California Harassment Lawsuit Filed Against Wells Fargo

Diana Duenas-Brown worked at a California Wells Fargo location for 14 years. During 11 of those years she worked as the Branch Manager. On December 9, 2016, Duenas-Brown filed a lawsuit alleging wrongful termination and retaliation. Allegedly, Duenas-Brown reported wrongdoing at Wells Fargo and as a result, she was fired in obvious retaliation for her reporting of illegal activity. In addition, her Wells Fargo supervisors harassed her.

According to the record, Duenas-Brown was fired on March 16, 2015 following her report of illegal sales practices by co-workers (i.e. opening customer accounts and issuing credit cards without prior customer consent). After an investigation uncovered widespread wrongdoing on the part of its sales representatives, Wells Fargo faced sanctions.

Duenas-Brown states that after reporting the illegal activity to her supervisors at Wells Fargo, she was harassed. She received unwarranted discipline, endured hostile interrogations, and was given poor performance reviews. She was also demoted, and transferred and had her wages reduced. This all occurred in the ten months preceding her termination from Well Fargo.

According to the lawsuit, Duenas-Brown suffered financial loss, the loss of her employee benefits and the loss of expected advancement opportunities as a direct result of the actions of Wells Fargo in response to her report of illegal activity in practice at the bank.

In response to the lawsuit and the allegations included, Wells Fargo stated that they have a zero tolerance for retaliation against employees policy – including retaliation against employees who submit a report of wrongdoing. The allegations included in the Wells Fargo lawsuit could easily be viewed as harassment on the job, but the lawsuit officially claims wrongful termination and retaliation. 

Wells Fargo is also facing lawsuits from customers who allege that the bank opened up face accounts/credit cards in their name without their consent. Some of the customers claim that the illegal action had a negative effect on their credit reports/scores. Wells Fargo has already paid $185 million in fines as a result of the illegal activity.

According to California employment law, employers must undergo training intended to prevent abusive conduct against employees, such as verbal abuse, physical abuse, derogatory remarks, etc. Abusive conduct can be defined as any act that occurs repeatedly. The law does not actually ban abusive conduct, but it does require training intended to prevent it from occurring. Sexual harassment against employees and discrimination against specified protected groups are also prohibited under employment law.

If you have questions or concerns regarding discrimination or harassment in the workplace, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Versace Allegedly Employed a Code Designed to Identify Black Shoppers

One of Versace’s former employees, Christopher Sampino, has come forward to file suit against the company alleging state law violations, i.e. unfair business practices, wrongful termination, racial discrimination, etc. The lawsuit claims that the Italian design house uses a secret “black code” that alerts staff and security when there is a black shopper in one of their retail locations.

Sampino’s complaint was filed in Alameda County Superior Court and included allegations that he was discriminated against by Versace for being of mixed race. He was fired after just two weeks at the Versace outlet store in Pleasanton, California. In the complaint, Sampino alleges that new-employee training included an unnamed manger advising him regarding the “D410 Code.” The code is used for labeling black clothing, but it is also used in a casual manner whenever a black person enters the Versace store. When he was advised of the use of the code, the manager explained that it was used to alert Versace workers that a “black person is in the store.”

Sampino also claims that during his time with Versace he was harassed and eventually terminated after informing the store manager that he was, in fact, black. According to Sampino, he met and/or exceeded all expectations in connection with his Versace employment, but was fired after two weeks because he did not “understand luxury” and did not “know the luxury life.” Versace also advised Sampino that his dismissal was due to his lack of experiencing a luxury life. He was advised to quit in order to make the paperwork easier.

Labor Violation Allegations Listed in Sampino’s Suit Include:

1. Not being paid for time worked.

2. Not receiving required rest periods.

3. Being wrongfully terminated.

Sampino seeks class action certification. If the proposed class action lawsuit is certified by the court, other employees and/or former employees of Versace who found themselves in similar situations and were subjected to discriminatory treatment by Versace in the U.S. during the same time frame would be able to join in the case and share in any settlement amounts.

