Volume 35 No. 2 March 2021

Official Publication of the California Lawyers Association Labor and Employment Law Section

Co-founder of Levin & Nalbandyan, LLP, partner Jacob Nalbandyan heads the civil litigation MCLE Self-Study: department focused on labor and employment law. ASSOCIATIONAL REASONABLE He argued for plaintiff- appellant in Castro-Ramirez ACCOMMODATIONS? v. Dependable Highway Express, Inc., an associational DEFINITELY MAYBE! disability discrimination case. Kelly (Ka In) Chan is a member of the employment litigation department at Levin & Nalbandyan, LLP, where she practices labor By Jacob Nalbandyan and Kelly (Ka In) Chan & employment law. Passionate about justice, she works hard to make sure her clients get rightfully compensated, and volunteers in multiple legal clinics.

INTRODUCTION In California, the Fair Employment and Housing Act (FEHA)1 affords wide protections to employees As associational disability discrimination laws take with disabilities. It imposes strict affirmative duties on shape in California, we must familiarize ourselves with the employer in this regard, all of which are aimed at their interplay with related reasonable accommoda- maintaining a healthy continuity of employment both tion and interactive process laws. This is particularly for the interests of employees and employers. In this pressing in light of the current lack of guidance from regard, the Legislature has declared these protections California courts. To examine the state of affairs a matter of public policy,2 which must, therefore, be pertaining to the latter two in the context of asso- at the heart of the discussions surrounding related ciational disability, this article will look at the relevant statutes and the cases related to associational disability legal issues. discrimination. By dissecting relevant cases and the A more complex issue arises in this legal space, underlying statutes, the authors conclude that because however, when it comes to whether the same associational disability discrimination protections protections apply to an employee who is not disabled exist, so must related protections against the failure but is, instead, merely associated with a disabled to reasonably accommodate and participate in an person but needs a reasonable accommodation, i.e., interactive process. flex schedule or intermittent leave.

— Inside the Law Review — 1 Associational Reasonable Accommodations? Definitely Maybe! 5 Top 2020 California Trade Secrets Decisions 9 California Employment Law Notes | 13 Wage and Hour Case Notes 16 NLRA Case Notes | 19 Public Sector Case Notes | 23 Mediation Tips and Arbitration Bits 26 Fresh Perspectives: A Deposition Toolkit for the New Lawyer 28 Cases Pending Before the California Supreme Court 32 Message From the Chair Under federal law, the answer has become wheelchair- established that FEHA affords a is definitely no.3 But under bound, necessitating that cause of action for associational California law, presently the he occasionally arrive late disability discrimination.9 answer is definitely maybe. to or leave early from work. There, an employee requested He approaches the HR a paid leave of absence to donate RELEVANT STATUTES boss, Jane, who thinks to a kidney to his sister, and the 10 herself: “I know I can’t fire employer terminated him. At the At the outset, FEHA’s anti- demurrer stage, the Rope court him because that might discrimination provision makes found a reasonable inference that constitute associational it unlawful for an employer to the employer committed asso- disability discrimination, terminate or discriminate against ciational disability discrimination, 4 an employee because of disability. but there’s nothing on because it “acted preemptively to It also makes it unlawful for the books requiring me to avoid an expense stemming from an employer to “fail to make accommodate him either.” [the employee’s] association with reasonable accommodation for his physically disabled sister.”11 The So what should Jane do? Let’s the known physical or mental court held the employee had met explore what is most prudent, disability” of an employee or to his burden “to show the adverse keeping in mind the State’s refuse to engage in an interactive employment action occurred process in search of reasonable public policy. under circumstances raising a accommodations.5 So far, from reasonable inference that the its plain language, FEHA seems RELEVANT CASES disability of his relative or associate to protect only those who are Unfortunately, an examination was a substantial factor motivating themselves disabled, right? 12 of the legislative history of the employer’s decision.” Not so. Enter Government Rope did not discuss the the relevant statutes we have Code section 12926(o), which applicability of FEHA’s interactive examined so far reveals nothing states, in relevant part, that process and reasonable accom- pertaining to the intent of the “‘disability’ . . . includes . . . that the modation provisions to employees person is associated with a person Legislature. The FEHA is silent associated with disabled persons. who has, or is perceived to have” on whether the interactive However, key facts presented in a disability.6 process and reasonable accom- that case turned on a denial of Accordingly, by the virtue modation apply equally to reasonable accommodations for of plug-and-play analysis, while associational disability.8 time off not because of one’s own FEHA protects an employee’s Nonetheless, there are several disability, but that of another. This actual disability, it also protects cases in the associational disability holding supported an associational that employee’s association with discrimination context that disability discrimination finding another who has a disability even indirectly shed light on the issue when it led to job loss. though the employee does not. at hand. Acutely though, at the KOUROMIHELAKIS V. HARTFORD The California Court of Appeal core of each of those cases, and FIRE INS. CO. (D. CONN. 2014) has twice said so in the context of factually, is an employee’s need associational disability discrimina- for a reasonable accommoda- Kouromihelakis v. Hartford Fire tory firings, but has remained tion because of that employee’s Ins. Co. is another case with similar silent (somewhat) on the issue of association with a disabled person. facts in the District Court of Connecticut regarding the federal whether an employer must also Take note of how each Americans with Disabilities Act provide reasonable accommoda- played out. tions in this context by engaging (ADA). It ruled that a reasonable an interactive process.7 ROPE V. AUTO–CHLOR SYSTEM inference could be made that This silence has put both OF WASHINGTON, INC. (2013) the employee was discriminated California employers and employees against based on the association Rope v. Auto–Chlor System 13 in a conundrum, illustrated by the he had with a disabled person. of Washington, Inc. was the first following hypothetical: The employee alleged that published case in California he requested a change in hours Johnny has worked for XYZ, that discussed associational under the employer’s flex Inc. for three months and disability discrimination under time policy to accommodate just learned that his wife FEHA. In Rope, the court for his responsibilities to his

2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 the nuisance [the employee’s] association with his disabled son Under federal law, the answer is would cause [the supervisor] in the future,” supporting his definitely no. But under California law, associational disability discrimina- tion claim.23 presently the answer is definitely maybe. This too was a case at its heart about an employee’s need for a reasonable accommodation, as immediately recognized by the disabled father. The employer Thus, an employer is obligated court. In the end, it triggered asso- denied employee’s request to reasonably accommodate an ciational disability discrimination and subsequently terminated employee who is associated with liability exposure regardless. 14 18 him. The court concluded a disabled person. Unsurprisingly, met the that the employee’s allegations However, in its revised majority opinion a strong dissent. were sufficient to establish a opinion, which is now published In the majority’s view, the inter- plausible associational disability law, the majority turned down pretation of FEHA should part discrimination claim, because they the temperature on this issue, but ways from the federal decisional supported a reasonable inference refused to hold back its thoughts authority when the statutory that the employer terminated the on it. “[W]e do not decide this language of ADA and FEHA is not employee based on a belief about point. We only observe that parallel, like in the associational 15 future absences. the accommodation issue is not disability context.24 The majority At its core, Kouromihelakis settled and that it appears signifi- found the ADA structurally is yet another case supporting cantly intertwined with the statutory different from FEHA because associational disability discrimina- prohibition against disability ADA does not define the term 19 tion in a factual context where an discrimination. . . .” Neverthe- “disability” itself as including employee needed a reasonable less, the majority noted, “[w] association with the disabled.25 accommodation, but lost his hen [Government Code section Still, the dissent refused to job instead. 12940(m)] requires employers construe FEHA as departing from to reasonably accommodate ‘the the ADA in this context. Indeed, CASTRO-RAMIREZ V. DEPENDABLE known physical . . . disability of HIGHWAY EXPRESS, INC. (2016) consistent with the ADA and an applicant or employee,’ read in Circuit Court opinions interpreting Three years after Rope was conjunction with other relevant it, the dissent opined that FEHA decided, a divided Court of Appeal provisions, subdivision (m) may does not extend accommodation revisited the issue of associational reasonably be interpreted to rights to a non-disabled employee’s disability discrimination relying, require accommodations based on disabled associates.26 in part, on Kouromihelakis for the employee’s association with a contextual support. Interest- physically disabled person.”20 IMPLICATIONS GOING FORWARD ingly, the majority first issued an In Castro-Ramirez, the opinion explicitly on point holding employee alleged that he was Interestingly, a very recent that an employee associated with terminated by the employer after federal case in the Southern District a disabled employee was entitled he refused to work the assigned of California adopted Castro-Ramirez to a reasonable accommodation shift because it impacted his as it pertains to reasonable accom- under FEHA, but then vacated ability to leave early enough from modation protections in the context it for a toned-down remix of the work to provide dialysis to his of associational disability. In Castro original on this very issue. 16 disabled son.21 The majority found v. Classy Inc., the court stated that In its now-vacated opinion, the there was no apparent reason “while the California Supreme Court majority explained that reasonable why the supervisor could not have has not yet held that FEHA provides accommodation is intertwined scheduled the employee for one of a cause of action for associational with the employee’s discrimination the eight earlier available shifts.22 discrimination, the decisions of case.17 The majority further opined Based on these facts, the majority California’s appellate courts are that by FEHA’s plain language, held that a reasonable inference ‘not to be disregarded by a federal association with a physically could be made that the employer court unless it is convinced by other disabled person is itself a disability. “acted proactively to avoid persuasive data that the highest

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 3 court of the state would decide ENDNOTES 2015 Cal. Legis. Serv. Ch. 122 otherwise.’”27 In doing so, the court (A.B. 987) (West); Labor And 1. Cal. Gov’t Code §§ 12900-12999 interpreted that Government Code Employment—Discrimination— (West 2021). section 12926 (o) indeed applies to Unlawful Practices, 2017 Cal. 2. Cal. Gov’t Code §§ 12920-12921 Legis. Serv. Ch. 799 (A.B. 1556) FEHA’s reasonable accommodation (West 2021). provision in the same way it prohibits 3. Larimer, at 700; Erdman v. (West). 28 associational discrimination. Nationwide Ins. Co., 582 F.3d 9. Rope v. Auto-Chlor Sys. of In sum, FEHA’s associational 500, 510 (3d Cir. 2009) (“the Washington, Inc., 163 Cal. Rptr. 3d disability discrimination prohibition association provision does 392, 410-412 (2013), superseded appears inseparable from the issue of not obligate employers to by statute as stated in Mathews v. reasonable accommodation, which accommodate the schedule of Happy Valley Conference Center, also triggers the duty to engage an employee with a disabled Inc., 43 Cal. App. 5th 236 (2019). in an interactive process. That is relative”); Den Hartog v. Wasatch 10. Rope at 399-400, 412. to say, the same set of facts have Acad., 129 F.3d 1076, 1084- 11. Id. at 412. repeatedly triggered associational 85 (10th Cir. 1997) (employer 12. Id. disability discrimination protections. not required to provide 13. Kouromihelakis v. Hartford Fire Ins. To avoid the conundrum highlighted employee with a reasonable Co., 48 F. Supp. 3d 175 (D. Conn. in our hypothetical above, they must accommodation for his son’s 2014). disability); Tyndall v. National also trigger the related reasonable 14. Id. at 180-81. Educ. Ctrs. of Calif., 31 F.3d 209, accommodation and interactive 15. Id. 214 (4th Cir. 1994) (“The ADA process protections. This view is also 16. Castro-Ramirez v. Dependable does not require an employer consistent with California’s stated Highway Express, Inc., 200 Cal. to restructure an employee’s public policy. Rptr. 3d 674, 683 (2016), reh’g work schedule to enable the Although the issue is not yet employee to care for a relative granted, opinion not citable (Apr. settled, best practices dictate that a with a disability”). 27, 2016), vacated, 207 Cal. Rptr. California employer should provide 4. Cal. Gov’t Code § 12940(a)(1) 3d 120 (2016); Castro-Ramirez v. reasonable accommodations in this (West 2021). Dependable Highway Express, Inc., context to limit liability exposure 5. Cal. Gov’t Code §§ 12926(m)-(n) 207 Cal. Rptr. 3d 120 (2016). stemming from an almost inevitable (West 2021). 17. Castro-Ramirez, 200 Cal. Rptr. 3d wrongful associational disability 6. Cal. Gov’t Code § 12926(o) at 683. discrimination claim should it lead (West 2021). 18. Castro-Ramirez, 200 Cal. Rptr. 3d to a job loss, as evidenced by the 7. Rope v. Auto-Chlor Sys. of at 684. cases examined above. Washington, Inc., 163 Cal. Rptr. 3d 19. Castro-Ramirez, 207 Cal. Rptr. 3d Returning back to our HR friend 392, 410–412 (2013), superseded 120, 129 (italics added). by statute as stated in Castro- Jane in thecla.inreachce.co hypotheticalm above, to 20. Id. at 128-129. limit her company’s liability, she Ramirez v. Dependable Highway 21. Id. at 132-33. should accommodate Johnny in Express, Inc., 207 Cal. Rptr. 3d 120 22. Id. at 132. (2016). the same way she would if Johnny 23. Id. at 132. 8. Discrimination—Employment and were himself disabled. 24. Id. at 133. Housing, 1987 Cal. Legis. Serv. 25. Id. 605 (West); Discrimination—Civil 26. Id. at 144-45 (Grimes, J., Rights—General Amendments, dissenting). 1999 Cal. Legis. Serv. Ch. 591 (A.B. 1670) (West); Civil Rights— 27. Castro v. Classy Inc, No. 3:19-CV- Medical And Physical Disability 02246-H-BGS, 2020 WL This article is available as an And Mental Condition, 2000 996948, at *5 (S.D. Cal. Mar. 2, online self-study test. (1 self-study credit for $20!) Cal. Legis. Serv. Ch. 1049 (A.B. 2020) (citing Kwan v. SanMedica Visit: International., 854 F.3d 1088, cla.inreachce.com 2222) (West); Employment— for more information. Disability Accommodations— 1093 (9th Cir. 2017). Religious Accommodations, 28. Id.

