Employee Pay: On-Call Shifts and Reporting Time Pay
Putting employees on-call or requiring them to call in before shifts could raise employee pay issues. Businesses that experience fluctuations in foot traffic, calls, or demand, face the difficulty of predicting employee schedules. Since needs change quickly, it could be difficult to anticipate how many employees the business needs on any given day or part of the day. Many businesses choose to address this difficulty by scheduling employees for on-call shifts to ensure that there are workers on stand-by who are ready to step in on short notice if the need arises. Depending on your business’s particular rules and practices related to these on-call shifts, you may have employee pay violations if on-call employees are not paid “reporting time” pay. A California Court of Appeal in the case of Ward v. Tilly’s, Inc., addressed the question of what it means to “report to work” for purposes of determining whether the employee is owed “reporting time pay” under the wage order (Wage Order 7 that governs the mercantile industry in this case). In that case, Tilly’s scheduled its employees for a … Continue reading
2018 Holiday Party Checklist
We’re in the last month of 2018, which may feel like mayhem for many business owners. It’s a difficult time. There are fewer work days, yet the client and customer deadlines remain; you’re evaluating employees and business year-end goals; you’re finalizing 2019 goals and strategies to meet those goals; and then there are the parties. There are parties you’re attending and the one you’re putting together for your employees. As you recognize (that’s why you’re throwing one) holiday parties are valuable. According to the Center for Management & Organization Effectiveness, a holiday office party could improve company culture in the following ways: It represents the preferred company culture in a light way; It unites office subcultures; It provides opportunities for recognition; It gives a morale boost; and It allows employees to interact with executives and upper management. But as a business owner, you walk a tightrope. You’re worried about putting on an office holiday party that is enjoyable for employees and positively contributes to the company culture on the one hand and making sure that things don’t get out of … Continue reading
Arbitration Agreements and Class Action Waivers Post-Epic Systems
When business owners call my office looking for guidance because their accountant, fellow business owners, colleagues, or friends told them they should talk to an employment lawyer about their fears and concerns surrounding an employee issue, I ask a series of questions to get a better understanding of what is going on in the business. One of the questions I ask is: Do you have an arbitration agreement? 9 out of 10 times there is a pause and a response that ranges from “can you tell me what that is” and “I’m not sure.” It’s understandable because unless you’re a doctor’s office, arbitration agreements aren’t part of your everyday life. However, these businesses are missing out on a great tool that could be used in their favor if they value privacy, expediency, and cost-savings should a dispute arise with an employee. Especially given the Supreme Court’s decision in Epic Systems Corp. v. Lewis. Below is an article I wrote on the decision that was recently published in the Orange County Lawyer’s Magazine. Although aimed at attorneys, it gives employers a better … Continue reading
New Independent Contractor Test: 3 Clarifications from the Court of Appeal
If your business uses independent contractors at all, you have probably heard about Dynamex Operations West, Inc. v. Superior Court and the new “ABC Test” to analyze whether a worker is an employee or an independent contractor. You were probably worried about whether your independent contractors pass the ABC Test. You are justified in worrying because the new test makes it much more difficult for someone to be classified as an independent contractor. This then opens the door for claims of misclassification, for missed meal break and rest break penalties, and unpaid overtime because that’s what you paid your hourly workers but not your independent contractors. Your business may be sitting on a 5 to 6-figure time bomb. ABC Test Recap If you have not heard about Dynamex or the ABC Test, or if you need a recap, here it is. Under this new independent contractor test, a worker is properly considered an independent contractor to whom the applicable wage order does not apply if the hiring entity establishes all of the following: (A) that the worker is free … Continue reading
New California Employment Laws 2019
This is the time of year that Californians, especially California businesses, learn of the slew of new laws that will go into effect in the coming year. This year is not any different and the new laws are reflective of the social discussions around sexual harassment over the course of the last couple of years. California employers now have a number of laws that will require changes in your documents, training requirements, and how you do business, to name a few. Below is a list of new laws that I thought were the most interesting and relevant by category, although there is inevitably some overlap. Contracts 1. Employers will be prohibited, with certain exceptions, from requiring an employee to execute a release of a claim or right under the Fair Employment and Housing Act (FEHA) or to sign a nondisparagement agreement or other document that purports to deny the employee the right to disclose information about unlawful acts in the workplace, including, but not limited to, sexual harassment. This is applicable when the release is provided in exchange for a raise … Continue reading
