Call-In Requirement Triggers Reporting Time Pay

“On-call” time may be compensable in some instance, and not compensable in others. It has to whether you are “engaged to wait,” or “waiting to be engaged.” They may sound the same, but one is compensable and the other is not. In Ward v. Tilly’s, Inc., the court had to decide whether the company’s call-in requirements for their “on-call” employees meant the employees were entitled to “reporting time” pay when they called in to get their shifts. The answer may surprise you.

On-Call Shifts and Reporting Time Pay

Tilly’s, Inc. assigns certain employees “on-call” shifts. The on-call employees must call in two hours before their shifts start to find out whether they should actually come in to work. If they are told to come in, they are paid for the shifts; if not, they do not receive any compensation for having been “on call.”

Plaintiff Skylar Ward challenges the on-call scheduling practices claiming the single phone call constitutes “reporting for work. Tilly’s argued that employees “report for work” only by physically appearing at the work site at the start of a scheduled shift, and that employees who call in and are told not to come to work are not owed reporting time pay.

Employees were disciplined if they failed to contact their stores before on-call shifts, or if they contacted the stores late, or if they refused to work on-call shifts.   

Wage Order 7, like most wage orders, contain the following regulations regarding reporting time pay:

(A) Each workday an employee is required to report for work and does report, but is not put to work or is furnished less than half said employee’s usual or scheduled day’s work, the employee shall be paid for half the usual or scheduled day’s work, but in no event for less than two (2) hours nor more than four (4) hours, at the employee’s regular rate of pay, which shall not be less than the minimum wage.

(B) If an employee is required to report for work a second time in any one workday and is furnished less than two (2) hours of work on the second reporting, said employee shall be paid for two (2) hours at the employee’s regular rate of pay, which shall not be less than the minimum wage.

(C) The foregoing reporting time pay provisions are not applicable when: [¶] (1) Operations cannot commence or continue due to threats to employees or property; or when recommended by civil authorities; or [¶] (2) Public utilities fail to supply electricity, water, or gas, or there is a failure in the public utilities, or sewer system; or [¶] (3) The interruption of work is caused by an Act of God or other cause not within the employer’s control.

(D) This section shall not apply to an employee on paid standby status who is called to perform assigned work at a time other than the employee’s scheduled reporting time.”

Cal. Code Regs., tit. 8, § 11070, subd. (5),

The court agreed that when the reporting time pay provisions were created in the 1940’s the phrase “report for work” meant physically showing up. Even though calling in from one’s cell phone is less burdensome than physically showing up at the worksite, the court concluded that the on-call scheduling alleged in this case triggered the wage order’s reporting time pay requirements.

Because Tilly’s requires employees to be available to work on-call shifts, they cannot commit to other jobs or schedule classes during those shifts. If they have children or care for elders, they must make contingent childcare or elder care arrangements, which they may have to pay for even if they are not called to work. And they cannot commit to social plans with friends or family because they will not know until two hours before a shift’s start whether they will be available to keep those plans. In short, on-call shifts significantly limit employees’ ability to earn income, pursue an education, care for dependent family members, and enjoy recreation time.

Further, because employees must contact Tilly’s two hours before the start of on-call shifts, their activities are constrained not only during the on-call shift, but two hours before it as well. That is, at the time employees are required to call in to find out whether they will be required to work on-call shifts, they cannot do things that are incompatible with making a phone call, such as sleeping, watching a movie, taking a class, or being in an area without cell phone service.

Reporting Time Pay Protects Employee Welfare

Quoting the IWC, the court confirmed “[t]he requirement for reporting time pay historically has been included in the commission’s orders on the basis that it is necessary to employee[s’] welfare that they be notified in advance when changes in their starting time must be made. It has been deemed a [maximum] of four hours’ pay adequate to encourage proper notice and scheduling.

The IWC’s purpose in adopting reporting time pay requirements was two-fold: to “compensate employees” and “encourage proper notice and scheduling.”

