EDD and Labor Commission Provide Guidance: Employee Versus Independent Contractor

The EDD and the DLSE (Labor Commissioner) are hosting on a free seminar throughout California regarding how to classify a worker as an employee versus independent contractor.  In the San Francisco Bay Area, the next one is in Dublin on February 11th.  For other dates and times, you can check the EDD’s website.

Employee Versus Independent Contractor

There are many benefits to using independent contractors, but is it worth the risk?  Classifying someone as an employee versus independent contractor has the potential to create significant exposure for companies that misclassify independent contractors due to a lack of understanding of what constitutes an employee versus independent contractor.  California Labor Code section 226.8 has significant monetary penalties for employers or persons who willfully misclassify employees as independent contractors.  “‘Willful misclassification’ means avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor.”

Since 2012, the Department of Labor, the IRS, and several state agencies have been sharing information about worker misclassification.

 

When: Thursday, February 11, 2016
Time: 9:00 a.m. to 3:30 p.m.
Where: Dublin Civic Center
100 Civic Center Plaza, Council Chambers
Dublin, CA 94568

The Employee versus Independent Contractor Tax Seminar will cover:

  • Common misconceptions about independent contractors.
  • Ways to combat payroll tax fraud.
  • How to distinguish between employees and independent contractors.
  • Statutory and exempt employment.
  • Resources to help classify workers.

EDD & Labor Commissioner

To register for the event, go to: http://www.edd.ca.gov/Payroll_Tax_Seminars/

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

Your use of this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted to this blog.

The Nuddleman Law Firm, P.C. represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, San Ramon, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

Meal and Lodging Credits in the Workplace

The Federal FLSA allows an employer to, under certain circumstances, count as wages “the reasonable cost … to the employer of furnishing such employee with board, lodging, or other facilities.” 29 U.S.C. § 203(m). The Department of Labor has just issued a new guidance document explaining the requirements for meal and lodging credits in the workplace under section 3(m) of the Fair Labor Standards Act (FLSA), as well as the proper method of accounting for this credit in calculating wages, with many examples involving home care workers.

Meal and Lodging Credits in the Workplace

The Q&A section answers such questions as:

What is a section 3(m) credit?

Under what circumstances may an employer claim the Section 3(m) credit for lodging?

What does it mean for lodging to be “regularly provided by the employer or similar employers”?

How do you determine if the employee “voluntarily accepted” the lodging?

What does is mean for lodging to be provided “in compliance with Federal, State, and Local Laws”?

What does it mean for an employee to receive the “primary benefit of the lodging” in the section 3(m) context?

When is housing “adequate” for purposes of whether an employer can claim a section 3(m) credit?How does an employer comply with the requirement to keep accurate records with regard to section 3(m)?

How does Section 3(m) apply if a live-in home care worker is a member of a union or subject to a collective bargaining agreement (CBA)?

How do you determine the amount of a section 3(m) credit?

What is the “reasonable cost” of the facilities?

And many more.

Employers who want to use meal and lodging credits in the workplace are encouraged to review the Q&A section and the Field Assistance Bulletin.

Employers in California should keep in mind that state and federal law are not the same with regard to meal and lodging credits in the workplace.  State regulations limit the amount of credit employers can use to offset minimum wage obligations, and there must be a written agreement between the employer and the employee.  Employers should also keep in mind that providing meals or lodging as part of the compensation could increase the employee’s regular rate of pay for overtime premium purposes.

If you have questions about the meals and lodging you receive from your employer, or if you provide meals and lodging to your employees as part of their compensation, speak with an employment attorney familiar with wage and hour issues as soon as practical.

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

Your use of this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted to this blog.

The Nuddleman Law Firm, P.C. represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, Berkeley, San Ramon, Concord, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

Hiring Employees Without Getting into Hot Water

As the economy improves and hiring increases, many clients have questions regarding how to avoid common pitfalls when hiring employees.  Asking the right questions and avoiding the wrong ones is just one step in Hiring Right!

