California Employee Rights Advocate : California Labor Attorney & Lawyer : Southern CA Employment Law : Los Angeles, Orange County : United Employees Law Group

On July 6, 2010, the Second U.S. Circuit Court of Appeals held that sales representatives for Novartis Pharmaceuticals Corporation  are entitled to overtime pay under the Fair Labor Standards Act (FLSA).  Many California employees of Novartis claimed that they were wrongfully denied overtime pay between March 23, 2000 and April 7, 2007. The representatives, who worked nine-hour days, made routine calls and visits to physicians inquiring as to whether they would prescribe the company’s products to patients. Under the FLSA, employees must be paid overtime for more than 40 hours worked per week, but there are exemptions for “outside” salespersons  and “administrative” personnel.

The Court ruled that neither exemption applies to pharmaceutical reps because

(1) representatives only promote a product and do not make “sales”
(2) their activities are so tightly controlled by the company that they are not allowed to exercise independent judgment.

According to Secretary of Labor Hilda L. Solis,  an employee who can merely promote a drug and provide samples, has not in fact made a “sale.” Judge Kearse  agreed, stating that an employee who cannot “even obtain from the physician a binding agreement to prescribe it” has not made a sale.  
Novartis contended that its representatives are exempt from overtime under the “administrative” exemption, because they are free to determine when they will visit a particular doctor and how best to earn their support, whether it be dinner, a sporting event, or some other activity. The Court rejected this argument because it failed to establish a freedom of discretion. It particularly noted that Novartis representatives have no control over the company’s marketing strategy. Furthermore, the company determines the physicians to be visited, the drugs to be recommended, and the promotional events to be held. 

The ruling in this case is important because it is the first federal appellate decision addressing the outside sales and administrative exemptions as it applies to the pharmaceutical industry.  
It also underlines the main purpose of California overtime law, which is to evenly divide work among employees. 
If you are a pharmaceutical representative and have questions regarding your entitlement to California overtime pay, take action and call a knowledgeable California labor law attorney.

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On June 17, 2010, the United States Supreme Court issued a unanimous ruling in the case of City of Ontario v. Quon  holding that a California Ontario police department did not violate the Fourth Amendment when it searched an officer’s text messages made on a department-issued pager. The case arose when respondent, Jeff Quon, a police officer with the City of Ontario’s SWAT Team, exceeded his monthly messaging limit on a city-issued pager thereby causing the city to incur overage charges. After at least two other officers exceeded their monthly character allotment, the department audited two months worth of text messages to determine whether the department’s monthly plan was adequate. During the course of the audit, it was discovered that many of the messages sent by Quon were not work-related and some were of a sexual nature. Quon filed suit against the City of Ontario alleging violation of the Fourth Amendment and the Stored Communications Act (SCA). 

The case presented the Court with an opportunity to address the issue of whether employees have a reasonable expectation of privacy in electronic communications made on employer-issued devices. However, the Court refused to make such a broad ruling stating that “the judiciary risks error by elaborating too fully on the Fourth Amendment implications of emerging technology before its role in society has become clear.” It assumed that the principles governing the search of an employee’s physical office space also apply to the search of electronic communications. As such, a search conducted for a non-investigatory, work-related purpose is reasonable where the search is “justified at its inception” and “not excessively intrusive.” The Court concluded that the city’s search in Quon was reasonable, because the city had legitimate work-related purposes for the search (i.e., to determine whether the monthly messaging limit was sufficient and whether the department was paying for excessive personal messaging). Moreover, the scope of the search was not excessively intrusive, because it was restricted to two months worth of work-hour messages.

Although Quon only applies in a public employment context, there are lessons to be learned for employees in both the public and private sector. Here are a few precautions all employees should consider:

• Request a copy of your employer’s electronic communications policy and become familiar with its terms
• Assume that electronic communications on an employer-issued device are not private and may be reviewed
• Restrict your electronic communications to work-related activities

If you do fall subject to a search, remember that your employer must have a work-related purpose and the search must be limited in scope. Should you have any questions regarding the legality of a search, do not hesitate to contact an experienced California labor law attorney for an unbiased evaluation of your situation.

