Monday, November 24, 2014
Martinez v. Joe’s Crab Shack Holdings: Court Reverses Order Denying Class Certification in Misclassification Action
However, we understand from Brinker, Duran and Ayala that classwide relief remains the preferred method of resolving wage and hour claims, even those in which the facts appear to present difficult issues of proof. By refocusing its analysis on the policies and practices of the employer and the effect those policies and practices have on the putative class, as well as narrowing the class if appropriate, the trial court may in fact find class analysis a more efficient and effective means of resolving plaintiffs’ overtime claim.
Friday, September 26, 2014
Jimenez v. Allstate: District Court Did Not Err in Certifying Off-the-Clock Class Action
The plaintiff satisfied the commonality requirement of Federal Rule 23(a)(2) by identifying common questions, the truth or falsity of which would “resolve an issue that is central to the validity of each claim in one stroke”:
(i) whether class members generally worked overtime without receiving compensation as a result of Defendant’s unofficial policy of discouraging reporting of such overtime, Defendant’s failure to reduce class members’ workload after the reclassification, and Defendant’s policy of treating their pay as salaries for which overtime was an “exception”; (ii) whether Defendant knew or should have known that class members did so; and (iii) whether Defendant stood idly by without compensating class members for such overtime.
These common questions constituted the “glue” necessary to say that “examination of all the class members’ claims for relief will produce a common answer to the crucial question[s]” raised by the plaintiffs’ complaint. Slip op. at 7-11.
The plaintiff could use statistical sampling and representative testimony to prove liability, “so long as the use of these techniques is not expanded into the realm of damages.” The district court “was careful to preserve Allstate’s opportunity to raise any individualized defense it might have at the damages phase of the proceedings” and “preserved the rights of Allstate to present its damages defenses on an individual basis.” As a result, the district court did not err by certifying the class. Slip op. at 11-15.
The opinion is available here.
Thursday, May 29, 2014
Jong v. Kaiser: Plaintiff in Off-the-Clock Overtime Action Failed to Raise Triable Issues on Summary Judgment
Jong knew of Kaiser’s written policy that OPMs should be clocked in whenever they were working;
Kaiser always paid him for time he recorded on Kaiser’s recording system, including overtime hours;
Kaiser instructed him that he was eligible to work and be paid for overtime hours;
There was never an occasion when he requested approval to work overtime that was denied and there were occasions when he worked and was paid overtime even though he did not seek pre-approval;
He was not told by any of his managers or supervisors or any other Kaiser management personnel that he should perform work before he clocked in or after he clocked out or otherwise work off-the-clock;
And he signed the attestation form and understood it was an attestation that he would not work off-the clock.
Slip op. at 7-8.
Monday, April 7, 2014
Martinez v. Joe’s Crab Shack: Court Reverses Certification Denial in Misclassification Class Action
The plaintiffs adequately represented the class because any antagonism to the case voiced by putative class members did not go “to the very subject matter of the litigation” and could be managed by creating subclasses. Slip op. at 10-12.
The plaintiffs’ claims were typical, even though different managers may have spent more or less than 50% of their time engaged in exempt administrative tasks. The trial court erred in focusing too greatly on this potential difference among putative class members and in attempting to resolve factual conflicts in the evidence. Slip op. at 11-12.
Common questions of law and fact predominated, and the trial court erred in failing to find ways to prove the plaintiffs’ claims through the resolution of those common questions. Slip op. at 13-19.
“Rather than engage in a post hoc calculation for each employee of hours worked in excess of the mandated 40-hour work week,” the fact finder should determine common issues, such as whether the employer properly classified the class members as exempt, by examining the employer’s “realistic expectations and classification of tasks.”
Slip op. at 14-15.
Finally, the Court remanded to the trial court to reconsider whether class treatment was a superior method of resolving the plaintiffs’ claims:
[W]e understand from Brinker, supra, 53 Cal.4th 1004, a renewed direction that class-wide relief remains the preferred method of resolving wage and hour claims, even those in which the facts appear to present difficult issues of proof.
Slip op. at 19.
The opinion is available here.
