While reversing summary judgment in favor of a holding company, in Castaneda v. The Ensign Group B249119 (Cal. Ct. App. Sep. 15, 2014), the California Court of Appeal held that a “corporation with no employees [that] exercises some control over [a] corporation with employees, [] may be the employer of the employees of the corporation it owns.” In doing so, the Court found that there were triable issues of material fact whether the holding company that alleged it had no employees, The Ensign Group, Inc., was the plaintiff’s employer.
Continue Reading California Court of Appeal Holds That A Holding Company With No Employees May Be Vicariously Liable For Alleged Wage and Hour Violations of a Subsidiary
Deputy Sheriff Protected by Whistleblower Retaliation Law, California Court of Appeal Rules
The California Labor Code’s Section 1102.5(b) whistleblower protections are not limited to the first employee reporting alleged misconduct, the California Court of Appeal has ruled, affirming a judgment in favor of a deputy sheriff on his whistleblower retaliation claim. Hager v. County of Los Angeles, No. B238277 (Cal. Ct. App. Aug. 19, 2014).
The
California High Court Rules that Franchisors are Not Liable for Workplace Injuries Inflicted By Franchisees’ Employees
In a recent opinion with important implications for California businesses, the California Supreme Court held that franchisors are not vicariously liable for the conduct of employees managed by its franchisees.
In Patterson v. Domino’s Pizza, LLC, et al., the plaintiff, a service employee at a Southern California Domino’s Pizza franchise, alleged that she had been sexually harassed by her supervisor, the store’s Assistant Manager. She asserted claims against the alleged harasser, the franchisee, and Domino’s Pizza, the franchisor, alleging that, although she (and the alleged harasser) formally were employed by the franchisee, the franchisor was vicariously liable for her injuries. More specifically, she argued that because the franchisor exercised extensive control over the franchisee’s operations, the franchisee was an “agent” of the franchisor and the franchisor was an “employer” of the franchisee’s employees, subjecting the franchisor to liability for injuries arising out of the employees’ performance of their job duties.
Continue Reading California High Court Rules that Franchisors are Not Liable for Workplace Injuries Inflicted By Franchisees’ Employees
California Court of Appeal Holds That Retired Employees Can Also Subject Employers to Waiting Time Penalties
On August 19, 2014, a California Court of Appeal held that the requirements of Labor Code sections 202 and 203 apply not only to employees who quit, but also to employees who retire. In McLean v. State of California et al., No. C074515 (Cal. Aug. 19, 2014), the plaintiff filed a putative class action lawsuit on behalf of all employees employed by the State of California who retired from their employment between November 2010 and March 2011, who did not receive prompt payment of wages as required by Labor Code section 202. Among other things, the putative class sought waiting time penalties under Labor Code section 203. At the trial level, the defendants’ demurrer was sustained without leave to amend because the plain text of Labor Code section 202 requires prompt payment of wages owed only for employees who “quit his or her employment.” Because the putative class sought penalties for retired employees, the trial court determined that the employer could not have violated Labor Code section 202. Nevertheless, the Court of Appeal reversed and found that the term “quit” in Labor Code section 202 also encompasses retired employees.
Continue Reading California Court of Appeal Holds That Retired Employees Can Also Subject Employers to Waiting Time Penalties
Arbitrator, Not Court, Decides Whether Arbitration Agreement Applies to Class Claims, California Court Rules
Whether the parties to an arbitration agreement agreed to class arbitration is a question for the arbitrator, not the trial court, the California Court of Appeal has ruled, reversing an order dismissing class claims alleging violations of California’s Fair Employment and Housing Act and Unfair Competition Act. Sandquist v. Lebo Automotive, Inc., No. B244412 (Cal. Ct. App. July 22, 2014).
Continue Reading Arbitrator, Not Court, Decides Whether Arbitration Agreement Applies to Class Claims, California Court Rules
CA Truck Drivers Entitled to Meal Periods and Rest Breaks
On July 9, 2014, a Ninth U.S. Circuit Court of Appeals ruled that California truck drivers are entitled to meal breaks and rest periods under California state law despite federal deregulation of the trucking industry. Prior to the Court of Appeals ruling in Dilts v. Penske Logistics, Inc. (July 9, 2014), several federal judges in
Arbitrator, Not Court, Decides Arbitration Agreement’s Enforceability, California Court Holds
A clause delegating to an arbitrator the authority to decide questions of an arbitration agreement’s enforceability was not unconscionable under California law, the California Court of Appeal has ruled. Malone v. Superior Court, No. B253891 (Cal. Ct. App. June 17, 2014). The Court affirmed an order enforcing the delegation clause and compelling arbitration. Significantly,
Protected Speech Does Not Include Extortion, California Appellate Court Rules
Be cautious with the employee who “doth protest too much.” The law protects whistleblowers. Employers must be careful to avoid retaliating against employees who report good faith concerns, even when such concerns prove meritless. But this does not leave employees free to blackmail employers by threatening to makes claims unless the employer capitulates to settlement demands. In Stenehjem v. Sareen, a California Court of Appeal allowed an employer to pursue a counter-claim for extortion where its employee allegedly sent an email threatening to report it to the U.S. Attorney and file a federal False Claims Act action unless it settled the employee’s defamation lawsuit. The Court also rejected the employee’s claim that his threat constituted protected speech under California’s anti-SLAPP statute. While Stenehjem presents a welcome development for California employers, its core allegations do not arise often. Employers should thus review situations closely with counsel before leaping to the conclusion that an employee’s “threat” to report concerns amounts to extortion.
Continue Reading Protected Speech Does Not Include Extortion, California Appellate Court Rules
The “Dog Ate My Affirmative Action Plan” and Other Bad Excuses for Not Getting the Job Done
In a welcome common sense decision, the California Court of Appeal in Serri v. Santa Clara University affirmed summary judgment granted to Santa Clara University against its former Director of Affirmative Action.
Why? Because as the University’s Director of Affirmative Action, she failed to file the University’s Affirmative Action Plan (AAP) for three years in
Employer Did Not Waive Right to Arbitration Despite One-Year Delay, California Court Rules
An employer that petitioned to compel arbitration one year after the employee filed his employment-related complaint did not waive its right to arbitrate the complaint, the California Court of Appeal has ruled, confirming the burden of proving a party waived its right to arbitration is a heavy one. Gloster v. Sonic Automotive, Inc., No.