Finding the Right Candidates

Hiring right begins with finding qualified candidates.  Before you begin your search make sure you know what you are looking for.  Explore your requirements and talk to others that will be working with, for and above the person.  What skills and qualities are needed?  What personalities will mesh with colleagues, subordinates and superiors?  What level of education or past experience is necessary for the job?  Will the person be supervising others?  Do you need someone with extensive experience in the field or will a recent graduate work better?  The answers to these questions and others are a good start in defining the position.

Once you determine the type of qualities and experiences the company needs, draft a job description to define the position.  An effective job description details the essential job functions, including any physical or mental requirements.  Having the essential job functions detailed in a formal job description enables you to determine what, if any, reasonable accommodations are possible for candidates with disabilities. The job description should list any job expectations and the reporting structure.  The job description should accurately reflect the work the employee is expected to perform.  Ambiguous or incomplete descriptions are not helpful and can cause problems in the future.  You may need to update the job description on an annual or more frequent basis depending on the actual work performed.

Determine a compensation range for the position as well as whether the employee will be eligible for incentive payment plans (i.e., commissions, bonuses).

Once the job description is created, determine whether the position should be classified as exempt or non-exempt.  Consult a professional familiar with the overtime laws if necessary.  Failing to correctly classify a non-exempt employee can result in an unpaid wage claim.  Recent years have seen a dramatic increase in overtime claims based on misclassification of non-exempt employees.

Once you have a Job Title for the position you are ready to create a job announcement.  Whether you work with a recruiter or post the job announcement online yourself, the job announcement should provide a good overview of the skills, qualifications and requirements of the position.  Some employers include pay ranges whereas others prefer to keep the pay range “close to the vest.”  Identifying the pay range may prevent people with higher salary requirements from applying, but may also encourage others to overstate their requirements.  Either method works if its right for you.

When considering where to post the announcement don’t forget to post the position internally.  Oftentimes the best candidates come from within your own personnel pool or from employee referrals.  Placement agencies and recruiters are a good choice if you don’t mind paying a referral fee.  Oftentimes they can vet the candidates reserving only qualified candidates for your review.  Consider posting the position with the Employment Development Department’s Job Match System.  If you are considering recent graduates, contact trade schools or other appropriate places of education.  Do not forget to put the job announcement on your own website and other online social media sites (e.g., www.LinkedIn.com, etc.).

Be aware: union contracts may require internal posting before seeking outside candidates.

When advertising the job, do not use language that could be interpreted as preferring one protected class over another (i.e., age, race, sex, national origin, marital status, sexual orientation, etc.) and state your Equal Employment Opportunity policy in the advertisement.  Do not make reference to the length of employment unless the position truly is temporary.  Remember, most employees are employed “at-will” and may be terminated or can quit for any or no reason.  Representations regarding the length of employment (i.e., “Our employees are like family – they never leave!”) can interfere with the at-will nature of the employment or lead to possible fraud claims.

The Interview Process

Hopefully your recruiting efforts resulted in a slew of qualified candidates and you now get to choose one among many to fulfill the vacant position(s).  Whether the candidates are interviewed by one person or several, each person participating in the interview process should review the job description and the candidate’s qualification prior to the interview.  Preferably, the decision makers will have already conferred about the qualities that the ideal candidate will possess.

The law prohibits discriminating against candidates based on various protected characteristics (e.g., age, race, sex, national origin, sexual orientation, disability, religion, marital status, etc.).  The law also may require employers to make reasonable accommodations for candidates with qualifying disabilities to enable such candidates to fully participate in the hiring process.  To avoid asking inappropriate or potentially unlawful questions, prepare the essential questions that you will ask every candidate ahead of time.  The questions should be designed to better enable the company to evaluate how well the candidates will be able to meet the criterion specified in the job description.  Asking the same questions to each candidate makes it less likely any single candidate can claim the interview process was slanted.

Try to ask open-ended questions, giving the candidate the opportunity to explain his/her qualifications or reasons for the answer.    Asking candidates how they handled, or would handle, specific scenarios can often provide insight into the candidates’ problem-solving and task-managing processes.