4 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 Tyler M. Paetkau, partner, Procopio, Cory, Hargreaves & Savitch LLP, Silicon TOP 2020 CALIFORNIA TRADE Valley ([email protected]). SECRETS DECISIONS Mr. Paektau represents employers and management in all aspects of labor and By Tyler M. Paetkau employment law, including trade secrets matters. He is a former Chair of the Labor & Employment Law Section and a current member of the Editorial Board.

Despite the raging pandemic, invalidate contractual covenants (Cal. Civ. Code § 3439.04(a)(1)), 2020 produced several important and promises by current employees constructive fraudulent transfer trade secrets decisions by not to compete. (Cal. Civ. Code §§ 3439.04(a)(2) California courts, including the and 3439.05), and common law following (selective and subjective) TERMINATING SANCTIONS WARRANTED fraudulent conveyance stemming “top,” caes in chronological order: FOR TRADE SECRET DEFENDANTS’ from AllRide’s alleged fraudulent SPOLIATION OF RELEVANT EVIDENCE transfer of its business. AGREEMENT NOT TO COMPETE WeRide Corp. v. Huang, No. U.S. District Judge Edward J. WITH EMPLOYER WHILE STILL 5:18-CV-07233-EJD, 2020 WL Davila’s lengthy opinion discussed EMPLOYED IS ENFORCEABLE 1967209 (N.D. Cal. April 16, 2020) remarkable and abundant evidence Techno Lite, Inc. v. Emcod, LLC, WeRide sued its former CEO of the defendants’ spoliation of 44 Cal. App. 5th 462 (2020) and former Head of Hardware relevant evidence. Techno Lite employees Technology, their new company Judge Davila issued entered into an agreement not AllRide, and its corporate alter-ego terminating sanctions under to compete with their employer for trade secret misappropriation Rule 37(b) and Rule 37(e), making while they were still employed under the federal Defend Trade it unnecessary to resolve the by that company. Later, Techno Secrets Act (18 U.S.C. § 1836) and parties’ dispute whether the court California’s Uniform Trade Secrets had inherent authority to grant Lite sued plaintiffs for “siphoning Act (Cal. Civ. Code § 3426 et seq.) WeRide’s sanctions motion. Rule off accounts” and “diverting the arising out of the alleged misap- 37(b) provides that a court may business” of Techno Lite to their propriation of WeRide’s trade sanction a party for failure to own company, Emcod. Techno secret source code. Based on the comply with a court order. Rule Lite sued its former employees and former CEO’s alleged false and 37(e) allows for sanctions where their new company, alleging breach damaging statements to WeRide’s a party fails to preserve elec- of fiduciary duty, interference investors and potential investors, tronically stored information (ESI). with contractual relationships, WeRide sued him for defamation Under Rule 37(b), district courts intentional and negligent interfer- and intentional interference with should consider “(1) the public’s ence with economic advantage, prospective economic advantage. interest in expeditious resolution conversion, fraud and unfair WeRide also sued the former of litigation; (2) the court’s need competition. The trial court found CEO for breach of contract and to manage its dockets; (3) the risk in favor of Techno Lite on the intentional interference with of prejudice to the party seeking interference, fraud and unfair contract. WeRide sued the former sanctions; (4) the public policy competition claims. The Court of Technology Head for breach of favoring disposition of cases on Appeal affirmed, holding that a fiduciary duty and duty of loyalty, their merits; and (5) the availability promise not to compete with an and breach of contract arising of less drastic sanctions.” Leon v. employer while employed is not from his alleged theft of source IDX Sys. Corp., 464 F.3d 951, 958 void under Cal. Bus. & Prof. Code code and other confidential (9th Cir. 2006) (quotation and § 16600. Therefore, the employees material belonging to WeRide, citation omitted. were properly found liable for and from his alleged solicitation of The parties disputed whether fraud based upon a false promise. WeRide employees to join AllRide. WeRide must meet the prepon- The lesson from Techno Lite WeRide sued AllRide and its alter derance of evidence standard or is that section 16600 does not ego for actual fraudulent transfer the clear and convincing evidence

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 5 standard for terminating sanctions. related claims. The trial court Hooked’s claim that Apple “aided Judge Davila found that the lower granted summary judgment to and abetted” Hooked’s former preponderance standard applied. Apple, and the Court of Appeal CTO’s breach of fiduciary duty. Judge Davila issued terminating affirmed, holding that the fraud The lesson from Hooked Media sanctions against AllRide under claim failed because the alleged v. Apple is that mere possession of both Rule 37(b) and Rule 37(e) misrepresentations by Apple a former employer’s trade secrets (ESI), noting that the “[t]he case all involved future events, not does not constitute improper use against AllRide [was] even more past or existing facts. As for the or disclosure by the employees’ damning under Rule 37(e).” The trade secrets claim, the Court new employer. Plaintiffs alleging Court ordered that defendants held that evidence that the trade secret appropriations must to pay WeRide’s reasonable fees former employees may have had have admissible evidence and and costs incurred in connection protected information in their cannot rely on a legal theory with (i) the motion for terminating possession is not sufficient to that sounds a lot like the rejected sanctions; (ii) all discovery related establish that Apple improperly inevitable disclosure doctrine. to their spoliation of evidence; and acquired or used it. Further, just (iii) the discovery motion practice because there was evidence EDWARDS v. ARTHUR ANDERSEN before another judge. In addition, suggesting that the former LLP DOES NOT EXTEND BEYOND the Court struck the defendants’ engineers “drew on knowledge THE EMPLOYMENT CONTEXT answers and directed the clerk to and skills they gained from Ixchel Pharma v. Biogen, 9 Cal. enter their default. Hooked to develop a product 5th 1130 (2020) WeRide underscores the for [Apple]” does not mean The plaintiff, Ixchel, had an importance and value of promptly there was a misappropriation of at-will contract with a non-party and thoroughly preserving all trade secrets, citing California’s to develop a drug based on a potentially relevant evidence, rejection of the “inevitable certain active ingredient. The including all electronic evidence, disclosure” doctrine. Nor did defendant, Biogen, reached its source code, laptops, etc. Apple’s production of Hooked’s own deal with that non-party Employers should consider trade secret information in to settle patent disputes and retaining experienced forensics response to discovery requests to license the same active consultants to comply with these show that Apple acquired trade ingredient, requiring that the legal and practical duties, and secrets by improper means. at-will contract with the plaintiff implement litigation holds and Finally, the Court held that “Cali- be terminated. Ixchel sued Biogen evidence preservation protocols fornia’s emphasis on employee in case of suspected or threatened mobility and freedom to compete in federal court for tortious trade secret misappropriation. counsels against a finding that interference with contract, the CTO’s self-serving efforts to arguing that Biogen’s agreement EMPLOYEES’ ALLEGED THEFT OF land a position with Apple were a violated a California statute TRADE SECRETS INSUFFICIENT TO breach of fiduciary duty.” barring contract provisions that ESTABLISH THEIR NEW EMPLOYER’S The Court of Appeal also restrain any trade or profession. LIABILITY FOR MISAPPROPRIATION gave short shrift to another The Ninth Circuit certified OF THOSE SECRETS category of claimed trade secret the matter to the Supreme Hooked Media Group, Inc. v. information–the makeup and skills Court of California. Clearing up Apple Inc., 55 Cal. App. 5th 323 of its engineering team–“there is uncertainty in California law, (2020) no evidence of Hooked making a unanimous Supreme Court Hooked Media, a startup reasonable efforts to maintain held that (1) to state a claim for company that Apple expressed the secrecy of the information, tortious interference with an interest in acquiring, sued Apple as required for a claim under the at-will contract, a plaintiff must after Apple passed on the deal UTSA.” “To the contrary, it inten- plead and prove an independently but three of Hooked’s most tionally disclosed much of the wrongful act, beyond interfering important employees (including information in negotiations with with the contract itself; and (2) two engineers and the Chief Apple even after Apple declined to California’s statutory prohibition Technical Officer) left to work for sign a nondisclosure agreement.” on contract provisions restraining Apple. Hooked sued for fraud, Finally, but importantly, the trade (Cal. Bus. & Prof. Code misappropriation of trade secrets, Court of Appeal affirmed the trial § 16600)—when applied to one interference with contract, and court’s summary judgment on business restraining another—is

6 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 subject to the same rule of reason ATTORNEY FEES BELONG TO THE The lesson from Aerotek is analysis prescribed by antitrust ATTORNEYS WHO DEFENDED BAD client and counsel should address common law. FAITH TRADE SECRET CLAIMS ABSENT all potential fees issues in their Ixchel advocated for the per CONTRARY CONTRACTUAL PROVISION engagement agreement, as the default is the attorneys are entitled se rule applied in the employment Aerotek, Inc. v. The Johnson context by the Supreme Court to any CUTSA fee award above Group Staffing Co., 54 Cal. App. 5th what the client already paid. of California in Edwards v. Arthur 670 (2020) Andersen LLP, 44 Cal. 4th 937 The law firm Porter Scott, P.C., ANY AMENDMENT TO EMPLOYMENT (2008). The defendant argued that defended its client, The Johnson CONTRACT ON OR AFTER JANUARY 1, the common law rule of reason Group Staffing (TJG), through two 2017 RENDERS FORUM SELECTION should apply in the commercial rounds of litigation against claims CLAUSE VOIDABLE BY EMPLOYEE context. The Supreme Court asserted by TJG’s chief competitor Midwest Motor Supply Co. v. had never specifically addressed Aerotek. In the litigation, Aerotek Superior Court (Finch), 56 Cal. App. the standard to be applied to alleged that TJG (whose founder 5th 702 (2020) contracts that restrain a business came from Aerotek) misappropri- Patrick Finch worked as a sale from pursuing a trade or business. ated trade secrets by soliciting supervisor for Midwest Motor After a lengthy analysis, the Court Aerotek’s customers. Aerotek Supply and was employed in concluded that a contractual lost the underlying cases and was 2014 pursuant to an employment agreement that contained a restraint of one business from ordered to pay prevailing-party attorney fees in the amount of choice-of-law and forum selection engaging in lawful business or $735,781 pursuant to Cal. Civ. clause invoking Ohio law and trade with another business must Code § 3426.4. The trial court venue in Franklin County, Ohio. be analyzed under the common determined that Porter Scott Finch was promoted in 2016 law rule of reason. The Court (not TJG) was entitled to the fees, and received a new compensa- did not decide whether the because “attorney fees awarded tion plan; he also received new specific non-compete prohibition under section 3426.4 (exceeding compensation plans in 2017 and in Ixchel was reasonable. fees the client already paid) belong 2018. After Finch sued Midwest Therefore, trial courts have the to the attorneys who labored to in California in 2019 for various responsibility to determine what earn them, absent an enforceable Labor Code violations, Midwest restraints are deemed reasonable agreement to the contrary” filed a motion to dismiss or, alter- natively, stay the action on the and will be enforceable in a (relying on Flannery v. Prentice, basis of the Ohio forum-selection commercial setting. 26 Cal. 4th 572 (2001), which clause. The trial court denied After a lengthy analysis of involved prevailing-party attorney Midwest’s motion on the ground fees under the FEHA). the development of the law, the that the modifications to the The Court of Appeal followed Court concluded that in light of compensation plan in 2017 and the California Supreme Court’s the potential pro-competitive 2018 occurred after January 1, effects of contractual restraints decision in Flannery v. Prentice, 2017 (the operative date of Labor on businesses entering a business 26 Cal. 4th 572 (2001). After Code § 925, which generally or trade, a contractual restraint considering the statutory text, the renders out-of-state forum legislative intent behind the statute, of one business from engaging selection clauses voidable by a and several policy considerations, in lawful business or trade with California employee). The Court of the court “conclude[d] that another business must be analyzed Appeal denied Midwest’s petition attorney fees awarded pursuant under the rule of reason for claims for writ of mandate, holding that to [Government Code] section a modification to an employment arising under section 16600. 12965 (exceeding fees already agreement on or after January 1, The lesson from Ixchel is that paid) belong, absent an enforceable 2017 triggers section 925 even contracts between businesses are agreement to the contrary, to the though the modification was to a subject to the common law rule of attorneys who labored to earn provision other than the forum- reason, whereas post-employment them.” Id. at p. 590. “Although [the selection clause. restrictions remain subject to the Court of Appeal found] this to be Midwest counsels California per se rule of invalidity announced a closer case, we interpret section employers not to include non- in Edwards v. Arthur Andersen.2 3426.4 similarly.” California choice of law and

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 7 venue provisions in employment contracts or amendments after The California Labor & Employment January 1, 2017, unless the Law Review is published by the Labor employee is actually represented by an attorney during the and Employment Law Section of contract negotiations. the California Lawyers Association.

ARBITRATOR EXCEEDED AUTHORITY IN ENTERING AWARD THAT Editors-in-Chief PERMITTED ENFORCEMENT OF Stephanie J. Joseph UNLAWFUL COVENANT NOT TO Hina Shah COMPETE IN VIOLATION OF CAL. Alexandra Stathopoulos BUS. & PROF. CODE § 16600 Brown v. TGS Management Executive Editors Company, Inc., 57 Cal. App. 5th Laura Davis 303 (2020) Kevin K. Hosn This decision is significant Ramit Mizrahi for allowing a court to review a contractual arbitration award that Managing Editor violates California public policy in Phyllis W. Cheng favor of employee mobility and against unlawful post-employment Editorial Board contractual restraints. The former Janine Braxton employee overcame the strong presumption in favor of arbitration Cara Ching-Senaha finality, including the ability of Elizabeth Franklin arbitrators to get the facts and/or Carol M. Gillam the law wrong. Lois M. Kosch An arbitrator granted in James W. Michalski part TGS’s motion for summary Beth W. Mora disposition, leaving only the claims for declaratory relief, payment of a Anthony Oncidi second deferred bonus, violations Tyler M. Paetkau of section 17200, and violation of Wendi L. Ross Labor Code section 1102.5(a). The John Louis Schwab arbitrator later ruled in favor of Erich W. Shiners TGS on all of Brown’s claims and TGS’s counterclaims. Mary Topliff The lesson from Brown v. TGS is that California employers Design should not expect to enforce Documation LLC facially unlawful anticompeti- tive contract provisions, such as those at issue here, even through https://calawyers.org/section/ use of “binding” and mandatory labor-and-employment-law/ contractual arbitration.