The court confirmed that employers do not trigger reporting time pay requirements merely by expecting employees to apprise themselves of their schedules. Tilly’s ran afoul of the reporting requirements because it “did not merely require employees to check their schedules as a necessary predicate to getting to work on time—it required employees to call in exactly two hours before the start of on-call shifts, and it ‘treat[ed] calling in late for an on-call shift or failing to call in for an on-call shift the same as missing a regularly scheduled shift.’”

If you have questions about on-call time or the pay practices in your workplace, contact the Nuddleman Law Firm, P.C. Robert Nuddleman has represented employees and employers in wage and hour matters for almost 25 years.

Original Article 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.

Missed Meal Break Claims Results in Multiple Violations

Almost every wage and hour lawsuit and Labor Commissioner claim that I’ve seen in the past 10 years has included a claim for missed meal and/or rest breaks. Employers who fail to provide at least one half-hour unpaid meal break whenever an employee works more than 5 hours is liable for one hour’s pay at the employee’s regular rate of pay. As Kaanaana v. Barrett Business Services, Inc. reveals, the “premium pay” is not the only liability.

Sometimes the employer has no record of the hours worked. This is problematic because the Labor Code and the Wage Orders require employers to maintain accurate records of the hours worked, including the times when lunch breaks begin and end. When an employer fails to maintain accurate records of the hours worked, the employee’s testimony alone is sufficient to establish the number of hours worked. This means an employee who testifies she did not receive a full half-hour lunch break will likely carry the day unless the employer has specific evidence to rebut the employee’s testimony.

Sometimes the employer allows employees to take the lunch but does not require the employee to clock out for lunch breaks. Instead, the employer automatically deducts a certain amount of time from the employees hour. This is problematic because the time records are not accurate, which means we default to the employee’s testimony. We have no way of showing how long the break lasted. The court may be required to base its decision on the employee’s testimony.

But what happens when the employer records show the employee clocking in and out for lunch, but the meal break is less than the full 30-minutes? In Kaanaana, the time records showed the employee breaks oftentimes were only 26-minutes because the supervisors gathered the workers before the break ended to ensure they were back at the line within 30 minutes.

The employees filed a class action lawsuit alleging they were owed the premium pay under Labor Code 226.7 because they did not receive the full 30-minute meal period. The employees also argued that because the meal period was “truncated,” it was an “on-duty meal period,” and the employer should pay for the entire 30-minute meal period. The employees sought liquidated damages under Labor Code 1194.2 for failing to pay minimum wage for the entire meal period and “waiting time” penalties under Labor code 203 for failing to pay all wages owed at the end of the employment. Finally, the employees sought PAGA penalties for the missed meal breaks.

The employer argued the employees were only entitled to the premium pay. Barrett Business Services argued the few minutes missed were de minimus, and therefore not compensable.

The court concluded the employees were not entitled to payment for the entire meal period, but were entitled to payment for the 3 to 5 minutes they actually worked during the meal period:

the right to be free from employer control for a 30-minute meal period, and the right to be paid for time worked during that meal period, are distinct rights with distinct remedies. The remedy for an employer violation of the former right is the hour of premium pay provided under section 226.7. The remedy for the latter is payment of wages for time worked (see § 1194), along with any applicable penalties for the failure to pay for time worked when the wages were due. But we find no persuasive basis in legal authorities to support plaintiffs’ claim that their remedy for time worked during the meal period is payment of wages for the full 30-minute meal period, rather than payment of wages for the three to five minutes actually worked.

While acknowledging that the Wage Order could be interpreted to require payment for the entire meal period, the court believed “that a truncated meal period, such as occurred in this case, is not in every case the equivalent of an on-duty meal period.”

The court determined the employees could recover liquidated damages for the 3 to 5 minutes the employees worked during the lunch break, and the employees could recover waiting time penalties since the employees worked time (albeit just a few minutes) without compensation.