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The recent  BP Global oil spill has brought havoc and despair to the residents of the Gulf, most especially to those families of killed or injured workers. Their story has been felt around the nation and California is no exception. Many California employees are questioning the safety of their workplace and what they can do to correct hazardous conditions.

California has long been a leader in establishing and enforcing workplace safety regulations. Before the federal Occupational Safety and Health Administration (OSHA) was created in 1970, California had already established its own version known as Cal/ OSHA. Cal/OSHA lays out specific regulations governing conditions in the workplace and provides stiff penalities for violations.  California has spread its commitment to workplace safety to the federal level. The nation’s labor secretary, Hilda Solis, is the daughter of  California blue collar union plant and factory  workers and thus champions the rights of workers. Most notably, after BP failed to correct safety problems after a 2005 explosion in a Texas City refinery, she issued the largest fine in history against now infamous BP Global. 

Under Cal/OSHA, every employer must be aware of any hazardous conditions in the workplace and insure that employees are properly trained. All hazardous conditions that pose the threat of serious injury to employees must be corrected. Furthermore, all incidents of serious injury or death must be immediately reported. Employees have numerous rights under Cal/OSHA including, but not limited to:

1. The right to file a complaint and request an inspection of unsafe working conditions,

2. The right to refuse to perform work that would violate Cal/OSHA standards

3.  The right not to be punished in any way for filing a complaint or using any under right provided by Cal/ OSHA. 

Unlike violations under federal OSHA, Cal/OSHA evaluates every safety violation with an aim toward issuing stiff panalties or pursuing vigorous prosecution. Depending on the severity, a citation penalty may range from $7,000 to $25,000. Additional penalties may be applied for each day the employer fails to correct the violation. A willful violaton carries a penalty of not less than $5,000 and no more than $70,000. Finally, a willful violation resulting in death or serious personal injury may carry a sentence of up to three years in prison and a $1.5 million fine. 

Despite these strong penalties, California still has its problems with worker safety. Most prosecutions occur in big cities such as Los Angeles and San Francisco where lawyers have adequate resouces and political sway. Yet, many safety violations occur in rural areas composed of migrant workers and illegal immigrants who are often overlooked by the system. 

Strategy:

1. Always obey state safety and health laws. Immediately report any hazardous or dangerous conditions to your employer.

2. If your employer does not take action to correct the condition, file a complaint and request an inspection from Cal/OSHA.

3. If you have been injured on the job, be sure the incident is reported to Cal/OSHA.

4. If you have questions or concerns about your situation, contact an experienced California labor law attorney who can advise you on your rights.

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On May 20, 2010, the Department of Labor (DOL) revised its rules regarding the employment of children in non-agricultural jobs. According to the DOL, the changes are designed to “give employers clear notice that there are certain jobs children are simply not allowed to perform. They also expand opportunities for young workers to gain safe, positive work experience in fields such as advertising, teaching, banking, and information technology, as well as through school-supervised work-study programs.”  The new regulations provide for the following:

• Work permitted for workers under the age of 18

Workers under the age of 18 were previously prohibited from performing tasks that were deemed particularly hazardous. The new regulations expand the list of prohibited activities to include forest fire fighting, operating power-driven hoist equipment, poultry slaughtering, the operation and loading of balers and compactors, and the operation of chain saws, reciprocating saws, wood chippers, and abrasive cutting discs. 

• Work permitted for minors ages 14 – 15

Under the Fair Labor Standards Act (FLSA), individuals under the age of 16 are not permitted to perform any form of work not specifically authorized by the U.S. Secretary of Labor. The former regulations authorized work in the areas of retail, food-service, and gasoline-service. This list has now been expanded to include office work, errand and delivery work, lifeguarding, banking, computer programming, advertising, teaching, and work of a creative nature such as drawing. The new regulations also prohibit certain activities, particularly door-to-door sales and sign waving with some exceptions.

