2018 Employment Law Update | Part Three

 

HARASSMENT

M.F. v. Pacific Pearl Hotel Mgmt. LLC, 2017 WL 4831603 (Cal. Ct. App. 2017)

M.F., a housekeeping employee who worked for a hotel, alleged she had been raped while working on the employer’s premises by a drunk, nonemployee trespasser whom the employer knew or should have known was on the premises, and who had “aggressively propositioned at least one other housekeeping employee for sexual favors.” M.F. alleged the hotel had violated the Fair Employment and Housing Act (“FEHA”), which, among other things, requires an employer to protect an employee from sexual harassment caused by a nonemployee. The trial court sustained the employer’s demurrer on the ground that the FEHA claim was barred by the exclusive remedy provided by the Workers’ Compensation Act (“WCA”). However, the Court of Appeal reversed, holding that FEHA protects an employee from sexual harassment at the hands of a nonemployee when an employer knows or should have known of the conduct and failed to take immediate and appropriate corrective action as was sufficiently alleged in this case. The Court further held that in view of the existence of a viable FEHA claim, the WCA presents no bar to the civil action.

Ly v. County of Fresno, 2017 WL 4546059 (Cal. Ct. App. 2017)

Three Laotian correctional officers were allegedly subjected to racial and national origin discrimination, harassment and retaliation by their employer, the County of Fresno. The employees filed suit in court under FEHA, while simultaneously pursuing their workers’ compensation remedies before the Workers’ Compensation Appeals Board (“WCAB”). The administrative law judge in the WCAB proceeding denied the employees’ claims after finding the County’s actions were nondiscriminatory, good faith personnel decisions. The County then moved for summary judgment of the civil action based upon the doctrines of res judicata and collateral estoppel, arguing the decision of the WCAB barred plaintiffs’ FEHA claims. The trial court granted the motion for summary judgment, and the Court of Appeal affirmed, holding that while the two forums are different, the “harm suffered [alleged psychiatric injuries caused by the County’s discrimination] is identical and therefore the same primary rights are implicated…. When two tribunals have jurisdiction… then the first final judgment from one of the tribunals becomes conclusive and renders the same issue res judicata in the other court.”

Diego v. City of Los Angeles

City of Los Angeles police officers George Diego and Allan Corrales were involved in the fatal shooting of a young, unarmed, autistic, African-American man. Following an investigation, both officers received reprimands, the lowest form of punishment within the department, continued to receive their full salary, less a “patrol bonus,” but were not allowed to return to the field. Their loss of field certification resulted in their being denied multiple opportunities for promotion, as well as their being ineligible for various off-duty jobs. At about the same time as the Diego/Corrales shooting, a Caucasian officer was involved in the fatal shooting of a Hispanic man. He was removed from field work for six weeks only. Diego and Corrales sued the city, alleging that they suffered disparate treatment because they were Hispanic and the victim was African-American.

A jury found in favor of the officers and awarded damages of almost $4 million. The city appealed.

The court of appeal reversed, holding that the verdict was not supported by the evidence. The fundamental problem with the officers’ claims was that they were based on a theory of discrimination that was legally flawed. The officers contended the jury could and should consider whether they were treated differently, not simply because of their race, but because of the race of their victim. This was error. Although the city could not lawfully take the officers’ race into account in deciding whether or not to return them to the field, it could lawfully consider the race of the shooting victim, and take into account the political implications of any sanctions imposed on the officers, without violating employment discrimination laws. Those laws would not permit the city to treat the officers differently because they were Hispanic, but they did not prohibit the city from assessing the risk management implications of returning officers of any race to the field who had been involved in a fatal shooting of an innocent, unarmed, and autistic African-American man.

 

MISCLASSIFICATION

Linton v. DeSoto Cab Co., 15 Cal. App. 5th 1208 (2017)

DeSoto Cab Co. required Darnice Linton to pay a “gate fee” in exchange for obtaining a taxicab to drive for each of his shifts. Linton alleged that he was an employee (not an independent contractor) and that by charging him “gate fees,” DeSoto is violating the wage and hour laws. The Labor Commissioner determined that Linton is an employee and not an independent contractor. The Superior Court ruled in favor of DeSoto, holding that Linton is an independent contractor and had not been misclassified. The Court of Appeal reversed the trial court’s ruling, and held that the trial court had failed to properly apply the law when it concluded that existing precedent only applied to unemployment and workers’ compensation cases and not to wage claims such as those that exist in this case. Accordingly, the appellate court reversed the judgment and remanded the case, instructing the trial court to apply the law properly.