The court remanded the case back to the trial court to determine what PAGA penalties to award, but reminded the court that the court could award less than the full PAGA penalties “if, based on the facts and circumstances of the particular case, to do otherwise would result in an award that is unjust, arbitrary and oppressive, or confiscatory.”

In February 2019, the California Supreme Court granted review of Kaanaana v. Barrett Business Services, Inc., but on a different issue.

I have some suggestions for employers that want to avoid meal break problems, or at least provide a defensible position if a dispute arises:

  • Make sure employees are afforded and take the full 30-minute meal period.
  • Publish the company’s official–and compliant–meal and rest break policy.
  • Keep accurate records of hours worked including meal breaks.
  • Never automatically deduct time from an employee’s record of hours worked. Only deduct time if the employee confirms (preferably in writing) the employee forgot to clock out.
  • Never require employees to return to work from their breaks early. Err on the side of granting more time than required.

If you have questions about implementing or enforcing appropriate workplace policies, or if you believe your company is not complying with the law, the Nuddleman Law Firm, P.C. represents employers and employees in variety of employment matters including meal and rest break claims. Contact our office for more information.

Original Article 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.

Labor Commissioner Takes Expansive View of ABC

The ABC Test established by Dynamex made it difficult for employers to classify workers as independent contractors for claims “under the wage orders.” But what does that really mean? Which cases are “claims under the wage orders?” Not surprisingly, the Labor Commissioner takes a very broad view of the ABC test’s applicability.

The Labor Commissioner oftentimes issues opinion letters on various topics within their jurisdiction (i.e., wage and hour questions). Courts are not required to follow the Labor Commissioner opinions, particularly when the Labor Commission changes its position on a topic, but most courts will at least afford the opinion some weight.

Earlier this year the Labor Commissioner issued an opinion regarding “Application of the “ABC” Test to Claims Arising Under Wage Orders.” The opinion discusses (or at least mentions) many of the cases interpreting the ABC test since Dynamex. Even if courts don’t follow the opinion letter, the Labor Commissioner will most certainly follow its own decision.

The Labor Commissioner points out that “Dynamex ties application of the ABC test to enforcement of obligations imposed by the wage orders.”

Because wage order provisions are not independently actionable (see Thurman v. Bayshore Transit Management, Inc. (2012) 203 Cal.App.4th 1112, 1132), the “obligations imposed by a wage order” do not appear only in the wage orders themselves. Wage order obligations are also imposed by certain Labor Code provisions, which serve to enforce the wage orders. In such cases, the IWC employer definitions are imported into the Labor Code provision.

[fn4] Some Labor Code provisions expressly reference the substantive standards of the wage orders. (See, e.g., Labor Code section 1197 [”The minimum wage for employees fixed by the [JWC] or by any applicable state or local law, is the minimum wage to be paid to employees .. .”]; section 1198 (”The maximum hours of work and the standard conditions of labor fixed by the [IWC] shall be the maximum hours of work and the standard conditions of labor for employees.”]; section 226.7 [“An employer shall not require an employee to work during a meal or rest or recovery period mandated pursuant to an applicable statute, or applicable regulation, standard, or order of the [IWC] …”].)

The Labor Commissioner then sets out the types of claims that involved enforcement of obligations imposed by the wage orders:

Obligations of employers under the wage orders include those relating to overtime; minimum wages; reporting time pay; recordkeeping (including itemized pay stub obligations); business expense reimbursement for cash shortages, breakage, or loss of equipment; business expense reimbursement for required uniforms, tools, and equipment; meal periods; and rest periods. (See, e.g., Wage Order No. 1-2001, sections 3, 4, 5, 7, 8, 9, 11, 12.)

“But wait,” you may be saying, “didn’t Dynamex specifically exclude expense reimbursement claims from the ABC test?” No, it didn’t. The drivers challenged which test was applicable to their 2802 claim “insofar as that claim seeks reimbursement for business expenses other than business expenses encompassed by the wage order.” The issue of which test applies to expense claims other than those encompassed by the wage order was not before the court. To the extent the expense reimbursement claim is related to expenses encompassed by the wage order, the ABC test still applies.

