California Mandates FMLA/CFRA Leave for Small Employers

The Federal Family Medical Leave Act (“FMLA”) and the state equivalent California Family Rights Act (“CRFA”) require employers with 50 or more employees working within a 75-mile radius to provide up to 12 weeks of unpaid time off for serious or chronic medical conditions, and to bond with newborn children. California’s New Parent Act expands the CFRA bonding leave to employees working within a 75-mile radius of 20 employees.

Governor Newsom just signed SB-1383 expanding CFRA’s medical and bonding leave to any employer with 5 or more employees. This means small employers will be required to provide up to 12 weeks of unpaid time off in the following situations:

  • (A) Leave for reason of the birth of a child of the employee or the placement of a child with an employee in connection with the adoption or foster care of the child by the employee.
  • (B) Leave to care for a child, parent, grandparent, grandchild, sibling, spouse, or domestic partner who has a serious health condition.
  • (C) Leave because of an employee’s own serious health condition that makes the employee unable to perform the functions of the position of that employee, except for leave taken for disability on account of pregnancy, childbirth, or related medical conditions.
  • (D) Leave because of a qualifying exigency related to the covered active duty or call to covered active duty of an employee’s spouse, domestic partner, child, or parent in the Armed Forces of the United States, as specified in Section 3302.2 of the Unemployment Insurance Code.

To qualify for the leave, the employee must have been employed with the employer for at least 12-months and must have worked at least 1,250 hours during the previous year.

Employers must grant the leave and provide “a guarantee of employment in the same or a comparable position upon the termination of the leave. “ Failure to provide the guarantee of employment is the same as denying the leave.

Employers with 50 or more employees are already familiar with the requirements under FMLA and CFRA. Now small employers will need to modify their policies and provide similar leave. When FMLA/CFRA were adopted, it only applied to employers with 50 or more employers because the legislature believed requiring small employers to keep a position open for 12 weeks would create an undue burden. This is particularly true when bonding leave is combined with pregnancy leave, providing an employee almost 7 months of time off.

The time off is unpaid, but:

Any employee taking leave pursuant to subdivision (a) shall continue to be entitled to participate in employee health plans for any period during which coverage is not provided by the employer under paragraph (1), employee benefit plans, including life insurance or short-term or long-term disability or accident insurance, pension and retirement plans, and supplemental unemployment benefit plans to the same extent and under the same conditions as apply to an unpaid leave taken for any purpose other than those described 

In other words, if the employer voluntarily pays all or some of the health insurance premiums for an employee, the employer must continue the health insurance payments as though the employee was working.

I expect many employers will have difficulty complying with the new requirements that take effect January 1, 2021. It also means employers with less than 50 employees will need to update their employee handbooks and policies to include the new leave entitlement.

If you have questions about what leave might be available to you or your employees, contact the Nuddleman Law Firm, P.C. We help employers navigate the difficult terrain of California and Federal leave laws, and we help employees whose employers fail to provide required leave.

Original article Robert E. Nuddleman

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

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on this blog.

The Nuddleman Law Firm, P.C. represents employers and employees in a wide range of employment law matters. Much of our practice focuses on wage and hour issues, such as unpaid overtime, meal and rest break violations, designing or enforcing commission plans, and other wage-related claims. Mr. Nuddleman advises employers on how to avoid harassment and wrongful termination claims and represents employees who have been victims of unlawful discrimination, retaliation or harassment. The Nuddleman Law Firm, P.C. helps employers develop good employment policies, helps employers and employees with disability accommodation issues and ensures employees are correctly paid wages owed.

Free Sexual Harassment Prevention Training

California employers with 5 or more employees must provide sexual harassment prevention training for all employees every two years. Supervisors must receive 2-hours of training. All other employees must receive at least 1-hour of training.

The training must cover specific topics, and can only be conducted by certain experienced professionals. The CalChamber and other organizations offer fairly reasonably-priced online training videos. I, as well as other attorneys, provide live training. The price can vary significantly.

Now employers have a free option: The California Department of Fair Employment and Housing has finally posted their online training. And it is absolutely free!

I’m typically not a fan of “one-size-fits-all” video training because you don’t get to address specific issues or adapt the presentation to the company’s culture. But if you are going to do video training to meet your anti-harassment policy obligations, then the DFEH training is likely a good choice. Aside from being free, it will undoubtedly include all the required content.