8 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 Anthony J. Oncidi is a partner and the Chair of the Labor and Employment CALIFORNIA EMPLOYMENT Department of Proskauer Rose LLP in Los LAW NOTES Angeles, where he exclusively represents employers and management in all areas of By Anthony J. Oncidi employment and labor law. His telephone number is (310) 284-5690 and his email address is [email protected]. (Tony has authored this column without interruption for every issue of this publication since 1990.)

BANK EMPLOYEE WHO WAS HARASSED and the district court granted the that was necessitated by certain BY A CUSTOMER CAN PROCEED bank’s summary judgment motion. budget cuts. Foroudi’s position WITH SEXUAL HARASSMENT CLAIM The Ninth Circuit reversed, holding was eliminated and his remaining that the incidents of harassment duties were redistributed to a Christian v. Umpqua Bank, 984 were severe or pervasive enough younger employee with better F. 3d 801 (9th Cir. 2020) to create a hostile environment qualifications. Foroudi filed a Jennifer Christian, a former even though there was a putative class action against employee of Umpqua Bank, alleged seven-month gap between them Aerospace in state court, which the she was sexually harassed by one and some of the incidents did not company removed to federal court of the bank’s customers in violation involve direct interaction between based upon Foroudi’s assertion of Title VII and Washington the customer and Christian (e.g., of a claim under the federal Age state law. Among other things, letters and notes that were left for Discrimination in Employment the customer dropped off “small Christian or persistent inquiries Act (ADEA). While in federal notes” stating that Christian was that the customer made about court, Aerospace moved to strike the “most beautiful girl he’[d] Christian to her colleagues). The the disparate impact and class seen” and that he “would like Court also held there was a triable allegations from the complaint, to go on a date” with her. After issue of fact as to whether the which the district court granted on Christian informed the customer bank ratified or acquiesced in the the ground that the administrative that she was not interested, the harassment in view of its “glacial filing with the Department of Fair customer sent her a long letter response–more than half a year Employment and Housing (DFEH) stating that she was his “dream after the stalking began–[which] did not evidence an intention to girl” and they were “meant to be was too little too late.” sue on behalf of a class or include together.” Flowers and references disparate impact allegations. to their being “soulmates” soon LAID-OFF EMPLOYEE WAS Foroudi then dismissed the followed. Christian notified the NOT DISCRIMINATED AGAINST ADEA claim and the matter was bank manager and others in the ON THE BASIS OF AGE remanded to state court. workplace about the customer’s Foroudi v. The Aerospace Corp., Once the case was back in repeated overtures toward her, 57 Cal. App. 5th 992 (2020) state court, Foroudi attempted to but her colleagues just warned The Aerospace Corporation amend his EEOC/DFEH admin- her “to be careful.” Eventually, in hired David Foroudi as a senior istrative charge to include class response to Christian’s repeated project engineer when he was allegations. While the EEOC issued requests, the bank closed the 55 years old. Several years later, a new right-to-sue letter, the DFEH customer’s account and told Foroudi was among the lowest- did not. Then, Foroudi sought leave him not to return; the bank also ranked employees based upon to file a second amended complaint temporarily transferred Christian his managers’ assessment of to add class and disparate impact to another branch before Christian his deficiencies in interpersonal claims to his lawsuit, which the resigned based upon her doctor’s communication skills and limited trial court denied. The trial court advice that it was “bad for her background in navigation relating subsequently granted Aerospace’s health to continue working at to GPS, despite being a technical motion for summary judgment, Umpqua Bank.” lead on a GPS project. Based and the Court of Appeal affirmed Christian sued for gender upon his low ranking, Foroudi was on the ground that there was discrimination and retaliation, included in a reduction in force a legitimate nondiscriminatory

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 9 reason for his termination (the Andrea Olson provided The owner/operators of the vessel company-wide RIF) and there was reasonable accommodation (all of whom are based in Louisiana) no “substantial evidence” that the services to employers such as petitioned the Court of Appeal to reasons offered by Aerospace the Bonneville Power Adminis- issue a writ of mandate directing were untrue or pretextual. tration (BPA) to facilitate their the superior court to vacate compliance with the Americans its order denying their motion COURT REVERSES $2.9 with Disabilities Act. Olson for summary judgment. The MILLION JURY VERDICT FOR began experiencing anxiety and owner/operators contended that FAILURE TO ACCOMMODATE requested, among other things, Louisiana law applied to the claims, EMPLOYEE’S DISABILITY that she be allowed to telework to while the crew members claimed Shirvanyan v. Los Angeles Cmty. reduce her time spent onsite. After California law governed. The Coll. Dist., 59 Cal. App. 5th 82 consulting with its legal counsel, Court of Appeal initially agreed (2020) BPA offered Olson a trial work with the owner/operators and Anahit Shirvanyan, a former period and continued telework held that Louisiana law applied, Los Angeles Community College and also made efforts to restore but after review and remand from kitchen assistant, alleged the her to an equivalent position. the California Supreme Court, District failed to reasonably However, BPA never provided the Court of Appeal denied the accommodate and/or engage in Olson notice of her Family and petition for writ of mandate on the interactive process with her Medical Leave Act (FMLA) rights. the ground that California not based upon two injuries she had The district court held a bench Louisiana law applies because suffered (a wrist injury from carpal trial and determined that BPA’s the crew members performed alleged interference with Olson’s the majority of their work within tunnel syndrome and a shoulder FMLA rights was not willful and, the boundaries of California at injury). Because the jury did not therefore, the applicable statute Port Hueneme and the Santa indicate whether it had relied upon of limitations was two rather Barbara Channel. one or both of the alleged injuries than three years. Because Olson in awarding Shirvanyan a verdict of waited more than two years to OWNER/OPERATORS ARE $2.9 million (including $2.8 million commence this action, the district PERSONALLY LIABLE FOR $481,000 in emotional distress damages), court entered judgment in favor WAGE/HOUR JUDGMENT the Court of Appeal reversed the of BPA. Analogizing to the willful Kao v. Joy Holiday, 58 Cal. App. judgment and remanded the case standard as applied to the FLSA in 5th 199 (2020) for a new trial on her claims for McLaughlin v. Richard Shoe Co., 486 Ming-Hsiang Kao was failure to accommodate/engage U.S. 128 (1988), the Ninth Circuit employed by Joy Holiday (a travel in the interactive process vis-à-vis affirmed, holding that “to benefit tour company) initially performing her wrist injury. The court held that from the FMLA’s three-year IT-related duties and then a reasonable accommodation of a statute of limitations, a plaintiff eventually as its office manager. finite period of leave was available must show that her employer While he was still in Taiwan, Kao for Shirvanyan’s wrist injury. either knew or showed reckless worked with Jessy Lin (one of However, there was no substantial disregard for whether its conduct the owners of Joy Holiday) as a evidence that an accommodation violated the Act.” (Olson at 1339.) tour organizer. Kao later arrived was available for her shoulder in California on a tourist visa injury because Shirvanyan could CALIFORNIA LAW APPLIES TO and moved into the home of Lin not have engaged in many of the NON-CALIFORNIA RESIDENTS and her husband, Harry Chen. essential job duties as a kitchen WORKING OFF THE COAST Kao was paid a salary of $1,700 assistant due to her shoulder Gulf Offshore Logistics, LLC v. per month, representing a gross injury, and there were no other Superior Court, 58 Cal. App. 5th amount of $2,500 less an $800 vacant positions for which she was 264 (2020) rent deduction. After he received qualified at the time. Non-California resident crew an H-1B visa, Kao was put on members of the “Adele Elise” (a the company payroll and worked EMPLOYER DID NOT vessel that provides services to oil as the “office manager” of Joy WILLFULLY INTERFERE WITH platforms located off the coast of Holiday where he booked hotels EMPLOYEE’S FMLA RIGHTS California) filed this putative class and coordinated bus tours. The Olson v. United States, 980 F. 3d action alleging multiple violations trial court determined that Kao 1334 (9th Cir. 2020) of California wage and hour law. worked roughly 50 hours per

10 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 week. Kao was later demoted to overtime and that, accordingly, EMPLOYER’S COUNSEL ADMITTED PRO “non-manager status,” moved into they were owed compensation HAC VICE SHOULD NOT ALSO HAVE his own apartment and eventually for unpaid overtime, missed rest REPRESENTED EMPLOYEE WITNESSES was terminated after working for and meal periods, inaccurate Joy Holiday for approximately two wage statements, and waiting Big Lots Stores, Inc. v. Superior years. Kao filed suit for breach of time penalties. Hildebrandt’s Court, 57 Cal. App. 5th 773 (2020) contract and violation of various lawsuit was filed after two other Big Lots, an Ohio corporation, wage/hour statutes. Following Staples general managers had filed applied to have Ohio counsel a bench trial, the court awarded similar class actions. In response admitted to represent it in a Kao $481,089 in unpaid wages, to Hildebrandt’s class action, putative class action pending in prejudgment interest, attorney’s Staples moved for summary California. When the trial court fees, and costs. The trial court judgment based upon the learned that the Ohio attorneys also determined that Lin and Chen applicable statutes of limitations. also were attempting to represent had individual alter-ego liability In response, Hildebrandt argued various current and former Big Lots based on the unity of interest and that application of the class action managers in depositions noticed ownership between them and tolling doctrine was necessary by plaintiffs, it revoked the court’s Joy Holiday; among other things, to protect the “efficiency and prior authorization for the Ohio they commingled and made unau- economy of the class action device; lawyers to continue to represent thorized use of corporate assets. otherwise putative class members the employer in the ongoing The Court of Appeal affirmed would be induced to file individual proceeding. The court reasoned the judgment. actions to avoid the statute of that the attorneys should have limitations bar, even while class sought its permission to represent STATUTE OF LIMITATIONS TOLLED BY certification proceedings were RELATED CLASS ACTIONS pending” in other cases. The trial the employees in their depositions. Hildebrandt v. Staples the Office court granted Staples’ motion for In response to Big Lots’ petition Superstore, LLC, 58 Cal. App. 5th summary judgment, but the Court for writ of mandate, the Court of 128 (2020) of Appeal reversed, holding that Appeal ordered the trial court to Von Hildebrandt filed a Hildebrandt was entitled to claim vacate its order granting plaintiffs’ putative class action against the benefit of the class action motion to revoke pro hac vice Staples asserting that he and other tolling rule, due to the pendency of authorization and to conduct general managers of Staples had the class certification proceedings further proceedings to determine been misclassified as exempt from in the other two cases. the appropriate remedy. Grateful Appreciation TO TONY ONCIDI

for 30 Years of Continuous Authorship of The California Employment Law Notes

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 11 From the Editors EDITORIAL POLICY The Law Review reflects the diversity of the Section’s membership in the articles and columns we publish. Our resources are you, the readers, so we count on you to provide us with the variety of viewpoints representative of our 7,000+ members. We therefore invite members of the Section and others to submit articles and columns from the points of view of employees, unions, and management. Although articles may be written from a particular viewpoint, whenever possible, submissions should address the existence of relevant issues from other perspectives. The Law Review reserves the right to edit articles for reasons of space or for other reasons, to decline to print articles that are submitted, or to invite responses from those with other points of view. We will consult with authors before any significant editing. Authors are responsible for cite checking and proofreading their submissions. Note that as a contributor of an article selected for publication in the Law Review, you can claim self-study MCLE credit, hour-for-hour, for the time you spend researching and writing the article.

As a rule, we accept only well-researched articles on timely topics. Submissions from third-party public relations or marketing firms will not be considered. Articles should be between 2,000 and 2,500 words. Please follow the style in the most current edition of The Bluebook: A Uniform System of Citation and put all citations in endnotes. Please e-mail your submission to Managing Editor Phyllis Cheng at [email protected]. With your submission, include: (1) a short abstract of your article (no more than 100 words); (2) an article word count; and (3) your current work address, phone number, email address, and CV.

12 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 Leonard H. Sansanowicz is the principal of Sansanowicz Law Group, P.C. and WAGE AND HOUR CASE NOTES represents employees in all aspects of employment law. He is a member of By Leonard H. Sansanowicz the Executive Board of the California Employment Lawyers Association, as well as the Executive Committee of the Labor and Employment Section of the Los Angeles County Bar Association. He can be contacted at: leonard@ law-slg.com.

