Arbitration and the California Supreme Court: A Glimmer of Hope in Melendez
Corporations in recent years have made great strides in their efforts to hijack the American system of justice and force workers out of court and into mandatory arbitration. Their hope is that arbitration is such a stacked deck (and often it is) that workers will choose not to try to enforce their rights. They also hope that the “repeat player” phenomenon will give them a decisive advantage in terms of the results. Sadly, all too often that is the case.
However, there are signs that some judges are beginning to realize exactly what is going on with mandatory arbitration-and what a travesty it is. (more…)
Unpaid Wages and PAGA: A Third Approach in Zakaryan v. The Men’s Wearhouse
On March 28, 2019, a third California Court of Appeal weighed in on the issue of whether California employees who have signed arbitration agreements can bring claims under the Private Attorneys General Act (PAGA) for unpaid wages.
To set the stage, in Esparza v. KS Indus., L.P. (2017) 13 Cal.App.5th 1228, the Fifth District Court of Appeal held that a PAGA claim can be split, and that PAGA claims for unpaid wages under Labor Code section 558 can be sent to individual arbitration. In Lawson v. ZB, N.A. (2017) 18 Cal.App.5th 705, the Fourth District Court of Appeal disagreed, holding that employees can bring those PAGA claims on a representative basis in court.
The Second District Court of Appeal has now weighed in on this issue in the case of Zakaryan v. The Men’s Wearhouse (March 29, 2019) Case No. B289192. In that case, the court agreed with Lawson for the most part, but added this interesting twist: Of the unpaid wages recovered, 75 percent must go to the State, and 25 percent to the workers. In reaching this holding, the Zakaryan court relied on the fact that Labor Code section 558 was enacted before PAGA. Therefore, PAGA’s later-enacted rule regarding the distribution of civil penalties recovered under that statute must control. (more…)
How to Stop Wage Theft and Hold Your Boss Personally Liable for Unpaid Wages under California Law
Wage theft, or the failure to pay all wages due, is a serious problem. Studies show that up to $50 billion 
in wages go unpaid every year in the United States, and even workers who get court judgments for unpaid wages find it hard to collect on them. One reason for this state of affairs is that the law makes it relatively easy for individuals to hide behind corporate status and/or corporate shells in order to protect their assets.
A 2018 California court case clarifies that workers in this state have an important tool that allows them to bring suit against individual business owners for unpaid wages. In Atempa v. Pedrazzani (2018) 27 Cal.App.5th 809, the court held that two former employees could sue the owner of the restaurant at which they had formerly worked for unpaid wages. The court reached this decision despite the fact that the owner had created a corporation that was technically the employees’ employer. (more…)
Providing PAGA Notice to the LWDA | Hunter Pyle Law
PAGA, also known as the Private Attorneys General Act of 2004 (Cal. Labor Code § 2698, et seq.) requires workers to give written notice to California’s Labor and Workforce Development Agency, or LWDA, before seeking civil penalties that otherwise could only be recovered by the state of California. A 2018 appellate decision in Brown v. Ralph’s Grocery Company, a case that has been pending since 2009, provides guidance in terms of how much written notice is required in PAGA notice letters, and when workers are required to amend their PAGA notice letters in order to preserve claims that that they discover after the date of their letter. (more…)
California Employers Must Pay for All Off-The-Clock Work: Troester v. Starbucks
California employers must pay for all off-the-clock work, even when it does not add up to very much money.In Troester, for example, Starbucks sought to use the de minimis doctrine to avoid paying wages for short periods of time spent closing the store and transmitting daily sales, profit and loss, and store inventory data to Starbucks’s corporate headquarters. Starbucks also sought to avoid paying for time spent activating the store’s alarm.
All in all the plaintiff estimated that he was owed about $100. That may not sound like a lot, but give the number of Starbucks in California it is clear that Starbucks was saving itself a significant amount of money in unpaid wages through its practices.
Troester reaffirms California’s strong commitment to ensuring that workers are paid for every minute that they work. If you are being forced to work off-the-clock, or have questions about your rights in the workplace, feel free to contact us at inquire@hunterpylelaw.com or (510) 444-4400 for a free and confidential initial intake.