My biggest concern about video training is that there is no evidence that video training about sexual harassment actually prevents sexual harassment. Live (including via Zoom or other webinar platforms) training can be adapted to fit a company’s specific needs and is usually more engaging than watching a pre-recorded video. Of course, live training may be more costly and it may be more difficult to conduct the training at the same time.

Although the legislature extended the time frame within which the sexual harassment prevention training must be completed, the date is rapidly approaching. If your employees have not received the required training, consider the DFEH Sexual Harassment Prevention Training. If you prefer a more tailored-training, give me a call.

Original article Robert E. Nuddleman

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

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on this blog.

The Nuddleman Law Firm, P.C. represents employers and employees in a wide range of employment law matters. Much of our practice focuses on wage and hour issues, such as unpaid overtime, meal and rest break violations, designing or enforcing commission plans, and other wage-related claims. Mr. Nuddleman advises employers on how to avoid harassment and wrongful termination claims and represents employees who have been victims of unlawful discrimination, retaliation or harassment. The Nuddleman Law Firm, P.C. helps employers develop good employment policies, helps employers and employees with disability accommodation issues and ensures employees are correctly paid wages owed.

The Times They Are A-Changin’

Last week was a bit of a whirlwind. Seven Bay Area Counties issued shelter-in-place orders. The Federal government passed two new laws as part of a larger bill providing extensive paid time off for employers with less than 500 employees. Governor Newsom issued Executive Order N-33-20 “ordering all residents are directed to immediately heed the current State public health directives.”

The Statewide stay-at-home order differs in some fairly significant ways from the county shelter-in-place orders. The same basic rule applies:

“Everyone is required to stay home except to get food, care for a relative or friend, get necessary health care, or go to an essential job. If you go out, keep at least 6 feet of distance.”

The list of “essential services” differs from the county orders. The State public health directives indicate the following essential services will remain open, such as:

  • Gas stations 
  • Pharmacies
  • Food: Grocery stores, farmers markets, food banks, convenience stores, take-out, and delivery restaurants 
  • Banks 
  • Laundromats/laundry services 
  • Essential state and local government functions will also remain open, including law enforcement and offices that provide government programs and services.

Additionally, companies “needed to maintain continuity of operation of the federal critical infrastructure sectors” are allowed to continue. Friday, March 20, 2020, the list of “Essential Critical Infrastructure Workers” was updated. I suspect this list will change over the coming days and weeks. As of today, the following are just a few of the categories of workers that are covered by my clients. This is not the complete list of workers considered part of the Critical Infrastructure. I put this list together so my clients could go to a single location and identify whether they can allow their workers to come to work.

Healthcare/Public Health Sector

  • Health care providers and caregivers (e.g., physicians, dentists, psychologists, mid-level practitioners, nurses and assistants, infection control and quality assurance personnel, pharmacists, physical and occupational therapists and assistants, social workers, speech pathologists and diagnostic and therapeutic technicians and technologists).
  • Hospital and laboratory personnel (including accounting, administrative, admitting and discharge, engineering, epidemiological, source plasma and blood donation, food service, housekeeping, medical records, information technology and operational technology, nutritionists, sanitarians, respiratory therapists, etc.).
  • Workers in other medical facilities (including Clinics, Community Mental Health, Home Health care, Hospices, Psychiatric, Residential, Rural Health Clinics, and Federally Qualified Health Centers, cannabis retailers).
  • Warehouse operators, and distributors of medical equipment, personal protective equipment (PPE), laboratory supplies, cleaning, sanitizing, disinfecting or sterilization supplies, and tissue and paper towel products.
  • Public health/community health workers,
  • Behavioral health workers (including mental and substance use disorder) responsible for coordination, outreach, engagement, and treatment to individuals in need of mental health and/or substance use disorder services
  • Workers that manage health plans, billing, and health information, who cannot practically work remotely.
  • Workers who conduct community-based public health functions, conducting epidemiologic surveillance, compiling, analyzing and communicating public health information, who cannot practically work remotely.
  • Workers who provide support to vulnerable populations to ensure their health and well-being including family care providers
  • Workers performing security, incident management, and emergency operations functions at or on behalf of healthcare entities including healthcare coalitions, who cannot practically work remotely.
  • Workers who support food, shelter, and social services, and other necessities of life for economically disadvantaged or otherwise needy individuals, such as those residing in shelters.
  • Workers supporting veterinary hospitals and clinics

Emergency Services Sector

  • Workers – including contracted vendors — who maintain digital systems infrastructure supporting law enforcement and emergency service operations.
  • Private security, private fire departments, and private emergency medical services personnel.
  • County workers responding to abuse and neglect of children, elders and dependent adults.

