California Court Grants Wells Fargo Loan Officers Class Action in Pay Dispute

California-based Wells Fargo loan officers recently filed suit alleging that they were improperly compensated (Kang v. Wells Fargo Bank). The lawsuit could now have even greater implications as the plaintiffs have been granted class certification by the California court.

The issue in the case is to determine whether state was violated when Wells Fargo allegedly conducted “clawbacks” of hourly wages, vacation and separation pay from earned sales commissions. Allegedly, Wells Fargo made a practice of compensating its mortgage sales force using advances on their commissions at a basic rate of around $12/hour, then “clawback” the hourly pay from commissions and vacation pay as they were earned.

James C. Kang, plaintiff in the case, claimed that the clawbacks were in violation of a number of state labor laws that related to employee compensation, including: overtime pay, minimum wage requirements, and vacation pay requirements because they left members of the sales force affected by the practice unpaid for tasks they were required to fulfill by the company that were unrelated to direct sales. Kang also alleged in court documents that members of the sales force who were promised vacation pay did not actually receive it due to the clawbacks.

The bank claims that the pay structure used to compensate home mortgage consultants is compliant with California wage and hour laws, including paying for all hours worked and that the compensation structure allows mortgage workers to earn a competitive, performance-based wage.

Since Well Fargo implemented a mandatory arbitration provision for its sales force on December 11, 2015, the judge ordered those hired or rehired after that date to be excluded from class certification. All other nonexempt employees of Wells Fargo as of October 27, 2013 working as home mortgage consultants or private mortgage bankers, junior HMCs or junior PMBs are part of the class. A subclass is included in the class certification for individuals who were terminated from their employment.

If you have questions about overtime or minimum wage requirements in California, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

Alaska Air Will Attempt to Overturn $78M Lawsuit Ruling

Alaska Air (or Alaska Air Group) seeks to overturn the $78 million lawsuit ruling. They are confident they will prevail upon appeal in the California class action lawsuit against a class of over 1,800 former flight attendants for Virgin America.

The judge ordered the company and its new owner, SeaTac-based Alaska, to pay the $78 million to cover damages and interest to the group of former flight attendants. This ruling followed three years of legal negotiation and litigation. Yet the SeaTac-based airline stated clearly in their 10K annual securities filing this past February 15, 2019 that it is confident that it will prevail upon appeal. The company is confident that the appellate court will agree with them that the claims made in the case are without factual and legal merit. No money has been set aside to cover the potential loss that would occur if they do not prevail on appeal.

The $78 million in damages was awarded by the Northern California U.S. District Court after they ruled the Virgin America and its successor Alaska Air Group Inc. (which took over in 2016) were responsible for various damages and associated penalties that the group of flight attendants sought by filing suit. The flight attendants’ legal representation argued that the airlines violated California state labor law and San Francisco city labor law when the Virgin America employees were not provided with overtime pay, meal breaks or rest periods as required by law.

The airline seeks to overturn the ruling in appellate court based on claims that the California laws on which the previous judgment was based do not apply to the situation due to the company’s status as a national airline (pursuant to the U.S. Constitution and federal law).

If you need help obtaining overtime pay that you have earned or if you are the victim of other employment law violations in the workplace, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

California Exxon Subcontractor On-Call Claim Settled for $2.3M

In recent news, an electrical subcontractor for ExxonMobil Corp. and Freeport McMoRan Oil & Gas agreed to a settlement to resolve employment law violation claims related to on call workers without pay. The $2.3 million settlement will resolve allegations that workers were due back pay after they were on duty at all hours and were not allowed to leave the offshore oil and gas platforms.

102 workers were involved in the claims based on both the Fair Labor Standards Act (FLSA) and California law. The proposed class action lawsuit listed Ardent Companies, Inc. as the Defendant. Allegations were made that the Defendant in the case required their employees to remain on-call at all times: during meal breaks, during rest periods, when they were not scheduled for a shift. The lead plaintiff in the case claimed that while employees were provided meals and lodging as a condition of their employment, the value of those benefits wasn’t included in their “regular rate” of pay when calculating any overtime pay due to workers.

The Defendant, Ardent, argued that the workers were appropriately compensated for their time and that California state wage and hour law requirements were not applicable to the situation because the platforms where the employees fulfilled their job duties were located in federal waters and that employees were able to leave the platform upon request.