Kao v. Joy Holiday, 2017 WL 2590653 (Cal. Ct. App. 2017)

Ming-Hsiang Kao was initially employed by Joy Holiday (a travel tour company) to perform IT-related duties, and be a tour organizer, in Taiwan. Kao later arrived in California on a tourist visa and moved into the home of Lin (an owner of Joy Holiday) and her husband Harry Chen. Kao was paid a salary of $1,700 per month, representing a gross amount of $2,500 less an $800 rent deduction. After receiving a H-1B visa, Kao was put on the company payroll and worked as the “office manager,” booking hotels and coordinating bus tours. The trial court determined that Kao worked roughly 50 hours per week. At some point, Kao was demoted to “non-manager status,” moved into his own apartment and eventually was terminated after working approximately two years. Kao filed suit for breach of contract and violation of various wage/hour statutes. Defendants contended that Kao was not an employee while he was awaiting his H-1B visa and, thereafter, he was an administrative exempt employee. Although the trial court rejected Kao’s statutory wage claims, the Court of Appeal reversed, holding that Kao was an employee (not a non-employee trainee or intern) before he received the visa and, thereafter, he was not paid a sufficient salary to be classified as an exempt administrative employee – the offsets for rent were not part of Kao’s salary. Accordingly, the Court held that Kao is entitled to unpaid wages and overtime, penalties for Joy Holiday’s failure to provide itemized wage statements and waiting-time penalties.

Batze v. Safeway, Inc., 10 Cal. App. 5th 440 (2017)

Gary Batze, et al., brought this lawsuit against their employer Safeway/Vons for failure to pay overtime wages. The employees alleged that they worked non-managerial tasks that rendered them non-exempt employees. After weeks of trial testimony, the trial court determined that the employees were engaged for more than 50 percent of their work week in managerial tasks and that they met all the other qualifications to be exempt from overtime. The Court of Appeal affirmed, holding that the employer had a realistic expectation that its store managers would be involved primarily in exempt work and that the work performed by the employees during a strike did not transform them into non-exempt employees. The Court further held that the statute of limitations was not tolled until the trial court’s order denying class certification was entered.

Jones v. Royal Admin. Servs., 2017 WL 3401317 (9th Cir. 2017)

Charles Jones and Josh Watson (individuals whose cell phones are registered on the national do-no-call registry) sued Royal Administration Services for violation of the Telephone Consumer Protection Act for calls that were made by telemarketers who were employed by All American Auto Protection (“AAAP”), which went bankrupt. The district court granted summary judgment in favor of Royal on the ground that the telemarketers were acting as independent contractors rather than as Royal’s agents, which means that Royal cannot be held vicariously liable for the telephone calls. The United States Court of Appeals for the Ninth Circuit affirmed, holding that AAAP was its own independent business that made sales for multiple companies without the direct supervision of a Royal employee – “AAAP provided its own equipment, set its own hours, and only received payment if one of its telemarketers actually made a sale.”  See also Alvarez v. Seaside Transp. Servs., LLC, 13 Cal. App. 5th 635 (2017) (independent contractor’s employee may not recover tort damages for work-related injuries from contractor’s hirer); Espejo v. The Copley Press, Inc., 13 Cal. App. 5th 329 (2017) (newspaper home delivery carriers were employees, not independent contractors, but employer was entitled to reduction in award to employees based on “readily identifiable payments and credits” that had been made).

RETALIATION/WHISTLEBLOWING

Light v. California Dep’t of Parks & Recreation, 14 Cal. App. 5th 75 (2017)

Melony Light worked as an assistant, office technician and eventually a staff services analyst at the Ocotillo Wells District of the California Department of Parks and Recreation. Light alleged that she had been retaliated against for having been a witness in an investigation of another employee’s complaint of discrimination. She also alleged intentional infliction of emotional distress. The trial court granted summary judgment in favor of the Department, but the Court of Appeal reversed in part, holding that Light had raised a triable issue of material fact that she had suffered an adverse employment action by the Department following her participating in the other employee’s discrimination complaint. Among other things, Light was isolated, moved to a different office, “verbally and to some extent physically attacked,” denied previously promised training for a new position, rejected for promotion and she suffered a reduction in her scheduled hours to zero. Further, there was “direct evidence the Department intended to and did retaliate against Light for participating in [the other employee’s] complaint.”  The appellate court also reversed the dismissal of the claim for intentional infliction of emotional distress, holding that workers’ compensation did not provide the exclusive remedy for alleged emotional distress arising from discrimination and retaliation. Finally, the court affirmed dismissal of the intentional infliction of emotional distress claim against one of the supervisors whose actions did not constitute “extreme or outrageous” conduct. See also United States ex rel. Campie v. Gilead Sciences, Inc., 862 F.3d 890 (9th Cir. 2017) (employee adequately pled a claim for retaliation in violation of the False Claims Act).