Can I Be Fired for My Political Beliefs or Activities in California?
In this time of political turbulence, many people wonder if they can be fired for their political beliefs or activities. In California, the answer to that question is no, thanks to the provisions of California Labor Code sections 1101 and 1102.
Section 1101, which has been on the books since 1937, provides as follows:
No employer shall make, adopt, or enforce any rule, regulation, or policy:
(a) Forbidding or preventing employees from engaging or participating in politics or from becoming candidates for public office.
(b) Controlling or directing, or tending to control or direct the political activities or affiliations of employees.
Note that section 1101 is broad, and includes rules, regulations or policies that tend to control or direct the political activities or affiliations of employees. This would include terminating an employee for his or her beliefs, because doing so would tend to control his or her activities or affiliations.
Section 1102, also enacted in 1937, provides as follows:
No employer shall coerce or influence or attempt to coerce or influence his employees through or by means of threat of discharge or loss of employment to adopt or follow or refrain from adopting or following any particular course or line of political action or political activity.
The California Supreme Court has interpreted these laws favorably for employees in a pair of cases. First, in Lockheed Aircraft Corp. v. Superior Court of Los Angeles County (1946) 28 Cal.2d 481, a group of employees had sued claiming that Lockheed fired them because of their political activities. In response, Lockheed raised a series of challenges to section 1101.
The Court rejected each of Lockheed’s challenges. The Court held first that section 1101 is not so uncertain or ambiguous as to be unconstitutional. The Court further held that section 1101 was not an arbitrary or unreasonable limitation on the right to contract.
Perhaps most importantly, the Court recognized that an employee who suffers a violation of section 1101 can bring a private right of action for damages resulting from a breach of his or her employment contract. In reaching this holding, the Court noted that Labor Code section 1105 provides that “Nothing in this chapter shall prevent the injured employee from recovering damages from his employer for injury suffered through a violation of this chapter.”
The Court then reasoned that, “a contract of employment must be held to have been made in the light of, and to have incorporated, the provisions of existing law. Hence, upon violation of the section, an employee has a right of action for damages for breach of his employment contract.” Lockheed Aircraft Corp., 28 Cal.2d at 486. (citations omitted)
Three decades later, the Court revisited sections 1101 and 1102 in Gay Law Students Assn. v. Pacific Tel. & Tel. Co. (1979) 24 Cal.3d 458. In that case, a group of students claimed that the defendant was discriminating against gays and lesbians by refusing to hire them, and that such conduct violated sections 1101 and 1102.[1]
The Court held that sections 1101 and 1102 “serve to protect ‘the fundamental right of employees in general to engage in political activity without interference by employers.’” 24 Cal.3d at 487. For this reason, the statutes should not be narrowly confined to partisan activity. Furthermore, “[t]he term ‘political activity’ connotes the espousal of a candidate or a cause, and some degree of action to promote the acceptance thereof by other persons.” (emphasis in original)
The Court then reiterated its holding in Lockheed that employees who are fired in violation of sections 1101 and 1102 can bring claims for damages.
If you are fired for your political beliefs or activities in California, you may be able to bring several different types of claims. First, you can sue under sections 1101 and 1102 directly. You may also be able to sue for wrongful termination in violation of public policy. See, e.g., Stevenson v. Superior Court (1997) 16 Cal.4th 880, 889–890. Third, you may be able to sue for breach of the covenant of good faith and fair dealing. See, e.g., Comunale v. Traders & General Ins. Co. (1958) 50 Cal.2d 654, 658.
It is not clear whether an employee who prevails under section 1101 or 1102 will be entitled to his or her attorneys’ fees. Therefore, you may also wish to explore bringing a claim under the Private Attorneys General Act of 2004 (PAGA) (Lab. Code, § 2698 et seq.), which provides for reasonable attorneys’ fees and costs. See Cal. Lab. Code section 2699(g)(1).
If you have questions about your rights in the workplace, please feel free to contact Hunter Pyle Law for a free and confidential initial intake. We can be reached by phone or by text at (510) 444-4400 or at inquire@hunterpylelaw.com.