The plaintiffs’ case was supported by a pending case scheduled to be heard by the U.S. Supreme Court in April. The 9th U.S. Circuit Court of Appeals reversed the lower court’s dismissal of the case, Newton v. Parker Drilling Mgmt. Servs, Ltd. They held that state minimum wage and overtime law were applicable to the case rather than FLSA in reference to the oil platform workers involved in the case working on the Outer Continental Shelf. A decision on this case is expected in June.

This is good news for California workers as California employment laws tend to offer more protection to employees than their federal counterparts – and on-call work is no exception to this trend. Under FLSA, employees are generally considered on call if they are required to remain on the job site/the employer’s premises. Employees who are to remain on call at home or who are required to leave a message where they can be reached, are not (in most cases) considered on call according to federal law. Exceptions may occur in situations where there are additional constraints on the employee’s freedom.

California state employment law, on the other hand, entitles employees to pay under a wider scope of circumstances. For instance, California state court recently expanded the requirements with the finding that on-call workers may be entitled to pay even when they are not scheduled to work (see Ward v. Tilly’s, Inc., B280 151 (Cal. App. Ct. Feb. 4, 2019)). In the Tilly’s case, workers who were required to call in hours before their shift to verify if they were scheduled or not, were not paid unless they were actually called in to work. The court agreed with the plaintiffs in the case that employees calling in hours before their shift constituted “reporting for work” and as such, they were entitled to pay under state law even though, ultimately, they were not required to work their shift.

If you have questions about California wage and hour law or if you need to discuss wage and hour or overtime requirements, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

PAGA Benefits Both Employees and Employers

The United States of America was found on a system of checks and balances. The most recent addition to this system of checks and balances is The Private Attorneys General Act (PAGA). PAGA was passed by the Legislature in order to oversee California employers at no cost to the state. Under PAGA, private citizens can prosecute labor code violations. In fact, PAGA prosecutions don’t only cost the state nothing, but they benefit the state financially and reduce the citizens’ tax burden because 75% of all funds collected go directly to the state of California.

PAGA prosecutions have already brought hundreds of millions of dollars to California. It has also resulted in California laying claiming to one of the most thorough levels of labor law enforcement in the nation. This means California employers are well aware that they can’t cheat to compete without serious risks involved.

The PAGA paradigm generates an additional benefit for California in the form of an exceptional employment bar (representing employers and workers) that commands compliance with state labor laws under serious threat of prosecution for non-compliance under PAGA. In order to comply with employment law, employers must conduct a balancing act with fear and greed. Under PAGA, the fear of enforcement is enhanced, therefore reducing the greed at the employer level and making the job of the employer’s bar (seeking compliance with labor law) significantly easier.

When considered from all angles, PAGA should not just be recognized for helping the state become the place where all companies have a chance to succeed due to an even playing field but should also be recognized as the set of factors creating the chance for better enforcement of environmental laws, health and safety laws. The Supreme Court said it best when they noted, “The general intent of PAGA is to allow employees to pursue civil penalties through the legal system when the LWDA and related state agencies do not have the resources to do so, with a goal of increasing the deterrent effect of the civil penalties and compliance with labor laws.”

If you have questions or concerns regarding how PAGA affects you in the workplace or if you need to discuss labor code violations on the job, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

California Court Rules On-Call Tilly’s Workers Should Receive Pay

Some employers require workers to call in in order to find out if they have to work their shifts. Some employees are required to call in just hours before they may need to start work. This practice triggered California’s requirement that workers be given “reporting time pay.” A split California appeals panel recently brought this up when reviving a proposed wage class action against Tilly’s Inc. In doing so, they potentially opened up many other California retailers to similar (potentially expensive) suits.

The Second Appellate District said Tilly’s on-call policy triggers California State’s Wage Order 7, in which it states that employers must provide workers with pay when they report to work but are not put to work or provided with at least half of their usual/scheduled day’s work. Since workers are “reporting” when they call in, Wage Order 7 means employers must pay them between 2-4 hours worth of wages depending on the length of the scheduled shifts being referenced.

Tilly’s practice of having their workers call in to see if they need to work their shifts just hours before they would need to start work, is exactly the type of policy that reporting time pay was intended to stop. The appellate court decision overturned a lower court ruling that tossed the suit when they concluded that the on-call scheduling alleged in the case against Tilly’s triggers Wage Order 7’s reporting time pay requirements. They noted that on-call shifts are a burden to employees who cannot take other employment, attend school or make plans socially because they may need to work, but simultaneously may not receive payment for the time they have set aside unless they are ultimately called in to work.