Essential Workforce – Public Works

  • Workers such as plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operation of residences.
  • Support, such as road and line clearing, to ensure the availability of needed facilities, transportation, energy and communications Support to ensure the effective removal, storage, and disposal of residential and commercial solid waste and hazardous waste.

Food and Agriculture

  • Workers supporting groceries, pharmacies, and other retail that sells food and beverage products, including but not limited to Grocery stores, Corner stores and convenience stores, including liquor stores that sell food, Farmers’ markets, Food banks, Farm and produce stands, Supermarkets, Similar food retail establishments, Big box stores that sell groceries and essentials
  • Restaurant carry-out and quick-serve food operations – including food preparation, carry-out and delivery food employees
  • Food manufacturer employees and their supplier employees—to include those employed in food processing (packers, meat processing, cheese plants, milk plants, produce, etc.) facilities; livestock, poultry, seafood slaughter facilities; pet and animal feed processing facilities; human food facilities producing by-products for animal food; beverage production facilities; and the production of food packaging
  • Employees and firms supporting food, feed, and beverage distribution (including curbside distribution and deliveries), including warehouse workers, vendor-managed inventory controllers, blockchain managers, distribution
  • Workers supporting cannabis retail and dietary supplement retail
  • Animal agriculture workers to include those employed in veterinary health;

Energy

  • Workers who maintain, ensure, or restore the generation, transmission, and distribution of electric power, including call centers, utility workers, reliability engineers and fleet maintenance technicians
  • Environmental remediation/monitoring technicians
  • Petroleum product storage, pipeline, marine transport, terminals, rail transport, road transport
  • Petroleum refinery facilities
  • Petroleum security operations center employees and workers who support emergency response services
  • Retail fuel centers such as gas stations and truck stops, and the distribution systems that support them.
  • Processing, refining, and transporting natural liquids, including propane gas, for use as end-use fuels or feedstocks for chemical manufacturing
  • Propane gas storage, transmission, and distribution centers

Water and Wastewater

  • Operational staff at water authorities
  • Operational staff at community water systems
  • Operational staff at wastewater treatment facilities
  • Workers repairing water and wastewater conveyances

Transportation and Logistics

  • Employees supporting or enabling transportation functions, including dispatchers, maintenance and repair technicians, warehouse workers, truck stop and rest area workers, and workers that maintain and inspect infrastructure (including those that require cross-border travel)
  • Taxis, transportation services including Transportation Network Companies, and delivery services including Delivery Network Companies
  • Maritime transportation workers – port workers, mariners, equipment operators
  • Automotive repair and maintenance facilities
  • Postal and shipping workers, to include private companies
  • Employees who repair and maintain vehicles, aircraft, rail equipment, marine vessels, and the equipment and infrastructure that enables operations that encompass movement of cargo and passengers

Communications and Information Technology

  • Maintenance of communications infrastructure- including privately owned and maintained communication systems- supported by technicians, operators, call-centers, wireline and wireless providers, cable service providers, satellite operations, undersea cable landing stations, Internet Exchange Points, and manufacturers and distributors of communications equipment
  • Engineers, technicians and associated personnel responsible for infrastructure construction and restoration, including contractors for construction and engineering of fiber optic cables
  • Installation, maintenance and repair technicians that establish, support or repair service as needed
  • Customer service and support staff, including managed and professional services as well as remote providers of support to transitioning employees to set up and maintain home offices, who interface with customers to manage or support service environments and security issues, including payroll, billing, fraud, and troubleshooting
  • Dispatchers involved with service repair and restoration
  • Data center operators, including system administrators, HVAC & electrical engineers, security personnel, IT managers, data transfer solutions engineers, software and hardware engineers, and database administrators
  • Client service centers, field engineers, and other technicians supporting critical infrastructure, as well as manufacturers and supply chain vendors that provide hardware and software, and information technology equipment (to include microelectronics and semiconductors) for critical infrastructure
  • Workers supporting the provision of essential global, national and local infrastructure for computing services (incl. cloud computing services), business infrastructure, web-based services, and critical manufacturing
  • Support required for continuity of services, including janitorial/cleaning personnel