Minors between the ages of 14 and 15 are not permitted to work more than 3 hours of work per day or 18 hours per week while school is in session. The DOL has clarified three major points: (1) the three hour limit applies to Fridays, (2) “school hours” are defined by the local school district, and (3) employers are required to use the 168 hour week to determine compliance with child labor laws.

Finally, the new regulations expand the work-study program available to 14 and 15 year-old workers. Students enrolled in a college-preparatory program may work during school hours so they may gain work experience and earn money they may use toward their college education. 

Employers must comply with the new regulations by July 19, 2010. While the new law only effects non-agricultural employment, the DOL has indicated that it will next address child-labor laws for agricultural employment. If you have any questions or concerns regarding child-labor law, you should contact an experienced California labor law attorney.

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When an employee is terminated or resigns from their job Federal COBRA law requires most employers to continue to make the current group health insurance available to workers. All employees who are discharged as a result of voluntary or involuntary termination, such as for: negligence, poor performance, or inefficiency (with the exception of those who are terminated for gross misconduct), may opt to continue plan benefits currently in effect at their own cost, provided the employee or beneficiary makes the first payment within 30 days of notification and is not covered under Medicare or any other group health plan. The law also applies to qualified beneficiaries who were covered by the employer's group health plan the day before the discharge. For example, if the employee decides not to continue coverage, her spouse and dependent children can elect continued coverage at their own expense.

The extended coverage period is 18 months upon termination of the covered employee; upon the death, divorce, or legal separation of the covered employee, the benefit coverage period is 36 months to spouses and dependents.

The law requires that employers or plan administrators independently notify all employees and covered spouses and dependents of their rights to continued coverage. After receiving such notification, the individual has 60 days to decide to continue coverage. Moreover, employees and dependents whose insurance is protected under COBRA have to be provided with any conversion privilege otherwise offered in the plan (if such coverage exists) within a six-month period prior the date on which coverage would terminate at the end of the continuation period.

A number of employers run afoul of the law in failing to adhere to the rules regarding notification requirements, excluded individuals, conversion privileges and time restrictions. In the event the employer fails to offer such coverage, the law imposes penalties ranging from $100 to $200 per day for each day the employee is not covered and other damages. 

However it’s important to note that you cannot attain benefits if you are fired for gross misconduct. This term is relatively ambiguous; the burden of proof is on the employer to prove that the discharge was for a compelling reason (such as starting a fight or stealing). 

If an employer reduces your working hours to a point that makes you ineligible for group health coverage, refuses to negotiate continued health benefits as part of a severance package, or fails to notify you of the existence of such benefits or if the employer refuses to offer continued COBRA benefits after a discharge for any reason, consult an experienced California labor law attorney immediately.

Tip: Know your COBRA rights before accepting any job and in the event you resign or are fired. This is particularly true if you or a spouse or dependent is sick and needs the insurance benefits to pay necessary medical bills. You are entitled to such protection even if you have worked for the employer for a short period of time. Most short-term employees can generally enjoy COBRA protection for periods exceeding the length of their employment. The only requirement is that you must have been included in the employer's group plan at the time of the firing and that the employer was large enough (i.e., employed 20 or more workers, including part-timers, independent contractors, and agents, during the preceding year) under federal law to qualify.

Strategy:

1. Be sure the company notifies you in a timely fashion so you can make the election properly before the short period of employer-provided coverage expires.
2. Never waive your COBRA rights when accepting severance payments or signing a release after a discharge if you or your dependants need continued insurance.
3. A company's hands may not be tied in the event that a group health plan is modified or eliminated; an employer may be permitted to change or eliminate a current plan provided all qualifying beneficiaries and covered employees are allowed to participate similarly under new plans, if any.
4. Coverage for adopted children, children born out of wedlock, and other dependents has been expanded under the Omnibus Budget Reconciliation Act of 1993 and recent court decisions. 
5. Speak to a California Employment lawyer if you or a dependent is excluded from COBRA protection because of the existence of a secondary health plan or other factors, such as because of an alleged discharge for gross misconduct.

