferior education.  Several associations representing school boards, school superintendents, and school administrators filed amicus briefs in support of the students’ position that the laws are unconstitutional. Read More

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