Caietti Law Group News Feed Jan 2020 00:00:00 -0800firmwise California Law Bans Secret Sex Harassment Settlements Dec 2018 | Blog<p>On its face, a new California law banning settlements that shield those accused in a lawsuit of sexual harassment, misconduct or discrimination would seem to be a good thing. After all, the argument goes, fewer individuals would likely be victimized if the harassers who have settled legal claims weren&rsquo;t protected by agreements that prevent the allegations from becoming public. Such confidentiality has been a hallmark of these settlements.</p> <p>The new law prohibits provisions in settlement agreements that prevent the &ldquo;disclosure of factual information related to a claim filed in a civil action or a complaint filed in an administrative action&rdquo; regarding:</p> <ul> <li>An act of sexual assault that is not governed by subdivision (a) of Section 1002;</li> <li>An act of sexual harassment as defined in Section 51.9 of the Civil Code;</li> <li>An act of workplace harassment or discrimination based on sex;</li> <li>The failure to prevent an act of workplace harassment or discrimination based on sex; or</li> <li>An act of retaliation against a person for reporting harassment or discrimination based on sex.</li> </ul> <p>While a victim could choose to keep his or her name private, as well as the value of the settlement, the perpetrator&rsquo;s identity cannot be kept confidential. Additionally, courts will no longer be able to restrict the disclosure of such facts in relevant civil proceedings.</p> <p>This is a well-intentioned law, but it remains to be seen it if will actually help victims of sexual harassment who file claims, or change workplace behavior. There is concern that the new law will make it more difficult for plaintiffs to receive beneficial settlements, as it makes it more attractive for companies to vigorously contest claims they might have previously been inclined to settle. Accused employees who will now face public shame if they settle may insist on extensive litigation to clear their names.</p> <p>Such disclosures may have a larger cumulative affect of curbing sexual harassment in the long run, but they add a new wrinkle to settling individual cases in the short term.</p> Are Sometimes Unlikeable People. But Don't Ignore Their Claims Dec 2018 | Blog<p>It shouldn&rsquo;t come as a surprise that a vast number of whistleblowers report some kind of retaliation. Some studies show that as many as 82% of whistleblowers report some kind of backlash. It&rsquo;s a stressful role to assume, and upsets everyone&rsquo;s apple cart, even those with no connection to the alleged wrongdoing. Additionally, there is research that shows that whistleblowers can be outspoken, strong willed, even rigid individuals with high moral standards, which can be off-putting, and sometimes with personalities that seem to naturally incite some level of animus among their co-workers. They don&rsquo;t tend to be &ldquo;go-along-to-get-along&rdquo; people, or are described as &ldquo;team players.&rdquo; Many could easily be labeled nonconformists.</p> <p>So it&rsquo;s tempting to want to discount their claims. They might complain about a lot of things at work, even minor items, such as conditions in the break room, or amorphous elements, such as not having ample resources to do their job when the supply of staples evaporates. But these elements will not be important to a jury, and will in fact prejudice matters against a company that seeks to discount a whistleblower because of their lack of &ldquo;likeability.&rdquo;</p> <p>Like juries, smart employers won&rsquo;t judge a book by its cover. Instead, they will take great pains to use filters to strip away personal judgment and focus on the message the whistleblower carries. Any attempt, especially at trial, to introduce accusations of unlikeability will almost always suffer tremendous backlash, and add credence to claims the whistleblower has suffered prejudice and retaliation.</p> <p>Bottom line: don&rsquo;t blame the messenger. Sometimes, whistleblowers have already been labeled the &ldquo;squeaky wheel&rdquo; of their workplaces. They may in fact play that role, but that doesn&rsquo;t mean that what they are claiming is wrong or incorrect, or should be discounted outright. Once brought into the light, evidence that an employer may have minimized the veracity of whistleblower claims can be as damaging as the claims about the underlying conduct itself. A company may not have full control over the initial alleged wrongdoing, but it does have control over how it responds to a whistleblower. Smart companies take charge and correct matters once they are forced by whistleblowers to act.</p> Battle Labor Over Whether "Dynamex" Should Become State Law Dec 2018 | Blog<p>Employers began organizing against the April 2018 Dynamex decision as soon as the California Supreme Court released the far-reaching, three-prong &ldquo;ABC&rdquo; test. Led by the California Chamber of Commerce and others, employers are lobbying the legislature to limit the reach of the decision and revert to the multifactor <i>Borello</i> test, in place before <i>Dynamex</i>, which was considered more advantageous to employers.