The following quotes and cites from the opinion letter will hopefully clarify the Labor Commissioner’s view of which tests apply to which claims:

Dynamex and decisions following it have applied the ABC test to Labor Code sections enforcing minimum wage, overtime, meal and rest breaks, and itemized pay stubs.

See, e.g., Garcia v. Border Transportation Group, LLC (20 18) 28 Cal.App.5th 558, 570-71 [Dynamex only applies to “wage-order claims”]; Alvarez v. XPO Logistics Cartage LLC (C.D. Cal. Nov. 15, 2018, No. CV 18-03736) 2018 WL 6271965, at *4 [Dynamex applies “for the purpose of wage orders”]; Karl v. Zimmer Biomet Holdings (N.D.Cal. Nov. 6, 2018, No. C 18-04176) 2018 WL 5809428, at *3 [”ABC test applies only to claims arising under Industrial Welfare Commission Wage Orders”]; Johnson v. Serenity Transportation, Inc. (N.D.Cal. Aug. I, 20 18, No. 15-CV-02004) 2018 WL 3646540, at* 11 [Supreme Court recently adopted the ABC test ‘·for purposes of the wage orders”].

We don’t know whether the ABC Test applies to section 203 claims for waiting time penalties. (see Garcia v. Border Transportation Group, LLC (2018) 28 Cal.App.5th 558,571, fn.11 [stating section 203 claim did
not “arise under the wage order”, and Futrell v. Payday California. Inc. (2010) 190 Cal.App.4th 1419, 1425, 1428-31 [applying “suffer or permit” standard to section 203, which could imply the ABC test applies].)

We will have to wait and see how the court and the legislature refine, limit or expand the ABC test. For now, the conservative approach means that employers in California should treat workers as employees–at least for wage and hour purposes–unless the hiring entity can prove each of the following factors:

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

If you have a question about classifying your workers, or if you believe you were incorrectly classified as an independent contractor, contact the Nuddleman Law Firm, P.C. Robert Nuddleman helps employers and employees comply with and enforce employment laws in California.

Original Article 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.

Appealing Labor Commissioner Decisions – A Cautionary Tale

Gbolahan Sarumi probably thought it was a good idea to appeal the Labor Commissioner decision. He obviously believed the employee was not entitled to the money awarded, or at least that Gbolahan was not responsible for the payment. He filed his appeal to Superior Court, and several weeks later filed the required bond. He probably didn’t know that when the appeal was later dismissed–even if it is dismissed through settlement–he would forfeit his right to recover the bond.

In Chavez v. Sarumi, the court had to decide whether a late-filed bond could be returned to the person who posted the bond, or if it had to be turned over to the employee. Employers appealing an adverse Labor Commissioner decision must:

first post an undertaking with the reviewing court in the amount of the order, decision, or award. The undertaking shall consist of an appeal bond issued by a licensed surety or a cash deposit, with the court in the amount of the order, decision, or award.

Labor Code §98.2(b)

Some court clerks refuse to accept the appeal without the bond or cash deposit. Others allow the employer to file the appeal and leave it up to the parties and the court to fight it out. In Chavez v. Sarumi, the court made it clear that:

“…when the appeal is dismissed without a settlement, and the employer fails to pay the amount awarded by the Labor Commissioner within 10 days of dismissal, section 98.2, subdivision (b) expressly provides for forfeiture of the undertaking to the employee; it does not provide for the release of funds to individuals who posted the undertaking on behalf of the employer.”

Citing Tabarrejo v. Superior Court, (2014) 232 Cal.App.4th 849

The exact facts of this case are a bit murky. It seems there was also a corporate defendant at the Labor Commissioner, but since the corporation was suspended it could not participate in the appeal. I’m assuming Gbolahan was a managing agent or director of the corporation . It’s possible the hearing officer allowed the employee to “pierce the corporate veil,” but Gbolahan more likely was held liable under Labor Code section 558.1.