Paystubs and When An Employee Requests Records
How many times have you said the following words: “If I had known this, I would have done things differently.” That is a common refrain of many small business owners in California. Many small businesses have grown organically and owners often cobbled together pieces of agreements and policies from your former employers and samples on the internet thinking “if my big employer did this, it must be fine,” and generally “winging it.” It generally works pretty well, sometimes even for years, until it doesn’t. When given the opportunity to reflect, most business owners will have the nagging feeling that they’re doing something “wrong.” You’re trying your best, paying your employees well, giving them flexibility, and are fair. Unfortunately, that is not enough. One of these moments that highlights the extreme complexity of having employees in California is when the business receives a letter from a lawyer asking for a copy of an employee’s personnel file and pay records. Upon receiving this letter, you will probably ask: What documents do I have to make available? The employee left years ago, do … Continue reading
Salary History and Equal Pay Laws Clarified
News of the Pay Privacy law prohibiting reliance on an applicant’s salary history in determining employment and pay hit the business world at the end of 2017 and went into effect in January 2018. Since pay is a large factor in the hiring decision, the new law raised many questions among business owners who are especially concerned about complying with California employment laws. Some of the common questions related to the salary history requirements and equal pay were: Is it legal to ask an applicant about their desired salary or salary requirement? Am I liable if an applicant voluntarily gives me their salary history or what they made a their last job? If an applicant voluntarily discloses their salary history, can I take that information into consideration? What about a current employee, I already know what they make, so can I take their salary into consideration to determine raises or pay for a new or different position? The conflict between California labor and employment laws and the practical questions that business owners must ask and take into consideration in order … Continue reading
Confidentiality Agreements in Sexual Harassment Cases – Banned if AB 3080 Signed
It’s difficult as a business owner to know what you need to know in the area of employment law and employee rights without having someone to guide you. The legal landscape is complex and ever-changing. New laws keep getting passed and court decisions could easily turn something that was an acceptable practice into a prohibited practice, forcing employers to scramble to change practices, usually crossing their fingers and hoping that the changes don’t trigger someone to ask whether what you were doing in the past was wrong. Most of the time, you don’t even know what you don’t know. I’ve often heard business owners say “had I known that I would have done it differently, but no one told me.” We’re here to tell you. The California legislature recently passed Assembly Bill 3080 (AB 3080), which is now awaiting Governor Brown’s signature. The bill has 2 main components. Bans Confidentiality Agreements Regarding Sexual Harassment Claims The first responds to the #MeToo movement and the argument that confidentiality agreements in settlements of sexual harassment claims allow harassers to become repeat offenders … Continue reading
Waiting Time Penalties (to Appeal or Not to Appeal)
“I quit.” These words from an employee leads to a string of questions from an employer. What do I need to pay the employee? How quickly do I have to do it? Can I wait until the next batch of payroll checks are processed? Do I have to cut the employee a separate check? What happens if I do it wrong? These are all legitimate questions because the laws in California are very specific about what an employer must do and the penalties for failing to do it correctly in the eyes of the law. A recent appellate opinion (Nishiki v. Danko Meredith, APC) is a great example of how a small inconsistency in the final paycheck that ultimately meant the employee is owed only $2,250 in penalties, resulted in the employer having to pay over $86,000 to the former employee in attorney’s fees. That’s 3,822% of the penalty itself. The inconsistent final pay check What happened in Nishiki could have happened to any one of us. In this case, plaintiff, who worked as a paralegal at the defendant law … Continue reading
Off-the-Clock Work Must be Paid
Last week, the California Supreme Court, in a case called Troester v. Starbucks Corporation, confirmed that California wage and hour law “does care for small things.” In this case, it cares about small increments of time spent on work off-the-clock by hourly employees. Small increments in this case is about 4 to 10 minutes after clocking out. De Minimis Doctrine This is a departure from federal law’s more employer-friendly version of the de minimis doctrine. The de minimis doctrine is an established defense under the Fair Labor Standards Act (FLSA), which allows employers to disregard time as de minimis (and therefore not have to pay employees for that time) if the employer could prove: (1) it would be difficult and impractical for the employer to record the additional time; (2) the total amount of compensable time is minimal; and (3) the additional work is irregular. For example, pre-shift or post-shift meetings. Starbucks Hourly Employee Worked 4 to 10 Minutes Off-the-Clock Each Shift In the Troester v. Starbucks case, Douglas Troester worked for Starbucks as an hourly shift supervisor. As part of … Continue reading