Other Community-Based Government Operations and Essential Functions

  • The Courts, consistent with guidance released by the California Chief Justice
  • Security staff to maintain building access control and physical security measures
  • Weather forecasters
  • Construction Workers who support the construction, operation, inspection, and maintenance of construction sites and construction projects (including housing construction)
  • Workers such as plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operation of construction sites and construction projects
  • Commercial Retail Stores, that supply essential sectors, including convenience stores, pet supply stores, auto supplies and repair, hardware and home improvement, and home appliance retailers
  • Workers supporting the entertainment industries, studios, and other related establishments, provided they follow covid-19 public health guidance around social distancing
  • Workers critical to operating Rental Car companies that facilitate continuity of operations for essential workforces, and other essential travel
  • Workers that provide or determine eligibility for food, shelter, in-home supportive services, child welfare, adult protective services and social services, and other necessities of life for economically disadvantaged or otherwise needy individuals (including family members)
  • Professional services, such as legal or accounting services, when necessary to assist in compliance with legally mandated activities and critical sector services

Financial Services

  • Workers who are needed to process and maintain systems for processing financial transactions and services (e.g., payment, clearing, and settlement; wholesale funding; insurance services; and capital markets activities)

Defense Industrial Base

  • Workers who support the essential services required to meet national security commitments to the federal government and U.S. Military. These individuals, include but are not limited to, aerospace; mechanical and software engineers, manufacturing/production workers; IT support; security staff; security personnel; intelligence support, aircraft and weapon system mechanics and maintainers
  • Personnel working for companies, and their subcontractors, who perform under contract to the Department of Defense providing materials and services to the Department of Defense, and government-owned/contractor-operated and government-owned/government-operated facilities

Even if you are in one of the designated critical infrastructure workers or provide essential services, employers are encouraged to have employees work from home when possible. When that is not possible, employers and employees should

  • Wash hands with soap and water for at least 20 seconds
  • ·        Cover your cough or sneeze with a tissue
  • ·        Clean and disinfect frequently touched objects and surfaces
  • ·        If soap and water aren’t available, use alcohol-based hand sanitizer
  • Maintain social distance of 6 feet whenever possible

This is a highly stressful time for employees, employers and the community. The landscape changes quickly, and it can be difficult to stay on top of current rules and regulations without becoming overwhelmed. Take a deep breath. Focus on what’s in front of you.

The Nuddleman Law Firm, P.C. is open and helping clients during the shelter-in-place and stay-at-home orders. Our response time might not be as quick due to the volume of questions. I will do my best to send periodic updates and best practices to my clients. If you have questions or concerns, call me. If you get my voicemail, leave a message and I will return to your call as soon as practical.

Information provided by Robert Nuddleman of the 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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on this blog.

The Nuddleman Law Firm, P.C. represents employers and employees in a wide range of employment law matters. Much of his practice focuses on wage and hour issues, such as unpaid overtime, meal and rest break violations, designing or enforcing commission plans, and other wage-related claims. He also advises employers on how to avoid harassment and wrongful termination claims and represents employees who have been victims of unlawful discrimination, retaliation or harassment. The Nuddleman Law Firm, P.C. helps employers develop good employment policies, and helps employers and employees with disability accommodation issues.

Non-Solicitation Clause Unenforceable

Court Decision Casts Doubt on Non-Solicitation Clauses

California is known for its strong prohibition on almost all forms of “non-compete” clauses. The Business and Professions Code states that “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void” (§16600). California courts have consistently held this statute makes it illegal for employers to make workers sign contracts limiting their freedom to work for competitors or in certain industries after termination.

However, the legality of “non-solicitation” clauses has been less clear. A new case from the Court of Appeal clarifies that certain types of non-solicitation clauses are illegal, ruling that certain non-solicitation clauses also violate Section 16600.

What AMN Healthcare v. Aya Healthcare Services Means for Employers and Employees

This case involved recruiters who signed a contract preventing them from “soliciting any employee” to leave the company for a year after they left the company. It did not stop employees from working for a competitor. It just prevented former employees from soliciting AMN’s current employees.

The court held this contract was still illegal, primarily because as recruiters, their sole job is to solicit prospective employees. By limiting who the recruiters could seek, the contract violated Section 16600. While this may seem like a limited case, it could have further repercussions.

The Court set the stage for further restrictions and confirmed the “rule of reasonableness” does not apply in non-compete agreements. It is important for employers to review any NDAs or confidentiality agreements they utilize to ensure that they don’t run afoul of the law, and contact our offices if there is any uncertainty. Employers can still prohibit employees from using confidential trade secrets to solicit former co-workers.

California law governing non-competes and all other sorts of employment conditions can be onerous and confusing, for both employees and employers. If you need assistance drafting employment contracts or feel your employer made you sign an illegal contract, contact the Nuddleman Law Firm, P.C. for legal guidance.

