How Much Notice is Required Under PAGA? Ninth Circuit Provides Guidance in Unpublished Decision
This month in an unpublished opinion in Green v. Bank of America, No. 13-56023 (9th Cir. Oct. 13, 2015), the Ninth Circuit clarified the standard for exhaustion of administrative remedies under the California Private Attorneys’ General Act (PAGA). The plaintiffs are now petitioning the court to have this decision published, so that the PAGA notice standard becomes the law of the Circuit. (more…)
When Are Union Members Required To Arbitrate Their Wage and Hour Claims? Only when the CBA Clearly and Unmistakably Waives Their Right to a Judicial Forum
An issue that sometimes arises for union members who are subject to a collective bargaining agreement (CBA) is whether they must use the grievance and arbitration mechanism provided for in the CBA for any wage and hour claims (failure to pay overtime, failure to provide meal and rest breaks, etc.), or whether 
they can sue in court. Federal and state authorities establish that the primary test for resolving this question is whether the CBA clearly and unmistakably provides that union members must arbitrate their statutory claims. Under the primary test, broad and vague language is not enough. The CBA must explicitly state that it requires individuals to arbitrate their statutory claims. Federal and state authorities also establish an alternative test. Under the alternative test, a general arbitration clause coupled with an explicit incorporation of statutory requirements elsewhere in the CBA may result in a requirement that the employees arbitrate their statutory claims. These tests are both explored in more detail below. (more…)
The Ninth Circuit and PAGA: A Pair of Important Decisions in Yocupicio v. PAE and Sakkab v. Luxottica
The Ninth Circuit Court of Appeals recently clarified two critical issues that pertain to claims brought under California’s Private Attorneys General Act of 2004 (PAGA), Cal. Lab. Code § 2698 et seq.. Each of these decisions is helpful to workers seeking to recover civil penalties under PAGA.
First, in Yocupicio v. PAE Grp., LLC, 795 F.3d 1057 (9th Cir. 2015), the Court held that PAGA penalties may not be counted when calculating damages for the purpose of the Class Action Fairness Act (CAFA). Under CAFA, when certain other requirements are met, a class action that is filed in state court can be removed to federal court if the defendants can show that the damages at issue are worth more than $5 million. (In very general terms, most plaintiffs want to be in state court because state courts are perceived as being more favorable to class actions than federal court.) (more…)
The Road Ahead for California Truckers: Rest Breaks, Piece-Rate Work, and Federal Preemption
Several cases over the past few years have made it much easier for truck drivers in California to collect unpaid wages for missed meal and rest breaks. These decisions have also clarified that truck drivers in California who are paid by the mile or by the load must be paid separately for time that they are not actually driving. This means that companies that pay their drivers by the piece must also pay them an hourly rate for time spent doing things like vehicle inspections and stand-by time.
For example, in Bluford v. Safeway Stores, Inc., a group of truck drivers sued Safeway for unpaid rest breaks. Section 226.7 of the California Labor Code and Industrial Welfare Commission Wage Order 9 require employers to permit employees to take 10 minute rest breaks for every four hours (or major portion thereof) worked. The first rest break kicks in after three and a half hours of work. The second kicks in after six hours, and the third after 10 hours. In other words, an employee who works a shift that is more than 10 hours long is owed three rest breaks. Although employees are free from job duties during these breaks, the employer is required to pay for them and cannot deduct the rest breaks from employees’ wages.
The Bluford drivers claimed that Safeway had violated these requirements because it paid drivers based upon miles driven and tasks performed, but did not pay them for their rest breaks. Safeway responded that it did not deduct any pay from the drivers’ paychecks, and thus did not violate the law.
The California Court of Appeal agreed with the drivers. The court held that the drivers’ claim that they were not paid separately for rest breaks was enough to state a claim under Wage Order 9. In other words, where drivers are paid by the mile or by the task, the employer must pay them separately for their rest breaks. (On a separate but related note, if a driver is unable to take a rest break, the employer must compensate him or her with an additional hour of pay.) (more…)
Unpaid TV Interns Settle Large Class Action Against NBCUniversal
Last year, a federal judge in New York ruled that Fox Searchlight Pictures violated minimum wage laws by not paying interns that worked on the set of the movie “Black Swan.” In holding that employers could not simply avail themselves of free labor by calling employees “interns,” this case opened the pathway for other 
intern cases against entertainment industry giants.