Wednesday, March 5, 2014
Vranish v. Exxon Mobil Corp.: Parties to Qualifying CBA May Alter Labor Code Definition of “Overtime Hours”
Under the CBA, Exxon paid the plaintiffs an overtime premium rate of one and one-half times their regular rate of pay for hours worked over 40 hours in a workweek or over 12 hours in a workday. The CBA provided that overtime would not be paid for hours worked between eight and 12 in a workday, as normally required by Labor Code section 510.
At issue was whether section 510’s definition of “overtime” applies to employees covered by a valid CBA under Labor Code section 514. More specifically, the question was whether the CBA at issue satisfied the fourth requirement of section 514, in that it provided “premium wage rates for all overtime hours worked.”
The Court held that section 510’s definition of “overtime” did not apply, and the CBA provided premium wage rates for overtime hours worked, thus satisfying section 514.
Section 514 does not incorporate expressly the definition of “overtime” provided in section 510. “When there is a valid collective bargaining agreement, employees and employers are free to bargain over not only the rate of overtime pay, but also when overtime pay will begin.” Slip op. at 8. Parties subject to a qualifying CBA may consider all hours over eight in a day to be overtime, or they may agree to a different model, such as considering only hours over 40 in a week.
The opinion is available here.
Tuesday, February 11, 2014
Jones v. Farmers Insurance Exchange: Court Reverses Order Denying Certification of Off-the-Clock Wage and Hour Class Claims
Kwesi Jones worked as an adjuster for Farmers Insurance Exchange (Farmers). He sued, alleging that Farmers should have paid him and his co-workers for “computer sync time” at home before the beginning of their scheduled shifts.
Although the trial court is “afforded great discretion in ruling on class certification” (slip op. at 11-12), the trial court here abused its discretion and applied improper criteria “by focusing on individual issues concerning the right to recover damages rather than evaluating whether the theory of recovery is amenable to class treatment.” Slip op. at 14. Further, “the trial court erred to the extent that its ruling was based on its evaluation of the merits of Plaintiffs’ claim as to the existence of such a uniform policy.” Slip op. at 15.
Plaintiffs’ theory of recovery is that Farmers applied a uniform policy to all putative class members denying them compensation for “computer sync time” work performed at home before the beginning of their scheduled shifts. The existence of such a policy is a factual question that is common to all class members and is amenable to class treatment. Whether such a policy, if it exists, deprives employees of compensation for work for which they are entitled to compensation is a legal question that is common to all class members and is amenable to class treatment.
Slip op. at 13. Farmers disputed that it had such a policy, but this argument raised a “common question amenable to class treatment.” Slip op. at 13. Farmers’ other evidence went to damages, which did not defeat certification. Slip op. at 13-14. Further, “Farmers’s liability depends on the existence of such a uniform policy and its overall impact on its APD claims representatives, rather than individual damages determinations.” Slip op. at 15.
Because of the predominance of common issues, class certification would “provide substantial benefits to the litigants and the courts,” and a class action would be a superior method of resolving the dispute. Slip op. at 15.
Substantial evidence supported the trial court’s finding that Mr. Jones was not an adequate class representative because he did not file a declaration stating that he understood his fiduciary obligation to the class. Slip op. at 17. However, rather than deny certification on this basis, the trial court should have given the plaintiffs an opportunity to amend their complaint to name a suitable class representative. Slip op. at 17-18.
The opinion is available here.
Wednesday, November 20, 2013
Mendiola v. CPS Security Solutions: Supreme Court Grants Review of Security Guard Wage and Hour Case Raising On Call and Sleep Time Issues
- Security guards who remain on the work site 16 hours per day during the week (eight hours “on duty” and eight hours “on call”) and 24 hours per day on the weekends (16 hours “on duty” and eight hours “on call”) must be compensated for their “on call” time; but
- The employer could deduct up to eight hours of regularly scheduled “sleep time” when the trailer guards worked 24 hour shifts because the employer and trailer guard employees had entered into an agreement to exclude eight hours of sleep time from the guards’ compensable time.
The California Supreme Court granted review on 10/16/13. Mendiola is Case No. S212704, and the Court’s web page for it is here.