Written by J.T. Keane, edited by Robert Nuddleman; 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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on this blog.

The Nuddleman Law Firm, P.C. represents employers and employees in a wide range of employment law matters. Much of his practice focuses on wage and hour issues, such as unpaid overtime, meal and rest break violations, designing or enforcing commission plans, and other wage-related claims. He also advises employers on how to avoid harassment and wrongful termination claims, and represents employees who have been victims of unlawful discrimination, retaliation or harassment. The Nuddleman Law Firm, P.C. helps employers develop good employment policies, and helps employers and employees with disability accommodation issues.

Disability Accommodations Require Extending Probationary Period

The Rancho Santiago Community College District learned the hard way that disability accommodations required the district to extend an employee’s probationary period. In Hernandez v. Rancho Santiago Community College Dist. an administrative assistant sued her employer for failing to accommodate her disability. Hernandez worked for defendant Rancho Santiago Community College District on and off for a number of years without any complaints about her performance.  During her one-year probationary period, her performance was to be evaluated at three months, seven months, and 11 months.  At the completion of 12 months of probation, she would become a permanent employee.  She took a medical leave of absence after 8 months for surgery related to a disability.  She was to return to work on, or shortly after, the anniversary of her hiring date.  The district terminated her while she was on the approved leave because her performance had not been reviewed.

District Sued for Failing to Provide Disability Accommodations

Hernandez sued the district alleging it failed to provide a disability accommodation for her medical condition. She also claimed the district failed to engage in an interactive process.  The court found in Hernandez’s favor and awarded her $723,746 in damages.  The court concluded the district could have accommodated her by extending her probationary period. If necessary, the district could have deducted the four months she was on disability leave from her probationary period. Alternatively, it could have added the time away from work to the probationary period. The district argued it would have been required to make Hernandez a permanent employee on the anniversary of her hiring regardless of the performance evaluation. The court disagreed.

The appellate court affirmed the lower court’s decision.

Disability Accommodations in the Workplace

Employers must provide reasonable accommodations to persons with disabilities unless to do so would create an undue hardship. Employers and employees must engage in an interactive process to determine what, if any, reasonable accommodations will enable the employee to perform the essential functions of the job. I routinely advise employers on how to correctly process disability accommodation requests. I work with employees to obtain the disability accommodations they need. Many employers misunderstand their obligations, and employees oftentimes don’t know their rights and obligations.

Providing persons with disabilities equal access to employment is a fundamental right protected by state and federal laws. Understanding the rights and obligations of both parties is the most effective way of ensuring persons with disabilities receive the accommodations the law requires.

If you have a question or concern about workplace disability accommodations, contact the Nuddleman Law Firm.

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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on 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.

Dynamex and the Independent Contractor Landscape

A friend and colleague, Alan Foster, asked me to write an article for his newsletter regarding independent contractors under Dynamex. I’ve seen articles, presentations and blog posts about the dramatic shift in the law regarding independent contractor versus employee tests. I have a slightly different take. The following is my take on the independent contractor landscape.

Dynamex and the Independent Contractor

Many legal professionals and business advisors are writing about the California Supreme Court “dealing a blow” to independent contractors. Different articles claim Dymanex Operations West, Inc. v. Superior Courtmakes it more difficult” for employers to classify workers as independent contractors. Many are calling it a “game changer.” But is it really?

Dynamex, a package delivery company, hired delivery drivers to deliver packages. Although Dynamex initially hired the drivers as employees, in 2004 Dynamex changed the drivers to independent contractors. Dynamex believed it provided drivers sufficient freedom it could safely classify the workers as independent contractors. The delivery drivers filed a class action lawsuit seeking unpaid wages and expenses, claiming they were really employees.

The employees claimed that under Martinez v. Combs (2010) 49 Cal.4th 35, Dynamex was the employer. Dynamex argued that Martinez only applied in the joint-employer situation and that the common law test set out in S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 should apply.

In Martinez, the court adopted a very broad definition of employer based on the IWC orders.

“[t]o employ . . . under the [wage order], has three alternative definitions. It means:

(a) to exercise control over the wages, hours, or working conditions, or

(b) to suffer or permit to work, or

(c) to engage, thereby creating a common law employment relationship.”