Do not, DO NOT, ask questions about:

Marital status

  • Are you single?
  • Do you live alone?
  • Are you dating anyone?
  • Have you ever been married?
  • Do you have or plan to have/raise a family?

Religion

  • Is that a Jewish name?
  • Where do you go to church?

Age

  • What year were you born?
  • What year did you graduate from high school?

Disabilities[1] or other medical conditions

  • Do you get sick often?
  • How often were you sick at your last job?
  • Do you need health insurance?
  • Have you ever been injured on the job?

Lawsuits (especially against prior employers)

Second languages unless speaking another language is an essential job function

Where the person was born

Are you a U.S. Citizen[2]?

Political affiliations

  • Who did you vote for?
  • What’s your take on [insert political issue of the day]?

Although not directly prohibited, employers should avoid asking about participation in clubs or other organizations because the answers may be perceived as asking about religion, age, etc.  Instead, ask if the candidate what interests the candidate has outside of work.

Questions should focus on the job requirements and the skills necessary to perform the job.

Some employers refuse to allow interviewers to take notes, fearing that something might be written in the notes and interpreted incorrectly.  I think notes can be helpful in recalling why a particular candidate was or was not chosen.  I do recommend the notes refer to objective information rather than subjective comments.  Note-takers should avoid comments such as “not a good fit” or “didn’t feel right.”  Instead, include the factors that led to those conclusions (e.g., “Wouldn’t make eye contact”  “Clothes were disheveled” “Did not answer questions directly”).

Checking Referrals

Some employers feel that checking referrals is a waste of time because the applicants will only provide referral sources that will provide positive information.  While this may be true, contacting former employers can help you evaluate strengths and weaknesses of potential candidates. Checking an applicant’s employment history can also verify the accuracy of the applicant’s resume and prevent a possible “negligent hiring” claim later on.

When checking references, obtain a release from the candidate authorizing the referral source to speak with you candidly about the applicant’s employment history.  As with the interview process, be consistent.  If you check references for one candidate, check references for all candidates.  The questions you ask should all be related to the job the applicant will perform.  Keep notes regarding the information obtained from prior employers with your notes from the initial interview.

Many companies do not know whether they should conduct background checks.  Background checks (as opposed to reference checks) usually refer to criminal and/or credit reporting checks.  Generally speaking, I recommend conducting a background check for employees that will have significant customer contact at customer sites or homes, or if the employee will be handling money. There are laws that limit the types of background checks employers can perform on certain employees.  If you are going to conduct a background check use a third party company familiar with the rights and responsibilities regarding how to conduct a proper background check.  Always ensure the employee authorizes the background check in writing.  NOTE: the background check authorization has to be separate from the general employment application paperwork.

Offer Letter or Employment Agreement?

Congratulations, you’ve found one or more qualified candidates!  Should you offer the job verbally or in writing?  The essential terms of the employment should always be in writing.  Essential terms include:

  • Job Title and possibly a short job description,
  • Reporting structure,
  • Compensation and benefits,
  • Vacation, Sick Leave, and/or PTO accrual if any,
  • Beginning employment date,
  • Necessity of providing appropriate documentation regarding ability to work in the U.S.
  • At-will nature of employment.

If you are going to make a verbal offer, send a written confirmation of the employment terms for the potential employee to sign.  If the offer is subject to any contingencies (such as successful background check or drug test[3]) make sure the contingencies are listed in the offer letter.  If the offer letter is a pre-cursor to a more formal Employment Agreement, ensure the terms remain the same and that the offer letter informs the employee that the employment is contingent upon execution of a formal Employment Agreement.

Many offer letters say they are not “contracts,” but they are.  At the very least they are written confirmation of the terms of the verbal contract.  Therefore, do NOT include any terms that are not part of the employment arrangement or that you will not be able to perform.

A detailed written offer may negate the need for a formal Employment Agreement.  However, depending on the level of formality and the essential terms of the employment an Employment Agreement may be necessary.  Many companies will require employees to sign Confidential and Proprietary Information Agreements.  These agreements can be part of or separate from the Employment Agreement.