If you have been wrongfully terminated or if you have questions regarding the definition of wrongful termination, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Augustus v. ABM Security Services: On Duty Rest Breaks Rejected

In the midst of the holidays, the California Supreme Court issued a decision in Augustus v. ABM Security Services, Inc. stating that the law does not allow employers to require their employees to utilize on-duty or on-call rest breaks. The impact of this decision will likely impact thousands of California employment centers with similar policies, particularly in security, hospitality, and retail industries.

California’s Industrial Welfare Commission’s industry-specific Wage Orders require employers in the state to allow non-exempt employees to take a 10 minute rest break for each four hour work period. The law also indicates specifically that the 10 minutes should be consecutive and that, when possible, the break should occur in the middle of the shift. In Augustus v. ABM Security Services, Inc. the question was whether or not this requirement was fulfilled if the “rest break” was on-duty or on-call.

This particular case was based on plaintiffs’ complaints that they were non-exempt security guards working for the company, ABM Security Services, Inc. (ABM) at a variety of work sites (i.e. residential, commercial, retail, office, industrial, etc.) throughout the state of California, and their principal duties providing immediate response to emergency and/or life threatening situations and physical security on site required that they keep their pagers and radios on. There was no exception to the rule for rest breaks. As part of their job duties, security guards were required to keep pagers and radios on during rest breaks and stay vigilant and respond to any calls that occurred regardless of their rest break schedule.

ABM’s policy was based on the urgency or time-sensitive nature of some of the clients’ needs pertaining to the on site security guards in a number of different circumstances. Some such situations included: building tenant who wanted a security escort to the parking lot, the manager of a building that needed notification of a mechanical issue on site, and various “emergencies.”

Security guards working for ABM saw this as a violation of labor law and filed suit complaining that ABM failed to provide employees with compliant rest breaks. The plaintiffs were granted summary judgment and awarded approximately $90 million by the trial court, but the Court of Appeal reversed the decision.

The case presented two issues to be considered by the Supreme Court:

1.     Are employers required to allow employees to take “off-duty” rest breaks?

2.     Can employers require employees to remain “on-call” during rest breaks?

After considering the issue, the California Supreme Court came to a decision. They first noted that California law did not explicitly require employers to provide “off-duty” rest breaks, but they also took into consideration the plain meaning of the word “rest” and other language included in the Wage Order and Labor Code. When they concluded that rest breaks need to be off-duty they noted that California Labor Code section 226.7 prohibits employers from requiring any employee to work during any meal or rest period and that the relevant Wage Order’s wording indicated that rest breaks needed to be considered time worked. The court decided that the language indicating that “rest breaks” be counted as “work time” would not be necessary unless it was the intention of the law for rest breaks to be off-duty. ABM attempted to sway the court’s decision in their favor by pointing to language in the Wage Order discussing the possibility for employers (on rare occasion) to require employees to take on-duty meal breaks. Their argument did not hold as the Court’s opinion was that the absence of language authorizing the same for on-duty rest breaks was more telling than the existence of the exception made for meal breaks. The Court held that rest breaks must be off-duty.

The Court also had to consider whether employers could comply with requirements to provide employees with breaks while also keeping them “on call” during the break. ABM argued that there was a difference between an employer requiring that an employee keep working throughout their rest break and an employer requiring that the employee remain on call. The Court did not agree and noted that the practical realities of a 10-minute rest period must be considered. The time limitation alone already restricted the employees’ options regarding what they could do on break. The Court felt any additional limitations (i.e. requirements for pagers or phones or availability on site, etc.) were not in accordance with the intention of the law to offer employees a small period of “freedom” from the job for rest and to use for their own purposes. Based on these arguments, the Court held that on-call rest breaks were not compliant with the law. 