Borello and the Independent Contractor

In Borello, decided 21 years before Martinez, the court focused primarily on “whether the person to whom services is rendered has the right to control the manner and means of accomplishing the result desired.” The court also looked at nine other factors:

(1) right to discharge at will, without cause;

(2) whether the one performing the services is engaged in a distinct occupation or business;

(3) the kind of occupation, with reference to whether in the locality the work is usually done under the direction of the principal or by a specialist without supervision;

(4) the skill required in the particular occupation;

(5) whether the principal or the worker supplies the instrumentalities, tools, and the place of work for the person doing the work;

(6) the length of time for which the services are to be performed;

(7) method of payment, whether by the time or by the job;

(8) whether or not the work is part of the regular business of the principal; and

(9) whether or not the parties believe they are creating the relationship of employer-employee.

In a very lengthy (85 pages) opinion, the Dynamex confirmed that Martinez and Borello applied in the independent contractor arena. And the court adopted a new test to determine whether someone was “suffered or permitted” to work. This new test is being called the “ABC test.”

Under the ABC test, a worker is an employee unless the hiring entity establishes:

(A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact;

(B) that the worker performs work that is outside the usual course of the hiring entity’s business; and

(C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.

Is This Really a New Test for the Independent Contractor?

Since this is a new test, that means this is a “game changer,” right? Not necessarily. Anyone who has gone through an EDD audit is familiar with the ABC test already. The Employment Development Department has a very useful, although not employer-friendly, test for determining whether someone is an independent contractor. The questions in the DE-38 contain the same factors that make up the ABC test.

Under the DE-38, if the employer answers “yes” to the first three questions, “it is a strong indication that the worker is an employee.” If the employer answers “no” to the next three questions, this “indicates that the individual is not in a business for himself or herself and would, therefore, normally be an employee.” Answering “yes” to the final seven questions on the DE-38 means there is a “greater the likelihood the worker is performing services as an employee.”

So, how does the ABC Test compare to the DE-38? This chart shows the ABC test elements line up directly with the DE-38 test:

ABC Test DE-38
(B) that the worker performs work that is outside the usual course of the hiring entity’s business 3. Is the work being performed part of your regular business?

 

(C) that the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity 4. Does the worker have a separately established business?
(A) that the worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of such work and in fact 5. Is the worker free to make business decisions which affect his or her ability to profit from the work?

One aspect of the ABC test arguably not in the DE-38 is that the hiring entity must establish each of the three factors in the ABC test. The DE-38 uses phrases such as “strong indication” and “normally,” allowing more leeway than the more definitive ABC test.

The ABC test is less a “new” independent contractor test, and more an application of an existing test that many employers ignored. I have been advising my clients against hiring workers as independent contractors unless the workers have their own established business and the workers are performing work not part of the company’s normal business. Dynamex confirms the conservative approach is the right approach, particularly in California.

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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on this blog.

The Nuddleman Law Firm, P.C. represents employers and employees in a wide range of employment law matters. Much of his practice focuses on wage and hour issues, such as unpaid overtime, meal and rest break violations, designing or enforcing commission plans, and other wage-related claims. He also advises employers on how to avoid harassment and wrongful termination claims, and represents employees who have been victims of unlawful discrimination, retaliation or harassment. The Nuddleman Law Firm, P.C. helps employers develop good employment policies, and helps employers and employees with disability accommodation issues.

Labor Commissioner Audits Can Be Expensive

Labor Commissioner audits can be time consuming and expensive. Just ask Kome Japanese Seafood & Buffet, Burma Ruby Burmese Cuisine, and Rangoon Ruby Burmese Cuisine. The restaurants and their owners are facing a hefty bill after their audits.

Expensive Labor Commissioner Audits

California’s Department of Industrial Relations announced the Labor Commissioner cited seven Bay Area restaurants more than $10 million for “wage theft violations.” The restaurants included Kome Japanese Seafood & Buffet, Burma Ruby Burmese Cuisine, and Rangoon Ruby Burmese Cuisine.

The Labor Commissioner’s Office launched the investigation after receiving complaints from workers who reported wage theft to the Asian Law Caucus. The Asian Law Caucus also represented many of the workers who cooperated in the investigation.

The wage theft violations and civil penalties cited in the Labor Commissioner Audits include:

  • Failure to pay minimum wage,
  • Overtime
  • Split shift premiums,
  • Illegal counting of tips received as part of the minimum hourly wage,
  • Waiting time penalties, and
  • Pay stub violations.

Many of the overtime violations resulted from employees paid a salary who worked 50 or more hours each week.