Tilly’s argues that workers “report” for work under Wage Order 7 only if they physically show up for the start of a scheduled shift. The appellate court concluded that the requirement should be read to include those required to check in before physically arriving on the job before granting worker Skylar Ward’s appeal.

The appellate court noted that while policies like Tilly’s call-in requirement probably didn’t exist when Wage Order 7 was adopted by the state, the reporting time requirement covers situations other than those specifically considered by the drafters.

If you have questions about what is covered by Wage Order 7 or if you are required to call in to report before a shift, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP so we can help you protect your rights in the workplace.

Do Breastfeeding Discrimination Cases Lead to Nursing Moms Losing Their Jobs?

It doesn’t surprise many to be told that many employers fail to offer appropriate accommodations for breastfeeding. Even though the failure to do so, poses a health risk (and headaches) for nursing employees. Yet a new study that is the first one of its kind if bringing more clarity to this invasive workplace issue. The damages actually extend to the livelihoods of the mothers. According to researchers, a shocking two-thirds of cases alleging breastfeeding discrimination in the past decade eventually led to the employee losing their job.

Even the researchers themselves were shocked at the results. If you want to learn more about this workplace issue, start by defining breastfeeding discrimination.

Types of Breastfeeding Discrimination:

·      Denying break requests from employees who are in pain and/or leaking milk.

·      Firing employees for asking for breaks in connection to breastfeeding.

·      Refusing to provide privacy for employees who need to pump breast milk.

Sexual harassment of breastfeeding employees is also a common problem in the workplace.

Employers are supposed to provide breastfeeding employees with a clean place to pump (that is not a restroom), 15-20 minute breaks to pump breast milk, and a change in their job duties or a temporary assignment that accommodates their situation if it is necessary. For example, one of the study participants was a police officer who was unable to wear a bulletproof vest while she was breastfeeding. She was denied a temporary assignment to a desk job.

As a result of the predominantly negative perception of breastfeeding in the workplaces of America, working mothers are weaning their babies sooner than recommended by doctors, ending up with a diminished milk supply, or suffering from painful infections (a health risk that is often associated with lactation discrimination). The researchers went into the study aware of the health risks associated with the issue, but what really surprised them was the economic harm caused and the extent to which it pervaded the women’s lives. On top of the two-thirds of employees in breastfeeding discrimination cases who ended up losing their jobs (by being fired or forced to resign), three-quarters of the workers in the group experienced an economic penalty, such as reduced hours or being unpaid during their 15-20 minutes breaks for breastfeeding.

If you are struggling with breastfeeding discrimination or any other form of discrimination in the workplace, get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.

Former Freelancer Loses Lawsuit Against LA Times

In recent news, the LA Times took home a win after the California Court of Appeals affirmed the dismissal of a former freelancer’s defamation and employment lawsuit. The former freelancer, Frederick Theodore Rall III, was a political cartoonist and blogger for the well-known media conglomerate. In his lawsuit, he brought claims of defamation, wrongful termination, intentional infliction of emotional distress, retaliation, and other employment law violations, against the paper – all stemming from the LA Times’ decision to disassociate itself with Rall and publish a note to readers that questioned the accuracy of a blog post Rall posted describing an interaction he had with police. Rall claims that he was handcuffed, thrown against a wall, and in the process his ID was thrown into the gutter.

After an investigation, the LA Times concluded that there were serious questions regarding the accuracy of the recounting of events and allegations made against the police in the recounting. They noted factual inconsistencies and stated that the paper would no longer be publishing the writer’s content. After reader responses, the paper published an additional item that offered a more detailed analysis of the event with their investigation findings including the LAPD records of the event, etc.

The LA Times filed an anti SLAPP (Strategic Lawsuit Against Public Participation) motion to strike the complaint in response to Rall’s lawsuit. The motion was granted by the trial court. The dismissal was confirmed by the California Court of Appeal – holding that the LA Times sufficiently established that the report offered to readers and the decision by the paper to stop publishing work by Rall were protected activities under the First Amendment and the “fair report privilege.”

If you have been wrongfully terminated or if you need to discuss your rights in the workplace and how to seek justice when you have been discriminated against on the job, please get in touch with one of the experienced California employment law attorneys at Blumenthal Nordrehaug Bhowmik De Blouw LLP.