Tuesday, November 5, 2013
Benton v. Telecom Network Specialists: Court Reverses Order Denying Meal, Rest, and Overtime Certification
Tuesday, September 24, 2013
Governor Signs Bill Providing Overtime Compensation to Domestic Workers
Friday, July 12, 2013
Ayala v. Antelope Valley Newspapers: Supreme Court Orders Supplemental Briefing on Martinez v. Combs
On January 30, the Supreme Court granted the defendant’s petition for review. Case No. S206874. And on June 26, the Court ordered the parties to submit letter briefs:
discussing the relevance of Martinez v. Combs (2010) 49 Cal.4th 35, 52-57, 73, and IWC wage order No. 1-2001, subdivision 2(D)-(F) (Cal. Code Regs., tit. 8, § 11010, subd. 2(D)-(F)), to the issues in this case. (See also Sotelo v. Medianews Group, Inc. (2012) 207 Cal.App.4th 639, 660-662; Bradley v. Networkers Internat., LLC (2012) 211 Cal.App.4th 1129, 1146-1147.)
Bradley (discussed here) reversed a trial court order denying certification, holding that common evidence would be used to determine whether the class members were independent contractors or employees, whether the trial court ultimately used the standard enunciated in Borello or the one in Martinez.
Thursday, July 11, 2013
Mendiola v. CPS Security Solutions: Court Of Appeal Issues Mixed Ruling Re. On Call Time and Sleep Time In Security Guard Action
The plaintiffs worked as security guards for CPS, which provides security guard services at construction sites. CPS designates some of its guards as “trailer guards,” who remain on the work site in residential trailers 16 hours per day during the week (eight hours “on duty” and eight hours “on call”) and 24 hours per day on the weekends (16 hours “on duty” and eight hours “on call”). During the nighttime on call periods, CPS generally compensates the guards only for time spent actively conducting investigations.
The plaintiffs filed a putative class action, and the trial court granted certification. The court then granted the guards’ motion for summary adjudication and motion for a preliminary injunction requiring CPS to compensate them for all on call time spent on the premises. CPS appealed, and the Court affirmed in part and reversed in part.
By their presence on site during the on-call hours, the guards perform an important function for their employer and its clients: they deter theft and vandalism. CPS promises its clients security services throughout the night and for 24 hours on Saturday and Sunday, and would be in breach if no security guards were present between 9:00 p.m. and 5:00 a.m. The parties’ On-Call Agreements designate that period as “free time,” but it is clear from the Agreements and the stipulated facts that trailer guards are not free to leave at will. A guard may leave only when and if a reliever is available. From this, it can reasonably be said that the restrictions on the on-call time are “primarily directed toward the fulfillment of the employer’s requirements,” and the guards are “substantially restricted” in their ability to engage in private pursuits.
While that wage order contained a specific provision permitting an employer and employee to agree in writing to exclude sleep time from compensation, neither court relied on the provision to exclude the eight hours of sleep time. Instead, both courts looked to the wage order’s definition of “hours worked” and found it comparable to the federal definition.
Thursday, June 13, 2013
Negri v. Koning & Associates: Pay Based On Number of Hours Worked Is Not A “Salary” For Overtime Exemption Purposes
A salary is generally understood to be a fixed rate of pay as distinguished from an hourly wage. Thus, use of the word “salary” implies that an exempt employee’s pay must be something other than an hourly wage.
Since federal law requires that, in order to meet the salary basis test for exemption the employee would have to be paid a predetermined amount that is not subject to reduction based upon the number of hours worked, state law requirements must be at least as protective.
Tuesday, June 4, 2013
Leyva v. Medline Industries: Ninth Circuit Holds that Individual Damage Calculations Do Not Defeat Certification
The district court applied the wrong legal standard by concluding that individual questions predominate over common questions. The only individualized factor that the district court identified was the amount of pay owed. “In this circuit, however, damage calculations alone cannot defeat certification.”
In light of the small size of the putative class members’ potential individual monetary recovery, class certification may be the only feasible means for them to adjudicate their claims.
Slip op. at 9-11.
The opinion is available here.