</p> <p>When the legislature reconvened in early December, though, it was labor that was first out of the gate with a bill introduced by Lorena Gonzalez (D-San Diego), AB 5, to codify <i>Dynamex</i> and &ldquo;clarify the decision&rsquo;s application in state law.&rdquo;</p> <p>However you come down on employee v. independent contractor classification, or where you stand on AB 5, it makes sense to address the issue head on in the legislature, rather than piecemeal in the courts. In the meantime, employers need to be extremely cautious on how they classify contractors versus employees. A safe bet is to assume that the ABC test in <i>Dynamex</i> will apply to all employer/employee relationships, not just wage and hour issues.</p> <p>To review, under <i>Dynamex</i>, a worker is assumed to be an employee unless the hiring entity can establish:</p> <ol> <li>that the worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;&nbsp;<i>and</i></li> <li>that the worker performs work that is outside the usual course of the hiring entity&rsquo;s business;&nbsp;<i>and</i></li> <li>that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.</li> </ol> <p>Employers may be tempted to stretch these bounds, but the California Employment Development Department investigates aggressively when it audits company practices.</p> <p>If you have questions, or you receive an inquiry from the Employment Development Department, contact employment counsel. Don&rsquo;t assume that Dynamex is in danger.</p> Is it Safe to Discuss Departing Employees? Nov 2018 | Blog<p>The #MeToo movement and efforts to provide greater transparency in hiring and firing decisions has turned the event of a departing executive into a land mine for some companies. Last month, Google&rsquo;s top executives faced a <a href="" target="_blank">testy town hall meeting</a> with employees after it was revealed in the <a href="" target="_blank">New York Times</a> that several key employees who were forced to resign after credible sexual harassment charges were lodged against them left with heaping severance packages and public praise for their performance.</p> <p>While certainly not every termination or departure is clouded, the culture and media focus on sexual harassment and misconduct means that unflattering stories are bound, eventually, to get out. It means that HR and company leadership needs to walk a fine line when it comes to explaining departures, both internally and externally.</p> <p>In the past, companies often allowed the departing employee to control the narrative, usually pegged to something about spending more time with their family, or pursuing other opportunities, and did little more than publically wish them well. Now some are wondering if ethically, it&rsquo;s right to unleash what sometimes are serial violators to blithely continue their conduct at another company. Reference checks that never mention anything negative, and confirm only dates of employment and job titles, which have been de rigueur for years, are part of this pattern.</p> <p>As the pendulum starts to swing and employers begin to rethink these traditions, a few CEOs have adopted what can only be termed as &ldquo;radical transparency.&rdquo; At Basecamp, a Chicago-based company that provides cloud-based project management tools, all departing employees get the chance to send a farewell email (though the content is pre-approved by the company). Then, several days later, management sends out an email to the entire company, <a href="" target="_blank">detailing why the employee left</a>. The founder and CEO determined that radical honesty was better than a vacuum soon filled with rumors, which can cause employees to worry about the stability of their own positions. At Basecamp, it&rsquo;s apparently working, as their employees tend to stay with the company longer than average for their industry.</p> <p>Employers are not prohibited from telling others that you were terminated, laid off, or let go, providing they are truthful. They can even share the reasons that led to the termination. However, if an employer falsely states that the employee was fired or cites an incorrect reason for termination that is damaging to his or her reputation, an employee can sue for defamation. While these cases rarely succeed, they do sometimes, which should stand as a caution for employers to seek counsel when they are tempted to share more than confirmation that an individual has left the company. Whether or not the departure is negotiated, or done summarily, it makes sense to include legal counsel in the decision-making process, including what information to share about the process.