It also seems there may have been a settlement of some sort because the decision talks about a “stipulation” between the parties regarding attorneys’ fees. I suspect the employer agreed to pay the full amount of the award, and possibly some amount of attorneys’ fees, once the employer realized he would be responsible for the employee’s reasonable attorneys’ fees if the employee recovered any amount.

I cannot tell whether the employer was represented when he filed the appeal or when he resolved the case. If he was represented when the appeal was filed, then hopefully the attorney advised Gbolahan about the risks involved in appealing Labor Commissioner decisions.

I don’t know why the “stipulation” between the parties did not address the disposition of the bond. This could have been a critical error. When resolving claims, be sure to resolve all claims, and consider what and how the payment will be made.

Whether you are the employee or the employer, deciding whether to appeal a Labor Commissioner claim requires thinking through all the possible consequences of the appeal. Even if you are confident in your position, a court will not necessarily rule in your favor. Appealing the Labor Commissioner decision can have adverse consequences for the employer and the employee.

If you are considering an appeal from the Labor Commissioner, or if you need assistance with a Labor Commissioner claim, contact the Nuddleman Law Firm, P.C. We are happy to help you defend or prosecute your claim.

Original Article 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.

Travel Time is Not Compensable

California Employees Must Be Paid for All “Hours Worked”

California protects workers’ rights to compensation. It has a very broad definition of “hours worked.” It includes any time an employee is suffered or permitted to work and any hours an employee is subject to the employer’s control. An employer usually does not have to pay an employee for the regular commute to and from work. Employers usually have to pay when an employee travels from one site to another. Employers may have to pay employees if the employer requires the employee to run errands or engage in other business before reaching the job site. Does the employer have to pay if the employee commutes in a vehicle while carrying company tools?

In Hernandez v. Pacific Bell Telephone Company Plaintiffs sought compensation for the time they spent traveling in an employer-provided vehicle–loaded with equipment and tools–between their homes and a customer’s residence (the worksite) under an optional and voluntary Home Dispatch Program. The trial court concluded the travel time was not compensable. The Court of Appeal agreed and affirmed, finding:

  1. the Home Dispatch Program was not compulsory; and
  2. simply transporting tools and equipment during commute time was not compensable work where no effort or extra time is required to effectuate the transport.

Travel Time Was Not Subject to Employer’s Control

The plaintiffs argued that the travel time to and from the technician’s home and worksite satisfied the “control test.” Plaintiffs focused on the numerous restrictions placed on technicians under the Home Dispatch Program. Technicians could not use the company vehicle personal matters and only authorized persons could ride in or drive the vehicle. Technicians had to drive directly between home and the worksite; they could not stop along the way to run errands or drop off or pick up children from school or talk on a cell phone while driving. Plaintiffs argued by imposing these restrictions, the employer controlled the commute.

The employer pointed out that the Home Dispatch Program was voluntary. Employees were not required to bring the company vehicle home. Employees could have picked up the vehicle at the company site each day. The court agreed with Pacific Bell:

[Plaintiffs] do not address the cases such as Overton, Alcantar, and Novoa in which the courts found commute time in an employer-provided vehicle is not compensable when the employee is not required to use that transportation. Nor do they address the emphasis in Morillion on the compulsory nature of the transportation by bus or the court’s observation “that employers do not risk paying employees for their travel time merely by providing them transportation. Time employees spend traveling on transportation that an employer provides but does not require its employees to use may not be compensable as `hours worked.'”

Hernandez at p.141.

Plaintiffs also tried to analogize their situation to cases where employees were required to deliver tools or equipment to the job site. The court was not persuaded. While employees were required to bring tools necessary to perform the work, every employee has to do that even if the “tools” consist of a laptop or a hammer. Merely bringing the tools necessary to perform the work does not “suffer or permit” the employee to work.

Deciding which hours are compensable or not can be difficult. Federal and state laws do not always agree, and Labor Commissioner Opinion Letters are unreliable. To correctly analyze whether an employee is entitled to compensation, contact the Nuddleman Law Firm, P.C.