Tuesday, May 28, 2013
Heyen v. Safeway: Court Affirms Judgment for Employee In Individual Wage and Hour Action
Linda Heyen worked for Safeway as an assistant store manager. In 2006, she was added as a named plaintiff in an existing putative class action as against Safeway. The plaintiffs alleged that Safeway should have treated them and other assistant store managers as nonexempt employees. The trial court denied their motion for class certification in 2008, and Heyen’s individual action went to trial in 2009. An advisory jury and the trial court found that Safeway improperly classified her, and the court entered judgment in her favor. The Court of Appeal affirmed, holding:
The trial court did not apply an incorrect legal standard to determine that Heyen was a nonexempt employee. Slip op. at 24-37. It properly found that time during which Heyen was performing both exempt and nonexempt tasks — for example, when she was both running a cash register and simultaneously managing the front end of the store, including instructing and coaching other employees — should count as nonexempt time for purposes of determining whether she was “primarily engaged in duties which meet the test of the exemption.” The Court drew four general principles from the Wage Order and the federal regulations incorporated therein:
First, work of the same kind performed by a supervisor’s nonexempt employees generally is “nonexempt,” even when that work is performed by the supervisor. If such work takes up a large part of a supervisor’s time, the supervisor likely is a “nonexempt” employee. (§§ 541.108(g), 541.111(b), 541.115(b).)
Second, the regulations do not recognize “hybrid” activities—i.e., activities that have both “exempt” and “nonexempt” aspects. Rather, the regulations require that each discrete task be separately classified as either “exempt” or “nonexempt.” (§§ 541.102(a), 541.108(a)-(g).)
Third, identical tasks may be “exempt” or “nonexempt” based on the purpose they serve within the organization or department. Understanding the manager’s purpose in engaging in such tasks, or a task’s role in the work of the organization, is critical to the task’s proper categorization. A task performed because it is “helpful in supervising the employees or contribute[s] to the smooth functioning of the department” is exempt, even though the identical task performed for a different, nonmanagerial reason would be nonexempt. (§ 541.108(a).)
Finally, in a large retail establishment where the replenishing of stocks of merchandise on the sales floor “is customarily assigned to a nonexempt employee, the performance of such work by the manager or buyer of the department is nonexempt.” (§ 541.108(c).) Similarly, in such a large retail establishment, a manager’s participation in making sales to customers is nonexempt, unless the sales are made for “supervisory training or demonstration purposes.” (§ 541.108(e).)
If a party claims that an employee is engaged in concurrent performance of an exempt and non-exempt work, you must consider that time to be either an exempt or a non-exempt activity depending on the primary purpose for which the employee undertook the activity at that time. The nature of the activity can change from time to time.
Slip op. at 35. The trier of fact must determine the “objective purpose” of the employee’s actions. “If such actions were taken to ‘supervis[e] the employees or contribute to the smooth functioning of the department,’ they were ‘exempt work’; if they were taken for some other reason, they were ‘nonexempt work.’” Slip op. at 37.
Friday, May 17, 2013
Dan’s City Used Cars, Inc., v. Pelkey: SCOTUS Issues FAAAA Preemption Decision
Pelkey’s state-law claims escape preemption because they are “related to” neither the “transportation of property” nor the “service” of a motor carrier. Although §14501(c)(1) otherwise tracks the ADA’s air-carrier preemption provision, the FAAAA formulation’s one conspicuous alteration— addition of the words “with respect to the transportation of property”— significantly limits the FAAAA’s preemptive scope. It is not sufficient for a state law to relate to the “price, route, or service” of a motor carrier in any capacity; the law must also concern a motor carrier’s “transportation of property.” Title 49 defines “transportation,” in relevant part, as “services related to th[e] movement” of property, “including arranging for . . . storage [and] handling.” §13102(23)(B). Pelkey’s Consumer Protection Act and negligence claims are not “related to th[e] movement” of his car. Chapter 262 regulates the disposal of vehicles once their transportation— here, by towing—has ended. Pelkey seeks redress only for conduct occurring after the car ceased moving and was stored. Dan’s City maintains that because §13102(23)(B)’s definition of “transportation” includes “storage” and “handling,” Pelkey’s claims fall within §14501(c)(1)’s preemptive ambit. But “storage” and “handling” fit within §13102(23)(B)’s definition only when those services “relat[e] to th[e] movement” of property. Thus temporary storage of an item in transit en route to its final destination qualifies as “transportation,” but permanent storage does not. Here, no storage occurred in the course of transporting Pelkey’s vehicle.
