April 2023 Wage theft is undoubtedly a major issue in the United States.  According to a study by the Economic Policy Institute, wage theft could amount to $50 billion dollars per year owed to unpaid workers. To combat wage theft, California has passed onerous regulations and severe penalties for non-compliance.  These rules are often so burdensome that it can be difficult for even the most well-intentioned employers to comply with all requirements. The ramifications of non-compliance can be devastating to businesses as they may face crippling class-action lawsuits and Private Attorneys General Act (“PAGA”) claims. There are, however, steps that […]

  January 2023 It is common practice for an employer to round employer timesheets, usually in 5, 10, or 15-minute increments, to help simplify payroll.  In 2012, the California Supreme Court approved the use of rounding in See’s Candy Shops, Inv. v. Superior Court.  The Court held that rounding was appropriate so longer as the process was neutrally applied.  For example, if an employer rounds time in 10-minute increments, the employer can round down for any time less than five minutes and round up for any time over five minutes.  In theory, therefore, the employer and employee should equally benefit […]

October 2022 As is the case each year, the California legislature passed a flurry of new employment laws at the end of the legislative session, many of which have been signed into law by Governor Newsom. Employers should be aware of these new laws, determine if they apply to their businesses, and take necessary steps to comply, including updates to their employee handbooks. Leaves of Absence Last year, California amended the California Family Rights Act (“CFRA”) to make it apply to employers with five or more employees (it previously applied to employers with 50 or more employees).  This year, the […]

  August 2022   California notoriously has some of the most stringent and complex employment laws in the nation. As such, even well-intentioned employers can easily find themselves running afoul of California’s rules and regulations, oftentimes at a significant cost. The following is a list of some of the most common mistakes employers make regarding California employment laws: 1. Overtime Under federal law, non-exempt employees are entitled to overtime for any hours worked in excess of 40 hours in a week. California, however, also requires overtime for any hours worked in excess of 8 hours in a day. California also […]

  August 2022 Many employers elect to pay salespersons commission-based wages. Employers can benefit by this arrangement as the salespeople are paid based on the amount and quality of their work. The salespeople also have the opportunity to earn higher wages for their hard work. Employers, however, need to ensure they are following the correct legal procedures for commission payments. Otherwise, they run the risk of owning considerable wages, fees, and penalties. A. Commissions Defined In 1998, the California Courts handed down the decision of Keyes Motors, Inc. v. DLSE. This case defined commissions as those payments arising from the […]

  June 2022 Under California Labor Code § 226.7, and the Industrial Welfare Commission (“IWC”) wage orders, employers must provide employees with a premium payment of one-hours’ worth of wages for every non-compliant meal and rest breaks.  Non-compliant meal breaks include failing to provide employees with at least 30 minutes, failing to completely relieve employees of job duties during the meal break, and failing to provide employees with the opportunity to take a meal break within the first five-hours of employment.  Non-compliant rest breaks include failing to provide two 10-minute paid breaks during a regular eight-hour workday and failing to […]

On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, also referred to as House Resolution (“H.R.”) 4445 (the “Act”). The overall purpose of the Act is to prohibit mandatory enforcement of arbitration agreements sexual assault and sexual harassment lawsuits. Instead, the Act gives the employee the option of proceeding with arbitration, if an arbitration agreement exists, or proceeding with claims in court, by amending the Federal Arbitration Act. The impact of the Act is that cases based on sexual assault or sexual harassment occurring or on or after March […]

California courts continue to demonstrate little patience for employment arbitration agreements that they deem are one-sided in the employer’s favor. In Ramirez v. Charter Communications, Inc., the appellate court affirmed a lower-court’s ruling holding that an employment arbitration agreement was unconscionable and, therefore, unenforceable.  The Ramirez court started its review with the well-established principle that unconscionability requires demonstrating both procedural and substantive unconscionability. Procedural unconscionability focuses on “ ‘surprise’ due to unequal bargaining power.” Substantive unconscionability focuses on “ ‘overly harsh’ or ‘one-sided’ results.”  While both procedural and substantive unconscionability need to exist, the elements do not need to exist in the same degree: “[t]he more […]

February 2022   Employers looking to retain or recruit talent realize that employees are not simply looking for a position with the highest salary. Employees may, for example, prioritize quality fringe benefits. These benefits may include traditional benefits, such as health and dental insurance, but also education allowances, surrogacy and adoption assistance, or unlimited vacation time. The COVID-19 pandemic has also shown that many employees are prioritizing office flexibility, including the ability to work remotely, so they can spend more time with their family and less time at the office or commuting. An idea that has received media attention lately […]

February 2022 A recent ruling by the California Supreme Court will likely make it easier for employees to bring and maintain Labor Code § 1102.5 whistleblower claims against employers.  In Lawson v. PPG Architectural Finishes, Inc., the federal Ninth Circuit asked the California Supreme Court to clarify the framework used determining a section 1102.5 claim.  Section 1102.5 generally protects employees from retaliation for reporting a suspected violation of a local, state, or federal law or for refusing to participate in a suspected violation of local, state, or federal law.  When Section 1102.5 was enacted in 1984, the statute did not […]