ERISA Lawsuit Argues Pharmaceutical Company Ignored Outrageous 401(k) Fees

In a recent ERISA lawsuit, plan fiduciaries allegedly failed to use the lowest cost share class for several mutual funds in a plan. They did not consider investment vehicles available at lower-costs. The plaintiffs claim the Pharmaceutical Product Development LLC Retirement Savings Plan fiduciaries have violated their fiduciary duties under the Employee Retirement Income Security Act (ERISA) since April 15, 2014.

Plan Fiduciaries Violated ERISA Failing to Use Lowest Cost Share Class:

Plaintiffs in the case claim that the plan fiduciaries failed to adequately (and objectively) review the plan investment portfolio to make sure that chosen investments were prudent both in terms of costs and maintenance of certain plan funds. This failure meant that ignoring other similar investment options that offered lower costs and better performance histories. Plaintiffs also allege that the fiduciaries failed to use the most economical cost share class for some mutual funds in the plan, and failed to contemplate collective trusts, separate accounts, or commingled accounts as options to the mutual funds (despite lower fees).

Plaintiffs Allege that Plan Fiduciaries Failed in Their Duties:

On average, 401(k) plans pay significantly lower fees than regular industry investors. This is true even as expense ratios for all continued to drop over the last several years. Additionally, the plan in question holds over $700 million in assets. The $700 million was managed since December 31, 2018, and the plan should have the ability to negotiate lower fees and invest in specific vehicles that require investment/balance minimums. The lawsuit documentation claims the plan funds have remained mostly unchanged through the past six years. As of 2018, plaintiffs were able to show data comparisons indicating over 60% of the plan funds were significantly more expensive than comparable funds in plans of a similar size.

Fulfilling a Fiduciary Responsibility for Retirement Plan Participants:

Plaintiffs argue that a prudent retirement plan fiduciary searches for and chooses the lowest-priced share class available. In this case, the plaintiffs’ fiduciaries failed to monitor the plan prudently and pinpoint whether or not it was invested in the lowest cost share class possible for the plan’s mutual funds. The plaintiffs also offered data illustrating how much more expensive the funds were in comparison to their similar situated options. Using more expensive share classes does not benefit plan participants in any way since the high-cost share classes did not provide any additional benefits or services. They did come with a consequence for plan participants, though.  

If you need to discuss violations of fiduciary duty or would like to talk about filing an ERISA class action, we can help. Get in contact with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.

Employers Forcing Staff Back to Work During the Coronavirus Outbreak

Many California workers are asking the same questions right now, can your employer force you to return to work during the coronavirus outbreak? Some employees refuse to return to the workplace because they do not want to risk spreading the novel coronavirus. 

California-based Hairstylist Who Refuses to Return to Work Amid Outbreak:

Michelle Sylvester is a California hairstylist who says that a significant portion of her clients are older. While the salon where she works is still open for business, she is not returning to work until health agencies announce that the Covid-19 crisis is over. She doesn’t feel comfortable putting her life in danger or the lives of her clients in jeopardy over a few dollars. Since Sylvester is an independent contractor, she is not at risk of losing her job if she doesn’t show up for work. But many Californians can’t say the same.

Workers Wonder About their Rights During the Novel Coronavirus Outbreak:

As the coronavirus pandemic spreads, workers are wondering about their rights. What rights do workers have if their superiors on the job request (or demand) their return to the workplace. With some legislative leaders more worried about the economy than personal safety of California’s people, it has become a very relevant and pressing question, can you boss make you return to your desk job during a pandemic?

Can Your Boss Make You Go Back to Work During a Pandemic?

While experts say the answer to this particular question is no, the law isn’t entirely black and white. Whether or not your boss can force you to return to work may depend on the type of job you have. If your job position is defined by the local government in your area as “essential,” you may need to comply with your employer’s request to return to work or risk your job. California workers performing essential jobs like pharmacists or police officers or sanitation workers, etc. can be told to return to work. If they do not respond as requested, their actions may be defined as insubordination, or even considered “quitting” their job.  