Pelkey’s claims are also unrelated to a “service” a motor carrier renders its customers. The transportation service Dan’s City provided — removal of Pelkey’s car from his landlord’s parking lot — did involve the movement of property, but that service ended months before the conduct on which Pelkey’s claims are based. Because chapter 262, on which Pelkey relies, addresses “storage compan[ies]” and “garage owner[s] or keeper[s],” not transportation activities, it has neither a direct nor an indirect connection to transportation services a motor carrier offers its customers.
The conclusion that state-law claims regarding disposal of towed vehicles are not preempted is in full accord with Congress’ purpose in enacting §14501(c)(1), which was to displace “a State’s direct substitution of its own governmental commands for ‘competitive market forces’ in determining . . . the services that motor carriers will provide.” Id., at 372. The New Hampshire prescriptions Pelkey invokes hardly constrain participation in interstate commerce by requiring a motor carrier to offer services not available in the market. Nor do they “freez[e] into place services that carriers might prefer to discontinue in the future.”
Wednesday, May 1, 2013
Guerrero v. Superior Court: Court of Appeal Reverses Order Sustaining Demurrer on Joint Employment Issues
The trial court sustained without leave to amend the demurrer of the County and the Authority. The Court of Appeal reversed, holding:
Although providing IHSS-funded care does not constitute employment for all purposes, the County and the Authority were Guerrero’s joint employers for FLSA purposes because: (1) “their power over the employment relationship by virtue of their control over the purse strings was substantial”; (2) her wages were determined and paid by the state and its agents, the County and the Authority; (3) the County and the Authority maintained employment records on Guerrero; and (4) the County had an inherent role in in supervising the provision of services by IHSS providers such as Guerrero. Slip op. at 12-30. The Court relied heavily on Bonnette v. California Health and Welfare Agency (9th Cir. 1983) 704 F.2d 1465 (state and counties were employers under California’s IHSS program) and distinguished Moreau v. Air France (9th Cir. 2003) 356 F.3d 942 (airline was not joint employer of service workers hired by outside entities for purposes of FMLA and CFRA).
Because Guerrero alleged that she “performed general household work exceeding twenty percent of her total weekly hours worked,” the trial court erred in sustaining the demurrer on grounds that her job was exempt from FLSA minimum wage and overtime protections pursuant to the domestic service companionship exception. 29 U.S.C. section 213. “Determining whether or not all of the elements of the exemption have been established is a fact-intensive inquiry. The appropriateness of any employee’s classification as exempt must be based on a review of the actual job duties performed by that employee.” Slip op. at 30-34.
The Court rejected the concern that allowing such wage claims on a joint employment basis make the County and the Authority “liable for wages that they have no power to control.”
The IHSS program pays for specified services delivered to qualified recipients up to a maximum number of hours. Where a qualified provider delivers services other than those authorized and covered by the program or for a greater number of hours than authorized and real parties have no knowledge that such is occurring and are realistically unable to inform themselves of such, we agree it would be inappropriate to impute the recipient’s knowledge to real parties so as to require real parties to pay for such services.
However, this was a factual issue not ripe for adjudication on demurrer. Slip op. at 34-36.
The County and the Authority were Guerrero’s employers for purposes of California wage law because: (1) California’s protections cannot be any less protective of employees than federal law; (2) while they did not directly hire, fire or supervise providers, through their “power of the purse” and quality control authority, the County and the Authority had “the ability to prevent recipients and providers from abusing IHSS authorizations both as to the type of services performed and the hours worked.” The trial court thus erred in finding that they did not suffer or permit Guerrero to work and were not her employers. Slip op. at 36-45.
The opinion is available here.
The County and the Authority just last week filed their petition for review in the California Supreme Court. The Court last year granted review in Patterson v. Domino’s Pizza (discussed here), in which the Court of Appeal held that a franshisor may be liable for a franchisee’s alleged violations of the Fair Employment and Housing Act, but denied review in Aleksick v. 7-Eleven (2012) 205 Cal.App.4th 1176, in which the Court of Appeal held that 7-Eleven is not liable for allegedly failing to pay its franchisees’ employees their earned wages. If I had to wager, I would say that the Court will deny review, particularly because Guerrero arises on the defendants’ demurrer.