</p>'t Cut Corners When Hiring Seasonal Workers Nov 2018 | Blog<p>Employers of all stripes hire temporary workers, but the holidays put additional pressure on various industries, including retail, travel, and hospitality. It can be a challenge to staff up quickly to meet demand, especially when some employers more than double their workforce to serve consumers. It&rsquo;s important to remember that state laws cover these temporary hires. They need to be properly screened, hired and on-boarded to avoid legal trouble down the road. And it&rsquo;s vital, following the <i>Dynamex </i>decision, to know whether the extra help is a contractor or should really be classified as a temporary employee.</p> <p>HR departments should have a temporary employee onboarding plan long before the holiday crush hits. They must also be aware of some city laws in California that require that extra available hours be offered to existing employees before they are contracted out or given to a temporary employee. It can make sense to work with an employment or staffing agency, but know that using one does not fully absolve an employer or completely shift liability for proper screening and background checks. Also, managers need to understand the scope of work the agency contract permits seasonal workers to perform. Employers with union workers need to be especially careful.</p> <p>It&rsquo;s not always possible to offer a full on-boarding process to temporary workers, such as training on sexual harassment prevention, but training should cover meal and rest breaks and safety issues, such as proper lifting techniques for temporary stock room employees. Some temporary employees may have previously worked for companies with less-than-stellar employment or workplace practices. Employers should not assume that employees know what is expected of them in this regard, and should take the time to be explicit in explaining that meal and rest breaks, for example, need to be taken on time. Likewise, make sure hours are properly recorded, and that everyone understands the proper use of overtime hours.</p> <p>Smart employers will condense the essentials of their employee handbook into a one- or two-page &ldquo;cheat sheet&rdquo; for temporary employees. It also makes sense to ensure that relevant signage about employee conduct and employer obligations are current in all break rooms.</p> <p>Know that while temporary employees are not entitled to benefits, they are entitled to a workplace free from discrimination and harassment. Treat temporary employees with all the respect you would give any team member, and instruct your wider workforce to do so as well.&nbsp;</p> Workplace Injuries Requires a Gentle Touch Nov 2018 | Blog<p>Under federal law, employers cannot deter proper reporting or retaliate against employees for reporting&nbsp;a workplace injury or illness.&nbsp;It may be tempting to want to rule out drug or alcohol use after a workplace injury, and mandate that an employee undergo testing. But doing so can be seen by regulators as a discouragement to employees to report injuries, and therefore as a form of harassment.</p> <p>Over the last several years, OSHA has issued guidance explaining that certain safety incentive programs and blanket post-accident drug tests would likely deter reporting and would therefore violate the retaliation rules. As a result, employers should limit post-accident drug tests to situations where drug use likely contributed to the incident and for which a drug test can accurately show impairment caused by drug use. Common sense says that there must be a reasonable possibility that drug use was a causal factor in the incident.</p> <p>This points out the importance of having defined drug testing policies and procedures that are properly communicated to employees, and are applied without malice, discrimination or harassment. Random drug testing should be avoided, except for very safety-sensitive positions (think aviation, transportation, and certain government contractors, such as those who do work for NASA or the Department of Defense).</p> <p>California law allows an employer to require a &quot;suspicionless&quot; drug test as a condition of employment after a job offer is tendered but before the employee goes on the payroll. California is one of the few states that define a right to privacy in the state constitution, which could be implicated via drug testing (though that doesn&rsquo;t make it per se illegal).</p> <p>Drug-testing policies should be approved by legal counsel, and rigidly adhered to. Any temptation to deviate from standard policy should be run by employment counsel. To sum up, pre-employment drug testing (once the candidate has been offered the position) is legal, as long as it is applied uniformly, for example, when it comes to age or race. An employer can decide that certain positions, such as those in which the employee has access to company coffers or proprietary data, merit pre-employment drug testing, while others, such as social media coordinator, do not. The courts frown upon random drug testing, except where safety is a critical issue. Post-accident drug testing should be done with caution, and typically only after conferring with counsel.