New Obstacles for California Employers after “Black Swan” Internship Case

July 20, 2015 - California internships in the past have been viewed as a trade-off between well know, desirable employers and young students interested in the industry. The employers get workers and the interested students get experience in their chosen field. Many college students and recent graduates vie for a limited number of highly coveted internship positions in Hollywood and Silicon Valley. Companies offer unpaid positions (internships) and students and new grads vie for the chance to start building a relevant network. The simultaneously beneficial nature of the internship means there has been a limited amount of litigation related to the arrangements. But as of 2013, there’s a ruling that is affecting the symbiotic relationship between employers and interns.

In 2013, a federal District Court in New York found that interns of the movie Black Swan were entitled to pursue a class action. The class action seeks millions of dollars for unpaid wages, overtime, etc. Studios and tech business employers are taking note.

With Glatt v. Fox Searchlight Pictures, Inc., the U.S. Court of Appeals for the Second Circuit attempted to answer the basic question, what is an intern? There are interns across the county, but there is a surprisingly limited amount of actual law related to this particular workplace relationship. The Second Circuit’s decision actually turned on a case from almost 70 years ago regarding railroad apprentices. California employers are discovering that the direction this particular discussion is taking holds both good news and bad news for the future of their workplaces.

The Good News: According to the Second Circuit’s decision, wage-hour cases in relation to interns are rarely subject to resolution in a class action or collection action due to the highly individualized nature of the setup.

The Bad News: Fox, the studio that produced the movie, convinced the court to impose a test to determine who the primary beneficiary of the intern/employer relationship is. This test was to be used to determine whether the worker was an intern or an employee. The court put together 7 non-exhaustive questions for a trial court to consider when attempting determining if a worker is an intern or an employee.

1. Is there a clear understanding that there is no expectation of compensation for work performed?
2. Does the internship offer any hands on training or clinical experience as would be provided by a school?
3. Is the internship a part of the coursework of the “intern”/will they receive academic credit?
4. Does the internship coincide with the academic calendar?
5. Is the internship limited to the time period during which the setup would provide beneficial learning opportunities?
6. Does the intern’s work compliment or replace the work of paid employees?
7. Is there a clear understanding that the intern is not entitled to a paid job once the internship is completed?

The primary beneficiary test is bad news for employers who offer internships with limited educational benefits for interns or for those whose interns are performing work that would be completed by employees in their absence. The opinion of the court indicated that the more menial the work assigned to an intern, the less likely that they would legally be considered an intern. Employers, particularly those in tech and entertainment industries, are finding that they need to rework their model in order to suit this new finding. It’s the first significant appellate opinion on this issue, but it will not be the last. There are other intern related cases on appeal and awaiting decision by other courts throughout the nation. In California, the opinion will probably have a fairly lasting impact. California employers are already hustling to bring their internship programs up to snuff. Interns considered employees might very well begin seeking to recover unpaid wages, overtime, etc. in accordance with the penalties of violating the California Labor Code.

If you are unsure what constitutes a valid internship or if you need additional information regarding being misclassified as an intern instead of an employee, contact the southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

$8.7 Million Settlement Paid to 19,000 Temps for Pay Stub Claims Against Manpower, Inc.

July 15, 2015 -Pay stub claims filed by over 19,000 temp workers against Manpower, Inc., an operator of a temporary-employment agency, resulted in a settlement of $8.7 million. A California federal judge approved the settlement amount on June 20, 2015. The workers who filed suit against the temp agency claim that Manpower, Inc. did not provide them with accurate wage statements as required by law. 

U.S. District Judge Jon S. Tigar granted final approval of the settlement as well as partially granting the motion plaintiffs’ made regarding their attorneys’ fees, costs, etc. The agreed upon settlement amount falls between 30 and 35% of the recovery that the counsel of the proposed class estimated as a likely result of the case.

What is a Pay Stub Claim?

California labor law lays out requirements for California employers. They are required to provide certain information on each employee’s paystub. The failure to provide the required information can result in a paystub claim or paystub violation lawsuit. These can result in fees or penalties charged to the employer. In the case of Manpower, Inc. the consequence was quite substantial.

For Instance: Information that Must be Included on an Itemized Statement

1. Name of the employee
2. ID Number (i.e. last four of social security number)
3. Gross wages
4. Hours worked
5. If employee is paid on piece rate basis – number of units and piece rate
6. Deductions
7. Net wages
8. Pay period by date
9. Name and address of employer
10. Hourly rates and hours worked at each specified rate 

If you need to talk to a southern California employment law attorney regarding potential pay stub violations, contact Blumenthal, Nordrehaug & Bhowmik.

Guide Dog Discrimination Lawsuit Against Uber Moves Forward

June 22, 2015 - There has been a recent wave of complaints aimed at the popular driving service, Uber (and similar services). In response, there could be a new ruling that raises the bar for accountability amongst such driving services. In fact, the ruling could raise the bar for all tech companies; not just those related to ride-hailing services.