The Augustus decision will have a significant impact on California employers who utilize on-duty or on-call rest breaks in order to maximize staff productivity and accommodate single-employee shifts. Employers who are unable to comply with the rest break requirement to relieve employees of all duties may have to pay rest break premiums as an alternative. If you have questions regarding how the Augustus decision could affect you, please get in touch with the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Chinese Toy Factory Cut Off by Disney for Alleged Labor Violations

Walt Disney Co. recently halted all business dealings with a Chinese toymaker and warned another of pending similar action due to reports of labor violations.  

As the world’s largest entertainment company, Burbank-based Disney felt it was important enough to post a memo on their website stating that it would no longer allow Dongguan Qing Xi Juantiway Plastic Factory to manufacture products that featured Disney characters. Labor violations were flagged by China Labor Watch, which is a New York-based non-profit whose mission is to monitor overseas manufacturing.

The investigation into the practices of Dongguan Qing Xi Juantiway Plastic Factory found that the company failed to remediate hiring and human resources problems that were identified at the facility last year. This was in spite of encouragement from and a contractual obligation to Disney to comply. Disney did not share additional information on their website regarding the specific problems/issues that were identified.

Lam Sun Toy Limited Co. was also noted as failing to meet expectations for accurate record-keeping, health and safety requirements and human resources policies. The Lam Sun company will have a chance to address the issues, but if they do not bring their practices and policies into compliance, Disney plans to discontinue their relationship as well.

Labor standards abroad are a continuing problem for U.S. companies who look to their foreign partners to manufacture goods and products that are then sold around the world. Policing foreign plants is riddled with challenges. In this instance, the challenges of policing a foreign plant are compounded by the sheer size of the Disney company, as they likely license their brands to hundreds of similar foreign vendors who then contract separately with manufacturers. 

Disney continues to maintain their International Labor Standards program (started in 1996) that works with companies and governmental agencies in order to prevent abuse. According to the company’s website, there are 120 people staffed in 12 different countries working to monitor and improve conditions in over 30,000 factories. Approximately 28% of the factories are found in China. Labor violations were listed by China Labor Watch in connection with five Chinese toy plants known to do business with Disney last year (including Dongguan Qing Xi Juantiway Plastic Factory).  A second report was released in June by China Labor Watch indicating that Lam Sun was only hiring women for assembly jobs, lacked of safety equipment and training, and forced overtime work in excess of local limits (90 hours overtime in one month).

If you have questions or concerns on how to handle overtime issues or other employment law violations, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Teamsters Object to $27 Million Lyft Deal, but are Rejected

Katie when teamsters’ objected to the proposed $27 million settlement between Lyft and the class of 163,000 California drivers, their objection was rejected by a federal judge. But the same judge also delayed finalizing the proposed deal.

The case has been all over the news and many have heard bits and pieces as the proceedings proceed. To recap, the Uber Lyft Teamsters Ride Share Alliance (known as ULTRA) filed a brief opposing the deal in October. Claims were made that the proposed settlement fails to adequately compensate full-time drivers and also forces workers to waive their right to sue the company due to Fair Labor Standards Act violations. During settlement approval, the U.S. District Judge Vince Chhabria appeared to become frustrated when the objecting attorney did not provide specific information supporting his argument that the deal should be rejected. The attorney argued that doubling compensation for individuals who driver 30+ hours per week for Lyft was not adequate because that would leave part-time drivers with a fairly high compensation for their work in comparison to full-time drivers. Yet could not tell the judge what he suggested an appropriate multiplier should be for full-time workers.

A similar argument occurred when the attorney suggested more data would be necessary in order to come up with such a number and the judge asked what data was necessary only to have the attorney unable to say precisely what data he would need to calculate the needed number.   

