Labor and Employment

By Jessica Schoendienst

The California Department of Industrial Relations (DIR) updated all but Wage Order 14 and 17 recently.  The DIR regulates wages and hours for employees.  The Division of Labor Standards Enforcement (DLSE) enforces the provisions of the wage orders, including the posting requirements.  The Wage Orders are numbered 1 through 17.

The most recent updates were made to reflect the increases in California’s minimum wage.  (To read more on the minimum wage increase, visit my prior L&E Blog here.)  The update shows the minimum wage for 2017 and 2018 as follows:

Effective Date          26 or More Employees         25 or Fewer Employees

January 1, 2017                        $10.50                                               $10.00

January 1, 2018                        $11.00                                               $10.50

Employers are required to post a copy of the applicable Wage Order in an area frequented by employees, such as a breakroom or your employee entrance.  The Wage Orders must be printed on 8.5″ x 11″ paper.  If you are unable to post the Wage Order because of the work location or other conditions, you should inform employees that they may request a copy of the Wage Order from you.  While the Wage Order does not specify what penalties can be imposed for failure to comply with the posting requirements, it is likely Private Attorney General Act (PAGA) penalties could be recovered by employees and/or the DLSE for noncompliance.  PAGA’s default penalty provision under Labor Code section 2699(f) permits the recovery of a penalty of $100 per employee for initial violations, and subsequent penalties in the amount of $200 per employee per pay period. The updated version of the Wage Orders contains a revision date of “12/2016.”  Employers can find this date on the cover page for each Wage Order.

Given that there are 17 different Wage Orders it may be unclear as to which Wage Order each employer must post.  The DLSE has published a pamphlet to help guide employers in determining which Wage Order must be posted.  This pamphlet can be found here.

Electronic versions of the Wage Orders for posting can be obtained from the DIR Industrial Welfare Commission Wage Order webpage here.  Printed versions of the Wage Orders can be obtained by contacting a local DLSE district office.  A listing of these offices can be found here.

If you have questions about these revisions or which Wage Order applies to you, the attorneys in Weintraub Tobin’s Employment Law Group can assist you.  Contact any one of us if we can be of assistance.

Imagine this: Your business lies within a zone that is subject to a mandatory evacuation order from emergency response and law enforcement officials.  Imagine that the evacuation order arises from a fire or imminent flooding.  What do you do?  Shut your business and get out of course.  Most evacuation orders are short lived and the hazardous conditions are realized or not within a short period of time.  But what happens when the evacuation order persists for a number of days or even weeks?  Your plant operations or business remains shut down.  You may have compelling business interests that demand attention during an extended evacuation order.  You may need to respond to security alarms and alerts, or ensure that the premises are adequately secured.  There may be a fear of product spoliation or destruction, and you may face a serious temptation to send a minimal or skeleton crew into the area covered by the evacuation order in order to ensure that those business concerns are addressed.

Lawyers are trained to look at scenarios like this in reverse.  The employer sends a skeleton crew in to secure the premises or ensure that essential processes are completed or that products do not spoil. Something bad then happens.  The wildfire burns down the surrounding area or the flood arrives and employees are injured.  Now what?

To read the full article, visit the HRUSA blog at http://blog.hrusa.com/blog/managing-your-business-under-mandatory-evacuation/

Introduction

For the first time, a federal appellate court has determined that discrimination on the basis of sexual orientation is a form of sex discrimination under Title VII of the Civil Rights Act of 1964 (“Title VII”). Under Title VII, an employer may not take an adverse employment action against an employee on the basis of a protected characteristic, such as race, color, religion, national origin, or sex. On April 4, 2017, the full panel of the U.S. Court of Appeals for the Seventh Circuit held in Hively v. Ivy Tech Community College of Indiana that sexual orientation is a protected class that may be used as a basis to bring a discrimination or retaliation suit under Title VII.

Read the case discussion on the HRUSA blog here: http://blog.hrusa.com/blog/federal-court-prohibits-sexual-orientation-discrimination/.

Intentional torts committed by employees are difficult for employers to both anticipate and protect against. When an employee commits a criminal act against another employee or a third party, the law generally considers whether the employer knew or should have known that the employee posed a danger in deciding whether a duty to protect against the harm was owed. However, an employee’s dangerous propensity is often difficult to predict.  Employees rarely make overt criminal threats or give unambiguous indications that they intend to cause harm. Further, employers are judged in retrospect, and with the benefit of hindsight, in deciding whether seemingly innocuous comments or acts should have been taken as warning signs that the employee posed a danger.

CASE DISCUSSION

On March 24, 2017, in Anicich v. Home Depot U.S.A., the Seventh Circuit extended the duty of Illinois employers to protect against criminal acts by an employee occurring away from the workplace, when a supervisor uses his or her “supervisory authority” to compel an employee to attend a private event under the threat of termination or job reduction.  The case arose out of a supervisor’s rape and murder of a subordinate employee during a trip to attend a family wedding in a different state, when the supervisor had previously threatened to either fire or reduce the employee’s hours if she did not attend.

To read the rest of the article, visit the HRUSA Law Blog at: http://blog.hrusa.com/blog/employers-may-be-liable-for-violence-away-from-work/.

As the national controversy continues to swirl around immigration issues, a federal appellate court this week faulted an employer for demanding that an employee provide information to prove “‘legal right to work in the United States … as required by the Immigration Control and Reform Act of 1986.’”  The U.S. Circuit Court of Appeals for the Ninth Circuit (“Ninth Circuit”) ruled in Santillan v. USA Waste of California, Inc., Case No. No. 15-55238, that Gilberto Santillan — a 53-year-old, Spanish-speaking garbage truck driver — did not have to “provide proof of employment eligibility.”