Whether you use an offer letter, an Employment Agreement, a Confidential and Proprietary Information Agreement, or some combination thereof, have the documents reviewed by qualified counsel to ensure the terms are clear, unambiguous, lawful and beneficial to the company.

The Employee’s First Day

Hiring right does not end until the employee receives a copy of all essential handbooks and benefit policies and receives any necessary training or orientation.  Smart employers have all of the new employee paperwork together for the employee on their first day, as well as a check list the HR Manager can use to confirm the employee’s receipt of the necessary paperwork.

The following paperwork is either required or highly recommended:

  • Notice to Employee (Labor Code 2810.5)
  • Report of New Employee (DE-34 from the EDD)
  • Employee’s State Withholding Allowance (DE-4 from the EDD)
  • Employee’s Federal Withholding Allowance (from IRS)
  • State Disability Insurance Pamphlet (DE-2515 from the EDD)
  • Paid Family Leave Pamphlet (From the DFEH)
  • Workers’ Compensation Rights and Benefits Notice (from WCAB)
  • Employment Eligibility Verification (I-9 from UCIS)
  • Sexual Harassment Information Sheet (From DFEH)
  • Personal Physician/Chiropractic Pre-designation Form (from WCAB)
  • COBRA, Cal-COBRA and/or HIPAA Questionnaire if the company offers health benefits

I also recommend confirming receipt of the following employment and benefit policies:

  • Sexual Harassment Prevention Policy
  • At-Will Employment Policy
  • Computer and Technology Use Policy
  • Employee Handbook
  • Summary Plan Descriptions or other paperwork regarding Health, Disability, Retirement or other employer-provided benefits

The employee should sign an acknowledgement that s/he received each of the policies.

Consider what type of training the employee will receive and implement the training as soon as possible.  If there is any safety or hazardous material training required prior to performing the job ensure the proper certifications are obtained before the employee performs any such work.

In Conclusion …

Hiring right is not something that just happens.  It takes careful consideration of the options and tactics that will work best for your company.  Thoughtful contemplation of your company’s needs and frank discussions with knowledgeable counsel regarding the various rights and responsibilities imposed by law can ensure your company hires and retains the right employees – and avoids costly litigation!

 

[1] You may show candidates the job description and ask, “Would you be able to perform the essential functions of this job with or without reasonable accommodations?”  Do not ask “Do you have a disability that would interfere with this job?”
[2] You may ask, “If you are hired, can you provide evidence that you are legally able to work inside the United States?”  However, if you ask the question to one candidate you must ask it of all candidates.
[3] When an employer can drug test a potential or current employee is regulated.  Speak with a knowledgeable professional before implementing a drug testing policy.

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

Your use of this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted to this blog.

The Nuddleman Law Firm, P.C. represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, Berkeley, San Ramon, Concord, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

When can an employer require an employee to pay for training?

Some employers require employees to have certain training before hiring the employee, advancing the employee to a higher position or even to maintain employment.  In some instances, the training is required by law (e.g., state-mandated continuing education).  In other instances, the training is required by the employer, but not required by any statute or regulation.

Can an employer require an employee to pay for training?

In a recent decision by the Fourth Appellate District, In Re Acknowledgment Cases, the court held that the City of Los Angeles could not require police officers to reimburse the employer for training unless the training was legally required.

The City, requires that all newly hired police officers attend and graduate from the Los Angeles Police Academy.  Tired of providing the training only to have the officers leave to work for another police department, the City enacted LA Administrative Code section 4.1700, which provides that any police officer hired by the LAPD that does not remain employed with the LAPD for 60 months and goes to work for another law enforcement agency is required to reimburse the City a prorated portion of the cost of training at the academy.  The training consisted of state-mandated training as well as unique training for the LAPD.

Each applicant signed an agreement stating that he or she would reimburse the city for the direct and indirect costs of training if he or she leaves the LAPD within five years after graduation and becomes employed by another law enforcement agency within one year after leaving the LAPD.