Who Determines Whether Your Job is Essential Or Not?

Federal guidelines leave it to the state and local authorities to define which businesses are essential in a time of crisis. In most cases, the following workers would be considered essential: grocery store workers, medical staff, law enforcement, food laborers, utilities and transportation workers, government workers, emergency personnel, first responders, etc.

What Protections Are in Place for California Workers?

Unless there is a local mandate requiring that you show up to work during the coronavirus pandemic, employees are most likely within their legal rights to stay home (particularly if they are near a hot zone). The Occupational Safety and Health Administration includes a “General Duty Clause,” requiring that employers provide hazard-free work environments. (Hazard being defined as anything likely to cause death or severe injury to workers). Covid-19 counts as something “likely to cause death or severe injury.

If you need to discuss employment law violations in the wake of Covid-19, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.

Will California See the First Coronavirus Discrimination Lawsuit?

In recent news, an L.A. attorney announced she would be representing the plaintiff in the first U.S. coronavirus discrimination case. The plaintiff was employed at a California medical facility at the front desk. He claims that when the coronavirus pandemic made itself known several weeks back, doctors and nurses were provided with personal protective equipment (PPE). Still, workers at the front desk were not given PPE.

Unsafe Work Conditions & Wrongful Termination Amid Covid-19 Crisis:

While he was concerned about the lack of safety precautions, he continued checking patients in for care at the medical facility until the hospital discovered that a patient he interacted with later tested positive for coronavirus. Once it was determined that he was exposed, he was sent home, which was appropriate as a preventive measure at the hospital. What followed was not necessary or legal. The next day, he was fired.

Wrongful Termination Following Exposure to Coronavirus on the Job:

When the hospital fired him the day after notifying him that he was exposed to a patient that later tested positive for the virus and sending him home, he was shocked. Luckily, the law provides a means for him to seek justice through general disability laws.

General Disability Laws & Employees Discriminated Against Due to Coronavirus:

 The case will be argued based on general disability laws. Since disability refers to a condition or state that affects a primary life function (like breathing), and even if the effect is only felt for a few days, it qualifies as a disability under state law. The law prohibits employers from discriminating against their employees or harassing an employee because they have a disability.

Employee Terminated Due to Suspected Covid-19 Infection:

In this case, the employee was tested for Covid-19. While the test came back negative, the employer (who is still unnamed at this point), terminated him simply because people perceived him to be infected. Firing an employee because you perceive them to have a condition or disease is prohibited under California law. Similar arguments were seen 30 years ago when AIDS discrimination cases were prevalent, and employees who were perceived to have AIDS just because they were a gay man, and they were fired. This same theory will be back in court again, but this time, with Covid-19 rather than AIDS as the target of workplace discrimination.

Will the First Coronavirus Discrimination Case Go To Court?

While the case has not yet officially been filed, the plaintiff’s attorney did release that a letter was sent to the medical center to allow them the opportunity to make it right. The only response received was that since they’re in the middle of a crisis, they won’t be responding. Due to this non-response, the case appears to be headed to court.

The Covid-19 Crisis Does Not Negate the Law: Employees Still Have Rights

The counsel for the plaintiff in this soon-to-be case does concede that there is a crisis; she points out that it is a medical crisis – not a legal crisis. Furthermore, this is also a time of crisis for California workers. People are out of work. Families are struggling to pay their bills. And we can’t forget them. California employers cannot cast their people aside, break the law, and justify it by the fact that they’re too busy facing a crisis to deal with the consequences of their employment law violations. The law is still in place, crisis, or not. Employees still have rights and protections under the law.

If you need to discuss discrimination violations or if you need to file a discrimination lawsuit, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.

Employment Law Issues: Are Nurses Being Punished for Speaking Out About Coronavirus Unpreparedness?

Some say that nurses know we were not prepared for the coronavirus, and those who speak out are punished.