</p> Wins Millions After Firing Over Criminal Charges That Were Dismissed Oct 2018 | Blog<p>A San Diego Allstate agent who had worked for the company for 30 years was fired after he was arrested on domestic violence charges. This summer, he won more than $18 million from a jury, nearly $16 million of it in punitive damages. The case highlights a sensitive area for employers: dealing with allegations of criminal conduct that have yet to be substantiated.</p> <p>In this case, however, the facts for the employer were even worse. Following an argument with his girlfriend, the agent was arrested and charged with possession of marijuana and two domestic violence counts. Two charges were dismissed in 2015, and a third domestic violence charge was dismissed after the agent attended an anger management course, as part of a plea agreement.</p> <p>Allstate investigated in February 2016, and found no violation of company policy. But in March 2016, after the agent&rsquo;s ex-girlfriend complained to company management, the company investigated again, and fired him several months later, saying that they conduct that led to his taking the anger-management class was a violation of company policy.</p> <p>There are several lessons here.</p> <ol> <li><b>Separate the PR issues from the legal issues. </b>As we know the facts, the company investigated once and found no violation of company policy. Then, when the agent&rsquo;s girlfriend complained in an emotional email to the Allstate CEO, the company changed its mind and fired the agent. The company seems to have reacted to the possibility of negative publicity, rather than a change in the status of any charges, which by that point had been dismissed.</li> <li><b>Document all employment decisions thoroughly.</b> If a company is going to review and reconsider a past decision, all actions must be thoroughly documented. Any change in a decision will be suspect and subject to intense scrutiny. If matters are to be re-opened, everyone needs to tread carefully.</li> <li><b>Understand California Labor Code section 432.</b>7. California Labor Code section 432.7 prohibits an employer from asking an applicant or employee to disclose information concerning an arrest or detention that did not result in conviction, or information concerning a referral to, and participation in, any pretrial or post-trial diversion program expressly authorized and described by statute. These types of &ldquo;ban-the-box&rdquo; laws are relatively new, and may require specific legal advice to help companies successfully navigate these new employee protections. Always seek legal counsel when these issues arise.</li> </ol> <p>Dealing with any assault charges, but especially with domestic violence allegations, need to be handled carefully by all employers. The size of this verdict is an indication of how juries will react when they feel that workers have been treated unfairly.&nbsp;</p> Day is Not a Holiday, But State Law Requires Time Off for Voting Oct 2018 | Blog<p>The November 6, 2018, mid-term elections are approaching, and that means an important deadline is creeping up on California employers. Under state law, employers must post a notice to employees 10 days before an election advising them of provisions for taking paid leave for the purpose of voting in statewide elections, under California Elections Code section 14001.</p> <p>A majority of U.S. states have time-off-to-vote laws, also known as voter-leave laws. These laws vary by state; employers with multiple locations should make sure each workplace complies with respective state laws. Noncompliance can result in civil and criminal penalties.</p> <p>In California, state law provides that employees are eligible for paid time off for the purpose of voting only if they do not have sufficient time outside of working hours to vote. The intent of the law is to provide an opportunity to vote to workers who would not be able to do so because of their jobs. Polls in California are open from 7:00 a.m. to 8:00 p.m. But given the excessive hours that some California workers must commute, it is not unreasonable to think that it could be difficult to access the polls on Election Day without cutting into the workday.</p> <p>Employees can be given as much time as they need in order to vote, but under California law only a maximum of two hours is paid. Additionally, employers may require employees to give advance notice that they will need additional time off for voting. Employers may also require time off to be taken only at the beginning or end of the employee's shift.</p> <p>Employers can find copies of the notice <a href="" target="_blank">here</a>, in English as well as nine other languages.</p> <p>Some employers go &ldquo;all out&rdquo; in encouraging their employees to participate in elections. Patagonia, the outdoor apparel retailer headquartered in Ventura, CA, will close all of its retail stores on Election Day to encourage voter participation. Other large employers, including General Motors and Ford Motor Co., have in past years given its workforce a paid holiday on Election Day in order to encourage civic participation.