43 former officers of the LAPD sued the LAPD claiming the agreement violated Labor Code sections 2802 and 2804. Labor Code section 2802 requires employers to indemnify employees for all necessary expenditures or losses incurred by the employee in direct consequence of discharging his or her duties, or at the direction of the employer.  Labor Code section 2804 says that an employee’s rights under Labor Code section 2802 may not be waived.  The officers contended that since the city required the employees to take training above and beyond state-mandated training, the city was required to bear the expense of that training, and requiring the employees to reimburse the employer for the cost of the additional training violates the Labor Code.

The City argued that because the officers did not pay for the training themselves, the officers did not incur any out-of-pocket expense, and therefore Labor Code section 2802 did not apply.  The court pointed out that the City’s argument contradicted the fact that the City sued the officers to recover the training costs.

The City also argued that Labor Code section 2802 did not apply because state law required training under the Peace Officer Standards and Training (POST) legislation.  The City ran into problems, however, because the LAPD required training above and beyond the state-mandated training.

In analyzing the issue, the court relied, in part, on a 1994 opinion letter from the Department of Labor Standards Enforcement, which says:

There is generally no requirement that an employer pay for training leading to licensure or the cost of licensure for an employee. While the license may be a requirement of the employment, it is not the type of cost encompassed by Labor Code [section] 2802. The most important aspect of licensure is that it is required by the state or locality as a result of public policy. It is the employee who must be licensed and unless there is a specific statute which requires the employer to assume part of the cost, the cost of licensing must be borne by the employee.

There may be situations, however, where licensure is not actually required by statute or ordinance but the employer requires either the training or the licensing (or both) simply as a requirement of employment. In that case, the provisions of Labor Code [section] 2802 would require the employer to reimburse the cost. (DLSE Op. Ltr. (Nov. 17, 1994) at p. 1, fn. omitted.)

The court also differentiated itself from a 2008 case, City of Oakland v. Hassey (2008) 163 Cal.App.4th 1477, because the employees in Hassey did not claim Labor Code 2802 as a defense—so the previous court never analyzed the issue—and the City of Oakland did not require its officers attend the additional training.

The court announced the following rule: where an individual must, as a matter of law, have a license to carry out the duties of his or her employment, the employee must bear the cost of obtaining the license. It is also consistent with this purpose to require an employer to bear the cost of training which is not required to obtain the license but is intended solely to enable the employee to discharge his or her duties.

To put it another way: If the law requires the training, an employer can require an employee to pay for training.  If the employer requires the training, the employer is responsible for the costs.

The court held that section 4.1700 and the agreements were void to the extent they required officers to reimburse training other than statutorily mandated basic “POST” training.  The court concluded that basic POST training is not employer-mandated training and is not an expense of discharging the duties of employment. Therefore, the individual officers could be forced to pay for the state-mandated POST training.  To the extent a City required training beyond the legally-required training, such “department required” training is for the benefit of the employer” and an employer cannot require an employee to bear that cost.

I have handled several cases against an employer that uses a very similar scheme in order to keep employees from leaving their employment within one year of being hired.  Although I made the Labor Code section 2802 argument, there were no reported cases directly on point, and the cases all resolved before trial.  With this new case, that particular employer’s policies are clearly void, and could subject the company to significant liability.  Employers should carefully review their expense reimbursement and training reimbursement policies to ensure they do not violate Labor Code section 2802 and 2804.

Original article by Robert E. Nuddleman of Nuddleman Law Firm, P.C.

Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

Your use of this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted to this blog.

The Nuddleman Law Firm, P.C. represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Pleasanton, Oakland, San Ramon, Hayward, Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

 

 

Hiring the Right Attorney

FAQ’s on Hiring the Right Lawyer

When you are considering taking legal action, it’s important to hire the right attorney for you.  It is important to have an attorney you trust, and one that can provide you the services you need.  The following are some answers to common questions my clients have when hiring a lawyer.

How do I find an attorney?

Searching online for an attorney is one method of finding the right attorney, but choosing an attorney solely on the basis of an advertisement is not always the best idea. Talk to friends, family members, colleagues and your network contacts. They oftentimes have positive or negative experience with specific attorneys that can help refine your search or point you in the right direction. Check online reviews (such as avvo.com), but be aware that one person’s experience does not guarantee a similar experience.

What things should I be looking for when I hire an attorney?

Consider your needs. You likely want an attorney with experience area of law in your case.  While you may be able to save some money by hiring a less experienced attorney, it may cost you in the end because the less experienced attorney may take more time to do the work, or may make potentially costly mistakes.

Also consider what you are trying to accomplish.  Do you just want advice, or are you already involved in a lawsuit?  Do you want your attorney to be aggressive, or use other tools to resolve your matter? Do you need someone to take the case on a contingency basis or can you afford to pay legal fees? Being clear about what you want will help you find the right lawyer for you.

How many attorneys should I talk to before I make a decision?

That’s going to depend on what you are looking for, and how quickly it takes for you to find the right attorney for you.  You may have a good feeling about the first attorney you meet, or you may need to continue searching for an attorney that fits the qualifications you are looking for.  If you meet with an attorney, even if it’s not one you are going to hire, ask for referrals to other attorneys.  A responsible lawyer will want you to find the right attorney, even if that’s not the attorney you are currently talking to.

Will I have to give my name and the name of the other side? 

Yes.  Attorneys represent a number of clients, and are required to maintain a list of everyone they have represented so they can make sure there is no conflict of interest.  It’s better to find out if there is a conflict of interest early, and the only way to do that is to provide the attorney with the names of any interested parties.

Can I just prepare a written summary and email that to a bunch of attorneys to see who is interested in my case?

I recommend against it.  Although it may be quicker to send out a mass email to several attorneys at once, you don’t know whether the attorney you are sending your summary to will have a conflict.  What would happen if you send the email to an attorney that represents the other side?

While drafting up a summary of what happened and gathering the relevant documents is a good thing to do, I would not send that to a prospective attorney unless the attorney has asked for it.  If a firm’s website gives you the ability to send the attorney an email, keep the description short.  Rather than describing your case in detail, let the attorney know you’d like to talk with someone about a wrongful termination, or your unpaid wages, or whatever short description fits your situation.  A reputable firm will usually try to respond within one business day.

Why do some attorneys charge for the initial consultation and others don’t?

Attorneys have a variety of ways of handling initial consultations.  Some, like our firm, use the initial consultation to understand your case, analyze your legal and practical issues, and advise you regarding the various options available to you.  We focus on educating our clients so they can make informed decisions about how to proceed. To do it right, this takes time.  An attorney’s skill is reviewing your matter and analyzing your situation based on the law, and creating a solution to your problems.  Much like a doctor will charge you to examine the mole on the back of your neck to determine how to treat it, an attorney may want to charge you for providing the tools of his/her trade.

Is there anything I should do to prepare for the initial consultation?

Prepare a list of questions and, if practical, a short summary of the information you want the attorney to consider.  Even before you contact the attorney, make a list of questions you want answered. That way the attorney can be sure to answer any questions you might have.

It is also important to be extremely candid with the attorney.  Every case has good facts and bad facts.  Some clients don’t want to tell the attorney all the facts, because they are concerned the attorney will be less interested in the case. If you only tell the attorney the good facts, then the attorney cannot do his/her job.  Imagine asking a doctor to give you advice about your child’s cold, but deciding not to tell the doctor that the child has been vomiting and has a fever of 103. Like your doctor, an attorney can better assist you if you tell the attorney everything.

Remember, everything you tell the attorney is confidential.

How does the attorney get paid?

That depends on your agreement with the attorney.  Attorneys will typically work on an hourly basis, a contingency basis or a flat fee basis.  There are other fee alternatives, but those are the most common.  It’s a good idea to ask the attorney up front about the fees.  Even if an attorney charges for the initial consultation, he/she may be willing to represent you on a contingency or other fee basis.