Nurses Not Provided with Basic Personal Protective Equipment: 

Chelsea Halmy worked the night shift at Providence St. John’s Health Center in Santa Monica. When she reported for her shift on April 11, 2020, she made a routine request for an N95 respirator mask before she came into contact with patients. As an experienced healthcare professional, she was well aware that the N95 masks were the most effective protection against the novel coronavirus. Yet the routine request was declined by her supervisor, who advised her that a standard surgical mask was good enough.

Speaking Out About Unsafe Work Environments:

Halmy refused to work with patients until she was provided with the N95 equipment. After her refusal, she was taken to a closed room where her supervisor read from a script that threatened to charge her with insubordination and a “patient abandonment” report to the state Board of Registered Nursing (which could result in the loss of Halmy’s hard-earned nursing license). 

Retaliation in the Workplace for Refusing to Work in Unsafe Environments:

Her supervisor then asked her if she would accept a direct order to work with a specific patient who was a Covid-19 patient. She responded that she did want to take her assignment but didn’t feel comfortable going into the room with the patient without an N95 respirator. Three other nurses were allegedly subjected to the same treatment that same night, and seven others earlier that same week. All the nurses who did not accept their patient assignment without the requested N95 respirator were sent home. Since that time, the hospital has backed away from its stance that N95 masks are not necessary for nurses in the unit, but the ten nurses are still on suspension.

Nurses and Healthcare Professionals Throughout the Nation Are In Similar Situations:

Nurses at UC Irvine Medical Center, UCLA Medical Center, and many other healthcare facilities throughout California have participated in multiple candlelight vigils and protests since January 2020 in an attempt to bring attention to conditions and the need for additional protective gear and N95 respirators so they can safetly treat coronavirus patients. Registered nurse Patty Pinedo actively sought to treat residents in a West L.A. hotel that was turned into housing for the homeless during the coronavirus pandemic.

Other Essential Workers Are Also Facing Likely Exposure During Covid-19 Pandemic: 

Many other front-line occupations that require direct contact with others can result in dangerous levels of exposure to the virus, like grocery store workers, delivery drivers, etc. But most will agree that healthcare workers are the most vulnerable at this time since their work requires them to come into contact with the virus and to be in close contact with Covid-19 patients in confined spaces. Nurses spend more time with patients than most other hospital employees and staff, and the coronavirus is taking its toll on California healthcare workers. In addition to the threat of exposure to the virus, nurses seem to be suffering an outbreak of threats of termination and discipline from management in response to routine requests for standard safety equipment (or PPE), or public complaints about their facility’s lack of preparation.

More and more healthcare professionals are speaking out about unlawful practices and policies being instituted by healthcare facilities in response to shortages and unpreparedness during the Covid-19 pandemic.

If you need to file a whistleblower lawsuit or if you need to discuss workplace retaliation, don’t hesitate to get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.

Whistleblower Claims Litter the Horizon During the Covid-19 Crisis

In the past several weeks, we have seen some mighty changes due to the spread of the coronavirus. In recent weeks, we’ve also seen many employees (particularly health care industry employees) claiming workplace retaliation after reporting health and safety concerns in connection to Covid-19 and exposure to the rapidly spreading coronavirus.

Whistleblower Claims Due to Covid-19 Pandemic on the Horizon: 

According to a recent article in the Washington Post, OSHA (Occupational Health and Safety Administration) had already received thousands of complaints from employees just a week into April 2020. The allegations were from employees citing a lack of protections against Covid-19 in their work environments. On April 8, 2020, OSHA released a press release urging employers to remember that it is illegal to retaliate against workers that report unsafe or unhealthy conditions in the workplace during coronavirus.

What is the Occupational Health and Safety Act of 1970/  

The Occupational Health and Safety Act of 1970 (OSH Act) is one of the whistleblower protections, and anti-retaliation statutes employees can depend on for protection during the Covid-19 crisis. Section 11(c) of the Occupational Health and Safety Act of 1970 prohibits employers from retaliating against employees that exercise their rights under the statute, including raising a health or safety complaint.

Does the Law Require Employers to Provide a Safe Workplace?