In the latest victory, a group of former interns reached a 6.4 million dollar settlement with NBCUniversal this week, representing the largest settlement yet in this new streak of cases. While the original complaint involved New York interns, the case grew to include plaintiffs from other states. This recent settlement makes clear that companies need to change the blanket exploitation of interns across industries and across the country, or pay the significant price that inevitably come with the growth of these cases.
Ninth Circuit Clarifies California Labor Law Protections for Truck Drivers in Dilts v. Penske Logistics
California labor laws almost always offer stronger protections than their federal counterparts, which set the minimum baseline for all states. However, for some categories of employees, the California Labor Code protections can be preempted by federal laws- meaning the federal law supersedes the California law. Federal preemption of California laws almost always translates into fewer protections for employees.
Two federal regulatory schemes in particular contain preemption clauses: the Federal Aviation Administration Authorization Act of 1994 (FAAAA), dealing with motor carriers (the trucking industry), and the Airline Deregulation Act of 1978 (ADA), dealing with the air carriers. Both laws bar the application of California laws “relating to the rates, routes, or services” of any air or motor carrier.
Guidelines from the Northern District Regarding Class Action Settlements
The United States District Court for the Northern District of California has issued a document called “Procedural Guidance for Class Action Settlements” (Guidance). The Guidance is extremely helpful, and offers a glimpse at the prevailing wisdom with respect to settlements of class actions, at least in federal court.
The first section of the Guidance addresses motions for preliminary approval (MPAs), making the following noteworthy points:
Ayala v. Antelope Valley: When are “Independent Contractors” really Employees?
On June 30, 2014, in Ayala v. Antelope Valley Newspapers, Inc., the California Supreme Court clarified the appropriate test to use when determining whether “independent contractors” are actually employees for the purposes of California’s wage and hour laws. The Court also provided a clear road map that lays out how courts should analyze class actions that raise this issue. These clarifications are welcome, and should help more plaintiffs achieve class certification in similar cases in the future.
The plaintiffs in Ayala deliver daily newspapers to people who subscribe to the Antelope Valley Press. Antelope Valley Newspapers, Inc. (Antelope) classifies these delivery men and women (called carriers) as independent contractors, not employees. As a result, they are deprived of the wage and hour protections to which they would otherwise be entitled.
An Epic Dissent: Justice Werdegar Nails it in Iskanian
The majority opinion in Iskanian has been discussed at length, both here and in every other employment blog that touches on California law. What has been overlooked, however, is the incredibly eloquent and persuasive dissenting (and concurring in part) opinion written by Justice Kathryn Werdegar.
The fundamental points made by Justice Werdegar are that (1) class actions are a form of collective action; (2) Congress has made it clear for eighty years that contracts that strip employees of the right to engage in collective action are illegal; and (3) therefore class action waivers are illegal and unenforceable.
Ninth Circuit Clarifies Some Issues and Ducks Others Regarding Arbitration Agreements
The Court of Appeal for the Ninth Circuit recently issued a pair of decisions that help to clarify the law surrounding arbitration agreements: Davis v. Nordstrom (holding that no particular form of notice is required to modify existing arbitration agreements) and Johnmohammadi v. Bloomingdale’s (opportunity to opt out of arbitration agreements with class action waiver defeats argument that federal labor laws bar such waivers).
In Davis v. Nordstrom, Inc. (9th Cir.2014) 2014 DJDAR 8019 the court clarified the law with respect to whether and how an employer can modify an existing arbitration agreement so as to prohibit class actions. The plaintiff in Davis had received an employee handbook that required arbitration but permitted class actions. In 2011, Nordstrom revised the arbitration agreement to bar class actions.