Arias v. Raimondo, 2017 WL 2676771 (9th Cir. 2017)

José Arnulfo Arias worked as a milker for Angelo Dairy. The dairy did not complete and file a Form I-9 when it hired Arias. According to the appellate court, “[i]nstead of complying with federal law, the Angelos wielded it as a weapon to confine Arias in their employ” by threatening to report Arias to the federal immigration authorities when, for example, he considered accepting employment with another dairy. In 2006, Arias filed a state court lawsuit against the dairy on behalf of himself and other similarly situated employees, alleging a variety of workplace violations, including failure to provide overtime pay and meal and rest periods. Ten weeks before the trial was scheduled to begin, the employer’s attorney (Anthony Raimondo) enlisted the services of the United States Immigration and Customs Enforcement (“ICE”) to take Arias into custody at a scheduled deposition and then remove him from the United States. There was evidence of “Raimondo’s pattern and practice of similar conduct in other cases.”  In this federal court lawsuit against Raimondo personally, Arias alleges that the dairy’s lawyer, acting as its agent, retaliated against Arias in violation of the anti-retaliation provision of the Fair Labor Standards Act. Raimondo’s sole legal defense is that because he was never Arias’s employer, he is immune from liability under the FLSA. Although the district court dismissed Arias’s complaint, the Court of Appeals reversed, holding that the FLSA’s anti-retaliation provision applies to “any person,” including a “legal representative” such as Raimondo. See also Cal. Labor Code § 1019, et seq., and Cal. Bus. & Prof. Code

  • 6103.7 (recently enacted California restrictions on “unfair-immigration related practices”).

 

Baker vs. Los Angeles Bureau of Sanitation

A Los Angeles jury panel recently awarded $17.4 million to a former employee of the Bureau of Sanitation.  The employee claimed he had been retaliated against because he had taken part in “protected activities” and because he had filed a complaint with the California Department of Fair Employment and Housing.  Although his employment was terminated by the Bureau, he successfully appealed the termination and was reinstated.  After he was reinstated, he claimed he was the subject of “rampant insults and slurs, verbally and in drawings, that implied he is gay.”  The employee was so distraught that he collapsed at work, went to the hospital and never returned to the job.  He sued the employer for sexual orientation discrimination, hostile work environment and retaliation, all of which allegedly caused depression, hypertension, vertigo, weight loss, heart damage and emotional distress.  The jury awarded the employee $15 million in past and future emotional distress damages and approximately $2.4 million in economic damages for lost wages and benefits.  In addition, the Court awarded the employee another $1.55 million in prevailing-party attorney’s fees.

CONFIDENTIALITY

Glassdoor, Inc. v. Superior Court, 9 Cal. App. 5th 623 (2017)

Machine Zone, Inc. (“MZ”), a software developer, brought suit against an anonymous former employee (“John Doe”) who allegedly violated a nondisclosure agreement (“NDA”) by posting a review on Glassdoor (a website where workers can post “reviews” of their employers) that allegedly disclosed confidential information concerning MZ and its technology. When Glassdoor refused to identify Doe, MZ moved for an order compelling it to do so. The trial court granted the motion, but in this writ proceeding, the Court of Appeal concluded that MZ had failed to make a prima facie showing that Doe’s statements disclosed confidential information in violation of the NDA. The Court first concluded that Glassdoor has standing to assert Doe’s interest in maintaining his anonymity. The Court further held that the information Doe had posted on the Glassdoor website regarding MZ’s platform team and alleged statements from MZ’s CEO did not violate the NDA: “The question thus remains: Insofar as an employee’s statement about an employer’s internal activities is untrue, can it ever violate a nondisclosure agreement? We think the answer is obviously negative.”

“GOING-AND-COMING” RULE

Morales-Simental v. Genentech, Inc., 2017 WL 4700383 (Cal. Ct. App. 2017)

Vincent Inte Ong was driving to work at Genentech when his vehicle collided with another vehicle, which resulted in the death of Marisol Morales. In this personal injury lawsuit, Morales’s survivors alleged that Ong was acting within the course and scope of his employment with Genentech at the time of the collision and that Genentech was, therefore, liable for the damages they seek. The trial court granted summary judgment in favor of Genentech, and the Court of Appeal affirmed, holding that Ong was going to work and was not performing a “special errand” for Genentech at the time, which exempted Genentech from vicarious liability in this matter.