A federal judge in San Francisco allowed the National Federation of the Blind of California (NFB) to file suit claiming that Uber actively discriminates against visually impaired guide-dog users. Allegations indicate that Uber drivers have refused to provide rides for passengers who have service animals in use, which is in violation of ADA laws. The suit claims that drivers have also denied transport to blind individuals without service dogs. In addition, other instances are cited in which the blind individual and their service dog were allowed to utilize the ride service, but the service animals were allegedly mistreated during the drive time. The original civil complaint cites over 30 instances of discriminatory action towards blind people and/or their service animals.

One instance of harassment involved the Uber driver forcing the guide dog of a blind woman named Leena Dawes into the trunk of the sedan before transporting Ms. Dawes. When she realized where the Uber driver had placed her dog, she asked repeatedly if they could pull over so she could retrieve her dog from the trunk, but the Uber driver denied her requests. This is just one of the many instances noted in the suit.

Uber requested the case against them be dismissed on the basis that due to contracts in place, users are required to take complaints/disputes to arbitration and argue as individuals not in the form of a class action lawsuit. They also argued that due to their unique service, they can’t be classified as “public accommodation” and therefore shouldn’t be held liable for ADA requirements.

This reasoning was tossed out by a federal judge who stated that the NDF could more forward with the suit on behalf of those members who have not yet signed the mentioned Uber contracts. This refers to class action lawsuit members who have not necessarily used the Uber service yet.

Other related legal news includes:

• Uber came under fire last March when their app was rendered useless to blind users after a software bug. They failed to fix it for a number of months.
• An ongoing suit in Texas argues the question of whether or not Uber offers sufficient access for users in wheelchairs.
• Lyft was sued as well, but settled out of court.
• Leap, the San Francisco private bus start up with a $6 fare, found themselves the focus of a suit due to the fact that they don’t provide wheelchair access.

Services such as Lyft, Uber and Leap are important as they make integration more convenient and accessible (through low pricing) for vision-impaired individuals. Most new smartphones’ built-in screen reading functionality makes the app based ride services an excellent option that allows for greater independence when traveling.

Many are hoping that the San Francisco ruling will set a precedent that will leave new, app-based services such as Lyft and Uber, etc. accountable to the same civil rights laws as other businesses and ride services.

For additional news and information on discrimination lawsuits or class action suits, contact the southern California employment law experts at Blumenthal, Nordrehaug & Bhowmik.

Workplace Claims: Should Workers Be Paid for Mandatory “Call Ins?”

June 1, 2015 - Victoria’s Secret Stores LLC workers are raising the question of whether or not retail employees who are required to call in to see if a shift is available or not should be paid simply for the mandatory call. It’s a new type of workplace claim that will be put to the test in federal appellate court.

Plaintiffs in the putative class action lawsuit seek payment for mandatory calls in their workplace. The petition for interlocutory appeal to the 9^th U.S. Circuit Court of Appeals followed a rare grant from U.S. District Judge George H. Wu to file due to what he referred to as the “novelty” of the legal question being presented.

Since the only precedent for the case is Judge Wu’s original dismissal followed by his grant to file for interlocutory appeal, the 9^th Circuit holds a lot of power in their hands. They will be the deciding factor. The employment law industry will either see this new and “novel” issue nipped in the bud or they could see an entirely new and fertile area for workplace grievances leading to worker lawsuits. This case could result in a new area of claims for employees as many large chains have call in policies for their workers.

The lawsuit was filed by Mayra Casas and Julio Fernandez. The suit is based on California’s reporting time laws requiring a minimum amount of pay when an employee is required to report to work, but they aren’t needed or no work is available at the appointed time. California is one of eight states with similar reporting time laws (including New York). The California reporting time laws guarantees employees will receive up to 4 hours of pay when they report for an 8-hour shift that is cancelled, resulting in the employee being sent home without working. Up until this point, the focus has been on employees who physically report in to their workstations. Whether or not similar guarantees should be in place for call in claims is the current question.

In the current lawsuit between Victoria’s Secret Stores LLC and Casas/Fernandez, it has been pointed out that employees abiding by the retail chain store’s call in policy must arrange their entire schedule around the need to call in 2 hours prior to a potential shift. Sometimes employees are required to do so up to five times in one week. Legal representation for the plaintiffs are pointing out the difficulties this poses in regards to scheduling daycare, etc. as proof of the need for a change.  

For additional information on California workplace claims and California reporting time law, contact the southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Discrimination Allegations: Pregnant Women Sue Raley’s

May 7, 2015 - Luciana Borrego, new mother to a baby boy born on Nov. 13, 2013, claims that she lost her job in Ukiah at Raley’s due to her pregnancy.