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Tired? Stressed? Need a break? Well, it is your employer’s duty to provide you with one. Many workers assume that they must work consistently during the hours required by their employer. Fortunately, this is not the case. In California, according to the Industrial Welfare Commission Wage Orders, employers are required to provide employees with a rest break of at least 10 consecutive minutes for each 4 hours worked; however, a rest period is not required for employees who work less than three and one-half hours. Generally, rest periods should occur in the middle of each work period. Because rest periods are considered as time worked, an employer must pay for rest breaks. Also for this reason, employers may require employees to take their rest break on the employer’s premises. The employer is mandated to provide a suitable resting place separate from toilet facilities. An employee is not required to take a rest break and may skip a break as long at the employer does not promote it. There are several exceptions to the “rest period” rule, including employees of 24-hour residential care facilities and swimmers, dancers, skaters, and other performers whose job requires strenuous physical activity.

If your employer failed to provide or pay for rest breaks, you are entitled to one additional hour at your regular rate of pay for each day the rest period was not permitted.
According to the holding by the California Supreme Court in the case of Murphy v. Kenneth Cole Productions, 40 Cal.4th 1094 (2007) and Labor Code section 226.7, a claim for violation of rest breaks must typically be filed within three years.  As such, it is wise to take action early. Your first step should be to contact a California labor law attorney to ensure you are able to collect lost wages and penalties as far as 4 years back.

If for some reason you are unable to find a California employment attorney willing to accept your case you can also file a wage claim with the California Division of Labor Standards Enforcement (DLSE). The DLSE will typically only reclaim lost wages as far as 3 years prior and further penalties are at their discretion as well. Your claim will be assigned to a deputy labor commissioner who will determine whether there should be a conference, hearing or dismissal of the claim. If the deputy determines that a hearing is warranted, then the parties will testify under oath and the Labor Commissioner will serve an order, decision, or award. In the event that an order, decision, or award is made in favor of the agrieved employee and the employer does not pay, the DLSE will have a judgment entered against the employer. Another problem may arise if the employer retaliates against you because you object to or have filed a claim against the employer for failing to provide required rest breaks. If this is the situation, you should likewise contact a California Labor lawyer first if your desired results are not reached you can also file a claim with the Labor Commissioner’s Office. 

Key Point:
If you believe you have been wrongfully denied a meal or rest breaks you should contact an experienced California labor law attorney. An attorney can guide you through the process and offer an unbiased evaluation of your particular situation.

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No one wants to walk into work one day and hear the words, “I’m sorry, but we have to let you go.” Although always upsetting, depending on the circumstances, these words may be lawful or unlawful. Generally, California follows the “at will” employment doctrine, which means the employment relationship may be terminated by either party for any reason as long as it does not violate any state or federal law. If there is a violation of law, the termination will be considered “wrongful.” Illegal reasons for termination include the following:

• Refusing to break the law
• Filing a discrimination, sexual harassment, or workers’ compensation claim
• Taking leave under the Family and Medical Leave Act
• Failing to comply with labor laws, including collective bargaining agreements
• Failing to comply with oral and written employment agreements

When faced with termination, it is easy to think that the situation is hopeless. On the contrary, there are steps you can take to protect yourself. Here are some tips for weighting the scales in your favor:

• Do not take any retaliatory actions against your employer
• Review your employment contract to determine your rights
• Inquire as to the specific reason for your termination
• Determine who made the decision regarding your termination
• Request a copy of your personnel file
• Return all company property and follow all post-employment procedures stipulated in the employee manaul

 If you believe you have been wrongfully terminated, you should immediately contact a California labor law attorney. As long as a claim is made within the statute of limitations, you may be able to be reinstated or recover lost compensation and/or damages. By consulting an experienced California labor law attorney they may be able to procure the following remedies:

• Reinstatement of employment
• Back pay
• Compensation for emotional stress
• Punitive damages to prevent further wrongdoing by the employer
• Mandated changes to the employer’s policies

While it may seem that your employer is holding all the cards, do not forget that you also have cards to play.