In Section 5(a)(1) of the OSH Act (often referred to as the General Duty Clause), employers are required to provide a workplace free from “recognizable hazards” that are likely to cause death or severe harm.

Does OSHA Enforce Any Regulations Specific to Health Concerns Associated with Covid-19?

OSHA also enforces regulations that are specific to health concerns that have been associated with Covid-19.

29 CFR § 1910, Subpart I: Outlines OSHA’s Personal Protective Equipment standards requiring the use of gloves, eye and face protection, and respiratory protection for employees working in specific industries. 

29 CFR § 1920.134: Defines OSHA’s Respiratory Protection Standard and requires that employers implement a comprehensive respiratory program when respirators are necessary to protect workers. 

OSHA recently issued temporary guidance related to the enforcement of respirator annual fit-testing requirements for health care workers during the COVID-19 pandemic.

OSHA’s Guidance on Preparing Workplaces for COVID-19, a recently published document related to the current crisis, contains recommendations for employers on how to provide a safe and healthy workspace during the COVID-19 crisis. 

What is the National Labor Relations Act? 

Certain sections included in the National Labor Relations Act prohibit employers from retaliating against an employee for various reasons. A March 30, 2020 decision from the National Labor Board (Maine Coast Regional Health Facilities, NLRB, 01-CA-209105, 01-CA-212276) indicates that this section applies to healthcare workers voicing concerns about working conditions in health care facilities. 

California Whistleblower Statutes Amid Covid-19 Crisis: 

In the state of California, we have numerous statutes that offer employees the right to make a whistleblower or workplace retaliation claim. Some of the laws are specific to healthcare workers. 

California Health and Safety Code § 1278.5: Designed to encourage medical workers to report suspicions of unsafe patient care and conditions to government entities, it prohibits healthcare facilities from retaliating against an employee or worker for presenting a complaint related to the quality of care, services or facility conditions. 

California Labor Code § 6310: Prohibits employer retaliation against employees who complain about employee safety or health. 

California Labor Code § 6311: Prohibits employer retaliation against employees who refuse to violate occupational safety or health law or any duty that would create a hazard to themselves or other employees during their job.  

Tameny Claim: In California, employees may bring a common law claim for retaliation or a Tameny claim. Policies that can give rise to a Tameny claim include protections against retaliation for reporting unsafe working conditions. Employees can bring a Tameny claim in addition to claims arising under California’s whistleblower statutes.

If you need to discuss workplace retaliation or if you need to file a retaliation lawsuit, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.

California Labor Law Issues Stemming from the Novel Coronavirus

The novel coronavirus has changed the day to day lives of many during the past weeks. The changes wrought by this unprecedented situation are making waves that seem to ripple through the legal landscape.

California Labor Law Issues Stemming from Coronavirus:

California labor law issues connected to the spread of the coronavirus are making themselves known. Uber drivers have been fighting for employee rights citing misclassification for years, but their arguments are escalating quickly in response to the coronavirus. 

Uber's Response to the Coronavirus Pandemic and Escalating Litigation: 

In response to the situation, Uber released a temporary pandemic-specific policy. The policy was introduced at the beginning of April 2020 after Uber drivers requested a California judge issue an emergency order to require Uber to classify them as employees during the coronavirus crisis. The drivers argued that failing to do so puts the public in danger as drivers classified as independent contractors are more likely to keep working when infected, which could further the spread of the virus at a crucial time when flattening the curve is so vital.

Introducing Covid-19 Sick Leave for Uber Drivers:  

The temporary policy Uber introduced in response to the demand for employee status is more stringent than protections provided to employees under the California labor code. However, it requires documentation of a Covid-19 diagnosis form a doctor or a personal order to quarantine, which still leaves a substantial risk to the public as many sick drivers will not be diagnosed or ordered to quarantine. With many of California's drivers living "check to check," they cannot obtain a doctor's note and will keep working even if exhibiting Covid-19 symptoms. The plaintiffs' counsel argues that this situation presents a risk of significant harm to the drivers themselves and the public.