</p> <p>Employers with questions about their obligations under various state voting laws should consult labor and employment counsel.</p> Reports Increase in Sexual Harassment Complaints and Enforcement Actions Oct 2018 | Blog<p>The Equal Employment Opportunity Commission, or EEOC, has reported an uptick in enforcement as it responds to #MeToo complaints of unlawful harassment in the workplace. The numbers are large enough that employers should take notice.</p> <p>According to data released Oct. 4, 2018, the EEOC filed 66 harassment lawsuits, including 41 that included allegations of sexual harassment. That reflects a more than 50% increase in suits challenging sexual harassment over fiscal year 2017. Additionally, charges filed with the EEOC alleging sexual harassment increased by more than 12% over the same time period.</p> <p>Those figures may not sound high, but the dollar amounts associated with them certainly are. In the last year, the EEOC recovered nearly $70 million for victims of sexual harassment, through litigation and administrative enforcement in FY 2018, up from $47.5 million just a year earlier.</p> <p>Despite widespread publicity, education campaigns, and mandatory workplace training, complaints continue to pour in to authorities against blue-collar and white-collar employees alike. Some, like a recent complaint filed with the EEOC against Ernst &amp; Young, a Big 4 accounting firm, contain allegations of clearly illegal conduct, such as commenting on women&rsquo;s breasts and holding business meetings with clients at strip clubs.</p> <p>While many employers have clauses in their employment contracts mandating that such complaints are handled through arbitration rather than litigation, employees are beginning to challenge those agreements and are bringing their complaints in public. There is also a move in some state legislatures to try to ban secret settlements when the underlying allegations assert sexual assault or harassment. Both of these trends place increased pressure on employers.</p> <p>The bottom line for employers: assume that any dirty laundry will be exposed, and take action now, before claims are filed or government officials are forced to act. Don&rsquo;t wait for matters to explode before you contact labor and employment counsel. There are ways to resolve matters before claims are filed. Few plaintiffs welcome the publicity their allegations will entail. This is by far the most sound course of action.</p> With Multiple Locations Need to Carefully Track Minimum Wages Sep 2018 | Blog<p>As of July 1, the minimum wage in 10 California cities, as well as Los Angeles County, increased. These include Belmont, Berkeley, Emeryville, Los Angeles, Malibu, Milpitas, Pasadena, San Francisco, San Leandro and Santa Monica. In most cities, employers with 25 or fewer employees pay a slightly lower minimum wage than those with 26 or more employees. In San Francisco, there is a lower minimum wage for a small group of workers classified as &ldquo;government-supported employees.&rdquo; The federal minimum wage is $7.25 per hour, though the federal government allows businesses to pay some workers with certain disabilities in certain jobs a sub-minimum wage.</p> <p>Additionally, there are different minimum wages for those in the service industry who earn tips. Currently, the federal minimum wage for those who earn at least $30 in tips per month is $2.13 an hour.</p> <p>But that may soon be changing. This month, the U.S. 9th Circuit Court of Appeals ruled that restaurant servers and bartenders must be paid full minimum wage for any time spent on duties for which they cannot earn tips, for example, cleaning or washing dishes after guests have left for the night. This adds a wrinkle for the hospitality industry, which will have to retool its timekeeping.</p> <p>The ruling is an important reminder that it is essential that employers stay current in their pay practices. State regulators come down hard on employers who try to skirt the law, and see it as their duty to protect easily exploited, low-wage workers. And it creates terrible PR for companies. With revenues in excess of $10 billion, Major League Baseball is currently fighting a suit brought by minor league players who allege that their pay, which can be as low as $1,300 a month, does not meet minimum wage standards. Earlier this year, the huge federal omnibus spending bill included wording that exempted minor league ball players from both minimum wage and overtime pay requirements. Yet the lawsuit continues.</p> <p>Even the smallest companies need to ensure they are working with the proper legal pay schemes and properly paying minimum wage in the jurisdictions in which they operate, especially if they are in multiple locations. It is too easy for disgruntled employees to complain to regulators, who will respond swiftly. The consequences are serious. Not only will employees win back wages, but they can also collect penalties from employers, as well as attorneys&rsquo; fees and court costs. Remain proactive to avoid problems.</p>