Raley’s is a part of a West Sacramento-based retail grocery store chain. In June of 2013, Borrego recalls advising her managers of her pregnancy (five months before her baby was born). On July 11, approx. one month later, she came to work with a doctor’s note advising her supervisors that she should not be lifting anything over ten pounds. Within an hour, Borrego claims she was called to the director’s office at the store and advised that she needed to take unpaid leave.

She was advised that she needed to go home, as the company didn’t accommodate pregnant workers even with the doctor’s note. Ms. Borrego claims she was devastated by the treatment she received. She never went back.

Ms. Borrego is one of two plaintiffs in a lawsuit filed in Sacramento Superior Court against Raley’s. The suit contains allegations that the policy mentioned by Borrego’s director that Raley’s didn’t accommodate pregnant workers is unlawful. The company policy makes reasonable accommodations for workers injured on the job, but fails to provide any type of accommodation for pregnant workers.

Raley’s spokesperson responded denying the accusations and objecting the suggestion that they don’t care about all their team members, and in particular, their pregnant team members. They continued by indicating that Raley’s has been known to go above and beyond legal minimum requirements in this area. They are known as a strong, family owned business and, as such, it’s important to them that people see them as appreciative of the role women play in their workplace. They will defend themselves against the charges being brought by the plaintiffs.

Raley’s (also operating under the names Bel Air Markets, Nob Hill Foods and Food Source) operate more than 120 supermarkets in Northern California and Nevada.

The plaintiffs are seeking class action status for current/former Raley’s California employees who were denied acceptable accommodations for pregnancy related needs over the past four years.

If you are interested in discussing California laws protecting pregnant women in the workplace, please contact your southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

California Class Action Lawsuits Over BYOD (Bring Your Own Device) Expense Reimbursement

April 23, 2015 - Some are expecting a wave of California employee class action lawsuits to show up any day with demands for expense reimbursement in relation to BYOD (Bring Your Own Device) policies. Last year a California court ruled that when employees use their personal mobile phone for work (resulting in phone call charges), they must be reimbursed by their employer.

The ruled that when California employees have to use their personal mobile phones for work related purposes, California law (Labor Code section 2802) requires that employers provide reimbursement. The specifics of the employees cell phone plan (unlimited minutes vs. limited minutes) shouldn’t change their right for reimbursement, but reimbursement for BYOD policies should be a reasonable percentage of their total cell phone service bill.

Based on the decision in Araiza v. The Scotts Company, LLC, in which plaintiffs demanding reimbursement for employee business expenses, other employees are starting to file class action lawsuits in California courts seeking similar reimbursement. This isn’t the first time a class action lawsuit has been filed in an attempt to obtain reimbursement for like expenses, but this decision has California employers studying their policies and California workers considering the legality of their own employer’s Bring Your Own Device policies. 

This trial could set in motion a new trend in class action lawsuits. The BYOD discussion lends itself to a number of devices – some are even pointing towards home WiFi. Almost everyone has WiFi in his or her home, but many use it to access their corporate network after hours or simply out of office. Those who see this as an issue limited to California should consider that other states have similar wording and language in their state labor laws. A lot depends on the ruling in this case, but even if it doesn’t end in the plaintiffs’ favor in California, it’s likely that someone else will use what they learned from watching the case play out in California and file a similar suit in another area.

If you are unsure whether or not you should be eligible for a BYOD expense reimbursement from your employer, contact the southern California employment law experts at Blumenthal, Nordrehaug & Bhowmik. 

Class Action Suit Against DirecTV: Justices Will Need to Decide Whether Customer Agreements Require Court

April 22, 2015 - The Supreme Court took up a class-action lawsuit against DirecTV. The suit was brought in California and calls into question early termination fees for customers who end their service prior to the agreed upon period. In brief order, the justices stated that they would need to come to a decision regarding whether or not the customer agreements between the company and their customers require private arbitration or a group lawsuit/court proceedings. They are determining how best to obtain a resolution to the dispute.

Plaintiffs would prefer a group lawsuit as they feel that conducting private arbitration behind closed doors would leave them at a disadvantage. Plaintiff counsel claims private arbitration is stacked in favor of the companies while businesses claim the process is an effective means by which litigation costs can be controlled and customer disputes can be resolved more efficiently.

In a string of cases, the Supreme Court has held that Congress sought to encourage arbitration in passing the Federal Arbitration Act.

DirecTV’s customer contract contains a clause that a California state appeals court stated made the arbitration clause unenforceable, but the Ninth U.S. Circuit Court of Appeals in San Francisco allowed that federal arbitration law enables DirecTV to move the dispute into arbitration.

The case will be heard in the fall of 2015.

For more information on the latest news on southern California class action lawsuits, visit Blumenthal, Nordrehaug & Bhowmik often. For answers to your questions regarding southern California law and filing a class action lawsuit, contact one of our experts today.