The Response to Uber's Temporary Pandemic Sick Leave Policy:

Under the temporary policy Uber introduced, drivers would lose work (up to several hours) attempting to obtain the required doctor's note. Those who do not have Covid-19 symptoms have been advised to avoid visiting health care facilities. Doctors are busy – they don't want to be bothered to write a note to your employer. And U.S. District Judge Edward Chen agreed as he was recorded as responding that "getting a doctor's note may be problematic…" The judge suggested the gig rideshare company consider offering a self-certification process for drivers who can't easily gain access to a physician. 

Back to the Drawing Table to Seek a Better Temporary Solution:

While Uber argued that the temporary sick leave policy combined with the federal Families First Coronavirus Response Act and CARES Act, would provide more for affected drivers than employees receive under California state law, Judge Chen instructed both parties to try again suggesting an interim, pandemic-specific policy allowing drivers to access paid sick leave without a doctor's note or personal quarantine order.

If you need to discuss how to file a misclassification lawsuit or if you have questions about employment law violations amid the Covid-19 crisis, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.

Will Uber Drivers Choose Between Employee Status and Covid-19 Pay?

The arrival of the novel coronavirus left Uber drivers with a strange choice. Is immediate relief worth giving up on the end goal? Should they choose Covid-19 pay over employee status?

Capriole v. Uber Technologies Inc.: Transferred to California Court

Initially filed in Massachusetts federal court, Capriole v. Uber Technologies Inc. was transferred to the Northern District of California, where several almost identical lawsuits were already in process. Plaintiffs in the cases are gig drivers naming Uber and Lyft as defendants. Capriole claims Uber misclassifies drivers as independent contractors and fails to provide drivers with paid sick leave. The lack of paid sick leave and other traditional employee benefits posed apparent problems for drivers who sought benefits afforded those with employment status.

Covid-19 Makes this Misclassification Issue Harmful to the General Public

The spread of Covid-19 introduced a new, more universally felt consequence to this particular issue. Drivers with no access to sick pay are more likely to continue working while they are sick. As a result, the public, currently struggling to face the spread of Covid-19, is taking note of the situation. Uber drivers, when confronted with the choice to stay home with no pay and risk their livelihood, their housing, and ability to provide the necessities, are instead choosing to continue working even though they may risk exposing hundreds of passengers each week by doing so. 

The History of the Case:

Before the lawsuit was transferred to California, the plaintiffs sought a preliminary injunction to require Uber to reclassify drivers as employees and comply with wage and hour law (including laws requiring paid sick leave), urging the court to adopt California case law as precedent. Still, the Massachusetts court denied the application citing insufficient evidence of the risk of irreparable harm. Since the case was transferred to the Northern District of California, it has been renewed as an emergency motion, and the judge ordered the parties to start negotiations to come up with a temporary solution.  

The Introduction of Uber’s Covid-19 Sick Pay Policy:

Uber introduced a financial assistance policy for active drivers during the pandemic on April 10th. The updated plan would allow drivers to take advantage of up to 14 days of financial assistance if they test positive for Covid-19, are placed in quarantine, if a public health authority or licensed medical provider asks them to self-isolate, or if Uber restricts their account after a public health authority indicates the driver may have been exposed to Covid-19. While the policy is more generous than California law requires in terms of “time,” the eligibility requirements appear to be more restrictive.

Temporary Measures Do Not Address the Actual Problem:

Drivers, at least initially, are rejecting the proposed compromise stating that while it addresses a problem in the current scenario, it does not solve the actual problem. Drivers insist that the issue is not limited to whether they are sick or not, etc. but whether they are entitled to wages and the other traditional benefits of employment under California labor law. Some are calling the financial assistance Uber offered through the recently updated policy a bandaid that is preventing (or at least delaying) resolution of the underlying problem.

If you have questions about misclassification or if you need to file a California overtime lawsuit, please get in touch with Blumenthal Nordrehaug Bhowmik DeBlouw LLP. Experienced employment law attorneys are ready to assist you in any one of various law firm offices located in San Diego, San Francisco, Sacramento, Los Angeles, Riverside, and Chicago.