Three New Laws: Minimum Wage, Domestic Workers Bill of Rights, Expansion of Paid Family Leave

September 30, 2013

Last week, California’s Governor signed into law legislation (1) increasing the state minimum wage, (2) providing overtime compensation for many household employees, and (3) expanding the scope of California’s paid family leave insurance program. With respect to minimum wage (which is currently $8/hour in California), AB 10 increases the minimum wage to $9/hour effective July 1, 2014, and further increases it to $10/hour effective January 1, 2016. Currently, the only state with a higher minimum wage than California’s upcoming $9/hour is Washington, where the minimum wage is $9.19/hour.

The Governor also signed into law AB 241, which adds section 1450 to the California Labor Code and is known as the Domestic Worker Bill of Rights. Under this new law, individuals who work in many household occupations are now required to be paid overtime compensation at a rate of one and one-half times their regular rate for all hours worked in excess of 9 hours per day or 45 hours per week. The law excludes “casual babysitters” whose work is intermittent or irregular as well as babysitters who are under age 18, and further excludes individuals who work in residential care facilities. The law would apply to nannies, housekeepers, and individuals who provide care for the elderly and/or disabled within a private household. This new law takes effect January 1, 2014.

Finally, the Governor signed into law SB 770, which expands the scope of California’s family temporary disability insurance program. Under the current program, employees who take time off to care for a seriously ill child, spouse, parent or domestic partner, or for baby bonding, are entitled to partial wage replacement benefits through this state insurance program administered by the EDD. Under the new law, these benefits are expanded to also be provided to employees who take time off to care for a seriously ill grandparent, grandchild, sibling or parent-in-law. This new law takes effect July 1, 2014. To be clear, this new law is not a leave statute and does not require California employers to provide leaves of absence to employees for any of these circumstances, much less to provide employees pay for such leaves. An employer’s leave obligations are governed by the employer’s policies and the employer’s coverage under other applicable laws such as the FMLA and CFRA.

As we near the end of the year, I will keep you updated as to any additional laws that the Governor and his Legislative buddies are passing.

Workplace Investigation Tip: Other Evidence to Consider

September 23, 2013

The success or failure of any investigation often can hinge on additional evidence that employers fail to consider. As many of you know, we conduct workplace investigations based on claims of harassment or wrongful termination. Whether we conduct the investigation, or you, make sure you always have copies of relevant organization policies readily available for quick reference. In addition, be sure you have reviewed them prior to your meetings with the complaining party, the accused harasser, or any witnesses that need to be interviewed. Plan and execute a comprehensive search of the computers, lockers, and files of employees (if necessary) and videos. Create a checklist to ensure you do not miss anything.

Forms of additional evidence you may gather include
• employee files and evaluations,
• incident reports,
• memos,
• procedure manuals, flow charts, etc.,
• correspondence,
• e-mail or any other computer files,
• managers’ files,
• notes of any kind,
• police reports,
• pictures, charts, data, and statistics,
• project files, and
• performance ratings and criteria.
• Company cell phone records (if applicable to the circumstances)

When gathering such evidence, you may find much of it difficult to retrieve. The organization may be working with forensic experts to retrieve digital files. When requesting evidence, be prepared to explain what you hope the information will provide. What kind of light will the evidence shine on the questions in front of you?

When you have the documentary evidence, be sure to confirm its authenticity with the witnesses where relevant. For example, if an employee is accused of sending out e-mails in violation of company policy, you must present the e-mail to the employee and ask him or her if she recognizes it and, in fact, sent it. It may be possible that someone else gained access to the alleged harasser’s e-mail account and sent out the e-mails. As you can see, it’s not as simple as asking if the accused sent out an e-mail. Did she write it? Did someone else have access to her account? If so, did she ever report this? When was the last time she changed her password? Did she receive similar e-mails from others? By clearly delving into the facts, a seemingly simple investigation can yield a variety of complex issues.