Labor Commissioner Audits Include Individual Corporate Owners

The citations are against the corporations and LLCs as well as the owners and members of the companies. Being incorporated does not prevent personal liability for wage theft claims. Labor Code section 558.1 provides:

Any employer or other person acting on behalf of an employer, who violates, or causes to be violated, any provision regulating minimum wages or hours and days of work in any order of the Industrial Welfare Commission, or violates, or causes to be violated, Sections 203, 226, 226.7, 1193.6, 1194, or 2802, may be held liable as the employer for such violation.

Other Labor Code sections also allow the Labor Commissioner to cite individual owners.

David Tai Leung, Wendy Lai Ip, Jun Zheng, Gang Zhou, Bai Dong Zhang and Tiffany Leung, owners of the corporations Kome Japanese Seafood Buffet, Inc. and Koshi Food Service, Inc., are ordered to pay the 133 workers at Kome Buffet $4,381,461 in unpaid wages, premiums and liquidated damages, as well as civil penalties of $780,400.

Max Lee and John Lee, owners of Rangoon Ruby Investment LLC and Burma Ruby Investment LLC, have been ordered to pay their 298 workers $4,394,118 for unpaid wages, premiums, liquidated damages and itemized wage statement violations, and civil penalties of $574,150

The press release did not indicate whether the restaurants will appeal the citations, or how much the Labor Commissioner will actually collect.

I represent employers in Labor Commissioner audits. The audits can be time-consuming and result in serious assessments. Seemingly small mistakes can have serious consequences, and the appeal rights are somewhat limited. Employers receiving notice of an audit should speak with counsel as soon as possible. Properly preparing for an audit can reduce the exposure.

The best way to prevent an audit, or at least make it through an audit unscathed, is to review your policies with a knowledgeable attorney before a problem arises. If you have a question about your wages or employment practices, contact the Nuddleman Law Firm, P.C.

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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The Nuddleman Law Firm, P.C. cannot guarantee the confidentiality of anything posted on 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.

Notice to Employees: The Missing Form

Every employer, at the time of hiring, must provide a notice to most employees regarding certain basic terms of employment. Labor Code 2810.5. The employee must sign the notice, receive a copy of the signed notice, and the original should be maintained in the employee personnel file.

Labor Code 2810.5 Notice to Employees Requirements

The Notice to Employees must contain:

(A) The rate or rates of pay and basis thereof, whether paid by the hour, shift, day, week, salary, piece, commission, or otherwise, including any rates for overtime, as applicable.

(B) Allowances, if any, claimed as part of the minimum wage, including meal or lodging allowances.

(C) The regular payday designated by the employer in accordance with the requirements of this code.

(D) The name of the employer, including any “doing business as” names used by the employer.

(E) The physical address of the employer’s main office or principal place of business, and a mailing address, if different.

(F) The telephone number of the employer.

(G) The name, address, and telephone number of the employer’s workers’ compensation insurance carrier.

(H) That an employee: may accrue and use sick leave; has a right to request and use accrued paid sick leave; may not be terminated or retaliated against for using or requesting the use of accrued paid sick leave, and has the right to file a complaint against an employer who retaliates.

(I) Any other information the Labor Commissioner deems material and necessary.

The Labor Commissioner developed a form employers can use for this purpose. You can download the form here.

For whatever reason, employers are not using the Labor Commissioner’s standard form, and many are neglecting to include the notice to employees in the hiring documents. If any of the items in the notice to employees change (i.e., pay rate, workers’ compensation carrier, etc.), the employer has to provide a new signed notice to the employee.

Even if your offer letter or employment agreement contains all the required information (it likely wouldn’t because no one includes their workers’ compensation carrier information in an offer letter), employers should still use a standard form.

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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The 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.

Sexual Harassment Training Does Not Work

Sexual Harassment Training Doesn’t Work

A recent study by the EEOC suggests sexual harassment training does not work. In California, employers with 50 or more employees must provide 2 hours of sexual harassment prevention training to managers and supervisors every two years. Smart employers train all employees on a regular basis.

Does sexual harassment prevention training prevent sexual harassment? According to an EEOC task force: “Much of the training done over the last 30 years has not worked as a prevention tool.” Much of the training is focused on avoiding liability instead of a more holistic approach. According to the researchers, this effectively teaches would-be-harassers how to harass people and avoid liability. Sexual harassment training and prevention should focus on creating a hostile-free work environment.

The sexual harassment prevention training I provide focuses on identifying sexual (and other types of) harassment, as well as circumstances that lead to harassment claims. We help employees not only identify unlawful conduct, but also behavior that can lead to a non-productive workplace. Aside from being compliant with the latest regulations, my training sessions are tailored to the company and its employees.