Once you’ve agreed on a fee structure, get it in writing.  Most attorneys have standard fee agreements they use, although the fee agreements will differ from firm to firm.  Read the entire fee agreement, and ask questions about anything you don’t understand.  It’s the attorney’s job to help you understand your legal questions.  Starting the relationship with questions about how the attorney will be compensated could lead to problems down the road.

Do I Need to Hire an Attorney for Labor Commissioner Claims?

Do I Need an Attorney at the Labor Commissioner’s Office?

Employees that believe they are owed unpaid wages or expenses can file a claim with the Division of Labor Standards Enforcement—aka the Labor Commissioner.  The Berman Hearing process, as it is called, is set up so the parties can represent themselves.  Oftentimes, however, parties will be represented.

Why Would Someone Want to Hire an Attorney for Labor Commissioner Claims?

There are many reasons participants hire an attorney for Labor Commissioner claims:

  • Although the process is fairly straightforward, having an advocate familiar with the Labor Commissioner process will help you identify the important facts and documents that you will enable you to prevail at the hearing.
  • Having an experienced wage and hour attorney advise you regarding your options and likely outcome will help you make better decisions regarding what to do in your particular situation.
  • Knowing someone is in your corner giving you the best chance to succeed will enable you to focus on the facts that really matter.
  • When the other side is represented, having your own attorney fighting for you can help balance the scales and help you avoid costly mistakes.
  • A qualified attorney will meet with you before the hearing and explain the process so you can be adequately prepared.
  • Hiring an experienced attorney to represent you at the Labor Commissioner will enable the attorney to better advise you should one side appeal the Labor Commissioner, because the attorney will be familiar with the facts and evidence and be able to advise you regarding the likely outcomes during the appeal.

Robert Nuddleman has been representing employers and employees before the Labor Commissioner since he was in law school.  He has represented hundreds of clients in a wide variety of Labor Commissioner claims, including claims alleging unpaid minimum wage, unpaid overtime, missed meal and rest breaks, unpaid commissions and bonuses, unpaid expenses, vacation pay, liquidated damages under Labor Code section 1194.2, waiting time penalties under Labor Code section 203.

Although you may be able to represent yourself at the Labor Commissioner’s office, hiring an attorney familiar with the wage and hour laws and the Labor Commissioner process will increase your chance of success.  Whether you need to hire an attorney to represent you at the informal conference or the hearing, or if you just need an attorney to review your matter and advise you regarding your options and the best way to improve your chance of success, Robert Nuddleman can help you succeed.

What is Alternative Dispute Resolution?

What is Alternative Dispute Resolution?

California and federal courts typically require all litigants to conduct some type of Alternative Dispute Resolution (ADR). ADR is a process in which a neutral person helps people who cannot agree, so that they can resolve their case.  ADR is designed to take place as early as possible in the life of a case, to provide an opportunity to settle all or part of the case and keep litigation expense to a minimum.  Parties in a civil case can use a mediator, neutral evaluator, arbitrator, or settlement conference neutral for assistance in resolving a case. In some programs, ADR providers determine their own fee for their services.

Types of Civil ADR available:

Mediation:

Mediation is an informal, confidential, flexible and non-binding process in which the mediator helps the parties to understand the interests of everyone involved, and their practical and legal choices. The mediator helps the parties to:

• Communicate better,

• Explore legal and practical settlement options, and

• Reach an acceptable solution of the problem.

The mediator does not decide the solution to the dispute; the parties do. The mediator does not have the power to force either party to accept any particular result, and does not render a decision regarding who will or who will not prevail in the case.  Rather, the mediator helps the parties facilitate a resolution of the case.

Mediators are allowed to charge for their time. The cost of mediation can vary depending on the mediator and the parties usually split the mediator’s fee. Some mediators charge an hourly rate, and others charge a daily rate.  Some programs offer free mediations in particular situations.

Neutral evaluation

Neutral evaluation, sometimes called “early neutral evaluation” or “ENE”, is an informal process in which the evaluator, an experienced neutral lawyer:

• Hears a compact presentation of the case from both sides,

• Gives a non-binding assessment of the strengths and weaknesses on each side, and

• Predicts the likely outcome.