DYNAMEX APPLIES RETROACTIVELY had not analyzed the employee/ businesses who complied with BECAUSE IT WAS A CASE OF independent contractor issue wage order obligations) favored FIRST IMPRESSION AND DID NOT under California’s wage orders. the retroactive effect of Dynamex. CHANGE A SETTLED RULE Vasquez further noted that twice in the past decade the Court WHETHER AN EMPLOYEE IS AN Vazquez v. Jan-Pro Franchising had indicated the classification “AGGRIEVED EMPLOYEE” FOR PAGA Int’l, Inc., 10 Cal. 5th 944 (2021) issue should remain an open PURPOSES IS NOT ARBITRABLE The Ninth Circuit certified this question. Ayala v. Antelope Valley Provost v. YourMechanic, Inc., question to the California Supreme Newspapers, Inc,. 59 Cal. 4th 522 55 Cal. App. 5th 982 (2020) Court: “Does the decision in (2014); Martinez v. Combs, 49 Cal. Defendant sought to compel Dynamex Operations West, Inc. v. 4th 35 (2010). Well before its plaintiff to arbitrate the issue of Super. Ct., 4 Cal. 5th 903 (2018) decision in Dynamex, employers whether he was an “aggrieved apply retroactively?” The California were on notice that the “suffer or employee” before proceeding with high court answered “Yes.” No permit” standard could be used his complaint for civil penalties decision prior to Dynamex had in the employee/independent under the Private Attorneys addressed how the “suffer or contractor analysis. The Court General Act (“PAGA”). The Fourth permit to work” language in the also highlighted Dynamex’s Appellate District affirmed the California wage orders should criticism of the numerous Borello trial court’s denial of defendant’s apply to work for a business by factors, including that such a motion on the ground that forcing putative independent contractors. standard made it “difficult for both plaintiff to arbitrate that issue The California Supreme Court hiring businesses and workers would have impermissibly split the intended its decision in Dynamex to determine in advance how a PAGA claim in two: an arbitrable to apply retroactively, because particular category of workers “individual” claim of willful misclas- the “suffer or permit” language would be classified.” Therefore, sification (Cal. Lab. Code § 226.8 had been included in wage orders as a practical matter, defendant (a)(1)), and a non-arbitrable repre- for over 100 years and had been overstated its case. sentative action. The Provost court given the broadest definition of As to the argument that cited to several prior opinions employment since at least 1937. businesses could not have directly on point holding that the Defendant argued that prior to anticipated California would adopt issue of whether an employee was Dynamex, it had reasonably relied the ABC test as the appropriate “aggrieved” may not be decided on the common law standard set standard, the Supreme Court in arbitration. Further, the Court forth in S.G. Borello & Sons v. Dept. noted that adoption of the ABC noted that section 226.8 does of Indus. Relations, 48 Cal. 3d test was reasonably foreseeable not give rise to a private cause 341 (1989). Defendant asserted based on prior decisions. of action. Because a PAGA-only that businesses could not have Finally, because there was representative action is indivisible anticipated that California would no settled rule, the high court and solely an action by the state, have adopted the “ABC” test for found Dynamex did not unfairly the Court held defendant could classifying workers according to prejudice defendant and other not require plaintiff to arbitrate the wage order definition. As to businesses. In addition, public any part of the PAGA action. The defendant’s reasonable reliance, policy and fairness considerations Court further rejected defendant’s the high court distinguished Borello (e.g., ensuring worker protections argument that the U.S. Supreme from Dynamex in that Borello or not penalizing competing Court’s decision in Epic Systems

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 13 Corp. v. Lewis, 138 S. Ct. 1612 the aggrieved employees. Thus, defendant had not met its burden (2018) had implicitly overruled summary adjudication disposing of proving by a preponderance of the seminal California authority, of the entire PAGA cause of action the evidence the legitimacy of its Iskanian v. CLS Transp. Los Angeles, was inappropriate. calculations, noting an increased LCC, 59 Cal. 4th 348 (2014), as While the Rojas court agreed likelihood that defendant had previously repudiated in Correia that the PAGA claim contained “grossly exaggerated” the amount v. NB Baker Elec., Inc., 32 Cal. App. multiple potential causes of in controversy. 5th 602, 613-614 (2019). action, it declined to grant the The Ninth Circuit affirmed, writ because defendant had not finding plaintiff had not only PAGA NOTICE IS SUFFICIENT, moved for summary adjudication mounted a facial attack on PAGA CLAIM CONTAINS MULTIPLE as to each of the eight parts of the defendant’s assumptions CAUSES OF ACTION PAGA claim. Rather, defendant (which would not have required Rojas-Cifuentes v. Super. Ct., 58 had treated the PAGA claim as one defendant to present evidence Cal. App. 5th 1051 (2020) cause of action and had sought akin to summary judgment), but The trial court dismissed to dismiss the PAGA claim in its also had made a factual attack by plaintiff’s PAGA claim on summary entirety. Because a motion seeking directly challenging defendant’s adjudication (with leave to amend) summary adjudication of a cause allegation that all members for failure to properly allege the of action may not be granted worked shifts long enough to facts and theories supporting his unless it “completely disposes of qualify for meal and rest periods. PAGA notice and failure to exhaust [the] cause of action,” Cal. Code Accordingly, defendant failed to his administrative remedies. Civ. Proc. § 437c(f)(1). since at meet its burden of supporting its Specifically, the trial court found least some of plaintiff’s allegations amount in controversy allegations that: (1) five of the eight paragraphs were properly alleged in the PAGA with competent proof. in the PAGA notice were merely notice, the PAGA claim survived. The Court also noted that in recitations of the statute or reviewing a removing defendant’s statements, “which ‘mimic’ the AN EMPLOYER HAS THE BURDEN evidence, a district court should statute;” (2) the notice did not OF PROVING ITS JURISDICTIONAL neither make its own assumptions specify who was harmed by the ALLEGATIONS FOR CAFA nor perform detailed mathematical supposed Labor Code violations; REMOVAL ARE REASONABLE calculations of its own. The fact and (3) the notice did not allege Harris v. KM Indus., Inc., 980 F. that defendant had not submitted whether plaintiff was defendant’s 3d 694 (9th Cir. 2020) any supportive evidence made such employee or give any indication of Defendant removed plaintiff’s assumptions unreasonable. Because his employment status. wage and hour action from state both parties had been given the The Third Appellate District court to federal court under the opportunity to place evidence on issued a writ of mandate setting Class Action Fairness Act (“CAFA”), the record, and defendant had failed aside the order, following the logic which requires removal if the to overcome plaintiff’s challenges, of Williams v. Super. Ct., 3 Cal. 5th amount in controversy exceeds the Ninth Circuit affirmed the 531 (2017) and its progeny that the $5 million. 28 U.S.C. § 1332(d)(2). district court’s remand order. “facts and theories” requirement Plaintiff moved to remand, facially of a PAGA notice did not need to attacking defendant’s allegations. CLASS CERTIFICATION DENIED FOR “satisfy a particular threshold of The district court, remanded LACK OF PREDOMINANCE SINCE weightiness,” and merely needed the action to state court, finding BANK POLICY DID NOT APPLY TO to put the employer and the defendant based its claimed OR HARM MANY EMPLOYEES LWDA on notice of the potential amount by incorrectly assuming Castillo v. Bank of Amer., NA, need for an investigation. The all putative class members worked 980 F. 3d 723 (9th Cir. 2020) appellate court also found plaintiff shifts long enough to be entitled to Plaintiff brought a putative had alleged sufficient facts and meal and rest periods. Specifically, class action on behalf of bank call theories to support at least defendant assumed that all putative center employees for various wage some of the alleged violations. class members were also members and hour claims, including a regular Moreover, plaintiff alleged that all of the meal and rest period rate of pay overtime claim (for of defendant’s “current and former subclasses, and that each member nondiscretionary monthly flat-sum California non-exempt employees” had missed one meal period and bonuses). Plaintiff moved for class were affected. While broad, this two rest periods per workweek. certification. The district court was enough to give notice of The district court agreed that found typicality and commonality

14 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 and the Ninth Circuit agreed. THE FAAAA DOES NOT PREEMPT performs work that is outside Nonetheless, the district court AB 2257, THE “ABC” TEST the usual course of the hiring denied certification on predomi- entity’s business.” Defendants People v. Super. Ct., 57 Cal. App. nance grounds, and the Ninth 5th 619 (2020) contended the FAAAA preempts Circuit affirmed. Many putative class The Federal Aviation Adminis- the ABC test, because prong B members did not work overtime tration Authorization Act of 1994 makes it impossible for a motor hours or did not receive a bonus (FAAAA) preempts state laws carrier to hire an owner-operator during the relevant period. Even if “related to a price, route, or service as an independent contractor. The defendant had applied the wrong of any motor carrier . . .with respect Court agreed with the People, calculation, the employees had been to the transportation of property.” however, that the ABC test is an adequately paid or even overpaid 49 U.S.C. § 14501(c)(1). However, employment law that applies to all and, therefore, had not suffered the FAAAA does not preempt California employers and creates any injury. The Ninth Circuit agreed worker-classification laws that a rebuttable presumption that a with defendant’s argument that are generally applicable or laws worker is an employee, while not the question of whether putative governing the use of independent prohibiting motor carriers from contractors. The Second District class members were subject to hiring independent contractors. As Court of Appeal determined that defendant’s overtime calculation such, the Court concluded that the Assembly Bill 2257 (2020 Cal. policy and were underpaid was thus ABC test is not the type of law the Stat. 38), which codified the “ABC” a question of liability rather than test adopted in Dynamex, is one FAAAA preempts. damages. As a result, determining such law. Therefore the FAAAA The appellate court further liability for all members “would does not preempt the application rejected defendants’ argument require complicated individualized of the ABC test to truck drivers of that the ABC test was not a law inquiries” and plaintiff could not interstate motor carriers. of general application because it establish classwide liability through The argument turned on prong exempts several occupations and common proof. B of the ABC test: “the worker industries.

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VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 15 Jeffrey S. Bosley is a partner NLRA CASE NOTES in the Labor and Employment Department of Davis Wright Tremaine LLP, and represents By Jeff Boseley and Tyler Maffia employers and management in labor and employment law matters. He can be reached by email at [email protected]. Tyler Maffia is an associate in the San Francisco office of Davis Wright Tremaine LLP, who assists employers in labor and employment law matters. He can be reached at [email protected].

BOARD DECLINES PROPORTIONALITY of contractor usage relevant evaluation of the merits of those REQUIREMENT FOR INFORMATION to multiple grievances already grievances. The Board found that REQUESTS UNDER THE NLRA filed by the union. The parties the $300 in costs was not an exchanged multiple communi- undue burden on respondents, Murray American Energy, 370 cations regarding the alleged and consequently, the union was NLRB No. 55 (2020) relevance of the requests and under no obligation to engage in In a unanimous decision, the approximately $300 in costs bargaining over cost sharing. The an NLRB panel found that an associated with its collection. Board also found that the union’s employer violated the National Respondents asserted that the eight requests for information Labor Relations Act (NLRA or Act) requests were not related to over a two-month period was not by failing to timely respond to a particular instance of unit evidence of bad faith, but rather broad information requests related work being contracted out, the evidence of “diligent execution” to contract enforcement. In in its requests amounted to a vague of their representative duties. analysis, the unanimous panel also blanket request for any and all rejected a request to introduce a Further, in waiting nearly two information, and that the union months to respond to a particular “proportionality requirement” to was obligated to bargain over the determine whether information information request, without cost of collection. communicating a valid reason must be provided under the Act. The Board found that for the delay, the Board found The parties waived a hearing respondents violated the Act by that respondents’ unreasonable and transferred the case directly failing to provide the requested delay in providing the information to the National Labor Relations information related to subcon- violated the Act. Board (NLRB or Board). Never- tracting work. Because the The Board also rejected theless, the Board found that information sought concerned respondents’ request to include a Murray American Energy was matters outside of the bargaining a single-integrated business unit, it was not presumptively proportionality requirement when enterprise and single employer relevant. The Board found evaluating whether a party must with both Harrison County that the union demonstrated respond to an information request. Coal Company and Monongalia the relevance of its general Although a similar requirement County Coal Company (collec- information requests with its was added to the discovery rules tively, respondents). The statements to respondents that under the Federal Rules of Civil parties’ collective bargaining it was necessary for “contract Procedure, the Board found agreement detailed contracting enforcement” and investigation of that the Act’s role of furthering and subcontracting of certain potential grievances. Additionally, national labor policy justified the work. The union sent multiple respondents should have been continued omission of a propor- information requests seeking aware of the relevance given tionality requirement. general details concerning the parties’ recurring disputes respondents’ use of contractors surrounding subcontracting. EMPLOYER’S LEAFLET DURING for the purpose of “determining Further, regarding the union’s ORGANIZATION CAMPAIGN WOULD the need to file a grievance and/ specific information requests NOT BE REASONABLY INTERPRETED or to determine if one has merit.” related to the pending grievances, AS CREATION OF NEW WORK RULE The union also sent information the union established relevance by S & S Enterprises, LLC, 370 requests seeking specific details stating that it was necessary for NLRB No. 59 (2020)

16 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 In a unanimous portion of the At the hearing, the Board’s to other complaint allegations opinion, the Board found that a General Counsel (GC) alleged concerning the leaflet and both leaflet distributed by employer that the leaflet constituted the parties presented evidence during an organization campaign, promulgation and maintenance regarding the underlying facts. referencing possible criminal of a new anti-harassment rule Because respondent did not consequences of employee action, because it included enhanced demonstrate that unprotected did not constitute a promulgation punishment in the form of activity occurred, Member of a new workplace rule. Member criminal prosecution. The admin- McFerran would have found that McFerran dissented, however, istrative law judge rejected that the leaflet equated union activity as to whether content contained theory because the leaflet could with unlawful harassment that in the leaflet separately violated not be reasonably understood as would be subjected to criminal the Act. a promulgation of a new rule. The prosecution, which constituted an In 2018, employer became the GC also argued in his brief that unlawful threat. focus of a union organizing drive. the leaflet constituted a threat against employees, who engaged POSTING ON PRIVATE SOCIAL MEDIA Employer took multiple steps to ACCOUNT VIOLATED THE ACT address this campaign, including in union activity. The judge found the distribution of a leaflet to that such a theory was not pled FDRLST Media, LLC 370 NLRB in the complaint, and declined to No. 49 (2020) employees referencing rumors that consider it. The judge found merit A unanimous Board panel union supporters were threatening on multiple other unfair labor found that a supervisor’s post other workers. That leaflet stated practices committed by employer on his private Twitter account in part: during the campaign. constituted an unlawful threat It is also a violation The Board unanimously of reprisal against employees of [employer’s] anti- adopted the judge’s findings, who engaged in union activity, harassment policy, including the dismissal of the and ordered employer to which says in part, “. . . allegation concerning promul- direct supervisor to delete [employer] is committed gation and maintenance of an the statement. to a work environment in unlawful rule, and agreed that The parties stipulated to which all individuals are the leaflet was not reasonably findings of fact. Respondent treated with respect and understood as a promulgation operated The Federalist, whose of a new rule. A Board majority executive officer had been dignity. Each individual also adopted the judge’s finding employed since at least 2016. has the right to work in a that the complaint failed to allege Executive officer regularly professional atmosphere that the leaflet itself constituted a communicated with employees that promotes equal threat and consequently that the regarding business matters using employment opportunities allegation should be dismissed, both his personal and business and prohibits unlawful noting that the complaint email addresses. Executive discriminatory practices, alleged that promulgation of officer maintained a private including harassment. . . .” the rule constituted an unfair Twitter account, and in June Let me remind each of you labor practice. 2019, posted the following that, although we respect Dissenting, Member McFerran tweet: “FYI @fdrlst first one of the rights of our workers would have found that the you tries to unionize I swear I’ll to support or not support complaint did allege that the send you back to the salt mine.” a labor union, we will not leaflet constituted an unlawful At least one employee viewed permit anyone to violate threat under the Board’s notice the tweet. A charge was filed the legal rights of our pleading standard, specifically by a person who was not, and employees who wish to relying on the language in the had never been, an employee of fight for or against a labor complaint alleging that the leaflet respondent. Executive officer union. Anyone caught threatened employees with asserted that the tweet was threatening our employees discipline, discharge, or criminal satire, and an expression of his or otherwise violating their prosecution if they engaged personal viewpoint on a contem- rights will be subject to in union or other concerted porary topic of general interest. criminal prosecution to the activities. Additionally, the An administrative law judge fullest extent of the law. threat issue was closely related found that the motivation of the