Thursday, February 21, 2013
See’s Candy Shops, Inc. v. Superior Court (Silva): Supreme Court Denies Review and Depublication of Time Rounding Case
Tuesday, January 15, 2013
Bradley v. Networkers International: Court of Appeal Modifies Opinion, Denies Rehearing
The Court’s order and modified opinion are available here.
Monday, January 7, 2013
Bradley v. Networkers Int’l: On Remand After Brinker, Court of Appeal Reverses Order Denying Certification of Overtime, Meal Period, Rest Period, and Related Claims
In Bradley v. Networkers International LLC (12/12/12) — Cal.App.4th —, the plaintiffs filed a putative class action for unpaid overtime, meal period, rest period, and related violations, alleging that the defendant improperly classified them as independent contractors and failed to pay overtime compensation, provide meal periods, or authorize and permit rest periods. The trial court denied their motion for class certification, and the Court of Appeal affirmed in an unpublished decision.
On remand after Brinker, the Court of Appeal reversed its prior position, holding that the trial court erred in refusing to certify the class with respect to each of plaintiffs’ claims, except for the off-the-clock claims, which the Court remanded for reconsideration.
The Court first determined that common evidence would be used to determine whether the class members were independent contractors or employees, whether the trial court ultimately used the standards enunciated in S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 or Martinez v. Combs (2010) 49 Cal.4th 35. The Court relied heavily on the fact that the defendant had “consistent companywide policies applicable to all employees regarding work scheduling, payments, and work requirements.” Without deciding the ultimate issue of employment status, the Court held that the evidence relied on by the parties “would be largely uniform throughout the class.”
Second, with regard to the plaintiffs’ meal and rest period claims, the Court noted that the defendant did not have meal or rest period policies in place during the class period and did not know whether the class members took meal or rest periods. “Under Brinker, plaintiffs’ legal challenge to these uniform practices involve common factual and legal issues that are amenable to class treatment.” Accordingly, those claims should have been certified.
Fourth, the Court held that the trial court did not abuse its discretion in refusing to certify off-the-clock claims because there was evidence to show that “the off-the-clock claims arose from individual actions of particular supervisors and the extent of the off-the-clock work varied substantially for each worker and for each job.” Regardless, the Court remanded these claims for reconsideration.
The opinion is available here.
Thursday, December 13, 2012
Brinker Grant-and-Hold Redux: Goodbye Lamps Plus and Chipotle, Hello Bradley (and Brookler, Sort Of)
Brinkley v. Public Storage (Case No. S168806)
Bradley v. Networkers International LLC (Case No. S171257)
Faulkinbury v. Boyd & Associates (Case No. S184995)
Brookler v. Radioshack Corporation (Case No. S186357)
Hernandez v. Chipotle Mexican Grill (Case No. S188755)
Tien v. Tenet Healthcare (Case No. S191756)
Lamps Plus Overtime Cases (Case No. S194064)
Muldrow v. Surrex (Case No. S200557)
Three of the cases were remanded to the Second Appellate District, Division Eight: Lamps Plus Overtime Cases (8/20/12) (discussed here); Hernandez v. Chipotle Mexican Grill, Inc. (8/21/12) (discussed here); and Tien v. Tenet Healthcare Corp. (10/4/12) (discussed here). In each case, the Court of Appeal pre-Brinker had affirmed a trial court order denying class certification. And in each case, the Court of Appeal on remand affirmed its pre-Brinker order.
In Brookler v. Radioshack Corporation (unpublished 8/26/10), the Court of Appeal (Second District, Division Seven) reversed a trial court order decertifying a meal and rest period class action (discussed here). The Court relied heavily on Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949. On remand after Brinker, the Court of Appeal last week held that the trial court’s decertification order was consistent with Brinker and affirmed. The Court of Appeal once again left its decision in Brookler unpublished, but you can find it here.
Yesterday, the Court of Appeal issued its new decision, which is published, holding that the the trial court erred in refusing to certify the class with respect to each of plaintiffs’ claims, except for the off-the-clock claims, which the Court remanded for reconsideration in light of Brinker and the new Bradley decision.
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