The evaluator can help parties to identify issues, prepare stipulations, and draft discovery plans. The parties may use the evaluation to discuss settlement. Evaluators are allowed to charge for their time.

Like mediation, the evaluator does not have the authority to decide who wins or loses the case.  The evaluator discusses the strengths and weaknesses of the parties’ case and can offer his/her opinion as to the likelihood of prevailing.  Oftentimes, ENE will lead to settlement discussions after the parties receive feedback regarding the merits and weaknesses of their claims and defenses.

The court oftentimes provides free ENE services, but the parties can also hire a private evaluator.

Private Arbitration

Arbitration is less formal than a trial. The arbitrator:

• Hears the evidence and arguments of the parties, and then

• Makes a written decision.

The parties can agree to binding or non-binding arbitration:

• In binding arbitration the arbitrator’s decision is final and completely resolves the case, without the opportunity for appeal.

• In non-binding arbitration, the arbitrator’s decision could resolve the case, without the opportunity of appeal, unless a party timely rejects the arbitrator’s decision within 30 days and requests a trial.

Many private arbitrations are BINDING; if there is an arbitration clause in a contract, that clause may state whether or not arbitration will be binding.

Some agreements require arbitration before or in lieu of filing a lawsuit.

Civil Judge ADR

The Civil Judges ADR program allows parties to have a mediation or settlement conference with an experienced judge of the Superior Court.

Judicially supervised mediation is an informal, confidential, flexible and non-binding process in which the judge helps the parties to understand the interests of everyone involved, and their practical and legal choices, and to hopefully resolve their disputes.

A settlement conference is an informal process in which the judge:

• Meets with the parties or their attorneys,

• Hears the facts of the dispute,

• Helps identify issues to be resolved, and

• Normally suggests a resolution that the parties may accept or use as a basis for further negotiations.

Judicial Arbitration

Judicial Arbitration is like a trial, but it is less formal and there is no jury. Each side presents its case to an arbitrator. The arbitrator is either a lawyer or a retired judge, and does not take sides or give advice.

Judicial arbitration is usually free for the parties. (If your arbitration takes more than 5 hours, the arbitrator may charge you a fee, but most arbitrations take 3 hours or less.) The parties can agree to binding or non-binding arbitration:

• In binding arbitration the arbitrator’s decision is final and completely resolves the case, without the opportunity for appeal.

• In non-binding arbitration, the arbitrator’s decision could resolve the case, without the opportunity of appeal, unless a party timely rejects the arbitrator’s decision within 30 days and requests a trial.

If the parties cannot agree on a particular form of ADR, the court’s default ADR process is non-binding judicial arbitration. If the parties use non-binding judicial arbitration, then oftentimes the losing party will simply reject the arbitrator’s decision. Although this can effect the recovery of costs should the matter proceed to litigation, it does not necessarily facilitate a resolution of the claims.

Civil Early Settlement Conference

A settlement conference is an information process in which the neutral (a judge or an experienced attorney):

• Meets with the parties or their attorneys,

• Hears the facts of the dispute,

• Helps identify issues to be resolved, and

• Normally suggests a resolution that the parties may accept or use as a basis for further negotiations.

Some courts offer this service at no additional charge.

When is the right time to engage in ADR?

That depends on a number of factors.  Sometimes early ADR efforts can help the parties resolve their differences without litigation, or early in the litigation process.  Early ADR may allow the parties to resolve their differences without incurring substantial costs and before the parties become too entrenched in their positions.  If ADR occurs too early, the parties may not have sufficient time to develop the evidence and therefore may make incorrect assumptions about what the evidence will or will not show.  The inability to examine the evidence that will come out at trial may help the parties resolve their case, but it can also cause one side or the other to over-value the strengths of their position.

Given the significant costs of litigating a case, the Nuddleman Law Firm believes exploring ADR options early makes sense for most clients, but early ADR is not appropriate for every case.  If one side or the other is too entrenched in their position or has an unrealistic expectation of what will occur during the litigation, the parties may need to litigate the case until their positions become clearer or they have a better understanding of what may happen at trial.