The appellate court said that was so because Santillan, who had worked for the employer for 32 years, had been fired and then reinstated shortly before his employer required him to provide such proof.  It may come as a surprise to employers to learn that an employee who is fired and then reinstated may not have to prove his or her eligibility to work in the U.S. upon reinstatement, but that is the case under federal law.

By Jessica Schoendienst

Pennsylvania’s Wage Payment and Collection Law requires employers to pay all wages, other than fringe benefits and wage supplements, due employees on regularly scheduled paydays designated in advance by the employer in cash, bank check, or direct deposit. As of May 4, 2017, Pennsylvania employers will have another option to pay employee wages each pay period.

On November 4, 2016, Governor Tom Wolf signed Senate Bill 1265 which amends the banking code to allow employers to use a payroll debit card on which an employer can load an employee’s wages each pay period.  The payroll debit cards work like an ATM card but without the employee needing to have a bank account to access the funds.  The sponsor of the bill introduced this option to provide an option to employees to avoid the costs of check cashing and money orders for those with little or no access to traditional banking.

The amendment allows for employers to use the payroll debit cards with certain restrictions that are intended to ensure that employees have access to the full amount of their wages, with unlimited, no-cost access to their accounts.  Read what these restrictions include at: http://blog.hrusa.com/blog/pennsylvania-employers-can-pay-wages-with-payroll-cards/

Federal law has long prohibited discrimination based on a person’s sex. In recent years, several courts have held that discrimination based on failure to conform to a gender stereotype is a form of prohibited sex-based discrimination. But courts across the country have been more divided about whether those same laws preclude discrimination based on one’s sexual orientation. According to a federal court in Georgia, the answer is no. In a decision handed down on March 10, 2017, the Eleventh Circuit Court of Appeals upheld the dismissal of a former Georgia hospital worker’s claim that she was fired because of her sexual orientation. In Evans v. Georgia Regional Hospital, the court held that Title VII does not cover such claims.

To read the case, please visit the HRUSA Blog at http://blog.hrusa.com/blog/sexual-orientation-discrimination-not-recognized-under-title-vii/.

They say that everything is bigger in Texas.  That now may be true for the risk that an employer’s change to its overtime policies will result in a claim filed by an employee alleging retaliation in violation of the Fair Labor Standards Act (“FLSA”).  That increased risk stems from a ruling by the Texas Court of Appeals for the Fourteenth District in January 2017.  In that case, Tooker v. Alief Independent School District, the appellate court ruled that a change in the employer’s stated overtime policy constituted a materially adverse employment action.

To read the full article, visit the HRUSA Blog at: http://blog.hrusa.com/blog/changing-overtime-policy-may-constitute-retaliation/

For several years, California law has required that whenever an employer hires an employee and “the contemplated method of payment of the employee involves commissions … the contract shall be in writing and shall set forth the method by which the commission shall be computed and paid.

Let me rant a bit. I will say it again. Any written commission agreement must simply and clearly express the terms of the commission. It is a long established rule in California that ambiguities in employer drafted documents will be construed against the employer and in favor of the employee. Chuck-Post-07_web

Because commission plans can serve as an effective means of incentivizing employees to succeed, employers have become expert at creating specific incentives for the specific behaviors. For example, Joe works for XYZ Company. He is great at selling XYZ’s low profit margin products but the company wants to create an incentive for Joe to upsell XYZ’s more profitable products. So, it drills down and creates a commission plan that increases Joe’s earnings if: (1) the company is paid for the order within 10 days of delivery; and (2) provides increasingly higher commissions on a sliding scale based on the size of the employer’s profit. Also included are means for refunds and deductions based upon return of goods or client utilization of post-sale services from XYZ. The employer also makes clear that no commission is earned until payment is received and that the commissions are only due and payable when funds are received while the employee is still employed by the company.

A first draft of the commission plan reflecting all these details can look like a physics equation or something written in Sanskrit. The fact that you or your employee understands the commission arrangement at the time it is written is less important than it probably should be. A commission plan is a contract and the terms of that contract will be construed and understood by a later court by the same rules as any other contract. If any word or phrase can be interpreted in two legitimate way, the interpretation more favorable to the employee will almost certainly be used. This can be an expensive lesson to learn.

Takeaways?

• Ensure all commission plans are in writing, signed by the worker.
• Use clarifying examples to demonstrate how particular abstract terms within a commission plan will actually be applied.
• Expressly state when the commission is “earned” and when earned commissions shall be paid. Clearly state when commissions top accruing or being earned (upon termination of employment, for example).
• Have the commission arrangement reviewed by strangers to your business. If you find yourself defending the instrument in court, neither the judge nor jury is likely to be experienced with the way your business operates.

By Michelle Covington

Over the past several years, many municipalities have taken labor and employment matters into their own hands, passing local laws requiring a higher minimum wage or paid sick leave beyond that required by the state or federal government. Florida and Pennsylvania are pushing back on these local laws.

On February 12, 2015, Philadelphia instituted an ordinance requiring employers with 10 or more employees to provide 40 hours of paid sick leave in a calendar year. Less than a year after its implementation, on December 30, 2016, two senators of the Pennsylvania state legislature issued a memorandum announcing their intent to propose a bill that would override municipal laws of this kind. The senators cited concerns of uniformity and the burden on local businesses as their motivation. On January 25, 2017, SB 128 was introduced in the Pennsylvania legislature.

Read what this bill would preclude municipalities from at http://blog.hrusa.com/blog/push-back-on-local-minimum-wage-and-paid-sick-leave/.