Readers of this blog are familiar with our coverage of the various cases involving high tech firms in Silicon Valley such as Google and Adobe involving alleged “no poaching” agreements that they would not solicit each other’s employees for possible employment.  Both the U.S. Government and plaintiff class action attorneys have alleged that such conduct violates anti-trust laws and/or constitutes unfair competition under California law for violating the provisions of Business and Professions Code section 16600 regarding the prohibitions on non-compete agreements.

Earlier this week, a similar class action lawsuit was filed against various entertainment companies, including DreamWorks Animation SKG and the Walt Disney Co., accusing these companies of agreeing not to “poach” each other’s animation and visual effect artists.  The suit also alleges that the defendants agreed to fix wages and salary ranges for these employees.  The plaintiffs in this new action will likely follow the “roadmap” set forth in the Silicon Valley litigation.  It remains to be seen what other industries may be targeted with similar lawsuits in the near future.

For more details concerning this latest lawsuit, please see “DreamWorks Animation, Disney sued over alleged no-poaching scheme,” Los Angeles Times, September 8, 2014.

On August 30, 2014, the Governor signed Assembly Bill 1152 into law and said “tonight, the Legislature took historic action to help hardworking Californians. This bill guarantees that millions of workers — from Eureka to San Diego — won’t lose their jobs or pay just because they get sick.”

The new law is called the “Healthy Workplaces, Healthy Families Act.”  Beginning on July 1, 2015, both public and private employers (of any size) will be required to provide eligible employees with paid sick leave “at the rate of not less than one hour per every 30 hours worked.” Eligible employees are those employees who have worked 30 or more days within a year after their date of hire.  Under the new law, exempt employees are deemed to work a 40 hour workweek.  Employees are to be compensated at the same wage as the employee normally earns during regular work hours.  The rate of pay shall be the employee’s hourly wage.  If the employee in the 90 days of employment before taking accrued sick leave had different hourly pay rates, was paid by commission or piece rate, or was a nonexempt salaried employee, then the rate of pay shall be calculated by dividing the employee’s total wages (not including overtime premium pay) by the employee’s total hours worked in the full pay periods of the prior 90 days of employment.

There are a few exceptions in which employers are not required to offer the new paid sick leave benefit and they relate mainly to employees who are covered under a collective bargaining agreement, or who work in the construction industry, the home healthcare industry, or the airline industry.

Click here to read the full article.

An employer’s response to employee complaints can either help keep an employer out of a lawsuit or potentially cause one.  SEAC has brought together two experts in workplace investigations to provide tips for conducting effective workplace investigations for the next breakfast meeting.

This presentation will provide an overview of how to conduct a prompt, thorough and objective investigation in the workplace.  Eve Fichtner and Alexander Sperry of Van Dermyden Maddux Law Corporation will provide invaluable tips, tools and techniques so you can confidently move towards resolution of workplace complaints.

Date:  Wednesday, September 10, 2014

Time:  8:00 a.m. – 10:00 a.m.

Location:  Weintraub Tobin, 400 Capitol Mall, 11th Floor, Sacramento, CA 95814

For more information and details of this seminar, please click here.

Summary of Program

Unfortunately, both single-plaintiff and class-action wage and hour lawsuits continue to plague California employers. Often employers are sued because of technical violations that occur simply because the employer is unaware of its legal obligations. Come join the Labor and Employment Group at Weintraub Tobin as they discuss the “Ins and Outs” of wage and hour compliance for “non-exempt” employees – there’s more to it than merely paying overtime and providing meal periods.

Program Highlights

  • “Actual hours worked” and problems with “off the clock” work.
  • Is your overtime rate correct?
  • Are you “providing” a meal period to your employees?
  • “Flex-time,” “make-up time,” and “alternative work” schedules.
  • What are the courts saying – highlights of recent decisions regarding non-exempt wage and hour issues in California.

Date:    September 18,  2014

Time:  9:30 a.m. – 11:30 a.m.

For additional information and details of this seminar, please click here.  To register for this seminar, please email Ramona Carrillo at rcarrillo@weintraub.com.

On August 12, 2014, the California Court of Appeal issued a short, but interesting decision that may trigger a new wave of class action lawsuits against California employers. In Cochran v. Schwan’s Home Service, Inc. (opinion found here), the Court ruled that employers must reimburse employees for the reasonable cost of using their personal cell phones for business purposes, regardless of whether the employees have plans with unlimited or limited minutes. The Court found that the amount owed is a “reasonable percentage” of the employee’s cell phone bill, although though no guidance was provided as to how to determine what “reasonable percentage” means.

Background: The plaintiff in Cochran filed a putative class action on behalf of 1,500 customer service managers alleging a violation of Labor Code section 2802 because the managers had not been reimbursed expenses related to their personal cell phones. Under section 2802, employers must indemnify employees for all necessary expenditures incurred by employees in the performance of their duties. The trial court denied class certification based on a lack of commonality – each class member would have to be asked who paid the phone bill and whether he or she purchased a different plan because of their work cell phone usage, and, therefore, incurred an “extra expense” as a result of their job duties.

Court of Appeal’s Decision: The Court reversed the denial of class certification and disagreed with the assumptions made by the trial court; namely, that: (1) employees are not entitled to reimbursement if a third person pays the bill; (2) employees are not entitled to reimbursement if they did not purchase a different plan because of their need to use their personal phone for work purposes; and (3) liability for failure to reimburse cannot be determined without an inquiry into each employee’s cell phone plan. The Court held that Labor Code section 2802 always requires reimbursement for the reasonable expense of a personal cell phone for work purposes. As the basis for this decision, the Court noted that the purpose of section 2802 is “to prevent employers from passing their operating expenses on to their employees” and, if reimbursement was not always required, employers would receive a windfall. Further, the Court stated, “to show liability under section 2802, an employee need only show that he or she was required to use a personal cell phone to make work-related calls, and he or she was not reimbursed. Damages, of course, raise issues that are more complicated.”

The implications of the Court’s rationale may be far reaching. Not only does this decision make it easier for a class to be certified under section 2802 claims, but this same rationale could be applied beyond personal cell phones. For example, the same arguments could be applied to personal internet plans or other personal electronics if the employee is required to access the internet from home or use any other personal electronics for work purposes.

Employer Takeaway: Employers should evaluate their reimbursement policies to determine if they need to be updated. If reimbursement policies do not yet exist, implementing a policy should be considered. If reimbursement policies need to be modified, employers will have to consider whether they should be modified retroactively or only on a going-forward basis. Ultimately, if employees are required to use personal cell phones for work purposes, employers should consider providing their employees with a cell phone plan. As the Court did not provide any guidance as to what a “reasonable percentage” means, an employer can get into muddy waters trying to determine what portion of an employee’s cell plan to cover.