Online versus In-Person Sexual Harassment Training

When choosing a sexual harassment training provider, many employers go the online route. There are some wonderful online options, many of which are less expensive than in-person training. But at what cost? The EEOC task force concluded that effective training must be “tailored to the specific workforce and workplace, and to different cohorts of employees.” Off-the-shelf online training does not have the flexibility of in-person training. It’s too easy for employees to simply check-the-box to get the training completed.

Online training can be interactive if the service provides a means for answering questions in real-time, but employees won’t use the Q&A feature if they aren’t already engaged. When I conduct in-person sexual harassment prevention training, the presentation is very interactive. I engage the audience so they remain interested.

I consider my audience when creating the training program. Software engineers can require different tactics than construction managers. Restaurant workers have different experiences than custodial staff. My goal is to tailor the sexual harassment training to the company, its employees and its culture.

I begin with, and include, the company’s actual policy in the training. Harassment prevention begins with making sure employees understand appropriate conduct and what to do if they see or experience problems. You may not get that from online training.

Can’t Train Everyone at the Same Time

A big obstacle to in-person training is getting everyone trained at the same time. Someone has to mind the ship during the training. Employees are oftentimes spread throughout the state, country or the world. Sometimes we conduct multiple training sessions in different locations. Other times we use technology to bring everyone together.

With online meeting technology, getting everyone together at the same time is easier. Many online meeting providers allow you to record the session, making the training available to those few people who cannot attend the session live. I provide my clients with direct access to me so I can answer questions when they arise during the training. Answering questions via email is not as good as in-person Q&A (see point above), but sometimes we have to work with the hand we’re dealt.

Costs of Sexual Harassment Training

Online providers usually offer “per seat” pricing. This can be great for a few training sessions, but not great for training 100 people. I price my training sessions on a flat-fee or hourly basis. Depending on the number of participants, in-person training is usually more cost-effective than online training.

I believe sexual harassment prevention training should be inexpensive and readily available.

Employers should foster an organizational culture in which harassment is not tolerated, and in which respect and civility are promoted. Employers should communicate and model a consistent commitment to that goal. Select Task Force on the Study of Harassment in the Workplace

Creating a productive work environment that is free of harassment is everyone’s goal, and everyone’s responsibility. Training employees today helps prevent problems tomorrow, and increases workplace productivity and job satisfaction.

If you would like more information regarding sexual harassment prevention training, contact my office today.

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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The 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.

Handbook Updates for 2018

California passed a number of new laws that take effect 2018. Here are a few employee handbook updates employers will need to make:

Employment Handbook Updates for 2018

Parental Leave Act

California’s New Parent Leave Act requires employers with 20 to 49 employees to provide unpaid, job-protected leave for purposes of bonding with a new child. This is similar to FMLA and CFRA, with some important differences. Employers may want to adjust their vacation policies to address the new leave act and Employers with 50 or more employees may need to adjust their FMLA/CFRA policies.

New IRS Mileage Rate

Employers must reimburse employees for all expenses incurred in the discharge of their duties. This includes mileage reimbursement. The simplest method is to pay the IRS mileage rate. January 1, 2018, the IRS mileage reimbursement rate increases to 54.5 cents. If you state a specific rate in your policies–rather than just referring to the IRS mileage rate–you’ll want to update your policy.

Lactation Accommodation

Now that lactation accommodations are part of the Fair Employment and Housing Act, and can constitute a type of gender discrimination, it is important to review your lactation accommodation policies. Employers may need to update policies to address differences between California and federal law.

Paid Family Leave

Paid Family Leave is available to some employees. Although not a “protected” leave of absence, employers must provide information regarding Paid Family Leave to all employees. A change to California law eliminates the seven-day waiting period before PFL benefits begin. This change should be noted in the handbook.

Hiring Practices

Two new laws change how employers interview and hire employees:

San Francisco Specific Changes

Three of the more notable changes to San Francisco’s laws will require handbook updates:

  • The City and County Paid Parental Leave Ordinance.
  • San Francisco Lactation Accommodation Ordinance
  • San Francisco Paid Sick Leave Ordinance has changed, allowing more flexibility for employers.

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. We cannot answer questions about specific situations or provide legal advice over the Internet. If you desire legal advice, you should contact an attorney.

Using this blog does not create an attorney-client relationship between you and Nuddleman Law Firm, P.C. Using the Internet or this blog to communicate with the firm does not establish an attorney-client relationship. Do not post confidential or time-sensitive information in this blog. The 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.