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Are you married, single, or divorced? Like many individuals, you may not relate the answer to this question to your employment status. Unfortunately, many employers wrongfully consider marital status when making employment decisions, including hiring, firing, compensation, and promotions. There is no federal law that specifically prohibits employers from making employment decisions based on marital status, although sexual and racial discrimination claims can be brought under Title VII of the Civil Rights Act of 1964. Nevertheless, a growing number of states have enacted laws protecting workers from adverse employment actions made on the basis of marital status.

In California, marital status discrimination is prohibited by Government Code Section 12940,  which states in pertinent part as follows:

It shall be an unlawful employment practice, unless based
upon a bona fide occupational qualification, or, except where based
upon applicable security regulations established by the United States
or the State of California:

(a) For an employer, because of the …marital status…of
any person, to refuse to hire or employ the person or to refuse to
select the person for a training program leading to employment, or to
bar or to discharge the person from employment or from a training
program leading to employment, or to discriminate against the person
in compensation or in terms, conditions, or privileges of employment.

The statute is enforced by the California Department of Fair Employment and Housing (DFEH),  which is one of the largest state civil rights agencies in the country.

Marital status discrimination, employment decisions made on the identity or situation of one’s spouse, can occur in a number of situations. Marriage between two individuals in the same company may be viewed as creating an uncomfortable working environment. If an employee’s spouse works for a competitor, an employer may consider it a conflict of interest. An issue may also arise where a spouse is deemed to be objectionable because of race, sexual orientation, or criminal background. These are all wrongful considerations by employers and employees should not hesitate to action.

If you believe you have been discriminated against based on your marital status, you should first consult an experienced California labor law attorney. By hiring a California labor law attorney, it may be possible to collect punitive damages, plus costs and attorney fees.

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An arbitration ruling has recently been handed down from the U.S. Supreme Court in a case entitled Stolt-Nielsen v. Animal Feeds Int'l Corp. 

Arbitrators, over the past several years, have followed U.S. and California Supreme Court rulings which have consistently held that if an arbitration agreement does not allow for class action treatment, then such class action treatment must be allowed.

In stark contradiction, the recent U.S. Supreme Court decision in Stolt-Nielsen v. Animal Feeds case, states "[A] party may not be compelled under the FAA to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so." This essentially means that unless the arbitration agreement specifically permits class wide arbitration, none shall be allowed.

This holding is in direct contradiction to the California Supreme Court case entitled Gentry v. Superior Court which held that any arbitration agreement that does not permit class certification is an unenforceable and voidable “exculpatory clause.”

Without a doubt many defense firms in California will attempt to use the recent decision to reshape California law, however this will likely not be successful since Gentry v. Superior Court does not conflict with the Federal Arbitration Act (“FAA”)  since it applies to all class waiver “exculpatory clauses” whether or not they happen to appear in arbitration agreements.

In addition, the Stolt-Nielsen decision simply holds that, without specifically an express agreement by the parties, class arbitrations cannot be ordered "under the FAA."   The decision does not state, however, that the FAA preempts California courts from compelling class-wide arbitration under state law, such as the California Arbitration Act or the anti-exculpatory rule discussed in the Gentry case.     

 It is likely that California courts will still be bound by the Gentry decision and judges are likely to reject any attempt to enforce an exculpatory class-waiver clause since such would conflict with Gentry. 

 The likely outcome is that defense firms and their clients will not be able to avoid class actions altogether but rather will need to choose between class wide litigation or class wide arbitration.

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