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 17 executive officer was immaterial SPLIT BOARD PANEL FINDS NON- Act. The judge found, because for determining whether a DISPARAGEMENT PROVISIONS the section was not limited violation of section 8(a)(1) of the OF VOLUNTARY SEVERANCE to remarks that are malicious Act had occurred. Rather, the test AGREEMENT THAT PERTAINS TO POST- or reckless, employees would is whether, from the perspective EMPLOYMENT ACTIVITIES LAWFUL reasonably interpret the provisions of a reasonable person, the as preventing them from making conduct tends to interfere with IGT d/b/a International Game critical public statements about the free exercise of employee Technology 370 NLRB No. 50 employment terms or practices, rights. The judge found that (2020) and that the provision would have because the tweet began with A Board majority, applying a broad impact on section 7 rights. a reference to “FYI” and then the recent precedent established The judge found that the respon- “@”respondent’s name, the tweet in Baylor University Medical dent’s interest was not sufficient was clearly a threat directed to Center, 369 NLRB No. 43 to outweigh such an impact. the employees of respondent, (2020), found that an overbroad A Board majority reversed the not the general public. The judge non-disparagement clause in a judge, and found that under Baylor then found the tweet had no severance agreement is lawful University Medical Center, the other purpose except to threaten if the agreement is voluntary language was lawful. Specifically, respondent’s employees. That and pertains to post-employ- the Board reiterated that its Boeing two of respondent’s employees ment activities. precedent only applied to allegedly submitted affidavits saying Employer maintained a unlawful work rules that establish they found the tweet funny separation agreement that it conditions of employment. and sarcastic did not change sometimes offered to lawfully However, because a separation threat result. separated employees in exchange agreement is not mandatory, and The Board panel unanimously for a severance payment. That it exclusively pertains to postem- adopted the judge’s finding that agreement contains a non-dispar- ployment activities, Boeing was not employees would reasonably view agement provision that states, applicable. Because the agreement the tweet as expressing an intent “You will not disparage or discredit here was voluntary, did not affect to take adverse action against any IGT or any of its affiliates, officers, pay or benefits established as employee who tried to unionize directors and employees. You will terms of employment, and was at respondent’s workplace. forfeit any right to receive the not proffered coercively, the The Board expressly rejected payments or benefits described Board majority found that the respondent’s contention that in Section 3 if you engage in non-disparagement provision did the tweet conveyed a personal deliberate conduct or make any not violate the Act. view protected by section 8(c) of public statements detrimental to Dissenting, Member McFerran the NLRA. The Board noted that the business or reputation of IGT.” argued that Baylor University section 8(c) expressly excludes Reviewing the case on remand Medical Center was a departure threats of reprisal. The Board after the Board issued its decision from precedent, contrary to modified the Order to require in The Boeing Co., 365 NLRB No. statutory policy, and she would respondent to direct the executive 154 (2017), the administrative law not apply it. Instead she would officer to delete the tweet and judge found that the non-dispar- find, in accordance with the judge, to ensure he complied with agement provision was overbroad that the agreement here was the directive. and violated section 8(a)(1) of the unlawfully overbroad.

18 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 Kerianne Steele is a partner with Weinberg, PUBLIC SECTOR CASE NOTES Roger & Rosenfeld, where she represents By Kerianne Steel and Alejandro Delgado unions and employees, primarily in the public sector. Alejandro Delgado is a shareholder of the Los Angeles office of Weinberg, Roger & Rosenfeld. He represents and advises public sector unions in all aspects of labor and employment law.

U.S. SUPREME COURT AFTER AN ADVERSE ACTION BECOMES The Court held that the FINAL BECAUSE THE EMPLOYEE question of whether the Board’s AGENCY FEE LITIGATION DOES NOT APPEAL IT, THE EMPLOYER decision was contrary to civil JANUS UPDATE CANNOT WITHDRAW IT. service statutes is a legal question subject to de novo review. The On January 25, 2021, the U.S. Chaplin v. State Personnel Board, 54 Cal. App. 5th 1104 (2020) Court reasoned that, although the Supreme Court denied certiorari Board is constitutionally vested in a bloc of cases in which public California Department of with the authority to review civil employees sought to recover the Forestry and Fire Protection (CAL services statutes, it was unclear agency fees that public sector FIRE) disciplined three employees for cheating on a promotional that the California Supreme unions had collected prior to examination. One of the employees Court would apply the “hybrid the Court’s 2018 Janus decision appealed his discipline to the approach” from Boling v. Public (Janus v. AFSCME, Council 31, 138 California State Personnel Board Employment Relations Board, 5 Cal. S. Ct. 2448 (2018)) (Janus I). In (Board or SPB) while the other 5th 898 (2018) to the SPB. More Janus I, the Supreme Court barred two did not. While the one appeal important, the Court stated that the collection of agency fees was pending, CAL FIRE issued it was skeptical the Board relied or “fair share” fees, which were new disciplinary notices to all on any “specialized administrative fees that unions collected from three employees imposing harsher expertise” in resolving the issue of non-members to cover the costs penalties. Over the employees’ whether to allow new discipline of collective bargaining, contract objection, the Board allowed CAL for misconduct that was already administration, and grievance FIRE to proceed. The employees disciplined in a final prior action. adjustment. The bloc of cases filed a petition for writ of admin- The Court also held that the that the Court declined to review istrative mandamus in superior notices of adverse action that included Janus v. AFSCME, 942 F. court alleging that the Board was became final were not subject 3d 352 (7th Cir. 2019) cert. den. prohibited from imposing harsher to withdrawal. The Court agreed (US Jan. 21, 2021) (No. 19-1104) penalties against them after they with the firefighters that once a (Janus II), which is the follow-up were disciplined for misconduct. disciplinary action becomes final, case to Janus I. Though not a ruling The superior court denied the the employer is prohibited from on the merits, the Court’s denial petition. The employees appealed. withdrawing it and initiating a of certiorari is consistent with the The Court of Appeal, First new adverse action. The Court decisions of lower courts, which Appellate District, held: (1) de novo reasoned that the plain language of have rejected lawsuits brought by review applied; (2) as a matter of Government Code section 19575 plaintiffs claiming that unions must first impression, an employer is not “could not be clearer” in stating reimburse the fees they collected permitted to withdraw notices of that that an appointing power’s before Janus I was decided. adverse action that become final when employees do not appeal the discipline is final where no appeal CALIFORNIA COURT OF discipline; and (3) an employer is is taken within 30 calendar days. APPEAL CASES permitted to withdraw a notice of The Court found that because adverse action when an employee the previous adverse actions had STATE PERSONNEL BOARD appeals the discipline. become final under section 19575,

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 19 the employer was prohibited from absences, however, are specifically provide that employees are not withdrawing the previous notices excluded from the provisions, entitled to accrue benefits while and issuing new discipline. such as absences covered under on CFRA leave. The Court further Lastly, the Court held that the federal Family and Medical found that that absence clearance notices of adverse action that Leave Act (FMLA) or the California is a reward for working without were not final could be withdrawn. Family Rights Act (CFRA). Plaintiff, absences and is not subject to the The Court found that the a bus operator for MTA, was fired provisions in CFRA’s regulations that discipline issued to the employee after he had eight non-excluded apply to employee benefits under who appealed the first notice of absences. More than 60 calendar health and welfare plans. The Court adverse action to the Board was days had passed between absences noted that the caveat to its holding not final under section 19575 and two of the absences would is that no violation of CFRA occurs when CAL FIRE served him with have been cleared, but he took only where the employer extends the new notice of adverse action. leaves under the CFRA during the absence clearance period by the The Court rejected the employees’ each of those periods and MTA number of days the employee was arguments that section 19575 did not count those days as part on any unpaid leave. was inapplicable because CAL of the 60-day clearance period. Plaintiff presented evidence FIRE did not secure the consent of The employee filed an action in that MTA counts three types of the Board before withdrawing its superior court against the MTA unpaid leave, including jury duty, original notice and issuing a new alleging retaliation for use of CFRA bereavement leave, and military one. The Court reasoned that the leave and interference with the use duty leave, toward absence Board impliedly gave its consent of CFRA leave. The superior court clearance, but does not count CFRA to withdraw the original notice granted summary judgment in favor leave. The Court did not believe this and serve a new one when the of the MTA and denied the former evidence raised a triable issue of administrative law judge denied employee’s motion for summary material fact. On this basis the Court the motion to dismiss, which is not adjudication. Plaintiff appealed. found that the trial court properly contrary to the statute. The Court of Appeal, Second granted summary judgment in favor Appellate District, held: (1) the of the MTA. CALIFORNIA FAMILY RIGHTS ACT MTA’s absenteeism policy did not PUBLIC PENSIONS CFRA IS NOT VIOLATED IF AN EMPLOYER violate CFRA by extending the TOLLS AN ABSENCE CLEARING absence clearance period by the PEPRA’S FORFEITURE PROVISION PERIOD WHILE AN EMPLOYEE IS number of days the employee was IS CONSTITUTIONAL, BUT PUBLIC ON UNPAID CFRA LEAVE. on unpaid CFRA leave during that RETIREMENT SYSTEM MUST AFFORD Lares v. Los Angeles County period; and (2) the MTA did not treat PENSIONER DUE PROCESS BEFORE Metropolitan Transportation bereavement, jury duty, and military FORFEITING RETIREMENT BENEFITS. Authority, 56 Cal. App. 5th 318 leaves differently from CFRA leave Hipsher v. Los Angeles County (2020) when calculating absence clearance Employees Retirement Assn., et This case concerns an periods. The Court held, with a al., 58 Cal. App. 5th 671 (2020) absenteeism provision within caveat, that, where an employer’s (Hipsher II) the disciplinary article of the no-fault absenteeism policy Plaintiff Tod Hipsher was collective bargaining agreement provides that an employee may hired as a firefighter with the Los (CBA) between the Metropolitan clear absences that would otherwise Angeles County Fire Department Transportation Authority (MTA) count for disciplinary purposes by (Department) in 1983. Starting and the union representing the working without violating the policy around 2001, he began conducting operations employees of the during a prescribed period, the an illegal gambling operation in MTA. Under the absenteeism employer does not violate the CFRA Orange and Los Angeles Counties. provision, an employee is subject by extending the prescribed period In 2013, the United States Attorney to progressive discipline, up to and by the number of days the employee filed a one-count information including termination, if they reach was on CFRA leave during that alleging that plaintiff conducted, a certain number of absences. To period. The Court reasoned that managed, supervised, directed avoid discipline, employees may while CFRA’s regulations provide and owned an illegal gambling remove or clear absences by not that an employee cannot lose any business. Plaintiff retired from the being absent for 60 consecutive benefits they have accrued before Department less than two months calendar days. Certain kinds of taking CFRA leave, they implicitly after the information was filed. He

20 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 was convicted the following year 234 Cal. Rptr. 3d 564 (2018) The Court of Appeal concluded following his plea of guilty to the (Hipsher I). In Hipsher I, , the Court anew that section 7522.72 offense stated in the information. of Appeal also held that LACERA need not provide a comparable The Los Angeles County failed to provide plaintiff adequate advantage to offset disadvan- Employees’ Retirement Association due process in determining that tages plaintiff may suffer as a (LACERA) notified Hipsher that the misconduct underlying his result of legislative changes to it was required to adjust his felony conviction arose out of the the public employee retirement retirement benefit pursuant to performance of official duties. system enacted decades after he the Public Employees’ Reform The Court noted that plaintiff had began his employment. Such a Act (PEPRA), Government Code a protected interest in retirement requirement would be antithetical section 7522.72. According to the benefits, but that PEPRA provided to the statute’s purpose by unfairly letter, the County of Los Angeles’ no mechanism for him to challenge enriching a malfeasant legacy (County) human resources the adverse determination. It employee for engaging in the very department had determined that found that, at a minimum, plaintiff sort of abusive practices section the conviction was job-related. was entitled to reasonable written 7522.72 is intended to curb. This determination was based notice of the pending forfeiture, Additionally, the Court of Appeal on investigation reports from and to contest the action before an confirmed its prior decision that the United States Department of impartial decision-maker. Noting section 7522.72 is not an unconsti- Homeland Security. that, under the California Consti- tutional ex post facto law, and that Plaintiff filed the lawsuit after tution, a public pension retirement plaintiff is entitled to appropriate LACERA confirmed that there board holds the “sole and exclusive administrative due process. The were no administrative remedies responsibility” to administer its Court modified the trial court’s to challenge the benefit adjustment retirement system, Hipsher I held judgment and remanded the determination. He alleged that that LACERA, rather than the matter with instructions for reduction of his vested retirement County, was required to provide LACERA (not the County) to benefits constituted an unconstitu- the necessary due process. provide plaintiff with appropriate tional ex post factor application of After the California Supreme notice of its intent and the reasons Government Code section 7522.72, Court granted review of Hipsher for its initiation of forfeiture violated the contract clause of I, the high court remanded the proceedings, and an opportunity the California Constitution, and matter back to the Court of to present objection to LACERA’s was invalid because there was no Appeal, to reconsider it in light of impartial decision maker whether nexus between his crime and the the Supreme Court’s decision in he falls within the scope of section performance of his official duties. Alameda County Deputy Sheriff’s 7522.72. The Court of Appeal The trial court ruled in favor of the Association v. Alameda County otherwise affirmed the trial defendants on the contract and ex Employees’ Retirement Association, court’s judgment. post facto claims. But it ordered the 9 Cal. 5th 1032 (2020) (Alameda County to reinstate proceedings County). Hipsher v. Los Angeles COUNTY CIVIL SERVICE under Government Code section County Employees Retirement APPEAL RIGHTS 7522.72 in a manner that afforded Association, 269 Cal. Rptr. 3d 198 Deiro v. Los Angeles County Civil plaintiff sufficient due process (Mem) (2020). Service Commission, 56 Cal. App. protections. Both plaintiff and the In Hipsher II, the Court of 5th 925 (2020) County appealed. Appeal concluded on remand that Plaintiff, Martin Deiro, began In 2018, the Court of Appeal, Alameda County confirms its prior working for the Los Angeles County Second Appellate District, had holding that section 7522.72’s Sheriff’s Department (Department) ruled against plaintiff on the public purpose, which is to protect in 1997. He was injured on duty on constitutional issue, finding that the pension system from abusive May 30, 2012. He continued to although plaintiff’s right to a practices of faithless public work through October 3, 2013, pension was vested at the time of employees and preserve public and then had the first of two LACERA’s determination, a felony trust in government, justifies surgeries relating to the injury. He criminal conviction arising from any concomitant diminution in was unable to return to work official public duties was a valid plaintiff’s pension rights. Hipsher following his surgery and remained justification for limited forfeiture. v. Los Angeles County Employees on leave thereafter. Hipsher v. Los Angeles County Retirement Assn., et al., 58 Cal. On May 1, 2015, plaintiff Employees Retirement Association, App. 5th 671 (2020) (Hipsher II). applied to the Los Angeles County

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 21 Employees Retirement Association suspension. After the hearing to the Commission of his discharge (“LACERA”) for service-connected officer issued a recommended by the Department, filed before his disability retirement. Two and a half decision that was adverse to the disability retirement, is no longer months later, and prior to LACERA Department, the Department viable. The court also held that the approving plaintiff’s retirement raised for the first time its argument Commission has no authority to application, the Department issued that the Commission lacked juris- order reinstatement or any other him a notice recommending his diction over a civil service appeal relief to a retired person whose termination. He was terminated relating to plaintiff’s employment, future status as an employee is not effective August 13, 2015. He because plaintiff had retired. The at issue. timely appealed the discharge Commission granted the Depart- Oddly, in Deiro, the Court of to the Los Angeles Civil Service ment’s motion to entirely dismiss Appeal did not mention the Fifth Commission (Commission). The the civil service appeal. Appellate District’s contrary matter was referred to a hearing Plaintiff filed a petition for finding in Hall-Villareal v. City officer. A few months later, while writ of mandate seeking trial of Fresno, 196 Cal. App. 4th 24 the disciplinary proceedings were court review of the decision. In (2011) (Hall-Villareal). The Hall- pending, LACERA’s Board of the writ petition, plaintiff Villareal court expressed doubt Retirement granted his application asserted, for the first time, that that there exists “a bright-line rule for service-connected disability if he were to prevail in his disci- that, if a person whose employment retirement, with the effective date plinary appeal and be reinstated, already has been terminated seeks to be determined. Over half a year any retroactive salary would retirement benefits, the Civil later, LACERA later issued him change his disability retirement a notice stating that “[p]er your pension. The trial court denied the Service Commission thereby loses discussion with LACERA staff, petition. plaintiff appealed. jurisdiction to hear [an] appeal of your effective date of retirement The Court of Appeal, Second the termination decision.” The Fifth is August 13, 2015,” the day after Appellate District, affirmed the trial Appellate District explained that his discharge. court’s denial of a writ of mandate Hall-Villareal’s receipt of retirement Despite having retired, on to compel the Commission to benefits did not preclude her from September 26 and November 4, complete a deputy sheriff’s admin- being returned to her employment 2016, plaintiff and the Department istrative appeal. The court held if her appeal before the commission participated in hearings regarding that an employee who has obtained were successful. Thus, the court plaintiff’s appeal of his discharge. and continues to receive service- in Hall-Villareal held that the civil The hearing officer issued a connected disability retirement service board was not divested recommended decision to reduce benefits is no longer an employee of jurisdiction to consider the the termination to a 30-day of the County, and thus his appeal employment termination dispute.

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22 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 Alan R. Berkowitz is a mediator with Judicate West, specializing in individual and class action cases. He MEDIATION TIPS AND has resolved hundreds of cases involving all types of employment matters, including wage and hour class ARBITRATION BITS actions and PAGA claims, many of which resulted in seven-to-eight-figure settlements. Before retiring from By Alan R. Berkowitz the practice of law to become a full-time mediator, he was a partner with Bingham McCutchen, managing partner with Schachter Kristoff Orenstein and Berkowitz, and Regional Attorney at the NLRB, Region 32. He has tried over 50 cases in state and federal courts and administrative agencies on behalf of both defendants and plaintiffs.

ARE LAWYERS GOOD AT lawyers believe they can take expectation of one party that PREDICTING CASE OUTCOME steps to increase the likelihood exceeds the expectation of the AND SETTLEMENT VALUE? of a desired result may lead to other party is a formula for non- overconfidence. This “illusion of settlement. Better informed Over the years there have control” may cause lawyers to lawyers will seriously consider been numerous studies of lawyers’ underestimate or fail to appreciate mediator feedback to overcome ability to accurately predict case the extent to which other factors overconfidence bias and hopefully outcomes and value. Although 3 may influence the outcome. lead to more realistic expectations different methodologies have Overconfidence and the failure and settlement. been used in various studies, to make realistic and objective essentially comparisons were projections of case outcomes ARBITRATION AGREEMENT made between initial predictions may lead to settlement failure or FOUND UNCONSCIONABLE or settlement demands and offers bitter disappointment after trial. Ali v Daylight Transport, LLC, 59 and the ultimate case outcome. In However, various actions can all studies that this writer is aware Cal. App. 5th 462 (2020) mitigate overconfidence bias. For Plaintiffs filed a proposed of, the conclusions are the same– example, peer review of the case lawyers are not particularly good class action lawsuit alleging that by other lawyers can provide defendant Daylight Transport at predicting outcomes. For the invaluable feedback about the misclassified them as independent most part lawyers were overcon- strengths and weaknesses of contractors and violated various fident in their predictions, failing the case, and may help to form a California Labor Code provisions to achieve their expressed goal in more objective projection of the 1 applicable to employees. Daylight a significant percentage of cases. likely outcome. Also, more formal move to compel arbitration Overconfidence exists in a processes such as Early Neutral pursuant to the terms of an wide variety of contexts but in Evaluation have proven successful Independent Contractor Service the legal profession it may be in changing initial assessments of influenced by a lawyer’s profes- the case.4 Agreement that had been executed sional obligation requiring diligence Finally, the input of an by plaintiffs and contained a to represent a client zealously. In experienced third party neutral, mandatory arbitration provision. doing so, lawyers tend to express such as a mediator, can be The trial court denied the motion confidence in their positions and invaluable to establishing a finding that: (1) plaintiffs were not advocate persuasively. But can realistic and objective projection covered by the Federal Arbitration 6 this skew their reasoning? Some of case outcome.5 Parties invest a Act (FAA) because they were research has shown that overcon- lot of time, resources and money transportation workers engaged fidence is more prevalent when in mediation. They should take in interstate commerce; and (2) the predictor has some degree of care in the selection of a mediator the agreement to arbitrate was commitment to, and emotional and should have confidence unconscionable and unenforce- investment in, the outcome. that the mediator selected has able. The Court of Appeal affirmed Further, lawyers may engage the experience and ability to the trial court’s decision that the in wishful thinking–believing a evaluate the case objectively. Be agreement to arbitrate was uncon- certain outcome is probable simply prepared to openly listen to your scionable and unenforceable. It, because of a desire to reach it.2 mediator and adjust expectations therefore, found it unnecessary Moreover, the extent to which when appropriate. A self-serving to decide whether plaintiffs were

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 23 transportation workers engaged in It was further found to be of this requirement. Moreover, interstate commerce and therefore procedurally unconscionable, under California law, an arbitration exempt from the FFA. because the arbitration provision agreement “may not require the Daylight categorized plaintiffs appeared at the end of a 15-page employee to bear any expense as independent contractors during contract; plaintiffs were given that the employee would not be the many years they worked for only a short time to sign and had required to bear if he or she were it. Every year, Daylight required no opportunity to consult with free to bring the action in court.”8 plaintiffs to sign the Independent counsel; and the agreement did Finally, the court affirmed the Contractor Service Agreement not attach the applicable AAA trial court’s refusal to sever the containing the arbitration rules, which themselves contained offending provisions and enforce provision. Each year, plaintiffs were some of the substantively objec- the remainder of the arbitration given the agreement shortly before tionable terms. Thus, as neither clause. Having found moderate they were required to sign it. They the arbitration agreement itself procedural unconscionability were not given any opportunity to nor the manner of its presentation and three provisions that were negotiate the terms of or to review to plaintiffs promoted voluntary substantively unconscionable, the the agreement with an attorney. or informed agreement to its court held that the central purpose They were told that if they did not terms, the court found a moderate of the contract was tainted with sign the agreement, they could not degree of procedural unconsciona- illegality. Further, there was no continue to work. Although the bility existed. single provision that could be arbitration agreement provided With respect to substantive stricken to remove the unconscio- that arbitration proceedings would unconscionability, the court agreed nable taint from the agreement. be governed by the Commercial with the trial court in finding that Accordingly, the court found Arbitration Rules of the American the agreement contained three the trial court did not abuse its Arbitration Association (AAA), unconscionable terms. First, discretion in concluding severance the rules were not appended to the agreement shortened the would not serve the interests the agreement. applicable statutory statue of of justice. Turning to the uncon- limitations periods for plaintiffs scionability issue, the court to assert the various Labor Code WAIVER OF RIGHT TO ARBITRATE first addressed Daylight’s violations alleged to 120 days. Said Garcia v Haralambos Beverage contention that because the limitation, in contrast to the three- Co., 59 Cal. App. 5th 534 (2021) agreements categorized plaintiffs to-four year limitations periods Plaintiffs were employed by as independent contractors, provided by law, was found to be defendant Haralambos Beverage California cases addressing substantively unconscionable. Co. as truck drivers. Both plaintiffs unconscionability in the Second, the agreement had executed the company’s employee-employer context were permitted Daylight to seek a employee handbook acknowl- inapplicable. The court disagreed, provisional remedy of injunctive edgement, receipt and consent in citing prior cases. It held that the relief to protect its property which they agreed to arbitrate all relationship between the parties interests but failed to provide disputes and controversies of any was characterized by a power similar relief to plaintiffs. Daylight kind with the company. imbalance analogous to that of failed to provide any reasonable Plaintiffs filed a putative an employer-employee relation- justification for such a one-sided class action alleging various wage ship, such that the arbitration exception to the mandatory and hour violations. Defendant agreement was subject to the arbitration requirement of the answered the complaint and raised requirements of Armendariz v agreement. Accordingly, the court numerous defenses including Foundation Health Psychcare found this clause to be substan- that Plaintiffs were subject Services, Inc.7 tively unconscionable. to an arbitration agreement. Reviewing procedural uncon- Third, the court held that the Nevertheless, over the next 15 scionability, the court found that AAA rules, which were to govern months, defendant attended the agreement was a contract of the arbitration, required plaintiffs two status conferences in which adhesion as it was presented by to split the costs of arbitration. it did not challenge jurisdiction, a party with superior bargaining The court specifically noted that venue or contractual arbitration, power to plaintiffs on a take-it-or- the AAA rules were not attached but reserved its right to do leave-it basis with no opportunity to the agreement signed by so later; agreed to participate to negotiate or change its terms. plaintiffs, who were not aware in class-wide mediation; and

24 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 engaged in extensive class by plaintiffs. The court noted that expense by participating in discovery producing thousands of defendant was clearly aware that classwide mediation, retaining documents subject to a stipulated its handbook required arbitration damage consultants and experts protective order. Plaintiffs retained and raised it as an affirmative to determine defendants’ a consulting group to create a defense. Further, pleading ability to pay a class settlement, damages model and a financial requirements allowed’ defendant propounding and pursuing class expert to research defendant’s to simply recite the terms of the discovery, and completing the ability to pay a class settlement. agreement without producing the Belair-West notice process. In The parties further met and executed document itself. Under addition, plaintiffs incurred conferred over the details of a these circumstances, the court additional expense on motions notice to class members under found 24 months was unreason- to compel discovery responses Belair-West Landscape, Inc. v able from filing the complaint to on class issues. In sum, the court Superior Court.9 moving to compel. found substantial evidence that Defendant ultimately sent The court next found that plaintiffs were prejudiced by a letter to plaintiffs demanding defendant’s actions were incon- defendant’s unreasonable delay in arbitration stating that it would sistent with its right to arbitrate. seeking arbitration. file a motion to compel arbitration. It noted that defendant attended The court affirmed the trial However, the parties continued two status conferences and did court’s denial of defendant’s to argue over production of not indicate its intent to compel motion to compel arbitration. documents relative to the Belaire- arbitration. Further, defendant ENDNOTES West notice process. In court agreed to a protective order to 1. See Jane Goodman-Delahunty, proceedings as to the Belaire-West facilitate class-wide discovery; Par Anders Granhag, Maria notice process, Defendant notified engaged in class-wide mediation, Hartwig and Elizabeth F. Loftus, the court that it had recently engaged in class discovery, met Insightful or Wishful: Lawyers’ discovered plaintiffs’ executed and conferred on class issues, Ability to Predict Case Outcomes, arbitration agreements and and participated in the classwide 16 Psychology, Public Policy, and intended to file a motion to compel Belair-West notice process. And Law 2, 133-157 (2010). arbitration. However, it did not do even after defendant discovered 2. See id at 135 (internal citations so for another three months The the executed arbitration omitted). trial court denied the motion to agreements, it continued to 3. See id at 136 (internal citations compel arbitration on the ground meet and confer with plaintiffs omitted). that defendant had waived its right on discovery and the Belair-West 4. See id at 152 (internal citations to arbitration. notice process. omitted). 5. See id at 152-153 (internal citations On appeal, the court affirmed Finally, on the issue of omitted). the trial court’s finding of waiver. prejudice, the court found that 6. 9 U.S.C. §§ 1-16; 9 U.S.C. §§ 201- The court found that defendant’s defendant’s delay in moving 208; 9 U.S.C. §§ 301-307. delay in moving to compel to compel arbitration impaired 7. 24 Cal. 4th 83 (2000). arbitration was unreasonable, plaintiffs’ ability to realize the 8. Subcontracting Concepts (CT), LLC rejecting defendant’s argument benefits and efficiencies of v De Melo, 344 Cal. App. 5th 201, that it had only recently found the arbitration. During the two-year 212 (2019). arbitration agreements executed delay, plaintiffs incurred additional 9. 149 Cal. App. 4th 554 (2000).

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 25 Janine Braxton is an attorney at Martenson FRESH PERSPECTIVES: Hasbrouck & Simon who represents employers in state and federal courts with A DEPOSITION TOOLKIT FOR THE an emphasis on complex wage and hour NEW LAWYER representative PAGA and class actions. Janine also focuses on litigating individual discrimination and harassment claims By Janine Braxton and is a liaison to the California Lawyers Association’s Labor and Employment Executive Committee. Janine can be reached by email at jbraxton@ martensonlaw.com.

Depositions are one of the taking my first. My experience as facts will allow you to better most valuable discovery tools an observer, however, still left me identify false, contradictory, or available in litigation. Not only can feeling less prepared than I would otherwise inaccurate testimony they affect the valuation of a case, have liked. My first deposition the moment such words are but they provide an opportunity just happened to be of a medical uttered. Prompt recognition of to assess a deponent’s credibility, expert. It was a rather contentious incongruities between testimony personality, version of the facts, matter that seemed headed for and the facts will enable you and how well he or she will be trial. I knew that the managing to challenge the deponent received by a jury. Only a small partner and more senior attorneys when necessary. percentage of cases proceed to handling the case would review On the other hand, a loose trial, so depositions are often the the transcript at some point grasp of the facts is sure to result only mechanism to obtain direct and, like any attorney looking to in a wasted opportunity (likely testimony from witnesses prior to impress, I did not want to seem the only one you will you have) disposition of the action. Indeed, unpolished or inexperienced. As to ask the questions you need for employment law and many a result, I overprepared. But my answered and to obtain real-time other areas of practice, depositions efforts paid off and I was quite responses. Miscalculating the are crucial and serve as the primary pleased with my deposition debut. deponent’s relevance and the bases for summary judgment and Since that day, I have taken and facts they are presumed to know other dispositive motions. defended many depositions. I have will undoubtedly result in a One of the best ways to gain also encountered civil and rather transcript replete with irrelevant relevant experience as an early uncivil opposing counsel. Now, testimony that fails to capture the practitioner is to attend as many nearly seven years later, I have deponent’s knowledge regarding depositions as you can to observe developed a few simple tips for material issues. the process. Ask senior colleagues taking effective depositions. if you can attend their depositions. KNOW THE LAW Better yet, offer to help them OVERPREPARE—KNOW THE FACTS prepare. While some clients are It is equally important to less than thrilled by the prospect As clichéd as it sounds, know all the claims alleged in the of paying multiple attorneys to preparation really is key. A Complaint and the respective attend depositions, COVID-19 strong command of the facts is jury instructions. Affirmative has significantly reduced the crucial. Familiarize yourself with defenses are important as well, associated costs. The pandemic the evidence and understand especially if you have the burden has effectively ended traditional the chronology, issues, and to affirmatively raise (and prove) in-person depositions, replacing relevant witnesses, including their the defense. Once you identify them with virtual proceedings. respective roles and how they the relevant causes of action, Without travel or lodging costs, fit into the puzzle. Review the respective elements, and jury virtual depositions are much pleadings, discovery responses, instructions, you will have a better more cost-effective, making this and documents produced. No grasp of the material issues and a particularly opportune time to fact borne or discovered from what admissions or information attend and observe depositions. the evidence or pleadings should you need to obtain from the I was fortunate to attend and be foreign to you heading into a witness. Knowledge of the law is observe several depositions before deposition. Familiarity with the essential to allow you to identify

26 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 the elements of each claim that a deposition will object to avoid employment defense attorney, I must be established for summary waiver, even if the objection is have also prepared witnesses to judgment and at trial. improper, baseless, or unwarranted. answer the difficult questions. Defending attorneys may also Do not shy away from topics CREATE AN OUTLINE want their clients to perceive because they make you (or the An outline will focus your them as aggressive advocates and deponent) feel uncomfortable. inquiry and keep you on track. over-object for that reason as well. The uncomfortable issues are Most witnesses (and their Familiarize yourself with frequently germane to (or the basis counsel) will respect the process proper deposition objections for of) the alleged unlawful conduct and conform with the applicable your jurisdiction. Review local and shying away from them will standards of civil procedure, and rules and guidelines regarding inhibit your ability to obtain the local and ethical rules. Some standards of conduct for discovery necessary testimony. however, will shock, surprise, and and depositions specifically. The As a new lawyer, I was reluctant disappoint you. An outline will help Federal and California Rules of to solicit testimony damaging to you maintain focus and control in Civil Procedure outline appropriate the theory of my case. While you these situations. deposition objections. certainly do not want to let the Creating deposition outlines Continual but otherwise proper witness get away from you or takes less time the more objections, without more, are otherwise facilitate unnecessarily depositions you take. As a prac- unlikely to rise to the level of inap- lengthy dialogue underscoring the titioner, irrespective of your area propriate conduct. If you find that weaknesses in your case, discovery of practice, you will encounter counsel is behaving in an egregious of all (even the bad) relevant facts is similar claims and legal issues manner, make every effort to necessary. The sooner you are able over and over again. It is also likely ensure the behavior is captured to identify and assess bad facts, the that another attorney in your firm on the record. The court reporter, better equipped you are to manage has litigated a similar claim. Ask of course, will record counsel’s around. Find senior colleagues statements made on the record. them and change the course of willing to share their outlines. However, if counsel’s behavior is litigation if necessary. A good substitute for attending nonverbal, capture that conduct In the same vein, it is important depositions is reviewing your as well (e.g., “Let the record show to know when not to ask more supervising attorney’s deposition counsel is leaning towards me, questions and when to move on transcripts. Everyone’s style is throwing objects, banging the to the next subject. If you obtain different, but it is certainly nice to conference table etc.”). Capturing a clear, unambiguous admission, know how your supervisor handles counsel’s behavior on the record move on. Review your notes during depositions. Review a sample if you can support a subsequent motion a break to further assess whether have the opportunity. for protective order, sanctions, or to resume questions regarding the need for a discovery referee. that topic. HANDLING OBJECTIONS AND Incorporating these tips into DIFFICULT OPPOSING COUNSEL ASK THE HARD QUESTIONS my practice helped reduce anxiety Objections not promptly As a former workplace inves- I felt as a new lawyer, and gave me raised at deposition are presumed tigator, I became accustomed to the confidence and framework to waived. Many attorneys defending asking the hard questions. As an take effective depositions.

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 27 Phyllis W. Cheng is a mediator at ADR CASES PENDING BEFORE THE Services, Inc., and is on the mediation panels for the California Court of Appeal, CALIFORNIA SUPREME COURT Second Appellate District, and U.S. District Court, Central District of California. She is Managing Editor of this publication and By Phyllis W. Cheng prepares the Labor & Employment Case Law Alert, a free electronic alert service on new cases for Section members. To subscribe online at http://www.calbar. ca.gov, log onto “My State Bar Profile” and follow the instructions under “Change My E-mail Addresses and List Subscriptions.”

ARBITRATION matter deferred pending consider- Lawson v. PPG Architectural ation and disposition of a related Finishes, Inc., 982 F.3d 752 (9th Conyer v. Hula Media Services, issue in Wilson v. Cable News Cir. 2020) S266001/9th Cir. No. LLC, 53 Cal. App. 5th 1189 (2020), Network, Inc. S239686 (decided 19-55802; 982 F.3d 752 review granted, 2020 WL 7391913 July 22, 2019; 7 Cal. 5th 871), Request under California Rules (2020); S264821/B296738 or pending further order of the of Court rule 8.548, that this court Petition for review after court. Submission of additional decide a question of California law reversal of denial to compel presented in a matter pending arbitration and remanded with briefing, pursuant to Cal. Rules in the United States Court of directions. (1) Did the Court of Court, rule 8.520, is deferred Appeals for the Ninth Circuit. of Appeal err in severing some pending further order of the court. Does the evidentiary standard terms in the defendant employer’s Fully briefed. set forth in Labor Code section mandatory employment arbitration Ducksworth v. Tri-Modal Distri- agreement and remanding for 1102.6 replace the rest of test of bution Services, 47 Cal. App. 5th McDonnell Douglas Corp. v. Green arbitration under the remaining 532 (2020), review granted, 2020 terms, or was the agreement (1973) 411 U.S. 792 as the relevant WL 4696753 (2020); S262699/ permeated by unconscionability evidentiary standard for retaliation B294872 such that enforcement of the claims brought pursuant to Labor Petition for review after remaining terms would not be in Code section 1102.5? Review affirmance of judgment. (1) In a the interests of justice? (2) Did granted/brief due. cause of action alleging quid pro Court of Appeal err in holding quo sexual harassment resulting in PUBLIC WORKS that the employee’s signature on a failure to promote in violation of a one-page employee handbook Busker v. Wabtec Corp., receipt and acknowledgment the Fair Employment and Housing 903 F. 3d 881 (9th Cir. 2018); form, which made no reference to Act, did the statute of limitations S251135/9th Cir. No. 17-55165 arbitration or to waiver of the right to file an administrative complaint Request under Cal. Rules to pursue statutory employment with the Department of Fair of Court, rule 8.548, that the law claims in court, constituted Employment and Housing begin to supreme court decide a question binding assent to arbitrate run when the successful candidate of California law presented in specified claims pursuant to the was offered and accepted the a matter pending in the United arbitration agreement? Review position, or when that promotion States Court of Appeals for granted/brief due. later took effect, if there is no the Ninth Circuit. Does work evidence that the plaintiff was installing electrical equipment on DISCRIMINATION / HARASSMENT / aware of the promotion on the locomotives and rail cars (i.e., the RETALIATION earlier date? (2) Was it proper for “on-board work” for Metrolink’s Bonni v. St. Joseph Health Sys., the Court of Appeal to award costs [Positive Train Control (PTC)] 13 Cal. App. 5th 851 (2017), review on appeal under rule 8.278 of the project) fall within the definition granted, 224 Cal. Rptr. 3d 684 California Rules of Court against of “public works” under Labor (2017); S244148/G052367 an unsuccessful FEHA claimant in Code § 1720(a)(1), either (1) as Petition for review after the absence of a finding that the constituting “construction” or reversal granting anti-SLAPP underlying claims were objectively “installation” under the statute, or motion. Further action in this frivolous? Fully briefed. (2) as being integral to other work

28 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 performed for the PTC project on Petition for review after requires employers to pay a wage the wayside (i.e., the “field installa- reversal of judgment. Can premium if they fail to provide tion work”)? Fully briefed. a homeowner who hires an a legally compliant meal period independent contractor be held or rest break, to have the same Mendoza v. Fonseca McElroy liable in tort for injury sustained meaning and require the same Grinding Co., 913 F. 3d 911 (9th by the contractor’s employee calculations as the term “regular Cir. 2019); S253574/9th Cir. No. when the homeowner does not rate of pay” in Labor Code § 510(a), 17-15221 retain control over the worksite which requires employers to pay a Request under Cal. Rules and the hazard causing the injury wage premium for each overtime of Court, rule 8.548, that the was known to the contractor? hour? Fully briefed. supreme court decide a question Fully briefed. of California law presented in Grande v. Eisenhower Medical a matter pending in the United Sandoval v. Qualcomm Inc., Center, 44 Cal. App. 5th 1147 States Court of Appeals for 28 Cal. App. 5th 381 (2018); (2020), review granted, 262 Cal. the Ninth Circuit. Is operating review granted, 242 Cal. Rptr. 3d Rptr. 3d 369; S261247/E068730, engineers’ offsite “mobilization 418 (2019); S252796/D070431 E068751 work”—including the transporta- Petition for review after Petition for review after affirmance of judgment in a civil tion to and from a public works site affirmance of judgment. Can a action. May a class of workers of roadwork grinding equipment— company that hires an independent bring a wage and hour class action performed “in the execution of contractor be liable in tort for against a staffing agency, settle [a] contract for public work,” injuries sustained by the contrac- that lawsuit with a stipulated (Labor Code § 1772), such that it tor’s employee based solely on judgment that releases all of the entitles workers to “not less than the company’s negligent failure to undertake safety measures, or is staffing agency’s agents, and the general prevailing rate of per then bring a second class action diem wages for work of a similar more affirmative action required to implicate Hooker v. Department premised on the same alleged character in the locality in which wage and hour violations against the public work is performed” of Transportation, 27 Cal. 4th 198 (2002)? Submitted/opinion due. the staffing agency’s client? pursuant to Labor Code § 1771? Fully brefed. Fully briefed. UNEMPLOYMENT INSURANCE Kaanaana v. Barrett Business STAFF PRIVILEGES Skidgel v. CUIAB, 24 Cal. App. Services, Inc., 29 Cal. App. 5th 778 Natarajan v. Dignity Health, 42 5th 574 (2018), review granted, 238 (2018), review granted, 243 Cal. Cal. Rptr. 3d 118 (2018); S250149/ Cal. App. 5th 383 (2019), review Rptr. 3d 827 (2019); S253458/ A151224. granted, 259 Cal. Rptr. 3d 195 B276420, B279838 Petition for review after (2020); S259364/C085906 Petition for review after affirmance of judgment. Are Petition for review after reversal of judgment. Should In Home Supportive Services affirmance of judgment for writ the phrase “work done for workers (Welfare & Institu- of administrative mandate. Does irrigation, utility, reclamation, and tions Code § 12300 et seq.) who a physician with privileges at a improvement districts, and other are providers for a spouse or a private hospital have the right to districts of this type” in Labor child eligible for unemployment disqualify a hearing officer in a Code § 1720(a)(2) of California’s insurance benefits? Fully briefed. proceeding for revocation of those Prevailing Wage Law (Labor Code §§ 1720–1861) be interpreted to privileges based on an appearance WAGE AND HOUR cover any type of work regardless of bias (see Haas v. County of of its nature, funding, purpose, or San Bernardino, 27 Cal. 4th 1017 Ferra v. Loews Hollywood Hotel, function, including belt sorting at (2002), or must the physician show LLC, 40 Cal. App. 5th 1239 (2019), recycling facilities? Submitted/ actual bias? Fully briefed. review granted, 257 Cal. Rptr. 3d 59 opinion due. (2020), S259172/B283218 TORT LIABILITY Petition for review after Naranjo v. Spectrum Security Gonzalez v. Mathis, 20 Cal. App. affirmance of judgment. Did Services, Inc., 40 Cal. App. 5th 444 5th 257 (2018); review granted, 232 the Legislature intend the term (2019), review granted, 257 Cal. Cal. Rptr. 3d 731 (2018); S247677/ “regular rate of compensation” Rptr. 3d 188 (2020), S258966/ B272344 in Labor Code § 226.7, which B256232

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 29 Petition for review after part violations, give rise to claims for meal breaks? (2) What is the affirmance and part reversal of under Labor Code §§ 203 and applicable prejudgment interest judgment. (1) Does a violation 226 when the employer does not rate for unpaid premium wages of Labor Code § 226.7, which include the premium wages in the requires payment of premium employee’s wage statements, but owed under Labor Code § 226.7? wages for meal and rest period does include the wages earned Fully briefed.

2021 CALENDAR OF LABOR & EMPLOYMENT LAW SECTION EDUCATIONAL SEMINARS Visit the Section’s website at https://calawyers.org/section/labor-and-employment-law/education/ for registration information

DATE TITLE LENGTH LOCATION Monday, March 29 Workplace Investigation 1.25 hours Interactive GoToWebinar Testimony: the Tightrope 12:00 p.m. – 1:15 p.m. of Admissibility Thursday, April 22 – 26th Annual Public 6 hours Virtual Conference Friday, April 23 Sector Conference 9:00 a.m. – 12:45 p.m. Thursday, May 6 The Ethical Consequences 1.25 hours Interactive GoToWebinar of Lawyers Engaging in 12:00 p.m. – 1:15 p.m. Prohibited Discrimination/ Harassment/Retaliation Tuesday, June 15 What You Need to Know 1 hour Interactive GoToWebinar from Recent PERB Decisions 12:00 p.m. – 1:00 p.m.

30 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 INTRODUCING THE CALIFORNIA LABOR AND EMPLOYMENT LAW REVIEW’S New Managing Editor Phyllis W. Cheng

Phyllis W. Cheng is a neutral at ADR Services, where she mediates labor and employment, civil rights and other matters. She also serves on the mediation panels of the California Court of Appeal, Second Appellate District, and the U.S. District Court, Central District of California, where she leads its mediation practice group. Ms. Cheng was director of the California Department of Fair Employment and Housing in the administrations of Governors Arnold Schwar- zenegger and Jerry Brown, as well as a member of the Fair Employment and Housing Commission, Comparable Worth Task Force, and Commission on the Status of Women. She was a partner at DLA Piper’s Employment Group, of counsel at Littler Mendelson, and associate at Hadsell & Stormer. She also served as a senior appellate court attorney at the Second District Court of Appeal, Division Seven, and was deputy attorney general at the California Department of Justice’s Civil Rights Enforcement Section. Long associated with this Section, Ms. Cheng formerly served on our Executive Committee as a member and advisor, and was editor-in-chief of this publication. For 18 years, she has continuously written a column on Cases Pending before the California Supreme Court for the Law Review. In addition, she is co-editor of California Fair Housing and Public Accommodations (The Rutter Group Civil Litigation Series), writer of our California Labor & Employment Case Law Alert for 14 years, and contributor to California Employment Litigation (The Rutter Group California Practice Guide) and other publications. The State Bar named her its 2014 Ronald M. George Public Lawyer of the Year. Ms. Cheng received her B.A. and M.Ed. from UCLA, J.D. from Southwestern University School of Law, and Ph.D. from USC, where she was a James Irvine Fellow.

VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 31 Deborah Maddux is the Senior Managing MESSAGE FROM THE CHAIR Partner of Van Dermyden Maddux Law Corporation. Deborah’s practice focuses By Deborah Maddux on conducting and overseeing workplace investigations and conducting administrative hearings. Her background includes serving as in-house counsel to the University of California, counsel to the California FPPC, and litigation counsel. Deborah is the incoming Chair of the Labor & Employment Executive Committee.

As I was preparing the agenda legal representation, regarding launching the application and for the most recent Labor & their labor and employment has plans to develop content for Employment Executive Committee law rights and obligations. The employers in the future. meeting, I marveled at the array subcommittee also partners of fantastic projects we have with community organizations to DIVERSITY underway. Our Members and provide trainings about relevant Study after study continues Advisors devote time, energy, and labor and employment law topics to demonstrate that the legal passion towards our mission in so using volunteer attorneys. profession remains one of the many ways. As I write this column, the least diverse of any profession. Some projects are more visible Outreach Subcommittee is For example, according to the and known to our membership. I preparing to launch an exciting most recent 2019 Census Bureau’s am sure all of you look forward web application aimed at educating Population Estimates, California is to your bi-monthly copy of the employees. The downloadable web 39.4 percent Latino and 6.5 percent Law Review, frequent e-mails of application will provide employees Black.1 Yet, according to the State the Case Law Alert, as well as the with basic information on labor and Bar’s 2019 demographic data, only monthly eNews blast. Many of employment law topics in a user- 7 percent of practicing attorneys you watch for the Conferences, friendly format that can be accessed in California are Latino and 4 whether Public Sector, Labor & from digital devices. Its easy-to-use percent are Black. California’s legal Employment, Wage and Hour, question and answer format will profession remains predominantly or the New Employment Lawyer direct employees to appropriate white.2 According to a 2016 Labor program. And you can rely on L&E governmental entities to address & Employment Law Section survey ongoing educational programs to their particular employment law of members, based on members’ stay abreast of changes in the law questions. The application quite self-reporting, we confirmed our and satisfy MCLE credits—whether literally puts right into their hands Section was underrepresented in through webinars, the online information employees need about terms of people of color as well. As catalog, or our self-study options. their legal rights. a result, we formed the Diversity But some of the other ways The application was initially Subcommittee to increase diversity the Section furthers its mission spearheaded by The Bar in the profession, particularly within are less visible to members, so Association of San Francisco Labor the labor and employment practice I would like to introduce you to and Employment Law Section Chair in California. The Subcommittee a few of our subcommittees. Carmen Leon and Santa Clara provides scholarships for law These subcommittees work to University School of Law Adjunct students, practitioners, and other advance outreach, diversity, and Professor Ruth Silver Taube. They legal professionals to attend the mentorship, and to provide grants applied for and received a grant to Section’s various conferences each for worthy programs as well as build the application with CS+Social year. It also has a new initiative information to the public. Good, a student computer science rolling out this spring to provide group at Stanford University. law students with scholarships for OUTREACH The application has been in summer clerkships. The Outreach Subcommittee development for about a year, and strives to educate workers has involved significant work from MENTORSHIP PROGRAM and small business owners, all groups involved. The Outreach In the last edition of Law Review, who do not have access to Subcommittee looks forward to I wrote about how grateful I am for

32 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2 those who mentored me throughout forms/d/e/1FAIpQLSe7il0xCK3xu YOUR LEGAL RIGHTS RADIO SHOW my legal career. Law school teaches qmvkZiKsR3E4a85Xw6rjaW80IdF The Executive Committee also lawyers to understand and apply the fbSwtxIEBg/viewform. contributes to the “Your Legal law, but often does not adequately GRANTS Rights” radio show by developing prepare law school graduates for labor and employment law content the nuts and bolts of practicing law. The Labor & Employment to present to the public. The radio There are a multitude of things—big Grants subcommittee facilitates show provides listeners with and small—like dealing with difficult funding for projects or events information on a broad range of clients, office politics, managing which help further its goals of legal topics. Members can access multiple projects with conflicting educating practitioners of all the radio show on Wednesdays deadlines, hours and billing, backgrounds, promoting practitio- at 7:00 pm on KALW at 91.7 FM balancing work and family, and even ners of diverse backgrounds, and for the San Francisco Bay area how to dress, for which guidance educating the public about labor and online at www.kalw.org. Past and advice can be invaluable. and employment law. programs can also be streamed at More experienced attorneys can The Grants Program specifi- https://www.kalw.org/programs/ get great satisfaction helping less cally aims to serve diverse regions your-legal-rights#stream. experienced attorneys develop into and sectors of the State. Bar asso- I close with a special thanks to seasoned professionals. The Labor ciations, nonprofits, and legal aid those who lead these important & Employment Mentorship Program organizations are just a few of the subcommittees and projects: introduces mentors and mentees for entities that have benefitted. Past Christy Kwon (Outreach); Jinny this purpose. selected projects have varied from Kim (Diversity and Your Legal Now is a great time for Section performing outreach and education Rights Radio Show); Esmeralda members to get involved in the on new legislation impacting specific Zendejas (Mentorship); and, Laboni continually improving Mentorship industries or employees, to hosting Hoq (Grants). If you would like to Program. The subcommittee trainings for employers, to funding become involved with any of these important efforts, please contact a recently established parameters translation of legal educational Member or Advisor of the Labor & to guide and help develop the materials. Organizations interested Employment Executive Committee relationship between mentor in obtaining funding can find at https://calawyers.org/section/ and mentee, and also plans to information on the application labor-and-employment-law/ host networking sessions at process and grant criteria at executive-committee/ . the upcoming Public Sector https://calawyers.org/section/ Conference and Annual Meeting. labor-and-employment-law/grants/ ENDNOTES If you are interested in becoming diversity-grants/. But act quickly 1. https://www.census.gov/quickfacts/ or connecting with a mentor, as the March 31, 2021 deadline fact/table/CA,US/PST045219 more information can be found for submitting grant applications is 2. http://www.calbar.ca.gov/Portals/0/ at https://docs.google.com/ fast approaching. documents/BarBrief/Bar-Brief-1.pdf

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VOLUME 35, NO. 2 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW 35 California Lawyers Association Labor and Employment Law Section 400 Capitol Mall, Suite 650 Sacramento, CA 95814 http://www.calawyers.org/laboremployment

Labor & Employment Law Section Executive Committee 2020–2021

Glenn Danas Jamie Wright Phil Horowitz OFFICERS Robins Kaplan LLP J. Wright Law Group, P.C. Law Office of Phil Horowitz Deborah Maddux, Chair Los Angeles Los Angeles Oakland Van Dermyden Maddux Law Adrianne De Castro Esmeralda Zendejas Jinny Kim Corp. Desai Law Firm, P.C. California Department Legal Aid at Work Sacramento Costa Mesa of Justice San Francisco Latika Malkani, Vice Chair Nicole Heeder Sacramento Christy J. Kwon Siegel LeWitter Malkani SEIU Local 1000 NLRB Oakland San Diego ADVISORS Oakland Scott Stillman, Secretary Stephanie J. Joseph Theodora Lee San Francisco District Carl Botterud California Teachers Association Botterud Law & Mediation Littler Mendelson Attorney’s Office Santa Fe Springs Walnut Creek San Francisco Pasadena Ireneo A. Reus, III Laura Davis Thomas A. Lenz Anne M. Giese, Treasurer Law Office of Ireno A. Reus III Atkinson, Andelson, Loya, SEIU Local 1000 PERB Long Beach Oakland Ruud & Romo Sacramento Cerritos Michael A. Robbins Andrew H. Friedman Erich W. Shiners, Immediate EXTTI Corporation Ramit Mizrahi Past Chair Helmer Friedman, LLP Bell Canyon Beverly Hills Mizrahi Law, APC PERB Pasadena Sacramento Christina Ro-Connolly Monica T. Guizar Oppenheimer Investigations SEIU Zoe Palitz Group LLP / Berkeley Los Angeles Altshuler Berzon LLP MEMBERS Berkeley San Francisco Maribel Hernandez Jorge Aguilar II Hina Shah Maxim Integrated Arlene P. Prater California Department of Golden Gate University San Jose Best Best & Krieger LLP Justice San Francisco San Diego Oakland Laboni Hoq Janet Cory Sommer Law Office of Laboni A. Hoq Katherine I. Thomson Rachel Bien CA Public Employers Labor South Pasadena El Cerrito Olivier Schreiber & Chao Relations Ass’n Los Angeles Pleasanton Kevin Hosn California Department of CYLA LIAISON Aaron Cole Alexandra Stathopoulos Justice Janine Braxton Ogletree, Deakins, Nash, Orrick Los Angeles Martenson Hasbrouck & Simon Smoak & Steward San Francisco LLP Los Angeles

36 CALIFORNIA LABOR & EMPLOYMENT LAW REVIEW VOLUME 35, NO. 2