Original Article 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.

Independent Contractor Analysis Gets Modified…Again

Further Clarification of the Employee vs. Independent Contractor Question

The distinction between employees and independent contractors is imperative to workers and businesses. Employees enjoy many more protections and benefits than independent contractors and therefore place a bigger legal burden on employers. Last year, in Dynamex, the California Supreme Court made the legal gray area of worker classification less hazy, and a new case, Garcia v. Border Transportation Group, provides further clarity.

Review of the Dynamex “ABC Test”

We covered Dynamex last year, but its importance to workers and businesses warrants a review. The Supreme Court set out a three-part legal standard (the “ABC test”) for independent contractor status. Part A requires independent contractors to be free from control by the contracting business. Part B requires contractors to perform work that is not in the normal scope of the contracting business. Finally, part C requires contractors to have their own independent business. If these qualifications are not met, the worker must be treated as an employee under Industrial Welfare Commission wage orders.

The Impact of Garcia

The ABC test does not apply to all areas of employment law, however. In Garcia, the Court of Appeal carves out important exceptions to this standard. The Dynamex decision only applies to wage orders, not other statutes or regulations. Wage orders require employers to pay the minimum wage, allow certain meal and rest breaks, provide itemized wage statements to employees, and other basic employment requirements. Other laws, such as Workers’ Compensation law to non-wage order claims don’t fall under the Dynamex standard. These statutes typically rely on a standard set in S. G. Borello & Sons, Inc. v. Department of Industrial Relations, which primarily relies on “whether the person to whom the service is rendered has the right to control the manner and means of accomplishing the result desired.”

Correct classification of workers can be make or break for both sides of employment relationships. Whenever a dispute arises, or when developing hiring practices, contact the Nuddleman Law Firm, P.C. to ensure compliance with the law.

Written by J.T. Keane for 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.

S.F. Minimum Wage Increases

San Francisco minimum wage increases to $15.59 per hour on July 1, 2019.

San Francisco, like many cities and counties in California, adopted a minimum wage rate higher than California or Federal minimum wage. The minimum wage increased to $15.00 on July 1, 2018, and now will increase each year based on the Consumer Price Index.

The City calculated the July 1, 2019 rate using the process required by S.F. Admin Code Section 12R.4. The Consumer Price Index for urban and clerical workers in the San Francisco area increased 3.934% between 2017 and 2018. The City applied that increase to the current $15.00 minimum wage to find the new July 1, 2019 rate of $15.59. 

Employers must display the San Francisco Minimum Wage Poster informing employees of their rights. Download a PDF of the 8.5″x14″ poster.

For more information, visit www.sfgov.org/olse/mwo. You can also call (415) 554-6292 or email mwo@sfgov.org.

Other cities and counties with minimum wage increases above California and Federal minimum wage include:

  • Belmont
  • Berkeley
  • Cupertino
  • El Cerrito
  • Emeryville
  • Los Altos
  • Los Angeles
  • Los Angeles County
  • Malibu
  • Milpitas
  • Mountain View
  • Oakland
  • Palo Alto
  • Pasadena
  • Redwood City
  • Richmond
  • San Diego
  • San Francisco
  • San Jose
  • San Leandro
  • San Mateo
  • Santa Clara
  • Santa Monica
  • Sunnyvale

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.

2019 PFAC Conference

I’ll be speaking at the 2019 PFAC Conference taking place May 1-4 at the Disneyland Resort Hotel in Anaheim. This conference provides a comprehensive educational opportunity for professional fiduciaries as well as pertinent learning for estate and trust attorneys, guardians, conservators and probate administrators. I encourage you to take a look at the schedule located at PFACMeeting.org and consider attending. The conference offers up to 20 CLPF CEs and up to 18 MCLEs (non-specialized).

For more information, contact PFAC at 844.211.3151.