[1] At that time, sexual orientation was not a protected category under the Fair Employment and Housing Act. It is now. See Cal. Govt. Code section 12940(a)(1).
Can My Boss Run a Background Check on Me in California?
California has two laws that protect employees from unauthorized background checks: the Consumer Credit Reporting Agencies Act, Civil Code section 1785, et seq. (“CCRAA”) and the Investigative Consumer Reporting Agencies Act, Civil Code section 1786, et seq. (“ICRAA”). (This blog post addresses only ICRAA, but we will post about CCRAA soon.) The California Supreme Court recently upheld the constitutionality of these statutes in a case called Connor v. First Student, Inc., S229428 (August 20, 2018). So now what? (more…)
Waiting Time Penalties under California Labor Code section 203
What are Waiting Time Penalties?
California Labor Code Section 203 provides for penalties to workers who are not paid all wages due at the time of their termination, or within 72 hours of their resignation. Waiting time penalties are in the amount of the wages that the worker normally earns, up to a maximum of 30 days. Accordingly, if a worker normally earned $25 per hour, and worked 8 hours per day, his penalties would max out at $6000 if the employer failed to pay him the wages due for 30 days or more.
Waiting Time Penalties under Labor Code section 203 are not discretionary
In the recent case of Diaz v. Grill Concepts Services, Inc. (May 24, 2018), the Second District Court of Appeal held that trial courts do not have the discretion to dispense with waiting time penalties under California Labor Code section 203.
The court reached this conclusion based upon a common sense interpretation of the language of the statute, which provides that an employer which fails to pay wages due to an employee who is discharged or quits “shall” be liable for the penalties. The court also considered the purpose of the statute, which is to enact a substantial penalty on an employer that delays in cutting the final paycheck. Finally, the court declined to create an equitable exception to the statute.
The holding in Diaz is important because workers rely upon their wages for the necessities of life. Diaz ensures that waiting time penalties are available in every case that wages are not properly paid at the time of termination.
If you have questions about your unpaid wages, please feel free to contact Hunter Pyle Law for a free and confidential initial consultation. We can be reached at (510) 444-4400 or inquire@hunterpylelaw.com.
Bonuses and Overtime in California: Does Your Company Owe You More Money?
If you work overtime in California and are are paid a bonus in addition to your hourly rate, you may be owed more money under a new California Supreme Court decision called Alvarado v. Dart Container Corp. (2018) 2018 WL 1146645.
In Alvarado, the workers were paid an “attendance bonus” if they worked on a Saturday or Sunday: In addition to their hourly rate, they were paid an extra $15 per day of weekend work. California law requires that bonuses be included as wages when calculating overtime rates for employees who work more than eight hours in a day, or more than 40 hours in a week.
The question in Alvarado was how to calculate an employee’s overtime rate when the employee earned a flat sum bonus during a single pay period. Both the trial court and the court of appeal granted summary judgment to the employer. However, the California Supreme Court reversed, and clarified how flat rate bonuses should be factored into overtime pay: (more…)
Using PAGA Claims To Recover Unpaid Wages: A Win For Workers In Lawson v. ZB
California workers are increasingly turning to the Private Attorneys General Act (PAGA) to protect their rights under the Labor Code. Labor Code section 558(a) is particularly useful to workers who have not been paid all wages owed, because it provides that workers can recover as a civil penalty any underpaid wages as well as an additional penalty of $50 or $100 for each pay period in which they were not paid all wages due.
California employers have been trying to force PAGA claims, including claims under section 558, into arbitration, where they believe they have a better chance of prevailing. Employers got a boost in 2017 from one particularly troublesome case called Esparza v. KS Industries (2017) 13 Cal.App.5th 1228. There, the court held that the underpaid wages portion of a claim under Section 558 (as opposed to the penalties portion) was subject to arbitration.
Fortunately, another California court of appeal has issued a decision that rejects Esparza. In Lawson v. ZB, N.A. (2017) 18 Cal.App.5th 705 , the Fourth District Court of Appeal held that claims for unpaid wages under Section 558 cannot be severed from claims for penalties under that same section. Accordingly, such claims cannot be sent to arbitration. (more…)