Other issues discussed during the proceedings were: the settlement provision shielding Lyft from lawsuits over alleged Fair Labor Standards Act (FLSA) violations and the workers’ right to opt in to waive their rights to sue, the addition of the condition post- Cotter v. Lyft suit, and appropriate (and timely) notification to workers of the settlement terms and their rights to opt out or object to the deal, the inability to access the actual text of the agreement online, and adequate time for class members to object to the motion for attorneys’ fees (13.6% or $3.67 million in fees), objections regarding Lyft policy and procedure being inadequate in the case of a deaf driver,

According to attorney for the plaintiffs in the class action lawsuit against Lyft, 84,000 drivers (or 51% of the class) have filed claims for reimbursement so far. As of mid-November, attorneys estimated that drivers who drove over 2,000 hours for the rideshare service since May 2012 should receive distributions of about $11,000 for vehicle expenses reimbursement and unpaid overtime wages. As part of the settlement, drivers would agree to waive their claims that Lyft misclassified them as independent contractors in order to be denied employment benefits. Drivers may continue to submit claims for a portion of the settlement up until the first distribution is allocated to drivers in the class, which should occur about six months after final approval of the settlement is granted by the judge.

For additional information about overtime pay, overtime pay violations or class action certification, please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.

Tellers’ Seating Suit Ending with B of A Paying $15M

In recent California news, Bank of America has decided to settle a class action over suitable seating for bank tellers for a reported $15 million. The settlement includes a deal requiring the bank to offer proper seats for tellers at their various California bank branches.

The settlement was approved by Alameda Superior Court Judge Winifred Y. Smith on October 28th, 2016. The Private Attorneys General Act claim covered all nonexempt Bank of America tellers in the state of California that were employed by the financial institution between March 2, 2010 and the date of the settlement approval. 75% of civil penalties remaining after deducting attorneys’ fees and costs will go to the Labor and Workforce Development Agency. The other 25% will go to Bank of America’s California tellers according to designated terms. The deal requires that Bank of America ensure all California bank branches have appropriate seat for tellers to use at their workstations within 60 days of the judgment entry.

Attorneys representing the bank in a federal suit moved to dismiss that case with prejudice in light of the deal that was reached, noting that the details of the state case’s settlement included the time period and tellers from the earlier federal action.

The action was up on appeal before the Ninth Circuit twice, but in both instances, the lower court’s dismissal of the action was dismissed. In February 2013, the appeals court stated the U.S. District Judge Real wrongly found that employees must request seats before they are provided and remanded for further proceedings. In May 2013, the suit was dismissed again on the grounds of preemption by the federal National Banking Act and the plaintiffs’ failure to properly exhaust the available administrative solutions. This dismissal was also reversed by the Ninth Circuit in October 2015. They found there was no indication that the applicable California wage order would pose a significant disturbance to the National Banking Act’s functions or purposes. It was also found that the plaintiffs did properly exhaust available administrative remedies when they offered written notice of claims to both the California Labor and Workforce Development Agency and the bank.

The tellers, of course, seek to make the order precedential, as the first ruling affirmatively stating the content that satisfies California Labor Code requirements for notification.

The original class action was filed in April 2011 by former Bank of America tellers, Green and Giddings. They accused the bank of making them stand even though it was in violation of the wage order and there was plenty of room in the workspace for appropriate seating. Similar suits have been brought against large retailers throughout California since 2009.

If you have questions about this or other California class actions, please get in touch with the experienced class action and employment law attorneys at Blumenthal, Nordrehaug & Bhowmik. 

California Guard Veterans Told to Repay Enlistment Bonuses

Close to a decade ago the Pentagon used a classic maneuver to entice soldiers to reenlist: hefty bonuses. Now, officials are demanding that thousands of those vets pay the money back. One California veteran affected by the situation is Christopher Van Meter. He was awarded the Purple Heart after being thrown from an armored vehicle during a deployment to Iraq. When the moment came for him to retire back in 2007 after serving for 15 years in the Army, he was encouraged to reenlist. According to Van Meter, he was encouraged with a reenlistment bonus of about $15,000. About a decade later, officials realized that Van Mater and many others like him were not technically eligible to receive the bonuses they were given to reenlist.