A couple of final points are: one, remember that the “alleged harasser” is just that. Do not make assumptions that the person is guilty until you have all of the facts and two, document as if your notes will be carried into court by both sides. Be as clear as possible because you may have to explain them one day in a court of law.

EEOC Commissioner Provides Answers on Obesity as a Disability

September 16, 2013

About two years ago, the Equal Employment Opportunity Commission (EEOC) sued a Texas company, alleging that the company engaged in disability discrimination, in violation of the Americans with Disabilities Act, when it fired a 680-pound worker because he was morbidly obese. The EEOC alleged that the employee’s immense weight interfered with his ability to walk, stand, kneel, stoop, lift and breathe. Consequently, he was disabled, as defined under the ADA.

Since then, at least one court has recognized that morbid obesity may be a disability, while another court held that, under state law, morbid obesity is not a disability. It was right around this time that the American Medical Association adopted a new policy that officially labels obesity — not morbid obesity, but obesity — as a disease.

So how does employee obesity impact employers under the ADA?

Here are the results of a recent interview with EEOC Commissioner Chai Feldblum, which focused on obesity as a disability. Below are some pertinent highlights:
Q: What is the Equal Employment Opportunity Commission’s position with regard to the coverage of obesity under the Americans with Disabilities Act?
A: …[B]ody weight that falls outside a normal range, whether above or below, or body weight that is the result of a physiological disorder (such as a thyroid condition) can be an impairment under the law . . . And while morbid obesity, like many other conditions, was often found not limiting enough to qualify as a disability under the ADA as originally enacted, courts are beginning to reassess that view in light of the ADA Amendments Act.
* * *
Q: Has EEOC issued any formal guidance that addresses obesity?
A: …[S]evere obesity, which has been defined as body weight more than 100 percent over the norm, is clearly an impairment.
* * *
Q: Might the AMA’s official recognition of obesity as a disease make it easier for plaintiffs to prove disability discrimination under the ADA’s employment provisions?
A: The AMA’s official recognition will certainly not hurt plaintiffs. But it does not change the basic legal framework.
* * *
Q: Does or will the AMA’s policy change regarding obesity alter the EEOC’s enforcement approach or efforts? If so, in what ways?
A: No. The commission’s enforcement approach is laid out in our Strategic Enforcement Plan for FY 2012-2016 (40 EDR 5, 1/2/13). As far as I know, there are no efforts to change or modify that plan.
* * *
Q: [H]ow significant an impact might the AMA’s recognition of obesity as a disease have in the American workplace?
A: … Recognition by the AMA is certainly an important moment but, on its own, I do not believe that it will have a significant impact on the workplace.
* * *
Q: What measures should employers take to respect and protect the workplace rights of obese workers?
A: Employers should create a culture of respect and provide equality of opportunity for all employees. That will go a long way to protecting the rights of all employees with disabilities.

Obesity in the workplace presents ADA issues for employers.That’s not to say employers must satisfy every accommodation request received from an obese employee. However, employers should avoid stereotypes and generalities and view each request/situation on a case-by-case basis. In addition to fostering a “culture of respect,” remember that not just open, but open-minded communication (interactive discussion regarding a reasonable accommodation) about disability issues — obesity and otherwise — will protect both employees and employers.

Tips on Holiday Pay

September 10, 2013

With another holiday season fast approaching, we are already getting calls about holiday pay. Whether you are closed on any holiday, here are 8 things you should know about holiday pay for your employees. All of these guidelines assume that your company does not have a collective bargaining agreement.

1. Does an employer have to pay for holidays?

You are not required to pay non-exempt employees for holidays. Paid holidays is a discretionary benefit left entirely up to you. Exempt employees present a different challenge. The Fair Labor Standards Act does not permit employers to dock the salary of an exempt employee for holidays. You can make a holiday unpaid for exempt employees, but it will jeopardize their exempt status, at least for that week.

2. What happens if the holiday falls on an employee’s regularly scheduled day off, or when you are closed?

While not required, many employers give an employee the option of taking off another day if a holiday falls on an employee’s regular day off. This often happens when employees work compressed schedules (four 10-hour days as compared to five 8-hour days). Similarly, many employers observe a holiday on the preceding Friday or the following Monday when a holiday falls on a Saturday or Sunday when the employer is not ordinarily open.

3. Are you required to pay non-exempt employees for holidays, and can you require that they serve some introductory period to qualify?

It is entirely up to your company’s policy whether non-exempt employees qualify for holiday pay immediately upon hire, or after serving some introductory period. Similarly, an employer can choose only to provide holiday pay to full-time employees, but not part-time or temporary employees.

4. Can an employer require employees to work on holidays?

Because holiday closings are a discretionary benefit, you can require that employees work on a holiday. In fact, the operational needs of some businesses will require that some employees work on holidays.

5. Can an employer place conditions on the receipt of holiday pay?

Yes. For example, some employers are concerned that employees will combine a paid holiday with other paid time off to create extended vacations. To guard again this situation, some companies require employees to work the day before and after a paid holiday to be eligible to receive holiday pay.

6. How do paid holidays interact with the overtime rules for non-exempt employees?

If an employer provides paid holidays, it does not have to count the paid hours as hours worked for purposes of determining whether an employee is entitled to overtime compensation. Also, an employer does not have to pay any overtime or other premium rates for holidays.

7. Does an employer have to provide holiday pay for employees on FMLA leave?

You have to treat FMLA leaves of absence the same as other non-FMLA leaves. Thus, you only have to pay an employee for holidays during an unpaid FMLA leave if you have a policy of providing holiday pay for employees on other types of unpaid leaves. Similarly, if an employee reduces his or her work schedule for intermittent FMLA leave, you may proportionately reduce any holiday pay (as long as you treat other non-FMLA leaves the same).

8. If an employee takes a day off as a religious accommodation, does it have to be paid?

An employer must reasonably accommodate an employee whose sincerely held religious belief, practice, or observance conflicts with a work requirement, unless doing so would pose an undue hardship. One example of a reasonable accommodation is unpaid time off for a religious holiday or observance. Another is allowing an employee to use a vacation for the observance.

Disclaimer. My Blog reaches out to clients- and non-clients on a national, and international, basis. The laws of your state, or country, might be different. If you are considering adopting or changing a holiday pay policy in your organization, or have questions about how your employees are being paid for holidays and other days off, it is wise to consult with counsel.

Employer’s Rights Regarding Getting Their Attorney Fees Back

September 3, 2013

You may recall recent publicity in California over the extent to which an employer may recover its attorneys’ fees after prevailing in a wage and hour action. This is because Labor Code section 218.5 on its face provides that the prevailing party in any action brought for nonpayment of wages “shall be awarded” its reasonable costs and attorneys’ fees. Thus, Labor Code section 218.5’s fee-shifting provision on its face applies equally to a prevailing employee and employer. Based on this language, in Kirby v. Immoos, a trial court awarded attorneys’ fees to an employer who prevailed in a wage case alleging, among other things, meal and rest break violations. A California court of appeal thereafter affirmed the employer’s fee award. However, the California Supreme Court ultimately reversed this outcome and held that Labor Code section 218.5 does not apply to meal and rest break claims, reasoning that these claims are not claims alleging “non-payment of wages.” The Court’s ruling left open the possibility that a prevailing employer could recover attorneys’ fees in certain other types of wage-related actions.
To avoid this result, the California Legislature introduced a bill, SB 462, to amend Labor Code section 218.5 to provide that a prevailing employer may only recover attorneys’ fees if a trial court finds that the employee brought the wage action in bad faith. The legislature recently passed this bill last and California’s Governor signed it into law. With this amendment, it will be even more difficult and rare for a prevailing employer to recover attorneys’ fees in wage and hour actions in California.

Not to get too political but this is another example of Governor Brown and his legislative buddies putting the shaft to California employers. As many of you might already know I am working on doing a Podcast. Hopefully we should be up in the next 30 days or so. You will be kept informed of the launch date. I intend to use that forum to be extremely outspoken on these types of issues.