I’ll be speaking at the Early Bird Track (yes, that’s at 7:15 in the morning!) on Thursday, May 2nd. I’ll be discussing Working with Caregivers: Solutions to Common Problems

I’ll cover topics such as:

  • Who is the Employer and Why is it Important?
  • Basic Employment Laws for Caregivers
  • The Right Way to Pay
  • Room and Board
  • Workplace Injuries
  • Simplest Solutions
  • What are the Terms?

I hope to see you there.

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.

Minimum Wage Increases for 2019

Most people know the minimum wage increases in California on January 1st. Employers with 26 or more employees must pay at least $12.00 per hour. Employers with fewer employees must pay at least $11.00 per hour. Other workers must also receive increased pay for the new year.

Minimum Salary for “White Collar” Exemptions

Most employees in California are entitled to overtime pay unless the employees meet one or more exemptions. Most exemptions require the employee to receive a salary equal to two times the state’s minimum wage. Since California’s minimum wage increases on January 1st, so did the minimum salary for most exempt employees.  

Employees covered by the administrative, executive, and/or professional exemptions must receive a salary of at least $49,920 per year if the employer has more than 26 employees. If the employer has 25 or fewer employees, the employees must receive at least $45,760 per year. for employers with 25 or fewer employees. Keep in mind, the salary test is only part of the exemption requirement. The employee must also spend most of his/her time performing exempt work.

Exempt Software Professionals 

Certain software professional may be exempt from California’s overtime requirements if they meet certain qualification. “Software professionals” generally covers many software engineers, programmers, developers, analysts, and others performing software development related work. 

Rather than the typical “Two Times Minimum Wage Salary Requirement” applicable to most exemptions, software workers have a higher minimum salary requirement and can be paid an hourly wage. The DIR increases the minimum payment every year based on the California Consumer Price Index.

Effective January 1, 2019, the new minimum wage increases for an exempt computer software professional from $90,790.07 to $94,603.25 per year (from $7,565.85 to $7,883.62 per month). The minimum hourly rate increases from $43.58 to $45.41. 

As with the white collar exemptions, paying the correct amount is only part of the battle. Employers must also ensure the employee’s duties are appropriate for the computer software professional exemption.

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.

California Rejects De Minimus Time

California Rejects De Minimus Time

Four minutes a day might seem inconsequential, right? Not to the California Supreme Court. In Troester v.Starbucks Corporation, the Court held that employers are required to compensate employees for short, unrecorded periods of time worked off the clock. Such de minimus time, which can add up to substantial time over weeks, months, or years, must be compensated if it occurs “on a regular basis or as a regular feature of the job.” Tasks such as locking up, shutting down computers, or setting the alarm must be compensated under California law.

Unlike Federal Law, California Does Not Have a De Minimus Exception

California’s stricter, more worker-friendly, employment laws supersede federal statutes like the Federal Labor Standards Act. Federal labor law and Supreme Court precedent carve out exceptions for “de minimus” work by employees. This provides some leeway for businesses to avoid compensation for seemingly inconsequential work. However, California law doesn’t contain a de minimus exception. In fact, California specifically requires compensation “for all hours worked.” That puts a requirement on employers to compensate employees for small fragments of time that easily slip through the cracks in the course of the workday. California employers must comply with California law and the FLSA.

What Does This Case Mean For Employers?

Troester does not require employers to track every fraction of a second. There are many instances of work so minuscule, difficult to track, or irregular that it would be nearly impossible to record and compensate. But wait, isn’t that what de minimus time is? Employers must make every reasonable effort to track and compensate workers’ time. The employer bears the burden of ensuring fair and complete compensation. The Court suggests technological advances, restructuring of time recording practices, or even a time rounding policy to assist employers in meeting their obligation to compensate their workers. The Court reminds employers that the DLSE manual and opinion letters are merely “advisory” opinions, and do not hold the force of law. This case makes it clear, once again, that employers should exercise caution when it comes to paying employee wages.

Original article by JT Keane for 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.

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.