Bonus Eligibility: In recent news, bonus eligibility has been discussed – particularly the fact that only soldiers holding certain assignments (i.e. intelligence, noncommissioned officer posts, civil affairs, etc.) were eligible for the bonuses. Investigation into the situation uncovered both fraud and mismanagement by California Guard officials who were desperately offering the bonuses in order to meet their enlistment target numbers.

In 2011, the California Guard incentive manager, retired Master Sgt. Toni Jaffe, pleaded guilty to filing false claims of $15.2 million. During the course of her admission, she stated that from Fall 2007 through Fall 2009, she routinely submitted fictitious claims on behalf of California National Guard members to pay bonuses to members she knew were not eligible, and to pay off officer’s loans she knew were ineligible for loan repayment. She was sentenced to 30 months in federal prison. Three other officers involved pleaded guilty, were required to pay restitution and put on probation. As a result, thousands of soldiers are now being asked to pay a hefty price for the fraudulent/fictional claims. Millions in enlistment bonuses are basically being recalled.

Van Meter, mentioned above, was shocked to receive a letter stating he owed $46,000: a combination of $15,000 enlistment bonus, a student loan repayment amount and an officer bonus…plus a processing fee. After his retirement in 2013, he had three years to pay back the debt. That meant monthly payments of more than $1,300 –leaving Van Meter struggling to provide the basics for his family. They were eventually forced to refinance their mortgage in order to pay off the staggering debt that they didn’t even know they had accumulated. The Van Meter family is one of many in similar situations. Some claim that approximately 9,700 current and retired soldiers have been told to repay some or all of the bonuses they received years ago, but the military auditor handling the process, Col. Michael Piazzoni, stated that the number was lower.

According to Piazzoni, 11,000 soldiers were included in the audit. 1,100 were discovered as receiving unauthorized distributions that need to be repaid. 5,400 soldiers were discovered to have missing paperwork or proper documentation of eligibility and have to pay back the money they received. Approximately 4,000 soldiers were found to be eligible for the payments as they were distributed. The process is not yet complete, but auditors have already confirmed 2,300 instances of unauthorized bonus payments to about 2,000 soldiers. The total comes to $22 million in unauthorized bonuses. That number includes 1,100 soldiers who received unauthorized money and the soldiers from the 5,400 who were unable to show proof of eligibility. The remaining recipients will need to produce the proper documentation proving their eligibility for the funds or they could be held liable to repay the amounts back to the Defense Department.

The audit and recoupment is being handled through a federal program jointly administered by the National Guard Bureau and the Department of the Army. The California National Guard has stated that it does not have the authority to waive the debts and that their hands are tied in this situation. As of now, there is no law passed by Congress to waive the debts so they stand, leaving the California National Guard in a difficult position as there isn’t much they can do to advocate for their soldiers. Affected soldiers are able to petition to have a debt waived. The military does hole the authority to waive an individual repayment, but only on a one-by-one basis. There is no authority held by the military to issue a blanket waiver to cover all soldiers affected by this situation.

Soldiers are being encouraged to take advantage of the appeals process while the Pentagon, the Army, the National Guard Bureau, the California Army National Guard and other relevant authorities and institutions work together to work towards a resolution. Soldiers affected who have petitioned for debt forgiveness have been denied, Van Mater multiple times. Van Meter is just one California vet who accepted an incentive payment in good faith. Many of them paid a heavy price for their military service; many even experienced severe injuries after reenlisting. And now, years later they are offered processing fees, interest charges, wage garnishment, tax liens and fines. It’s possible that Congress will take action to resolve the issue when members return from election recess.

If you have questions or concerns regarding enlistment bonuses, or proving your eligibility for bonuses please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik.